A South Korean public institution has announced it will back a controversial new coal project in Indonesia. The move is at odds with election promises made earlier this year, say experts. In Jakarta, activists took to the streets to protest the decision.

South Korea’s largest state-owned electric power distribution company and government banks will invest in a proposed coal power venture in Indonesia after years of deliberation, contradicting the ruling party’s pledge that it would phase out coal finance, made in the run-up to the nation’s recent parliamentary election.

Government-owned utility Korea Electric Power Corporation (Kepco) said on Tuesday (30 June) it will hold 15 per cent equity in the Jawa 9 & 10 coal-fired power project sited near the Indonesian capital Jakarta, according to media outlet Asia Today. The decision was unveiled at a board meeting in Seoul.
Kepco’s stake in the controversial venture will see the firm invest US$51 million in addition to providing a shareholder loan guarantee of US$250 million. Korean government-owned banks Export-Import Bank (Kexim) and Korea International Trade Insurance Corporation (Ksure) will contribute the bulk of the financing, with US$1.4 billion in investment, Asia Today reported.

More stories on…