CAO Cases

Arne Hoel, The World Bank

East Asia & the Pacific

Indonesia / Wings-01/Long Beluah and Long Lian

Complainant
Community members of Long Lian and Long Beluah
Date Filed
November 26, 2018
Concerns
Water pollution, waste management, land clearing
Case Status
Open - Ombudsman
 

Synopsis

Project Overview 

According to IFC, in 2012 the Wings Group was undertaking a US$176 million project to: (i) expand its beverage product lines under PT Tirta Alam Segar (PT TAS), (ii)  expand fruit-flavored beverage in plastic cups under PT Murni Alam Segar (PT MAS), (iii) commission a green-field coffee mix production under PT Harum Alam Segar (PT HAS), and (iv) increase the capacity of its existing detergent business under PT Sayap Mas Utama (PT SMU). The proposed IFC financing is a loan package of up to US$88 million (US$44 million A-Loan and US$44 million of syndicated B-loan) to those four entities of the Wings Group.

 

 

Complaint 

In November 2018, CAO received a complaint from AMAN Kaltim (Alliance of Indigenous Peoples of the Archipelago Kalimantan Timur), a local NGO, on behalf of community members living in Long Beluah and Long Lian, North Kalimantan, Indonesia. The complaint raises concerns regarding the environmental and social impacts of an oil palm plantation operated by PT Inti Selaras Perkasa (PT ISP). PT ISP together with PT Prima Tunas Kharisma and PT Sentosa Sukses Utama comprise Gawi Plantation which is part of the Wings Group. The complaint raises concerns related to water pollution, implementation of a government-approved plasma scheme, and land clearing without permission and/or consultation.

 

 

CAO Action

CAO found the complaint eligible for further assessment in February 2019 and in May 2019, CAO conducted a field visit to Indonesia to discuss options for addressing the complaint with the relevant parties. During the assessment process, the complainants and the operator of the palm oil plantation expressed their desire to participate in a dispute resolution process. The dispute resolution process is ongoing. 

 

 

Status

The dispute resolution process between the Company and the Long Beluah community is ongoing. However, the dispute resolution process between the Company and the Long Lian community continues to be on hold due to connectivity issues and Covid-related travel restrictions. In parallel, the Long Lian representatives are deliberating on Long Lian's position and willingess to renegotiate.

 

Status as of June 24, 2021



Note: A CAO assessment does not entail a judgment on the merits of complaints.  Rather, the aim is to listen to people's concerns, understand the different perspectives, and determine what options are available to address the complaint through CAO's Dispute Resolution and Compliance functions.

Project information

Institution
IFC
Project Name & Number
Wings – Beverage & Detergent Expansion (Indonesia) 32208
Department
Global Manufacturing & Services
Company
Wings Group
Sector
Soft Drink
Region
East Asia & the Pacific
Country
Indonesia
Environmental Category
B
Commitment
US$44 million A-loan and US$44 million syndicated

Case Tracker

Ombudsman

  • Eligible: Completed
  • Assessment Period: Completed
  • Facilitating Settlement: In Process

Compliance