The Land Grabbers: The New Fight over Who Owns the Earth

by Fred Pearce

  Tiong is no longer the chief villain for people concerned about the fate of PNG’s rain forests, however. Not since the country succumbed to one of the most outrageous, mysterious, and little-known land grabs anywhere in the world. According to the man who did most to track it down, Colin Filer of the Australian National University, in the past decade more than a tenth of the country’s land has been secretly handed over to foreign corporations and their shadowy local representatives through complex leasing arrangements. It is a scam on a huge scale. In two provinces, Western and West Sepik, over a fifth of the land has been signed away.

  The customary rights of the forest communities to their neighborhood forests are supposedly enshrined in PNG’s statutes. But the country’s Land Act also contains provisions that allow those communities to do deals with outsiders to kick-start economic development—for instance, by establishing commercial farms in their territory. This is done by leasing forestland to the government, which in turn can issue “special agricultural and business leases” to private companies. This arrangement means the government can act as the policeman for the schemes to prevent isolated communities from being defrauded. Initially, it worked well. Several small agricultural projects were set up that benefited communities.

  But from 2003, the provisions were hijacked for a series of large logging projects. That was never the idea. Companies justified the logging on the grounds that, after the trees were cut down, there would be farming on the cleared land—usually oil-palm plantations. But Filer says in most cases the outsiders securing the special leases only ever want the timber. The promises of farming and economic development were usually a sham. And when he started talking to communities about the leases, he discovered that many of them had little idea what they were signing up for. And in some cases they hadn’t signed up at all.

  The island of Lavongai (formerly known as New Hanover) is at the far end of the Bismarck Archipelago in PNG’s offshore province of New Ireland. It is 40 miles long and 20 miles wide. The Lonely Planet guidebook calls it “volcanic, ruggedly beautiful . . . a truly wild Island, complete with dense rainforest, mountains, waterfalls and rivers.” It has some twenty thousand inhabitants, with their own distinctive Melanesian language and culture. On March 4, 2011, they woke up to hear, by mobile phone from friends reading the Post-Courier newspaper in Port Moresby, that their island had been leased to a company registered in Singapore called Palma Hacienda. It was the first they knew of this, says Filer.

  The details were complex. Palma Hacienda is an obscure subsidiary of Ayamkuat Maju, a Malaysian import-export company based in Sarawak’s logging capital, Miri. Two New Ireland luminaries allegedly set up the deal. One was Pedi Anis, a former premier of the province. He was by then chairman of a logging company called Tutuman Development, which obtained a series of special leases in the name of local landowners. It then sublet the leases to Palma Hacienda.

  The other local was Miskus Maraleu, a lawyer whose role in previous logging operations in the province was described by an official inquiry in 1989 as “disgraceful and reprehensible.” He had “disregarded the interests of his own people” and “served the interests of a foreign paymaster” as well as “personally benefitting financially from the improper role he played.” He was an improbable partner in any legitimate deal, you might say.

  When the story broke, Anis claimed he had terminated the leases, but only after Palma Hacienda had cleared 17,000 tons of timber. He denied receiving the $600,000 stipulated in his purchase agreement with Palma Hacienda. The one certainty was that the trees were gone; no oil palm had been planted, and no economic “development,” the supposed justification for special leases, had occurred. What was really in question was how the locals had had control of their land taken from beneath them without their consent—and where the money went.

  The scale of the special leases scam is huge. So far, they cover more than 12 million acres. But regulatory oversight seems to have been nonexistent. Far from protecting the interests of the communities, provincial officials seem sometimes to have been conniving to defraud them. Filer found that many of the leases have been handed out to bogus companies with consent from, at best, individuals with a dubious claim to represent the communities. Sometimes, companies and government officials took a trip to a forest clearing to promise the locals that they would bring roads and phone lines and agricultural projects. But the communities, which are nominally shareholders in the projects, were rarely told what they were handing over in return.

  Among the dozens of special leases signed off by provincial officials, three involved more than a million acres. In February 2009, an outfit called Tosigiba Investment, which had not been properly incorporated, was somehow given a ninety-nine-year lease on 1.5 million acres in Nomad district. The local villagers denied all knowledge of the deal. So did the chairman of Tosigiba Timber, a properly incorporated company that was owned by the villagers. Dina Gabo accused the government secretary of lands of being “negligent in the extreme” for issuing the lease to this unknown entity, owned by persons also unknown.

  At least the Purari Development Association had a formal existence when it was granted a special lease for 1.5 million acres. But the purpose raised eyebrows. It plans to construct a giant 1,800-megawatt hydroelectric plant that would flood much of the valley of the Purari River and send power by undersea cable 300 miles across the Coral Sea to Queensland. Some locals in the flood zone said they knew about the project, but others claimed they had “never been consulted or given permission” for the takeover.

  There seemed to be more local support for a scheme from a South Korean company known as Changhae Tapioka. It signed up with local communities in Central and New Ireland provinces to set up cassava farms on previously logged land, and to process the crop at five local ethanol plants. The cassava plantations were developed, and the crops grown. But, despite promises to process the crop locally, they were instead shipping chipped cassava to a Korean ethanol factory.

  In a detailed analysis of these and other special leases, Filer concluded that the motivation behind them was mostly grubby, devious, and opportunistic. A series of shadowy here-today and gone-tomorrow companies, several of them involving Malaysian logging entrepreneurs in cahoots with local politicians and government officials, were trashing the forests using laws designed to ensure that local people consented to, and benefited from, development projects. His wrap-up of one typically convoluted saga concluded: “The logging company has since departed, the Woitape people still lack road access to Port Moresby, while the fate of the [promised] oil-palm seedlings and the new telephones lines is unknown.”

  Why the plunder? Filer suggests that there has been a scramble among foreign loggers working in PNG to get as many Papuan logs as possible to Chinese manufacturers of timber goods before tougher rules on sourcing of logs come in. One trigger may be new rules on timber sourcing from the European Union. From 2013, the EU will insist on chain-of-custody paperwork on all timber products, showing where the wood came from and demonstrating their sustainability. That could make Chinese purchase of PNG timber tricky. So everyone wanted to grab the wood, and take their profits, while the going remained good.

  The PNG government reacted to the growing concern about the special leases by “suspending” them in May 2011 and launching an inquiry into their legality. But nobody knew for how long the suspension would last. Just till the dust settled? Few believed they were serious about a cleanup. Filer predicts “an upsurge of rural social unrest and civil disorder” as the scams unravel. As the poison spreads.

  Chapter 17. Cambodia: Sweet and Sour

  A couple of hours west of the Cambodian capital, Phnom Penh, I stopped at random at a meager roadside shack. I was in sugar land. I knew that one of Cambodia’s most powerful politicians, the tycoon senator Ly Yong Phat, had been accumulating land in the area to set up a sugarcane plantation. The sugar was destined for the European Union, under pr
eferential trade rules designed to help poor nations like Cambodia. In particular, it would end up at the giant Tale & Lyle sugar plant on the Thames estuary outside London—just downstream from the big banks in Canary Wharf.

  But Omlaing commune, in the Cambodian province of Kampong Speu, was a long way from London. Mey Mao and his family lived almost in the open, in a tiny wooden shelter raised on stilts above the frequent floods. They had one bed and an open fire. They had a kettle and pans, but no tap. As the rain fell, the crudely thatched roof dripped. “We have lived here since 1979,” Mey told me. That was the year Vietnam invaded Cambodia and liberated it from the tyrannous “year zero” regime of Pol Pot, during which millions died, and most of the rest were forced from their homes into work camps.

  Now it looked like this family faced a new “year zero.” More powerful men were coming to upset their rural backwater. “The company came and told us the land belonged to them,” said Mey, looking perplexed. But it couldn’t be true, he said. He and his family had lived and farmed there for more than thirty years. It was their home. “The company told us we had to go. That we would be resettled, but they didn’t say when and I am worried.” The company was owned by the senator for sugar, Ly Yong Phat.

  Mey’s land extended a few dozen yards back from the road. But his livelihood was meager. “I have four cows; I grow some cassava and rice, and I have trees with bananas and papaya,” he said. A few chickens also scuttled around. “Some years it is enough, but not every year. I have six children to feed.” His most valuable possession looked like a battered bicycle. He didn’t have a radio or TV. The house had no magazines or books. He knew little of the world beyond his tiny corner of Cambodia. His passivity was distressing.

  Five of Mey’s children went to school—when he could afford the fees, which were a bit over a dollar a day for them all. One son, maybe ten years old, seemed to know a little more than his bemused father. “We will be resettled on the hillside, up there,” he said, pointing to the distant Pis Mountain. It was beyond Ly Yong Phat’s sugar plantation, which extended ominously down the valley towards their shack. “But I’ve never been there,” interjected the boy’s mother. “It’s no good. We won’t be able to grow rice there. There is no water, they say. We don’t know what we will do. We don’t know what we will eat. And it will be too far for the children to go to school.”

  This is not how modern Cambodia is supposed to be. Back in the 1970s, Pol Pot’s Khmer Rouge abolished all private property in the cause of creating a Communist agrarian utopia. Its year-zero policies included destroying most legal documents recording land ownership. Recently, as part of a reform program organized with the assistance of the World Bank, the Cambodian government has been reinstating formal land titles for the millions of people who lost their land rights at that time. The declared aim is a property-owning democracy.

  Approaching 2 million land titles have been handed to Cambodian peasants so far. But if a big private investor wants some land, he can apply for an Economic Land Concession. These large concessions are only supposed to be granted on state land, but in practice often override the title claims of ordinary farmers. Unlike Papua New Guinea’s special leases, the concessions don’t even pretend to have local consent. All over the country, leading figures like the sugar senator are muscling in on the land and homes of people like Mey. Sometimes they are acting as fronts for foreign investors.

  There are no official figures, but NGOs reckon that since 2003, more than 5 million acres—equivalent to half Cambodia’s arable land—have been handed out in this way to around 150 private companies. This is institutionalized land grabbing on a huge scale for such a small and densely populated country. In theory, the law limits Economic Land Concessions to a maximum of 25,000 acres. But there is a way around that: the creation of adjoining concessions under separate names. In Kampung Speu, Ly Yong Phat claimed one 25,000-acre concession for himself, and another one right next door for his wife, Kim Heang. The two concessions are, so far as I could see, run as a single farm.

  There were protests when representatives of the senator’s company, Phnom Penh Sugar, first toured Omlaing handing out eviction notices. Mey Mao joined the demonstrations. He said the company offered to give him $200 if he and his family moved. It was not formal compensation, and the offer would be taken away if he did not agree there and then. But Mey had no idea what his land and house by the main road might be worth. In the end, he followed most others and turned the offer down. Now he waited on events. All through Omlaing commune, I found people in a similar situation. Many were bereft, clueless, and passive, waiting for their land to be taken. But not all.

  I spotted what looked like an oasis of order and productivity amid the muddled patchwork of shacks, trees, and rice paddies we had passed. Chhuon Chuon’s plot stretched back 500 yards from the road, behind a neat wall. It was full of fruit trees. “I bought this land from a former Khmer Rouge soldier in 2005,” he told me as we sat in the shade of the orchard. This was not unusual. Remnants of the Khmer Rouge had hung on here for years after they were ousted from Phnom Penh. Chhuon paid about $400 for the plot. “I cleared it and planted these trees. Now I make enough money to support three families, seventeen people.”

  This was a proper business. Wholesalers came to his gate to buy his mangoes, papayas, and bananas, and the milk from his cows, which grazed among the trees. But unlike many others hereabouts, Chhuon did not feel tied to his land. He was sixty years old, and had seen a lot in this ravaged country. He had been moving around ever since the days of Pol Pot, and he had other activities. He was a primary school teacher. But he wasn’t going to give up his plot easily.

  Chhuon was fighting his eviction notice. He said records of his purchase of the land had been among many that were mysteriously lost during a local government reorganization. He didn’t think it was an accident. “The company has taken some of my land already,” he said. The compensation it offered for taking the rest was less than one year’s income from the fruit on his trees, so he turned it down. Soon after spurning the company’s offer, he found himself in court. The charge was encroachment on the company’s land. “I got bail after I got support from an NGO [the human rights group Adhoc]. But I have to appear in court three times a month. I am still waiting for a decision. I am not scared to stand trial. I am a legal land owner.”

  He had suggested his own terms to end the dispute, he said with a brief smile. “I said I’d like $20,000. That would be a fair price, though not as much as I was offered for my land by someone else in 2007.” But the company was not interested. It told the local press that it owned his plot. Simple as that. At the time of writing, the case was still unresolved.

  Next, I went to a meeting of other locals fighting the eviction orders. They sat cross-legged on a raised platform, shaded by palm trees. The meeting was friendly, but there was an edge. One woman fiddled with a sharp knife. It marked the first anniversary of a successful demonstration at a provincial court, when some five hundred villagers had demanded the release from custody of their local leader. You Tho had been charged with inciting them to protest and to commit arson after a previous demonstration outside the company’s offices.

  You Tho, a soft-spoken man in his sixties, seemed an unlikely hothead. He was wearing a T-shirt with a picture of the Indian pacifist Mahatma Gandhi on it. He told me that some three hundred families in eleven villages in the Omlaing commune were threatened with losing at least some of their land to Ly Yong Phat’s sugar plantation, as it expanded down the valley. Their situations varied. In one village, people had been told their houses would be bulldozed. In another, every family had lost rice fields. “They will have nothing to eat this year,” said women at the meeting. Some just had their pastures fenced off.

  The company initially offered alternative land to replace the lost rice fields. But few accepted. “Usually it was either hill land, where you can’t grow rice, or land in other villages that w
as already owned by the people there,” one man said. There was no offer of compensation for lost pastures, even though raising cattle was good business here. You could get $1,200 for a pair of animals, they said. I asked if they had tried to get work with the company. Some had. But there was only casual work, at $2.50 a day. Most had given up. “It’s hard work, and you have to stay in the sun all day in the fields,” one woman said.

  After the government gave him the concession, Ly Yong Phat had come personally to the village, said You Tho. “He asked me to stop working for the community. He said he would give me a car and five hundred dollars a month if I went to work for him.” Similar offers were made to other local leaders. “Some have stopped working for their people since,” he said, without malice. “But I am not going to give up my community. If we stick together we can keep our land.”

  The plantation was reaching ever closer to their homes. People were losing their land individually, as the company decided it needed it. Sugar so far covered 12,000 acres, with 37,000 acres to go. I went to the main farm gate to ask about progress and discuss the complaints. I was surprised to find that the plantation was guarded by the military—Battalion 313 of the Royal Cambodian Armed Forces, which is largely composed of former Khmer Rouge soldiers. The government assigned the battalion to Ly Yong Phat’s companies as part of a policy it described as encouraging links between the military and private business. In return for receiving security services, Ly Yong Phat provides the battalion with “charitable support.”

  Locals were not impressed with the battalion. “The soldiers kidnap people and demand ransoms. It’s a way of boosting their income,” they told me. At the farm gate, the soldiers were friendly enough to a foreigner. But nobody inside wanted to speak to me.