Friday, November 12, 2010

London Sumatra: the Myth of Sustainable Palm Oil

Surrounded on all sides by swathes of oil palm plantations lies a village of indomitable residents that have for many years waged an ongoing battle to regain the land that was stolen from them during the Suharto dictatorship and ended up in the hands of the plantation company, London Sumatra. The village, Pergulaan in the Indonesian province of North Sumatra is by no means unusual in that regard, cases of land seizure are ubiquitous in Sumatra, affecting 250,000 families in North Sumatra alone1. Along with rainforest destruction, Indonesia's plantation industries are founded on the dispossession of peasant farmers.

The case of Pergulaan is important to highlight however, because the company, London Sumatra(Lonsum), formally British-owned but now bought out by the Indonesian Salim group, last year obtained certification from the Roundtable for Sustainable Palm Oil (RSPO), an initiative designed to clean up the image of the palm oil industry by marketing environmentally and socially sustainable palm oil. The thing is, in the criteria for certification it states very clearly "Criterion 2.2 The right to use land can be demonstrated, and is not legitimately contested by local communities with demonstrable rights2." The public summary report issued prior to granting RSPO certification to Lonsum 3 is equally clear: "For the moment, there is no land dispute".

We might wonder how TÜV Nord Indonesia, a branch of the German Multinational, managed to miss this conflict, because it really should be quite clear to anyone investigating Lonsum, in fact it is one of the most well-known conflicts in the region. 15 hectares of the disputed land was reclaimed and replanted by the people and the occupation and subsequent eviction was covered by local and national media. A case is still open and being considered in the Supreme Court. Two of the villagers still hold the original certificates giving them the right to use the land.

But the auditors TÜV managed to miss this obvious omission and as we will see below, it turns out that that wasn't the only thing they overlooked. It is clear that on many accounts Lonsum should never have recieved certification.

That was over a year ago and since that time big environmental NGOs have garnered attention for their challenges to other RSPO certified oil palm companies over big environmental issues such as tropical forest destruction. Multinational companies such as Unilever have cancelled their contracts with Sinar Mas, a prominent member of the RSPO, for this reason. Of course it is understandable that big environmental NGOs like friends of the Earth and Greenpeace choose to strategically target the big environmental issues such as global climate change and deforestation, rather than protracted injustices faced by small communities. But a closer look at the Lonsum case can give us a better understanding of the fundamental unsustainability of oil palm and other plantation agriculture.

The land that is now controlled by Lonsum was forest until it was opened up by local people for agriculture in 1939. That was still the Dutch colonial era and the forest land at that time was part of an undeveloped concession of a rubber company. After independence in 1945, the new Indonesian government attempted to redress the injustices of the Dutch system by granting each family the right to 2 hectares of land to farm. After a survey in Pergulaan, this was eventually granted in 1954, and certificates denoting the right to use land were handed out.

In 1968 the company Horison and Crossfield, which was to become Lonsum, was granted Business Use Rights to the old rubber concession, with the exception of the land which was being farmed in Pergulaan. Yet it was clear that Lonsum had an eye on that parcel of land as well. Then in 1974 the farmers of Pergulaan were asked to hand in their land certificates to be exchanged for new ones. They were never returned and instead people were evicted from 125 hectares of their land and the homes that were built on it. They were forced to sign a letter accepting compensation, not for the land itself, but for the plants planted on it, and this compensation came from the police, not from Lonsum. A further eviction from 5.6 hectares of land took place in 1984.

Similar evictions were happening all over Sumatra at this time, but people did not feel able to resist the Suharto's military regime, which had already massacred 500,000 members of the Indonesian Communist Party in 1965 and still held this as a threat over those who might wish to revolt in the future. As Suharto fell in 1998 however, a vast movement rose up to reclaim the stolen land and re-establish themselves as farmers. In different communities this movement took different forms. Some communities merely put their trust in NGOs and other bodies who offered to help pursue their claims through legal channels.

But Pergulaan was fortunate to have a strong sense of community spirit. People there are by-and-large  poor, many being forced to work as farm labour on other people's land far away, past the borders of the oil palm. But they are used to pooling their resources and working together. When I visited, people pointed out how almost everyone had good houses, despite their low incomes, and explained that it was due to the culture of 'gotong-royang', helping out your neighbours when they need it.

So when it came to the time when some of the oil palm trees were no longer productive and due to be replanted, the 300 dispossessed farmers got together and occupied some 15 hectares of the disputed land. They planted crops such as banana, corn, cassava and peanuts and managed to defend the land through two harvests before being evicted by 700 company guards on 23 October 2007. The proceeds of the sale of the crops obtained was used to meet legal costs in the court process to regain the land. Throughout the occupation they had to contend with repression of different kinds, including 11 people being sentenced to one year of prison for damage that they caused to the plantation by planting bananas.

After the eviction, Lonsum responded by digging a 3 meter deep trench all around the village, defending their vast plantation from this small enclave of farmers, isolating the residents and of course causing a great danger for children and animals. Yet the community remains strong and is ready to take action again, if it is seen as strategic useful for their struggle.

Certified for what?

While some dream of making a simple living farming their own piece of land, others on a entirely distinct plane of reality give themselves the grander ambition of creating an false image of  this irredeemably destructive industry that is compatible with the half-hearted ethical concerns of the global market. This was the job of  TÜV Nord Indonesia, charged with giving an ethical audit to London Sumatra's oil palm estates.

An Indonesian NGO, Sawit Watch, wrote to TÜV over four months ago asking for an explanation of how it was possible that this conflict was not considered relevant in the evaluation of the RSPO application. The company has yet to respond, and Sawit Watch suspects that they actually did not find out about the conflict.

A public summary of the TÜV's evaluation of all Lonsum's sites in the province of North Sumatra is available online3. To take a look through it does not give the impression that someone has carried out any thorough research. Some statements in the report seem to have been lazily cut-and-pasted from some spurious piece of corporate propaganda. Take this as an example: "Despite Lonsum cultivating its plantations for >100 years, the fact that some High Conservation Value areas are still found is testimony to the management’s concern for the environment".

Lonsum's operations in the province comprise 12 oil palm plantations and 4 palm oil mills. Yet aside from the company,  TÜV chose only to interview a selection of 11 stakeholders, mostly village chiefs or other local government representatives, as well as a couple of local NGOs and the representative of a trade union at one site. The results of this consultation are presented as a response to the questions asked, and it turns out that all the responses are positive towards the company. But the data presented seems to be the responses of one interviewee, no indication of how this could possibly be a synthesis of the responses of all 11 organisations questioned. The only feedback to the question about land conflicts for example, merely states "No, the company obtained the land a long time ago, and there are no current conflicts". It is unclear which of the plantations was being referred to in this statement.

Clearly a reliable investigation of the company's behaviour would require seeking the opinion of several people and organisations around each plantation. RSPO-certified status could potentially make or break contracts worth many millions of euros, yet it seems increasingly shoddy, only with the purpose of giving a green light to this destructive industry.

At their Rambung Sialang plantation which surrounds Pergulaan village Lonsum do not even have the permit to operate a plantation (Izin Usaha Perkebunan). There is documentary evidence for this as well, I was shown a letter from the head of the local branch of the forestry and plantation service to the Pergulaan village chief. It seems that they didn't renew it because that necessarily entails a review of the boundaries of their plantation. As would be expected the RSPO criteria request "...compliance with all applicable local, national and ratified international laws and regulations" , but this one too slipped through the net of the auditors.

Worker's issues

I decided to check out the situation at another of Lonsum's North Sumatra estates, Turangie, in the Langkat Regency of North Sumatra, by talking to someone from Kelompok Pelita Sejatera, who works with the workers on that plantation. It seems that Lonsum fails to meet several of the RSPO criteria around working conditions to. For example workers are paid slightly lower than the minimum wage which is established by the Langkat local government in consultation with employers and unions. The RSPO demands that "Pay and Conditions... at least legal or industry minimum standards".

My contact explained that whilst health and safety issues are accorded more attention at Lonsum than the dire conditions in some other oil palm plantations, there are still major gaps. Safety equipment is provided, but is of poor quality, as are the harvesting tools, and this is a frequent cause of accidents. Women who spray herbicide complain that it drips down their back, causing black stains and itchy rashes. There is propaganda about health and safety all around Lonsum's plantations including sculptures with a safety message, something which surely impresses the RSPO auditors. Yet no training on health and safety is given, and this maybe played a part in the four potentially avoidable fatal accidents that took place in Turangie in the last decade.

I heard also about other issues which do not fall under the radar of organisations like the RSPO but are surely a big deal in the life of workers. Such as how Lonsum manipulates their employee records to deny workers the benefits of a fixed contract, which they should be entitled to after three months of work. Workers are also obliged to each month undertake tasks additional to their already-exhausting regular work, such as clearing dead branches, which is compulsory but paid ridiculously little.

Hearing more about the conditions of plantation workers highlighted the sharp difference between their lives and those of independent farmers. The plantation system has inherited much from its colonial beginnings including the means of social control. Plantation villages are usually in the middle of the plantation, where the workers can be kept isolated. They are constantly watched by security whose vigilance not only protects company property but also ensures that their workers behave appropriately and subversive activity will be nipped in the bud. There is a paternalistic system enforced which brings families under the company wing. So each employee receives part of his (in this system the wage earner is always male) salary in rice, 15kg a month along with 9kg for his wife and 7.5 kilo for each child. The wife is usually the person called upon to do the unmanageable additional work referred to above, or needs to look for a job with the company spraying chemicals to support her husband's low income.

At the age of 55 workers retire with a pension, but have to leave their house in the plantation village. This is a huge contrast to a free village like Pergulaan where the community grows from generation to generation, supporting the young and the old together and building up the strength, trust and solidarity which makes daily life more pleasant and brings a unity in key moments, such as times of struggle. This form of interaction and social integration is something which plantation owners have had to break in order to exist in the first place. Neither peasant agriculture nor plantation labour bring great wealth but the difference in freedom is unquestionable.

The RSPO system in the case of Lonsum can clearly be seen with merely a superficial glance to be an utter sham constructed by some wise monkeys to promote the needs of a destructive industry. While it is important to point out this manipulation, it is nevertheless vital to bear in mind that some minor tinkering will set the system right. Any real notion of sustainability must include the necessity that local people are the stewards of their own land in free communities that know how to take care of it for the generations to come. Farmers know this and that is why they continue the struggle for that land. Neither oil palm as a crop, nor large plantations as a system of agricultural production, can bring any useful contribution to ecological or social sustainability, that much is quite clear.

3. . Note this document is no longer linked from the main RSPO site. However it is still downloadable

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