President Suharto of Indonesia officially opened a World Bank-funded dam in Central Java on May 18 despite the resistance of hundreds of farming families whose demands for fair compensation remain unanswered.
The US$281 million dollar Kedung Ombo dam, which is also funded by the Japanese Export-Import Bank and the Indonesian government, has displaced 5400 families (about 27,000 people), many of whom were given little choice but to leave Java under the government's notorious transmigration program.
In an act of unprecedented defiance, many families simply refused to move off the land their families had farmed for generations. But in January 1989, the dam gates were closed. As the water rose they were forced to build makeshift houses further up the slopes of the dam.
One of their main complaints was compensation. Despite World Bank guidelines which say the standard of living of persons displaced should be at least as good after resettlement as before, neither cash compensation, transmigration, nor local resettlement in an infertile area were adequate.
Kedung Ombo villagers refused en masse to accept the compensation offered. They were intimidated by the local authorities, who warned they would be branded communists and ex-political prisoners if they continued to reject the compensation.
Delegations have travelled to Jakarta to protest at parliament and at the World Bank's office, where they were told the World Bank would pass on their concerns to relevant government officials — a sorry response from an institution which claims to take particular care over the environmental and social impact of its projects. — TAPOL/PEGASUS