The REDD contradiction: Deforestation and oil palm plantations in the Congo Basin

REDD Monitor: Chris Lang: 28th February 2013

Since 2009, companies have announced new oil palm plantation projects in the Congo Basin covering a total area of 1.6 million hectares. Projects currently underway cover 500,000 hectares. A new report by Rainforest Foundation UK warns that vast areas of the Congo Basin forests are potentially threatened by the expansion of oil palm plantations.

The report, ‘Seeds of Destruction’ (pdf file, 4.7 MB), includes case studies of three of the companies involved. A company called Atama Plantations SARL has started clearing forest in the Republic of Congo for a 180,000 hectare plantation. Rainforest Foundation UK investigated the companies behind Atama Plantations and found a “web of ‘shell’ companies registered in secretive tax havens”.

In February 2012, a Malaysian company called Wah Seong announced it would buy a 51% stake in Atama Resources Inc, a Mauritius-registered company that owns Atama Plantations SARL: ‘The $25 million purchase of Atama by Wah Seong is almost as complicated as the web of companies behind Atama.’

Rainforest Foundation UK concludes that: A company with no significant relevant previous experience has begun felling tropical forests in the Republic of Congo to make way for what could be the region’s largest ever oil palm plantation. Almost no public information is available about the project, and its new owners have declined to provide even the most basic information, such as concession maps.

In Gabon, the Singaporean agricultural commodities trading giant, Olam, plans to establish 130,000 hectares of oil palm plantations. Norway’s Pension Fund Global holds shares in Olam: Perhaps most worrying is the fact that almost 70 per cent of the first 87,000 hectares allocated by the Gabonese government for the planting of oil palm by Olam was found to be extremely valuable forest, including areas of intact forest landscape, Ramsar wetlands, great ape and elephant habitat, and areas with crucial livelihood functions. While Olam has committed not to develop such areas, this is a voluntary commitment.

In Cameroon, New-York based Herakles Farms is developing 60,000 hectares of oil palm plantations. A report by the Centre for Environment and Development (CED) states that the concession agreement breaches both the spirit and the letter of Cameroon law. The plantation area borders five protected areas. According to Greenpeace, 85% of the concession area is dense natural forest.

Simon Counsell, Rainforest Foundation UK’s Executive Director, said: “Governments of Congo Basin countries have handed out vast tracts of rainforest for the development of palm oil with apparently little or no attention to the likely impacts on the environment or on people dependent on the forest. There is a need for regional agreement to ensure that best practices are mandatory for any new oil palm development, including avoiding high conservation value forests and ensuring the rights of existing forest dwellers are respected.”

The report makes several references to the failure of REDD to address the expansion of oil palm plantations in the Congo Basin.

Rainforest Foundation UK is critical of proposals to encourage oil palm development on degraded land, which is sometimes linked to potential funding for REDD. The report points out three problems with this strategy:

1. “Land rights and land tenure issues on ‘degraded land’ may be as or even more significant than they are on forested land.”

2. The term ‘degraded land’ has been “widely abused and often used to refer to areas of forest that have been selectively logged but still retain significant biodiversity values, carbon stocks and livelihood and watershed functions.”

3. The strategy could be counterproductive, because “it is not being sufficiently coupled with parallel actions to prevent continued new planting on ‘non-degraded’ forest land. Given the huge profits and massive demand for palm oil, as well as the tempting cash-flows offered by timber clearance and sale, it is entirely possible that oil palm companies will take the degraded land offered to them, and then plant on that and the forested land they were originally planning to plant on. The reality is that, in Indonesia and other Asian countries, palm oil companies have built up substantial ‘land banks’ which, if utilised, would require further forest clearance, and they have been strongly reluctant to relinquish such land reserves even if suitable ‘degraded land’ is on offer.”

These large-scale oil palm developments will result in significant increases in greenhouse gas emissions, as well as increasing forest loss and impacting existing conservation areas. One of the recommendations from the report is that international organisations involved in funding REDD in the Congo Basin should “seek to address such developments through both ‘REDD-readiness’ programmes and/or REDD ‘payments for achievements’ agreements”.

But while all the Congo Basin countries are involved in the REDD discussions and processes, the expansion of oil palm plantations is taking place in parallel to REDD. CIRAD’s Alain Karsenty pointed out the problem in 2010 regarding logging (the same contradiction applies with palm oil companies): “On the one hand, they negotiate with Chinese companies over logging concessions, and on the other they’re negotiating with REDD. There is a real contradiction at play.”

Full Disclosure: Rainforest Foundation UK has funded REDD-Monitor.