The AIIB responds to environmental criticism for a project in Indonesia

The Asian Infrastructure Investment Bank (AIIB) stated that its investment in Indonesia’s Mandalika Urban and Tourism Infrastructure Project complies with all environmental and social standards.

Urjit Patel, Vice President of Investment Operations in South and Southeast Asia at the AIIB, Indian that “since the concerns were first raised in 2019, the AIIB has demonstrated after due diligence that the complaints were largely unrelated to the Mandalika Project, but rather to the nearby MotoGP Circuit, which is an independent Project and not funded by the AIIB.”

Patel stressed that the Mandalika Project is designed to provide sustainable basic infrastructure to develop the southern Lombok region as a tourism destination and stimulate local businesses and create employment for the community.

Tourism contributes greatly to the country’s GDP, but requires supporting infrastructure such as roads, water and sanitation services, solid waste management, electricity distribution, disaster risk management, landscaping and community facilities, investments that will also benefit community.

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Since the approval of the Mandalika project, the AIIB has closely monitored the implementation by its client, the Indonesia Tourism Development Corporation (ITDC), of the Bank’s Environmental and Social Framework.

With the support of the AIIB, the ITDC has worked with the affected communities during Project preparation to avoid, minimize and/or mitigate potential adverse impacts.

The resettlement action plan for the affected local community includes the provision of larger houses for the resettlers. People affected by the project have the opportunity to own both the house and the land.

Training and jobs are also being provided to the affected people. As part of the plan, market plots have been set aside for local vendors, micro, small and medium-sized enterprises, and community facilities within the Mandalika Special Economic Zone.

The AIIB notes that the Mandalika Project, like any other infrastructure development, is a complex undertaking, but “the Bank remains committed to working with its partners and stakeholders so that all can participate and reap the benefits that the Project is expected to bring.” ” as reported in an official statement.