The area of tree plantations in Cambodia and Laos is expanding rapidly, as are the impacts on villagers and their environments.
By Chris Lang. Published in Focus Asien, December 2006.
Notes from a trip in November 2006
“All villagers understand the need to protect the forest. We can’t live without it.” The speaker is a villager from Dak Dam Commune in Mondulkiri province in the north-east of Cambodia. “Now our life is more difficult,” he said.
About 20 of us (from Vietnam, Thailand, Cambodia, the Philippines and the UK) sat with villagers in the shade of a large tree near the village school. We were on our way to the Mekong Regional Conference on Tree Plantations, organised by NGO Forum on Cambodia, Oxfam, TERRA and World Rainforest Movement. The meeting would take place over the next two days in Kratie province. We had travelled to Mondulkiri province to hear how the indigenous Phnong community is struggling to keep its land against Wuzhishan, a Chinese-Cambodian company with close links to the Cambodian government. In August 2004, the Cambodian government awarded permission in principle to Wuzhishan to establish a 199,999 hectare concession with 10,000 hectares approved immediately for trial and commercial planting.
“The company increased its area of land to 20,000 hectares,” a villager told us. Another told us the company had taken 30,000 hectares. Neither Wuzhishan nor the government has given villagers a map of the plantation operations. “People asked why the company could take the land,” a villager said. “We struggle against the company because we need the land for farming. We have complained for two years to this company.”
Villagers grow no paddy rice, but cultivate upland rice on rotational swidden fields. The company had planted on some of villagers’ swidden fields. This year, there had been a drought in the area and some rice was destroyed.
“The company cut down all the trees on our land, including the spirit trees,” one of the villagers said. “Our people are suffering as a result. The company also destroyed the land we use for burying our ancestors. The company came to cut the big trees. We never cut these trees. On the top of the hill we grew fruit trees. The company cut all the trees and now we have no fruit. We used to sell the fruit in the market to buy food.”
The impact on culture since the company arrived in their land was a recurring theme during the meeting. “The trees and land were respected by our culture. As indigenous people we believe it is important to live together in a certain way. There has been a change in the community’s culture since the arrival of the company,” a villager explained.
“Children and girls have been exploited by the company workers,” added another. “Young girls have fallen in love with workers and then the company moves to another area. We are afraid of the workers. They drink wine and beer and do bad things.”
“The government has forbidden burning the grasslands,” a villager said, “but we need to burn to make the grasslands better for grazing.” The company hired workers to monitor the villagers who attempted to burn the company’s trees or land.
A villager told us how the company uses chemicals to clear the grass in the areas it plants. “The chemicals ran into the rivers and streams. This is our drinking water. The chemicals killed fish in the streams.”
Villagers protested to local authorities about the company’s operations. The result was heavy-handed repression. Villagers were prevented from leaving the province, to go to Phnom Penh to attend workshops, for example. When hundreds of villagers walked into Sen Monorom to ask the District Governor to address their problems, they were met with water cannons. The authorities told them to return to their villages and promised that they would resolve the situation in a couple of days. “But nothing has happened,” pointed out a villager.
Earlier this year, villagers arranged a meeting to discuss the problems with Wuzhishan, but no one from the company turned up. “One of our villagers tried to meet with the company in Phnom Penh, but this came to nothing. The company never responds to our complaints.”
The villagers are far from giving up, however. “We will keep complaining to the government until the government gives us our land back,” one of them said.
State supported expansion of plantations
Wuzhishan’s plantations in Mondulkiri province are just one example of a series of “Economic Land Concessions” that Prime Minister Hun Sen’s government has issued – many to his business cronies. The concessions are for plantations of pulpwood trees, teak, rubber, sugar, cassava palm oil and other cash crops intended for export. There is no transparency in the awarding of the concessions, many of which are in breach of Cambodia’s land law, which sets a maximum area of 10,000 hectares for such concessions. Companies carry out no studies on the likely environmental and social impacts before they get the land and no consultations are carried out with local people.
In 2001, the World Bank launched a Land Management and Administration Project aimed at improving “land tenure security and promote the development of efficient land markets”. The World Bank made clear its structural bias towards companies and against communities in its comment that “Lack of a land law is one of the main complaints of foreign investors in Cambodia.”
Twenty per cent of the people in Cambodia are now landless, and the figure is increasing every year. As a result of the concessions, land grabbing and conflicts over land rights are becoming more common in Cambodia. Few people are employed to work on the plantations and those that are often come from other areas of the country or from different countries, because they have no connection to the land, or to the people living there. Plantation companies use the workers as a means of driving out the local population. Because the workers are paid so badly, they kill local people’s animals for food. They protect the tree plantations from local people.
The Mekong Regional Conference on Tree Plantations, was attended by more than 100 people including farmers, activists, scientists and NGOs. During the meeting we heard how a sugar company in Koh Kong province had taken land affecting more than 400 households. Villagers have lost their rice fields and can no longer use the forest to collect food and medicines. When villagers protested, the company and government sent in soldiers. One villager was seriously injured.
We heard about a cassava company which has started planting in Stung Treng province. A feasibility study was carried out in 1999 and planting started in 2001, but no consultation happened. Villagers sent a report to the authorities, but this achieved nothing. Villagers have been protesting for two or three years, but so far there has been no resolution of the problems.
We heard how villagers in Pursat and Kompong Chhnang provinces have been fighting against a concession covering more than more than 300,000 hectare for the last six years. Villagers have complained to the authorities, organised meetings, visited Phnom Penh, filed lawsuits, sent a petition to the King, talked to journalists, attempted to get their community forest legally recognised and have held marches, protests and blockades to prevent workers from cutting down their forest. The company which owns the concession, Pheapimex, is one of the most powerful companies in Cambodia. In 2004, the company sent in bulldozers to clear the forest. When villagers set up a protest camp, someone threw a grenade into the camp, injuring nine people. Instead of investigating, the police blamed the villagers themselves.
Pheapimex isn’t operating the plantations itself, but has handed the concession over to Wuzhishan which has close links to Pheapimex. One of the directors of Wuzhishan is married to the owner of Pheapimex, Chheung Sopheap. Both are close friends of Cambodia’s Prime Minister, Hun Sen.
A villager from Kompong Chhnang echoed the villager in Mondulkiri province. “We will never give up our struggle,” he said.
Protest experience from Thailand
Sawaad, a farmer from northeast Thailand has been involved in struggles against eucalyptus plantations for many years. “Fifteen years ago in Thailand, we faced the same problems,” he told the villagers in Dak Dam Commune in Mondulkiri province. “We did not have enough experience when Phoenix Pulp and Paper started planting eucalyptus trees. Eucalyptus causes problems with water, the environment and livelihoods. Land rights is a big issue. Before we knew that there was a problem, it was already there. At first people wrote letters. It was the same as here. We sent lots of letters but no one replied. Then we started to form groups and expanded to hundreds of people.”
Sawaad explained how farmers in Thailand organised to resist the spread of plantations on their land. “People have to find their own ways to put pressure on the government. In Thailand, we set up the Northeast Small Farmers Network and the Assembly of the Poor. We held rallies to protest and to negotiate with the government. In the past 15 years I don’t know exactly how many protests there have been, but it’s probably between 300 and 500. In 1997, the Assembly of the Poor held a protest for 99 days outside Government House in Bangkok. Sometimes the protests involved hundreds of people, sometimes tens of thousands. We need to rely on ourselves, on our movements. We can’t rely on anyone else.”
When he was asked about how the government reacted to the protests, Sawaad replied that “The government did everything it could to stop us. I have been in jail eight times. But we were able to work as a network, not just small groups of people. So if the government attacked one person, or jailed one person, the network just carried on working.”
“There will never be an end to the process of struggle, there will always be people who want to increase their profits, we need to think about our collective interests and not our private interests,” Sawaad said at the Mekong plantations meeting in Kratie.
The same thing in Laos
During the meeting we also heard how the Lao government is also awarding a series of plantation concessions. In the south of the country, Vietnamese companies are establishing large areas of rubber plantations. In the north, Chinese companies are setting up rubber plantations. In the central areas of the country, Oji Paper, a Japanese pulp and paper giant is planting fast growing eucalyptus trees for the pulp industry. The Finnish-Swedish company, Stora Enso is also looking at investing in plantations in Laos. Representatives of perhaps the world’s notorious pulp company, Asia Pulp and Paper, have also been spotted looking at the possibilities of expanding to Laos.
The Forest Sector 2020, a policy report drawn up with the assistance of the Japanese government, anticipates an area of 500,000 hectares of industrial tree plantations in Laos by the year 2020. The Asian Development Bank (ADB) wants to meet this target by 2015. From 1993 to 2003, the ADB ran a US$11.2 million Industrial Tree Plantation Project in Laos. According to the ADB’s project completion report, the project was “unsuccessful” and the ADB’s performance was “unsatisfactory”. The project created and increased poverty and indebtedness. It replaced forests important to the livelihoods of local communities with eucalyptus plantations that then failed. Loan funds went missing and the Bank is investing allegations of corruption.
In December 2005, the ADB’s Operations Evaluation Department released an evaluation of ADB lending to the Natural Resources Sector in Laos, which included a very critical report of the Bank’s Industrial Tree Plantations Project. The very next month the Bank’s board approved a new plantations project for Laos. Rather than helping to “alleviate poverty” as Bank documents claim, this new project is set-up to repeat the mistakes of the first project. It will help facilitate and subsidise private foreign plantations companies in taking over even more forest land in Laos while further impoverishing local communities.
Oji Paper started its operations in Laos shortly after attending an ADB sponsored “Private Sector Consultation Workshop” in Vientiane in August 2004. The aim of ADB’s workshop was to “to present the investment opportunities to multinational pulp and paper companies”.
While the companies describe the land they are logging as “degraded forest” the land is in use by villagers and includes villagers’ community forests. At the meeting in Cambodia, we saw photographs of forest now cleared to make way for Oji Paper’s eucalyptus monocultures. After the meeting in Cambodia, I visited Laos with colleagues from TERRA in Thailand and World Rainforest Movement. We visited Oji Paper’s plantations at Ban Lao Kha. Six years ago I had seen forest being cleared to make way for these plantations – with ADB funding. The eucalyptus trees haven’t grown well. In some places the forest was growing back faster than the eucalyptus trees. Some of the eucalyptus trees had died.
In March 2006, the Indian company Aditya Birla Group signed an agreement for 70,000 hectares of industrial tree plantations and a 200,000 tonnes a year pulp mill. A representative of the Provincial Agriculture and Forestry Office (PAFES) in Savannakhet province was reported in a June 2006 report by the German Agency for Technical Cooperation (GTZ) as saying that they were afraid this company would destroy the forest: “Our staff have no ability to control this company, it is beyond the ability of the Lao technique.”
The ADB’s new Forest Plantations Development Project aims to set up a Lao Plantations Authority, the purpose of which is to make it easier for multinational corporations like Oji, Birla, APP and Stora Enso to invest in industrial tree plantations in Laos.
As in Cambodia, some of the plantation concessions are little more than an excuse to log the forests. Areas of forest in Pakkading district in Bolikhamxai province were cleared for a series of plantation concessions which have all failed. For example, in March 2006, GTZ visited a coconut concession in Pakkading district and found “heavy natural forest logging and burning in the project area, high rates of large log removals”. Meanwhile, the coconut seedlings were “poorly tended and likely not salvageable”. The purpose of the concession, it seems, was to log the forests, not to establish a plantation.
Rubber plantations in Laos: Development for whom?
In July 2004, a business delegation from the Vietnam General Rubber Corporation visited Laos. At the time only a small area was planted with rubber in the south of Laos. “We can provide 50,000-100,000 hectares of land for Vietnam to grow rubber,” Thongloun Sisolit, the Lao Deputy Prime Minister, told the delegation.
A few months later, the Lao government licensed a US$30 million project by the Dac Lac Rubber Company, a Vietnamese state-owned company. The Dac Lac Rubber Company is named after a province in the central highlands of Vietnam where the company has 14,000 hectares of rubber plantations. The company aims to plant 10,000 hectares with rubber trees in Champasak, Saravane, Sekong and Attopeu provinces, on a 50-year land lease. By October 2006, the company had planted 3,200 hectares with rubber trees.
The Vietnam Economic Times reported Thongloun Sisolit as describing the company’s project as “a model to help his people gear up for commercial production”.
But Dac Lac Rubber Company has replaced forests and villagers’ land with rubber plantations. The company paid compensation where it cleared cash crops, but provided no compensation where it cleared farmers’ upland rice fields. Before the company established its rubber plantations, much of the land was a mixture of rice fields, fallows and forest. The company simply declared it “degraded forest” and cleared the land.
In March 2005, another Vietnamese company started operations in Champasak province. The Viet Nam-Laos Rubber Joint Stock Company plans to plant 10,000 hectares of rubber trees with a total investment of US$30 million. The company pays a rent of US$9 per hectare per year to the Lao government. The company is part of the Vietnam General Rubber Corporation.
In December 2006, the Quang Minh Rubber Production Joint Stock Company signed a contract with the Lao Planning and Investment Committee, for a US$15 million project to plant 4,900 hectares of rubber plantations in Sekong and Attopeu provinces.
We visited one of the Viet Nam-Laos Rubber Joint Stock Company’s plantation areas near Mak Ngeo village in Champasak province. A sign in the plantation forbids cattle grazing. One side of the dirt track had been fairly recently planted. The red soil and rows of metre-high rubber trees stretched away into the distance. Beyond the plantation we could see the remains of the forest that had been cleared to make way for the rubber trees. On the other side of the track the rubber trees were older and more than two metres high. Four Lao villagers were clearing grass and small shrubs from around the trees. The villagers told us that they had lost their land to the company. Working together they could clear about 150 metres a day, sometimes more, sometimes less, depending on how bad the weeds were. The company paid them 50,000 kip (about US$5.25) for each 150 metres distance that they cleared, so they each received a little over US$1 a day.
In May 2006, at a workshop on “Rubber Development in Laos” held in Vientiane, Sounthone Ketphanh, Deputy Director of the Lao Forest Research Centre, explained that market demand for rubber in China had encouraged investments from Chinese and Vietnamese companies in rubber plantations in Laos. The Chinese investments are in the north of the country and the Vietnamese in the south.
According to a report in the Vientiane Times, Sounthone described the benefits of rubber plantations: “Unlike other cash crops, rubber offers long-term benefits to farmers for a period of 30-40 years. Farmers not only benefit from tapping latex but also from intercropping in the first few years after planting and from selling the timber when tapping comes to an end.”
Participants at the meeting noted that the price of rubber on the world market follows “boom and bust” cycles, which could spell disaster for companies and farmers growing rubber trees on their land. Since May 2006, the price of rubber has plunged, although analysts are predicting that it will recover.
Southone acknowledged another problem. “On the downside,” he told the workshop in Vientiane, “the rapid growth of rubber plantations causes large-scale loss of forest resources and watershed destruction, which is particularly important in Laos where rural food security is directly related to forest health.”
The position of the international aid agencies
International aid agencies appear on both sides of the debate that is currently taking place in Laos and Cambodia about large scale concessions for plantations. Some, such as the Asian Development Bank, are in favour of plantations and are actively promoting them. Others, such as GTZ are concerned about the fact that the government is not receiving enough revenue from the plantations. But GTZ is in favour of industrial tree plantations as a means of “development”: “To benefit from foreign capital inflows to the greatest extent possible, a sound investment regime – regulations on entry, land tenure and contracts, market oriented mechanisms for price setting, and monitoring mechanisms – have to be in place and managed well. Without these, foreign capital inflows will remain low and impede development.”
Villagers have a completely different view of development. In Kompong Chhnang province, a villager told us, “We want development. We want projects like health centres and schools. But we don’t want development where we become workers. We want development that we can control ourselves.” Villagers in Mondolkiri province are clear that industrial tree plantations are not development: “The authorities said that this is development of our country. But this is not development.”
Sector Assistance Program Evaluation for the Agriculture and Natural Resources Sector in the Lao People’s Democratic Republic, SAP: LAO 2005-17, Operations Evaluation Department Asian Development Bank, December 2005.
Project Completion Report, LAO: Industrial Tree Plantation Project, Project Number: 20067, Loan Number: 1295, Asian Development Bank, November 2005.
Chris Lang and Bruce Shoemaker (2006) Creating Poverty in Laos: The Asian Development Bank and Industrial Tree Plantations. World Rainforest Movement, April 2006.
Carl Middleton and Hak Sokleap (2005) Fast-wood Plantations, Economic Concessions and Local Livelihoods in Cambodia. The NGO Forum on Cambodia.
Gunda Schumann, Pheuiphanh Ngaosrivathana, Bouakham Soulivanh, Somboun Kenpraseuth, Khamdeng Onmanivong, Khamthanh Vongphansipraseuth and Chithasone Bounkhong (2006) Study on State Land Leases and Concessions in Lao PDR, Land Policy Study No. 4 under Lao Land Titling Project II, GTZ.