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Friday, June 9, 2023

Financial group says its ‘not currently involved’ in controversial oil pipeline project

Sumitomo Mitsui Financial Group (SMBC Group) has reportedly said that it is “not currently involved” in the East African Crude Oil Pipeline (EACOP), a large-scale fossil fuel project that is increasingly criticised for its impacts on local communities, nature and the climate.

SMBC Group
Sumitomo Mitsui Financial Group (SMBC Group)

“We welcome the announcement, as this is the first time that the group has issued a statement distancing itself from EACOP,” said 350.org Japan Acting Team Leader, Masayoshi Iyoda, in a statement on Wednesday, May 17, 2023.

SMBC Group affiliate Sumitomo Mitsui Banking Corporation had not only provided a large amount of funds to Total, which is promoting EACOP, but was also reportedly serving as a financial advisor on EACOP. To date, civil society around the world, including in Africa, has repeatedly inquired as to whether or not SMBC is involved in EACOP, and have taken simultaneous global action to demand that SMBC state that it is not involved in EACOP. 350 Japan also questioned and requested SMBC Group’s involvement in EACOP at its general shareholders meeting last year.

However, until Tuesday, there had been no response from the side of SMBC Group or SMBC distancing itself from EACOP. In a press report issued on Tuesday, they only stated that they are not currently involved in the EACOP, and it remains unclear what involvement they have had in the EACOP to date and whether SMBC may be involved in the EACOP in the future and whether they will continue acting as financial advisors to the project.

350 Japan requests that SMBC Group and SMBC state that they will not be involved in the EACOP business in the future.

“At the same time, we reiterate our call to cut off the flow of funds to all fossil fuel projects, including EACOP, and support energy conservation and renewable energy,” Iyoda commented, adding: Sumitomo Mitsui Financial Group’s (SMBC Group) explanation that it is not currently involved in the East Africa Crude Oil Pipeline (EACOP) has brought some relief to African and global citizens suffering from the climate crisis. SMBC Group and SMBC should make it clear that they will never be involved in EACOP in the future.

“With this development, Mitsubishi UFJ Bank is the only one of the three Japanese mega banks that has not explained its status of involvement in EACOP.”

Charity Migwi, Regional campaigner, 350Africa.org, said: The three mega banks should do what they can before the June shareholders’ meeting: stop supporting fossil fuel businesses like EACOP and strengthen their climate policies to be consistent with the 1.5°C target of the Paris Agreement.

“It is encouraging that more and more institutions, including Sumitomo Mitsui Financial Group recognise the impacts of EACOP on local communities, wildlife, sensitive ecosystems and the climate and are choosing to distance themselves from it. This is a testament to the power of the voices of communities and activists that have persisted in resisting this harmful project. It’s critical that we cut off financing to fossil fuels projects which are fuelling the climate crisis, causing untold devastation to our communities and instead invest in safe, reliable, sustainable and community-centred renewable energy.”

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