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Global Land Grab: Rainforest Vanishing in Shady Deals, Report Says

November 21, 2013
100 Reporters

Spurred by increasing food prices and demand for biofuels in Europe and North America, one of the world’s largest rainforests in Papua New Guinea is quickly disappearing under a voracious land rush that has handed 12 percent of the country’s entire land area to foreign companies over the last decade, according to a new report.

Under the umbrella of a government program promoting Special Agriculture Business Leases, 13.6 million acres (5.5 million hectares) — an area nearly twice the size of Maryland – was leased out to foreign corporations hungry for the country’s natural resources. The government forged many of these deals in secret, the report says, without consulting customary landowners who depend on the rainforest for their livelihoods.

The report by the Oakland Institute and the Pacific Network on Globalisation, nonprofit advocacy organizations that oppose large-scale land deals, found that in one case, police coerced villagers to sign over their land rights at gunpoint.

Sparked in part by a worldwide spike in food prices in 2007, multinational companies have been buying rights to massive tracts of land in Africa, South America and Asia over the last few years. Wealthy nations in the European Union and the United States have raised biofuel targets to reduce dependence on oil and find cleaner alternatives. But scarcity of arable land in developed countries is prompting global companies to buy up vast tracts of cheap acreage in the developing world, where governments thirsty for foreign investment have flung open their doors.

“It was really shocking to see that it was an official policy of the government to take land away from the people of PNG for development,” said Frederic Mousseau, the author of the report and policy director for the Oakland Institute.

In PNG, home to the third largest rainforest in the world, companies that clear land for crops like oil palm also get a tasty payoff in hardwood timber. The remote nation bordering Indonesia has become the second leading exporter of tropical wood in the world, at 3 million cubic meters per year. With the surge in investment, a third of PNG’s entire land mass is now controlled by foreign companies.

The new report, On Our Land, paints a grim picture of aggressive and poorly managed land deals gained through fraud, brutality and intimidation. The loss of land is sparking growing tension in Papua New Guinea, whose 6.2 million citizens hold communal land rights, an unusual system that was baked into the nation’s constitution in 1975.

The Special Agriculture Business Leases, or SABLs, were created to promote agricultural development, but loopholes and weak oversight have opened the way for foreign investors to acquire massive plots of land for other purposes.

The government commission appointed in 2011 found widespread corruption and mismanagement, and said the system had been “widely abused by logging companies.”

The new report says that given the commission’s findings of widespread fraud, intimidation, bribery – even children’s names were signed on official documents – most of the country’s timber exports should be considered illegal. Though the government has admitted that the SABL agreements are flawed, it has taken no steps to reform the system.

The government commission found that lease agreements so strongly favor companies that landowners would be virtually unable to break their lease unless they compensate the company for projected revenue. Spiraling oil palm development over the last few decades has led to social instability and conflicts between clans and families over land and labor, the report said.

During a research trip this year, Mousseau found himself teetering across a bamboo walkway, following villagers through a swamp in PNG’s West Sepik province. Suddenly, he said, a man “came out of nowhere with a machete, saying, ‘Why are you bringing this white man there?’”

The villagers had asked Mousseau to visit their farmland, which they said an outsider had signed away to be cleared and used to grow oil palm.

“Then, he started threatening these people that he would kill them. And taking up his machete like he was going to hit them. A few times it happened this way, running to these poor villagers with the machete up. Like he was going to strike,” Mousseau said.

No one was injured in the confrontation, but the incident illustrated how sketchy land deals can fuel violence.

Thomas Imal, a lawyer with the Centre for Environmental Law and Community Rights, which represents small indigenous landowners in disputes, said the leasing program lacks proper record-keeping and transparency, leaving it open to abuse.

“The government has limited documentation or none at all, and you find out that the documents are with the logging companies or consultants hired by the company, which is not supposed to be the case,” Imal said.

Paul Palosualrea, a land rights advocate in the Pomio district of East New Britain Province, has been leading a fight against a land deal involving Malaysian logging giant Rimbunan Hijau. A report from Greenpeace last year described police abuses and intimidation in Pomio in 2011, including beatings with fan belts and forced marches. In one incident, protesters reported they were locked in shipping containers for three nights and were only released after signing agreements not to protest.

“I’m very frustrated. Those people who sign the land away, they sign away land that doesn’t belong to them,” Palosualrea said. “The forest is our life. Without it we cannot survive. I do not personally see that the government is going to help us.”

The country’s police commissioner at the time, Tom Kulunga, later ordered police officers to withdraw from all logging areas, but police turned up at logging sites again just a few months later. The new report claims that it is common practice for companies in PNG to “provide police with transport, accommodation, and allowances in exchange for protection for their projects.”

The government has framed the push for more SABLs as a development strategy to leverage the country’s vast timber and land resources into better services.

In the group’s documentary, an official from the Department of Agriculture, Dong Manuk, explains to an audience that the mentality of landowners “is hindering development. We are trying to educate them so they will free up land mentally first. And then the land will be free.”

But Rosa Koian, the networking coordinator of the Bismarck Ramu Group, a local non-governmental organization, said the people who live on the land have scarcely benefited from these deals, and much of the money ends up in the pockets of opportunists.

“It’s not just corruption in government, it’s corruption in the private sector as well and even among the development groups. So who is really helping who when we’re talking about removing land from people?”

To demonstrate the shortcomings of previous development deals, researchers working on the report visited villages in the island province of West New Britain, where community land was leased to oil palm companies in the 1960s. They found that despite several decades of industrial agriculture, people still lacked basic services like water treatment and schools, and were dependent on the companies for food and goods like tools and equipment used to farm palm oil.

“The rhetoric is for development, but there’s no development happening,” Mousseau said. “We question the benefits of such plantations for the people who are giving away all their resources and are turned into low paid farm workers.”

One of the country’s largest land leases involves a 372-mile (600 kilometers) road project headed by the Independent Timbers and Stevedoring Ltd., whose parent companies are registered in Delaware and Australia. The report says that local land owners initially agreed to permit logging in a 130-foot (40 meters) wide corridor along the road, but later the agreement expanded to 7,888 square miles (2.04 million hectares), equivalent to a swath of 21 miles (34 kilometers) divided along the length of the road. The company contends that only a small portion of the total area included in the agreement would be used for logging.

The report calls this project, which has not yet been finalized, “one of the most egregious SABLs and a good illustration of the many flaws of SABLs signed in recent years,” because of the size of the project and irregularities discovered by the government commission.

The company’s CEO, Neville Harsley, rejected the criticism and disputed the organizations’ estimates of the land area connected to the Trans Papuan Highway Project. He said the road corridor slated for selective logging is only 3.1 miles (5 kilometers) on either side, and the larger estimate encompasses the entire land area that communities along the corridor own, including some overlapping territory, not land slated for clearing.

He said the project includes plans for many improvements for villagers, including water treatment facilities, bridges, ambulances, schools and hospitals.

“The benefits that we’re paying the landowners here, in terms of royalties, employment training — no one has done it before in PNG like we’ve put it out there.”

The deal has not been approved, and appears to be stalled because of the commission’s hearings, so none of these proposals are binding. Harsley says critics are missing a key point about the leases, which solidify traditional boundaries and register land, moves that could help ease land disputes and protect communities from exploitation.

Sambu Kobi, a landowner representative from Juha in Western Province and a stakeholder in the deal, rejects allegations of irregularities in the highway project.

“We did it properly. We followed all the procedures,” Kobi said. “I’m one hundred percent sure our community will benefit.”

Transcripts of the Commission of Inquiry’s hearings show poor oversight from the government, and testimony from agents who claim they were manipulated or coerced into signing agreements.

Asked to respond to these allegations, Harsley said competing interests in Australia had asked witnesses to speak at the hearing, and lawyers representing the company are preparing to file a “major defamation lawsuit” over those statements.

Mousseau said he’s deeply skeptical of Harsley’s list of proposed benefits for people along the road corridor.

“Frankly, it looks like a long letter to Santa, but I’m afraid this man does not look like Santa,” he said.