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Logo of Phnom Penh Post newspaper Phnom Penh Post - ANZ accused of abandonment

Traffic passes one of ANZ Royal Bank’s branches in Phnom Penh’s Daun Penh district
Traffic passes one of ANZ Royal Bank’s branches in Phnom Penh’s Daun Penh district earlier this year. Vireak Mai

ANZ accused of abandonment

ANZ Royal has been accused of abandoning the communities impacted by ruling party Senator Ly Yong Phat’s $220 million sugar plantation developments, after the bank last month announced it had severed all financial ties with his controversy-hit firm.

More than 350 members of Thpong and Oral districts, which surround plantations belonging to Yong Phat’s Phnom Penh Sugar Company (PPS) and his wife Lim Heang’s Kampong Speu Sugar Company [KSS], signed and delivered a two-page complaint to the bank on Friday.

“For over four years we have been subject to hardships and poverty due to land grabbing by PPS and Kampong Speu Sugar,” the letter reads.

“We have no land for farming. The companies have blocked road access to our rice paddies that are located inside the sugar plantation and seized our cattle that graze inside the plantation. The companies ask for 100,000 riel to 200,000 riel [$25 to $50] to have the cattle returned each time.”

The complaint calls for urgent compensation and assistance to the affected households. If ANZ does not meet the community’s demands, the letter states, demonstrations will be held outside the bank’s Phnom Penh head office until a solution is reached.

Environmental audit documents commissioned by ANZ and obtained by the Post in January linked ANZ Royal Bank – a joint venture between the Australia and New Zealand Banking Group and Cambodia’s Royal Group – to PPS. The documents revealed that from 2010 to 2013 the company failed to act on 60 per cent of recommendations made by Bangkok-based auditor International Environmental Management, including ones related to worker health and safety.

ANZ Royal announced on July 6 that Yong Phat had paid out and finalised all loans with the bank, and that PPS and KSS, which had long been at the centre of land disputes and child labour claims, were no longer clients.

“Full repayment of the loan, however, does not absolve ANZ of accountability for the negative impacts caused by the companies’ plantations from 2010 to 2014,” the letter says. It also claims that ANZ Royal is in breach of an agreement it made on February 15 in which it promised to investigate offering fair compensation for all affected parties.

The letter goes on to accuse Yong Phat’s PPS of sending “representatives” to the surrounding communities to offer small amounts of compensation as well as to threaten recipients to keep news of the settlements secret.

PPS managing director Seng Nhak rejected the letter’s claims and insisted the firm had continuously engaged the affected community and is assisting in developing the area.

“I can categorically state that Phnom Penh Sugar does not use threatening tactics at any time for any purpose,” he told the Post.

A spokesman from ANZ’s head office in Melbourne said the issue was now entirely out of the bank’s hands and urged community representatives to take up their issues directly with PPS.

“While we had put in place a detailed action plan to help PPS improve its performance in addressing its social and environmental obligations, it ultimately decided to pay out its loan and is no longer a customer of ANZ,” the spokesman said.

Eang Vuthy, executive director of Equitable Cambodia, rejected ANZ’s stance, calling on the bank to fulfil its obligations and provide a practical solution to the 350-plus effected households.

“Paying back the loan does not end the responsibility of ANZ to human rights abuses caused by its client, PPS,” Vuthy said.

“ANZ needs to work with its clients to address these issues otherwise their reputation will be further damaged.”

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