ANZ Royal and sugar firm part ways
ANZ Royal Bank has severed its ties with ruling party Senator Ly Yong Phat’s controversial sugar plantation, a $220 million development that has been at the centre of years-long land disputes and child labour scandals.
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 Yong Phat’s Phnom Penh Sugar Company. The documents revealed that from 2010 to 2013 the company failed to address 60 per cent of recommendations made by Bangkok-based auditor International Environmental Management, including ones related to worker health and safety.
After the revelations, ANZ said it would continue its commercial relationship with Phnom Penh Sugar and work with the firm, affected families and NGOs to address concerns at the 8,343-hectare land concession in Kampong Speu.
But an ANZ spokesman confirmed via email yesterday that the bank had cut its ties with the company.
“While I’m limited in what I can say about individual customers, I can confirm that PPS has paid out its loan and is no longer a customer of ANZ,” the spokesman said, declining to go into further detail.
A report on Saturday in The Australian newspaper said that Phnom Penh Sugar had found a new backer for the part-financing of its sugar business, and that its compliance costs made it a cheaper lending option than ANZ.
Seng Nhak, Phnom Penh Sugar’s managing director, declined to comment on any new agreement yester-day; however, he confirmed that ANZ was no longer involved with his company.
“While Phnom Penh Sugar has very much valued its relationship with ANZ, the company has found itself in a position whereby it is able to repay the loan and has now done so,” he said by email.
Nhak added that Phnom Penh Sugar was regularly meeting with families affected by its operations.
Rights groups working with these families expressed disappointment at ANZ’s decision, saying that no progress has been made since the banking giant agreed to work with those evicted from their homes.
“As a major financier of the sugar project, which has no doubt profited handsomely from it, ANZ has a duty of care to the people whose land was grabbed and that duty does not go away when it recalls its loan,” David Pred, managing director of Inclusive Development International, said.
Eang Vuthy, executive director of Equitable Cambodia, who attended a meeting on May 8 with ANZ representatives of Australia, Yong Phat and community representatives, said dozens of issues remained unresolved.
“Both the company and ANZ have a responsibility to address these issues. They have to work better to address these issues, but we have seen zero solutions on the ground,” he told the Post yesterday.
“Of course they have paid back the loan to the bank, but the harm is still there.”