Deforestation by Definition
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DEFORESTATION BY DEFINITION THE PERUVIAN GOVERNMENT FAILS TO DEFINE FORESTS AS FORESTS, WHILE PALM OIL EXPANSION AND THE MALAYSIAN INFLUENCE THREATEN THE AMAZON CONTENTS 3 EXECUTIVE SUMMARY 5 1. GRUPO ROMERO: PLANNED DEFORESTATION 8 1.1 HOW A SKEWED FOREST DEFINITION RESULTS IN DEFORESTATION 12 1.2 VIOLATION OF RESERVE REQUIREMENTS EIA would like to thank the following organizations and 13 1.3 AN INVALID LAND TRANSFER individuals for contributions to this report: 15 1.4 GRUPO ROMERO EXISTING PALM OIL PLANTATIONS Asociación Interétnica de la Selva Peruana (AIDESEP) 20 2. MELKA GROUP: AMASSING LAND IN THE AMAZON Andrew Heatherington 24 2.1 LOOMING DEFORESTATION: 458 PROPERTIES AND COUNTING Bruno Manser Fund 26 2.2 MELKA GROUP’S ONGOING DEFORESTATION: TAMSHIYACU AND NUEVA REQUENA Center for International Environmental Law 32 2.3 ILLEGALITIES IN TAMSHIYACU AND NUEVA REQUENA Clinton Jenkins 35 2.4 INSTITUTIONAL LIMITATIONS: THE GOVERNMENT’S INABILITY TO STOP DEFORESTATION FOR MONOCULTURE PLANTATIONS Global Witness Juan Luis Dammert 38 3. GREASING THE PALMS: DENNIS MELKA, ASIAN PLANTATIONS LTD., AND FOREST DESTRUCTION IN SARAWAK, MALAYSIA Nick Cuba 40 3.1 A NEW EMPIRE OF DEFORESTATION Oxfam 41 3.2 ASIAN PLANTATIONS LTD. Sam Lawson 47 3.3 KERESA PLANTATIONS: GRAEME BROWN, THE LINGGI FAMILY, AND Sidney Novoa CLEARCUTTING FOR OIL PALM Transparent World 52 3.4 RSPO-CERTIFIED FOREST DESTRUCTION Henry Túpac Espíritu 53 3.5 ASIAN PLANTATIONS LTD’S SUBSIDIARIES IN SARAWAK: VARIATIONS ON A THEME The local residents of Barranquita, Nueva Requena, 57 3.6 ASIAN PLANTATIONS LTD.’S MODEL OF INTERNATIONAL FINANCING FOR OIL PALM Shanusi and Tamshiyacu 62 CONCLUSION EIA would also like the thank the following funders for their support: 64 RECOMMENDATIONS Cox Foundation 67 GLOSSARY OF TERMS AND ACRONYMS Good Energies Foundation 72 MAPPING DEFORESTATION: ONGOING AND PROJECTED Lia Foundation 74 ANNEXES Overbrook Foundation Tilia Foundation 84 WORKS CITED Weeden Foundation BOXES EIA is responsible for the content of this report ©Environmental Investigation Agency 2015. 5 WHAT IS GRUPO ROMERO? No part of this publication may be reproduced in any form or by any means without permission in writing from the Environmental 12 UNDERMINING REDD COMMITMENTS: 3.9 MILLION TONS OF CARBON DIOXIDE Investigation Agency, Inc. The contents of this report do not necessarily reflect the views and opinions of EIA’s funders. EIA is 18 ENVIRONMENTAL IMPACTS OF AGRO-INDUSTRIAL PROJECTS IN THE AMAZON solely and entirely responsible for the contents of this report. 30 LAUNDERING ILLEGAL TIMBER 33 BACKGROUND ON REGULATIONS AND PROCEDURES FOR AGRICULTURE ACTIVITIES 46 “SARAWAK POLITICS IS TIMBER POLITICS.” 58 OFFSHORE TAX HAVENS: A MONEY MAGNET FOR AGRIBUSINESS 61 SOCIAL AND ENVIRONMENTAL IMPACTS OF TROPICAL TIMBER PRODUCTION AND FOREST DEGREDATION EXECUTIVE SUMMARY Governments, donors, technocrats, activists, forward in realizing the vision of deforestation- funneled their profits from harvesting and local communities and diplomats agree: Peru’s free development, and we are firmly committed selling tropical timber7 into oil palm plantations.8 forests must be protected. With 70 percent of its to implement its provisions faithfully.”2 The Start-up capital for palm plantations9 was used national territory covered by forests and 74 Peruvian government nonetheless continues to to purchase new land and clear forests.10 Land million hectares of forest land to its name, Peru promote the expansion of palm oil, claiming that was repeatedly allocated at far below market has resources to protect.1 Yet despite national cultivation will not threaten forests.3 Despite rates and subsequently reappraised for its true and international commitments, a major new protections embedded in Peruvian law to value, with massive profits accruing to palm oil threat to Peruvian forests is being ushered into safeguard forest resources for the benefit of all companies and hidden in offshore accounts the country with open arms: large scale Peruvians, palm oil plantations continue to (See Section 3). The massive allocation of land monoculture oil palm projects. expand at an alarming and increasing rate and forests for cheap and without public Significant commercial groups, both national throughout the Peruvian Amazon, in violation of transparency constitutes, in essence, theft of and international actors, have begun national law. Illegal cultivation of agricultural resources that should be for the benefit of all aggressively pursuing palm oil projects in the plantations poses perhaps the greatest new Malaysia’s citizens—especially those that Peruvian Amazon. These powerful economic threat to the forests of Peru, as the Peruvian depend directly on land and forests for their players have already acquired tens of government currently lacks the effective power livelihoods. (See Section 3.) thousands of hectares of primarily undisturbed to enforce laws and regulations, even when While the links between these companies were natural forest in the Peruvian Amazon for palm illegalities are clearly documented and reported. initially obscured by a complex network of shell oil expansion. Grupo Romero, the largest companies and offshore accounts, a closer look economic actor in the country, already has A NEW FRONTIER at financial records and leaked government data 22,500 hectares of palm oil plantations in reveal a new empire of deforestation that operation and has requested the allocation of Malaysia and Indonesia currently produce 85 reaches across the Pacific Ocean to Peru. The more than 34,000 additional hectares of public percent of the world’s palm oil. Global demand increasingly opaque corporate ownership land for palm oil. If allowed to proceed, the is projected to rise, but land suitable for palm structures are also globally relevant, as they planned projects by Grupo Romero will result in oil expansion is expected to run out in this complicate the implementation and enforcement 4 25,055 hectares of deforestation in violation of region by 2022, and costs of labor are rising. possibilities of recent “zero-deforestation” Peruvian law (See section 1.1 ). The Melka Group, With global demand for palm oil projected to pledges by powerful, multinational a network of companies linked to massive increase, and diminishing available lands in corporations.11 These pledges rely on supply deforestation and corrupt land deals in Southeast Asia, companies are aggressively chain traceability and excluding suppliers that Malaysia, is illegally operating on 7,000 hectares seeking new terrain for oil palm. The Peruvian are responsible for deforestation and human of forest, has acquired over 450 units of rural Amazon provides an ideal environment for rapid rights abuses. However, if responsibility for such private property in the Peruvian Amazon palm growth and the Peruvian state an even acts is obscured through a network of shell (mostly forested) and has requested at least more ideal political environment for palm companies, commodities linked to deforestation 96,192 additional hectares of public land from investors. Peru has announced it has the will continue to enter the supply chain. the Peruvian government (See Section 2). Both capacity to dedicate a minimum of 1.5 million 5 groups have already illegally deforested hectares of land for oil palm. The government massive tracts of forested areas to make way has not been able yet to show, however, where ILLEGAL DEFORESTATION: for agricultural plantations and are set to the suitable available land, as has been FOREST DEFINITION WORD increase their operations. promised, will not have to be deforested. GAMES The fate of oil palm cultivation in Malaysia International donors are dedicating Procedural loopholes and violations of national provides a cautionary tale, as the same unprecedented funds to forest protection in law are facilitating palm expansion in the corporate actors that have decimated Malaysian Peru, with the most recent commitment coming Peruvian Amazon. While forest resources are forests are now pursuing forested land in Peru. from Norway in September 2014 for US$300 protected by national law,12 the Peruvian Logging companies operating forest million to help reduce deforestation. In government has nonetheless approved private concessions, given by politicians to curry favor announcing the agreement, Peruvian President sector requests to clear massive tracts of with local ethnic leaders,6 subsequently Ollanta Humalla noted, “[This]…is a major step forested land—mostly primary forests—for 3 DEFORESTATION BY DEFINITION: THE PERUVIAN GOVERNMENT FAILS TO DEFINE FORESTS AS FORESTS, WHILE THE MALAYSIAN INFLUENCE AND PALM OIL EXPANSION THREATEN THE AMAZON agricultural plantations throughout the country. FAILED GOVERNMENT caused. In February 2015, the Judiciary also The government claims that land is classified OVERSIGHT suspended approval of Grupo Romero’s four according to a technical definition, known as planned projects.19 However, these actions are “best land use capacity (BLUC),” that only Illegal expansion and deforestation carried out only temporary, intended to suspend significant includes soil and climatic characteristics and by corporate groups has not gone undetected. and harmful activities pending further ignores the presence of standing trees. Relying Civil society groups, as well as government investigation and action. agencies and committed individuals within solely on the BLUC assessments to determine the Before further expansion is considered, it is those agencies,