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

by Fred Pearce

  The casual indifference to people’s rights that I encountered in Cambodia seemed at first extraordinary. But soon it began to appear routine. On the way back from the senator’s sugar farm, I passed a grand gateway leading to the premises of HLH Agriculture (Cambodia) Co., Ltd. The local offshoot of the Singapore-based Hong Lai Huat Group had in 2009 acquired 25,000 acres of land that was, technically, within the Aoral Wildlife Sanctuary. The company was growing corn there. Its website said the concession comprised “vast tracts of uncultivated arable land.” Well, uncultivated yes. But not unused. There was the wildlife, and also the indigenous Suy people who live in the sanctuary. They said their five villages had been encircled by the concession, and the forest where they gathered fruits and other produce had been plowed up.

  It wasn’t the Suy people’s first encounter with land grabbers. Back in 2004, New Cosmos Development had arrived in another part of the sanctuary and built what it called an “eco-tourism” center, complete with a golf course. The four hundred Suy who still live in the reserve claim to be among the last 1,200 of their people left in Cambodia, and hence the world. But, well, golf comes first.

  Next day, I took the road southwest toward the coastal tourist resort of Sihanoukville, before making a right turn to Koh Kong province. Koh Kong borders Thailand and is often called the “wild west” of Cambodia. Remote from Phnom Penh, it has in the past been the center of illegal logging, drug cultivation, and human trafficking. It is also the provincial base of Ly Yong Phat, who, among his many real estate developments here, runs a casino complex at the Thai border, and a Safari World theme park that had been accused in the past of smuggling orangutans from Indonesia. Some call the senator the “King of Koh Kong.” He even built a 1-mile toll bridge linking the province to Thailand, where he owns further land.

  Land grabbing is a daily news story in Koh Kong. Over coffee at the roadside, I read in that day’s paper about a huge new tourist development being built on coastal land inside nearby Botum Sakor national park. It covered 75,000 acres and would house resort buildings, an airstrip, and, naturally, golf courses. The developer was the Union Development Group, a state-owned Chinese textile group diversifying into land and tourism.

  A thousand families in the company’s way had accepted offers of new homes and departed. Cambodia Daily had found them. It reported: “Rows of yellow wooden houses can be seen about 20 kilometres from the coastline, where families now live on parched deforested land, far away from the rows of cashew and coconut trees they once possessed.” The Cambodian League for the Promotion and Defence of Human Rights (LICADHO) said that the twenty families who refused compensation had had their crops and homes burned. The paper quoted a military police commander saying he “had to protect” the development. “I do not defend the Chinese, but I do defend Cambodian law.”

  The paper reported that further up the road, in the Cardamom Mountains, a former Australian finance minister, Peter Costello, was a partner in promoting a 12,000-acre banana plantation that conservationists said would block an elephant migration corridor. I turned the page, and Ly Yong Phat was also in the news. In the far north of the country, in Oddar Meanchey province, the senator was reported to be helping set up another enterprise, this time involving linked concessions held by three companies, each headed by Thai nationals who are also senior executives from Thailand’s largest sugar producer, Mitr Phol.

  I checked Mitr Phol’s website. It did not mention the concessions. NGOs said that the village of Bos in the concession had been burned to the ground. People who had lived there since 1998, when it was cleared of land mines left by the Khmer Rouge, had been expelled. They had official documentation of their land title, dated 2003, but were told that their land was now within the new sugar concession.

  Back on the road, I was heading for another enterprise of the sugar senator, the Koh Kong sugar refinery. It is Cambodia’s first since the French left more than half a century ago. It had been opened by the prime minister, Hun Sen, a year before and occupied an improbably large site that locals said once contained three villages. Most of the land was unused—and the factory was only open for three months a year, during the harvest.

  The refinery processes sugar from a 50,000-acre concession given in 2006 to the ubiquitous Ly Yong Phat and two business partners, the Thai company Khon Kaen Sugar and Vewong, a Taiwanese company that manufactures sugary soft drinks and instant noodles. The UN Commissioner for Human Rights reported in 2007 that the concession was granted without public consultation, and that to get around the 25,000-acre limit on the size of concessions, land registration was split between Ly Yong Phat and the boss of Khon Kaen Sugar, Chamroon Chinthammit. In 2011, Ly Yong Phat was reported to have sold his share to the other partners, making the concession entirely foreign owned.

  Before that, in late 2009, Khon Kaen Sugar signed a contract selling all of its output from Cambodia for five years to Tate & Lyle. This included the Koh Kong plantations. The first shipment of 10,000 tons, valued at some $3 million, left for Europe in June 2010. A month later, Tate & Lyle sold its European sugar business, including its famous brand name and the supply contract with Thailand and Cambodia, to the U.S. company American Sugar Refining.

  Just past the Koh Kong refinery, I turned into Srae Ambel, where about fifty people assembled in the village temple beneath large murals and statues of the Buddha. They sat cross-legged on straw mats made from grass cut from land they could no longer enter. They wanted to tell me about their lost land. Things went slowly. Nobody seemed to want to talk. After a few minutes, I noticed a villager at the back, smoking nervously and taking notes. I discovered later that everyone knew him as the company spy. After he got bored and departed, they loosened up. The stories came thick and fast.

  One woman, her hair tied in a tight bun, sat forward urgently: “Some soldiers came and told me to remove my house, because it was not my land. I said no. I said I would report them to the commune officer. But they just smashed the house down. I built another one, but they burned that. Then they burned our rice and all our belongings. They offered just a hectare in compensation. But it was sacred forest land, which isn’t theirs to give. I can’t use that land. I’d be scared to.”

  Local NGOs calculate that the sugar plantation had consumed some 12,000 acres of land owned and farmed by local villagers, as well as areas of common pasture. In Srae Ambel alone, 250 families lost land. Most still had enough to grow some rice, but their grazing land had been taken. One gap-toothed old woman said she once had thirty cattle, “but I only have one left.” A man said: “I used to have fifteen buffalo. If I got sick and needed some money to go to the hospital, I sold a buffalo. But now we have fewer cattle, so we can’t do that. And without the pastures we don’t have grass to repair our roofs.”

  The pajama-wearing women didn’t know who owned the sugar company. But one man in a blue jacket, a community representative called Konh Song, told them it was Ly Yong Phat. “He visited two houses here in 2007. He said he would try to find replacement land for the villagers. But the land they offered was not good, so we rejected the offer. We haven’t seen him since.” I asked the villagers where they thought the sugar went. Thailand, they suggested. Then someone said: “That’s where it was refined before they built the new factory here. After that it goes to England.” So, I said, “you lose your land so that I can eat sugar.” The women smiled, but seemed afraid to appear rude by agreeing. Then one of the men, Hun Phan, asked me not to buy the sugar. “It’s corrupt; it’s not clean. People are crying here because they have lost their land.”

  They said they had legal possession of their land but that the company took it regardless. Economic Land Concessions overrode local land rights. Nor did it matter what they used their land for. One middle-aged man, Teng Kao, had planted 35 acres with cashew trees along with palms, tamarinds, bamboo, and mangoes. “I had over a thousand trees. I could have gotten rich and had a car,” he said, putting asid
e his spectacles to see me more clearly. “But they destroyed all the trees before I had a chance to make my money.”

  Later, one of the village youths drove me on his motorbike through the back roads, past a sleeping guard, onto the farm. We saw two cashew trees in a hedge—all that remained from Teng’s orchard. Teng wouldn’t come with us. He said he was a local representative of the villagers and that it would anger the company guards if he showed up with foreigners. But maybe he just couldn’t face it. He could see what was happening to the village. They used to collect forest products from the mountain nearby, he said, but now the sugar farm was in the way and they could not cross it. The local streams were now polluted with farm chemicals and waste from the refinery. The fish were poisoned. “The children used to drink water from the rivers when they were looking after the buffalo. Now they get sick if they do that.” And there weren’t many buffalo these days, anyhow.

  It might seem as if it’s all over for the people of Srae Ambel and the other victims of the sugar rush. At Srae Ambel, they have done with protesting. When it all started in 2006, they marched in Phnom Penh. They came home and tried to block the company bulldozers. There were arrests. One woman wiped her tears as she remembered: “We had to sell ten cows because of the cost of going to court.” Some said that, because they got arrested, they got no compensation. In 2007, the UN High Commissioner for Human Rights reported that the sugar concessions in Koh Kong were “granted without public consultation . . . The clearing of rice fields and orchards belonging to villagers has affected over 400 families . . . and has restricted the availability of grazing land. Some have little or no remaining farmland. Company security guards have reportedly seized or shot cattle straying into the concession.” The farm had “expanded activities despite efforts to resolve the dispute.”

  Nothing had changed as a result. American Sugar did not reply to questions posed by Cambodian NGOs, or later by me. Five years after the arrival of the senator for sugar, lives in Srae Ambel were disintegrating fast. As I left someone had a parting shot: “Pol Pot killed us quickly. This is slow. But they are killing us just the same.”

  But the story may not be over. The sugar rush is sustained in Cambodia because of that country’s preferential trade arrangement with the European Union, known as the Everything-But-Arms system. Its purpose is to allow the world’s poorest countries to export effectively unlimited quantities of certain goods to the EU with zero tariffs. In the case of sugar there are guaranteed minimum prices, too. There is nothing comparable in the United States, which still imposes quota-based tariffs on sugar imports. But the European incentives have created a sweet spot for capital, where there is everything to gain and nothing to lose. One result has been widespread land grabbing.

  In May 2011, shortly after my trip, Swedish member of the European Parliament Cecilia Wikstrom followed much the same route as I had. Afterwards, in Phnom Penh, she declared there was widespread evidence of human rights abuses, and that she was not satisfied with the response from the deputy prime minister, Sok An. “There is no doubt that the villagers have suffered,” she said. “This is blood sugar.” She called for the Everything-But-Arms terms to be suspended for Cambodian sugar.

  At the time of writing, that hasn’t happened. But if they were suspended, the bubble would burst. There is every chance the land grabbing, at least for sugar, would stop here. And some of the concessions might cease business. Some of the villagers might even get their land back.

  Chapter 18. Southeast Asia: Rubber Hits the Road to China

  In the hills of northern Laos, up near the border with China, the rice paddy is disappearing. For thousands of years, nothing was more important here than to grow a constant supply of rice. But rice is no longer the focus of every meal. Village life is no longer organized around the relentless labor needed to grow it. People ride into town on their motorbikes to buy bread and chickens. So what grows now on the hillside terraces, where rice was once planted on almost every square inch? The answer, in this corner of Laos, is rubber.

  The Associated Press’s Denis Gray visited the remote village of Chaleunsouk in northern Laos in 2008, and produced a memorable item describing how “the rice fields that blanketed this remote mountain village for generations” have been replaced by “neat rows of young rubber trees—the sap destined for China . . . Sixty families in this dirt-poor, mud-caked village of gaunt men and hunched women now are growing rubber, like thousands of others across the rugged mountains.”

  There are several large rubber plantations in the hills. But many villagers grow rubber trees on their own land. In any event, the new masters here, whether as plantation owners or buyers, are Chinese rubber companies like Sino-Lao Rubber, Yunnan Rubber, and Chia Xuang. In the past decade, they have conducted what Yunnan University and the International Union for the Conservation of Nature reported to be “a sudden, rapid and largely uncontrolled” invasion of northern Laos.

  Along with other commodity crops such as cotton, rubber has long competed with food for the world’s farmland. Early in the twentieth century, Malaya produced three-quarters of the world’s rubber, under British control. Today, some 25 million acres of the planet—an area almost the size of England—is covered in rubber trees. And global demand for rubber latex is rising by 3 percent a year. As with many commodities these days, China is the demand driver.

  China expects to be consuming a third of the world’s rubber by 2020, mainly for car tires. And Laos’s Communist state wants to hitch a ride on China’s coming car boom to join big producers like Thailand, Indonesia, Malaysia, Vietnam, and India. With its long border with China, Laos is ideally placed to become, in effect, China’s new rubber-growing province. This, it hopes, will be how the rubber hits the road for the laggardly Lao economy.

  So Chinese companies are welcomed as they cross the hills. And Laos was pleased to provide the land for a new road, the Northern Economic Corridor, constructed through the country’s far north between China and Thailand. It will ease export of the rubber from the 345,000 acres of this small landlocked country that have been converted to growing rubber. It will help Laos meet its target of doubling the amount of converted land by 2020.

  Alan Ziegler, a geographer at the University of Singapore, says that a “rubber juggernaut” is rolling through Southeast Asia. Altogether more than a million acres have been converted from peasant paddy and woodland to rubber in Thailand, Vietnam, Cambodia, Burma, Laos, and China’s Yunnan province. Ziegler compares it to the takeover of Indonesia by oil palm and timber plantations, many of which also supply China. He fears similarly “devastating” ecological and social consequences.

  Burma is granting Chinese companies giant rubber plantations covering up to 50,000 acres, riding roughshod over the interests of villagers. It expects to have a million acres of rubber by 2020. Both Thailand and Vietnam are developing their own rubber plantations, with the Chinese market in mind. They have about 2.5 million acres of latex-producing land. Such is the intensity of demand from their regional big brother that they are invading their poorer neighbors to grab more land to grow more rubber for sale to China.

  Among the Vietnamese rubber barons being granted large plantations in southern Laos is Doan Nguyen Duc, a flamboyant figure who claims to have been Vietnam’s first private owner of an executive jet. He has grown a small carpentry business into one of Vietnam’s largest companies, Hoang Anh Gia Lai. He explained his newfound enthusiasm for agricultural projects to Forbes Asia in 2009: “I think natural resources are limited and I need to take them before they’re gone.” He grabbed 25,000 acres of rubber plantations in Laos in return for building an athletes’ village in the capital, Vientiane, for the 2009 Southeast Asian Games. Miles Kenney-Lazar at Clark University in Worcester, Massachusetts, says much of the land given to Doan previously grew rice and vegetables and grazed cattle. Of seven impacted villages, only four knew their land had been handed over when Doan showed up.

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bsp; Cambodia, meanwhile, plans to multiply its rubber plantations eightfold to 2 million acres as early as 2015 to supply China, and recently invited Vietnamese companies to take over 90,000 acres for the purpose. Doan already has 37,000 acres there.

  Rubber, as we have seen in earlier chapters, has an inglorious history, not least in Southeast Asia. In the 1930s, French tire company Michelin ran one of a string of rubber plantations that extended for 185 miles along the coast of Vietnam. They were a byword for brutality, and incubated the Communist activism that later threw first the French and then the Americans out of Southeast Asia. More recently, plantations in traditional rubber-growing regions like former British imperial Malaya have given up growing rubber in favor of oil palm. Smallholders have often taken up the slack. As much as three-quarters of the world’s rubber has come from smallholders in recent years. But in countries like China and Vietnam, estates have retained their control. And as their influence grows, big plantations are making a comeback.

  The Chinese are coming. It is a constant refrain. A constant paranoia. In London, Emergent Asset Management claims to base its investment strategy on the belief that the West will go to war to prevent China from taking over the world’s resources. After two decades of double-digit growth, the country of 1.3 billion people is, of course, a fast-growing player on the world stage, demanding an increasing share of the world’s resources. But there is much myth making about Chinese land grabbing, and how far it might go. So first, how are things in the Middle Kingdom?

  With almost a fifth of the world’s population, but only a tenth of the world’s arable land and much less of the world’s water, China is short of some basic resources for growing crops. And it is growing shorter. Urbanization, industrial development, reservoirs, soil erosion, and spreading deserts have cut the amount of cultivated land in China by about 6 percent in the past decade alone. An estimated 50 million Chinese farmers have lost their land since 1990. Rural protests against domestic land grabs proliferate. Meanwhile, a growing demand for meat and dairy products, which take more land and water to produce, has been stoking up the pressure. China accounts for 30 percent of global meat consumption. The amazing thing, perhaps, is that for most foodstuffs, China still largely feeds itself. More so, in fact, than almost any other country.