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THE NEW SNAKE OIL? The violence, threats, and false promises driving rapid palm oil expansion in Liberia.


Global Witness

July 23, 2015

Urgent reforms needed to protect citizens and regulate plantation companies.

As Liberia emerges as a new frontier market for the cheapest, most popular vegetable oil globally, Liberians report being beaten, threatened, and arrested for taking a stand against one of the world’s biggest palm oil plantations in the southeast of the country.

State officials are said to be helping the palm oil company Golden Veroleum (GVL) harass communities into signing away their land and crush dissent. Global Witness reveals how GVL accelerated its operations at the peak of Liberia’s 2014 Ebola outbreak, holding meetings with hundreds of people and encouraging illiterate citizens to sign away their land rights when community support groups were staying home for risk of contagion. At this time GVL almost doubled the size of its plantation.

This behaviour hasn’t discouraged the world’s major banks from offering their services. Standard Chartered, HSBC, and Citibank alone hold shares in GVL’s parent company – Golden Agri-Resources (GAR) – worth nearly US$ 1.5 billion.

The case of GVL risks becoming the first chapter of a longer narrative of dispossession and abuse. Liberian President Ellen Johnson-Sirleaf has made agriculture a central pillar of the country’s development strategy, making repeated – yet so far unfulfilled – public assurances that palm oil will lift poverty in rural areas. In response to early protests at GVL’s plantation she called those who spoke out against the company “unpatriotic” as they risked discouraging future investors.

Hear from communities about signing deals with GVL, called Memorandums of Understanding (MoUs).

GVL has bought the rights to convert 2,600 km2 of southeast Liberia into an oil palm estate – an area the size of London and Barcelona combined. Its contract is valid for up to 98 years, affecting some 41,000 people.

Public meetings where landowners were encouraged to hand over their land to GVL were watched over by powerful local officials, and in at least one case armed police. Global Witness also documents several accounts of violent assaults and arbitrary arrests of those who voiced their concerns.

The benefits offered by GVL to communities in return have been negligible. Those willing to work for the company are promised access to free medical support and schools. For non-employees, the most tangible negotiated benefits Global Witness could find evidence of were six toilets.

The violence and intimidation documented in Liberia parallels a disturbing global trend of increased attacks on human rights activists who protect the environment and defend their land. Activists are being killed in record numbers, threatened and criminalised for standing in the way of so-called ‘development’. 

Ten percent of Liberia is now earmarked for agricultural plantations – an area three times the size Beijing. This rapid expansion is taking place in a legal vacuum. There are no laws in Liberia to govern how agriculture companies should be awarded contracts, how they should operate, or how they will be held to account.

Global Witness is calling on Liberia’s government to investigate acts of violence, pass a law recognising that rural communities own their land, and regulate the country’s agriculture sector to bring an end to the impunity enjoyed by plantation companies.

Watch the rate of GVL expansion in Liberia from 2011 – 2015 here.  

GVL and GAR have denied wrongdoing. GVL stated that it has played no part in the intimidation of community members in its plantation area and that its operations between August and October 2014 – when the Ebola outbreak was at its peak – were part of its long-term plan. GAR has acknowledged that its operations have experienced “challenges” but that it is working to improve its procedures. Representatives of HSBC and Citibank stated that its shares in GAR are held “in custody” for other ultimate (beneficial) shareholders.

Read full responses from GVL here and here, from GAR here. Communication from one of GAR’s investors Kopernick Global Investors, can be found here.

Read The New Snake Oil report here

Download the press release here 

FIND OUT MORE

Alice Harrison, Communications Adviser

aharrison@globalwitness.org

+44(0)7841 338792

Nigeria approves N33bn intervention fund for meter procurement


Nigerian Tribune

by Gbola Subair

The acute shortage of electricity meters in the country will soon be a thing of the past as the Presidency has approved the sum of N33 billion intervention fund for its procurement.

The fund, which attracts a very low interest rate, will be made available to Distribution Companies (DISCOs) to buy meters and other electricity accessories with a view to bridging the meter deficit gap which is about three million yearly.

The Director-General of the Bureau of Public Enterprises (BPE), Mr Benjamin Ezra Dikki, speaking in Abuja, also gave an assurance that the fixed charge currently borne by electricity consumers in the country would be dispensed with as soon as power generation increases to an economically sustainable level.

The director-general, who said the fixed charge was a temporary measure, appealed to electricity consumers to bear the burden, as it would soon be abolished, noting that the country had an installed power capacity of 6,000 megawatts, but was generating only about 3,000 to 4,000 megawatts. 

The BPE boss stated that the revenue from the 3,000 megawatts was not sufficient to support the power infrastructure.

”When power generation increases, the fixed charge will go,” he maintained.

According to him, it was the initial sacrifice consumers had to make given the huge financial investment made by the new power investors who are yet to obtain adequate returns on their investments.

Dikki added that as what obtained at the initial stages of the reform in the telecoms sector, when the cost of   the Subscriber Identity Module (SIM) cards and telephone handsets was as high as N50,000 per SIM, “the electricity fixed charge will also crash.”

Dikki debunked claims of lack of transparency in the privatisation of Kaduna Electricity Distribution Company (KEDC) and the picture created of a conflict between Geometrics Power Group and Interstate Electrics Ltd, the core investor of Enugu Distribution Company.

On KEDC, he said the reserved bidder could only be invited to step in if the preferred bidder failed to pay.

He added that the preferred bidder was, within the time limit, to pay the 75 per cent balance of the bid price after an initial payment of 25 per cent had been made.

The director-general said it was wrong for anybody to call for the revocation of the sale, as the process had to complete before reversion to the reserved bidder could be made.

On Geometrics, Dikki explained that it had a 20-year contract with the Enugu Distribution Company to supply power to the Aba and Ariaria districts, which is not in contention.

“Both parties are aware of this but it baffles me when people go out to deliberately distort the facts. We don’t understand the hue and cry that Geometrics is short-changed in the transaction,” he said.

South Africa: Gordhan’s war on incompetence and impunity


Mail & Guardian

By Faranaaz Parker

July 24, 2012

Finance Minister Pravin Gordhan has revealed plans for the national treasury to take a much tighter grip on local governments‘ finances. See the full report here.

Following the release of a damning report on the scale of mismanagement at municipal levels, Finance Minister Pravin Gordhan on Monday revealed that the national treasury would take a tighter grip on procurement processes across the country.

Gordhan announced that treasury would create a procurement oversight unit to actively enforce supply chain management at a national level and would shortly appoint a chief procurement officer. The position would be advertised in two weeks and would be established within the next two months.

“Where there are transactions for a particular size or type within the national domain there must be the ability to assess whether they meet market criteria in terms of prices [and] whether proper processes havebeen followed,” he said.

The announcement was an indictment of local government’s failure to spend and account for public money effectively.

The minister was speaking at the release of auditor general Terence Nombembe’s report on local government audit results, which showed that only 5% of all municipal entities – a total of 13 – had achieved clean audits for the year 2010/2011.

Gordhan said IT systems would be developed to allow the treasury to actively monitor compliance with financial management requirements so that it may demand information regarding procurements, such as how decisions were made and by whom.

Spending fiascos

The move may help prevent public spending fiascos such as the multibillion-rand leasing scandal that saw former police chief Bheki Cele and former public works minister Gwen Mahlangu-Nkabinde sacked last year.

Gordhan said the government should be able to demonstrate that there were consequences for nonperformance and for working outside the law.

“At the moment, those consequences are not there. When consequences are not there continuously then a level of impunity develops,” he said.

He said the new oversight mechanism would require the help of law enforcement agencies, who would bear the responsibility of preparing cases against and prosecuting those guilty of corruption.

With reference to the auditor general’s report, Gordhan said he was particularly disappointed that some large metros, which had better skills and capacity than small municipalities, did not received clean audits.

“If they can’t meet simple criteria in financial management, then it’s a matter the treasury has to take a closer look at,” he said.

Nombembe’s damning report
Nombembe’s report showed there were three root causes behind the slow progress towards clean audits in local government.

The biggest problem, he said, was a general lack of consequence for poor performance. Modified audit results were simply considered the norm, he said.

In addition, over 70% of those audited did not have the minimum competencies and skills required to perform their jobs.

Worryingly, over half of the municipalities audited were slow in responding to the auditor general’s suggestions and were not taking ownership of key financial controls.

Nombembe said if these issues were not addressed, they would continue to weaken governance.

He also complained that most municipalities employed consultants in areas where they already had people to do the work, and even then the results were not as good as they should be.

Cedric Frolick, National Assembly house chairperson, agreed, saying: “What are the employees doing when 70% of the work is being done by people who must be paid for it on top of their salaries?”

“Why are people who are not doing their job, being allowed to keep on [not] doing it?”

Meeting the criteria
But Minister in the Presidency responsible for performance, monitoring and evaluation Collins Chabane said because of the way the three spheres of government were structured, it was difficult to make interventions in local government unless specific criteria had been met.

“It creates a complication where no other authority can intervene, by law, until that municipality makes a decision,” he said.

Chabane said in future, the performance of departments and institutions may be linked to the performance of the heads of those institutions.

“That will begin to bring accountability,” he said.

Meanwhile Subesh Pillay, chairperson of the South African Local Government Association, said it was important to remember that clean audits were a means to an end.

“That end is to ensure that local government become efficient and effective organs of service delivery,” he said.

UN Seeks Controls on Private Armies


IPS

July 12, 2011

By Sunaina Perera

The UN Working Group on Mercenaries has urged the international community to regulate private military security contractors (PMSCs).  A draft resolution has already been submitted to the UN General Assembly and Human Rights Council. However, countries that heavily use PMSCs (predominately in the West) are reticent to pass a legally binding resolution. PMSCs have perpetrated armed and sexual violence with impunity. Thus, the lack of accountability mechanisms between PMSCs and governments are disconcerting and urgent action is necessary to ensure that PMSCs are adequately regulated.

With U.S. and Western military forces planning to gradually withdraw their troops from Iraq and Afghanistan, there will be an increasing demand for private military contractors to provide security in both politically-troubled countries.

As a result, the number of military contractors is set to reach 5,500 in Iraq alone, according to a U.N. Working Group on Mercenaries, prompting demands for a specific international instrument to regulate their activities.

The members of the Working Group have stressed the importance of establishing international guidelines and legislation when dealing with Private Military and Security Companies (PMSCs)…Read more.

South Africa’s new labour policy: an analysis


by Anthea Jeffrey, The South African Institute of Race Relations, February 8, 2011

The Cabinet used the festive season to unveil five new bills: four labour, one on land. All five supposedly aim to help the poor, but their predictable effect will be to worse unemployment and build dependence on the State. Apart from the controversial Protection of Information Bill, these five bills are the firs major legislative intervention by President Jacob Zuma’s administration. They bode ill for South Africa, as the Institute’s in-house legal expert, Dr Anthea Jeffrey, explained at a briefing in Johannesburg on February 2011…In addition, the outsourcing of cleaning and other services has become an important way of promoting the preferential procurement required by the BEE of good practice. Under the bill, however, of a major corporation outsources or sub-contracts its catering needs to a BEE firm, the corporation will be liable for unfair labour practice by the BEE entity. As the RIA warms, this could ‘create a significant disincentive to supply chain diversification and have a negative impact on small business and job creation.’ Read more

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