After coming under fire from environmental and social justice organisations for violations of land protection laws, Herakles Farms, a New York-based agricultural company, has suspended a large, controversial palm oil project in Cameroon.

The announcement comes after the Cameroonian government ordered the company to halt its operations, saying the project had failed to obtain necessary permits. Critics of Herakles’s Cameroon plans are celebrating the decision as a victory for the power of local community activism, though the suspension is currently seen as merely temporary."If you think you’re going to go into an African country and do as you please to make some quick money, it now turns out you’re in over your head." -- Anuradha Mittal of the Oakland Institute

“People on the ground are celebrating, and the suspension is being viewed as recognition of the [Forest] Ministry standing up for what is right,” Anuradha Mittal, executive director of the Oakland Institute, a U.S. watchdog group that has followed Herakles Farms’ Cameroon project for years, told IPS.

“In fact, what it shows is that it’s communities on the ground that will make governments honourable – and that’s what democracy is supposed to look like. This is sending a strong message that African countries are open for business, but they’re not open for theft.”

In a 2009 agreement, the Cameroonian government authorised a Herakles Farms subsidiary to develop more than 73,000 hectares for new palm oil plantations. Much of this forestland has reportedly already been cleared, and the company says it is currently in the process of transporting saplings to the plantation areas from nurseries.

Yet local NGOs have increasingly accused Herakles Farms of ignoring community concerns and failing to comply with both court mandates and a government injunction. The company’s decision to suspend the operation now comes following a mid-April order from the Forest Ministry that the company halt a logging operation in the Cameroonian southwest.

A request for comment from Herakles on Friday was not responded to by deadline.

Ministry officials say Herakles has failed to attain two required permits, with Forestry Minister Ngole Philip Ngwesse noting Thursday that previous agreements between the company and government don’t “exempt” Herakles from following “legal procedure”.

Ngwesse said his office was forced to act following grievances lodged by local communities. Authorisation to resume operations is now based on a “declaration of public usefulness”, according to the ministry.

In announcing the suspension of work, Herakles stated that it “always has and will comply fully and transparently with government regulations in force” and that it “hopes to understand and resolve these actions” by the ministry. Noting that nearly 700 employees involved in the project could now be furloughed or laid off, Herakles said it “finds these events especially tragic”.

Need to “safeguard reputation”

Yet according to Mittal, newly released evidence of Herakles’s internal operations suggests that moving forward could be complicated for the company, which says it has invested some 350 million dollars in the Cameroon project.

“Given the other evidence that we have of the company’s mismanagement, it will be interesting to see how exactly they decide to handle this,” she says.

“After all, this could now undermine a misconceived business plan. If you think you’re going to go into an African country and do as you please to make some quick money, it now turns out you’re in over your head – and there’s no way to fix that quickly.”

Earlier this week, the Oakland Institute and Greenpeace International jointly released a report highlighting wide discrepancies between how Herakles was presenting its projects in Cameroon to investors and consumers and the environmental and social impacts on the ground.

At the heart of the issue is Herakles’s presentation of the Cameroon project in a way that emphasised its purported environmental sustainability and beneficial impact on local communities – the company even began its own development group, called All for Africa. Yet internal documents included in the report now show that executives at Herakles were aware of the legal holes in the investment.

One e-mail between company executives called the management situation in Cameroon “pathetic” with a “grossly overstaffed office”, and urged “formal approval from the government for land concession”. The e-mail also warned that the situation in Cameroon should be addressed “to safeguard Herakles investments and reputation”.

“What’s really unique about this [instance] is the web of lies and deceit,” Samel Ngiuffo, director of the Center for Environment and Development, a Cameroonian NGO, told reporters this week. “It’s not just to consumers … it’s to investors and the Cameroonian government.”

Chief among these allegations is that Herakles, despite denials to the contrary, began clearing forest and developing palm nurseries before obtaining certificates required by Cameroonian law. According to the report, some evidence suggests that the projects have been in violation of those laws since 2010.

Herakles has also touted the project’s employment potential. Its corporate website, for example, states that the company has developed a “staffing plan and will work closely with village leaders to identify and train candidates and employ as many of those seeking employment as possible.”

Yet a convention Herakles signed in 2009 allows the company to pay according to minimum wage scales “fixed on the basis of productivity and efficiency criteria”, rather than according to Cameroonian minimum wage laws.

“Small-scale farmers who are already producing cash crops like cocoa are making far more independently operating than they would be as labourers in a Herakles plantation,” Brendan Schwartz, a forest campaigner with Greenpeace International, told reporters this week.

Additionally, Herakles Capital, an affiliate company, is a member of the Roundtable on Sustainable Palm Oil, a group designed to set and monitor environmental standards for such investments. The group formally prohibits its members from using so-called high conservation value forests (HCVF), or forests designated as ecologically, economically or culturally vital, for palm plantations.

Despite this, the new report points out that the Germany Agency for International Cooperation (GIZ), among other monitoring groups, has indicated that “part of the [Herakles] concession area has to be considered as HCVF.”

Now, the Cameroonian government’s strong position on the Herakles project shouldn’t be read as an attempt to close the door on foreign investment, the Oakland Institute’s Mittal cautions.

“The ministry is not saying that Cameroon is a bad place to invest,” she says. “It’s just saying that investors need to follow the proper regulations.”

Nasako Besingi (l), the director of the local NGO Struggle to Economize the Future, has been arrested an intimidated by police because of his protests against a controversial palm oil planation development in Cameroon’s Korup National Park. Courtesy: Frank Bieleu/Oakland Institute.

By Monde Kingsley Nfor
YAOUNDE, Dec 20 2012 (IPS)

Protests against a controversial palm oil plantation in the Korup National Park, Africa’s oldest and richest rainforest in terms of floral and faunal diversity, in Mundemba, southwest Cameroon will continue despite the arrests and intimidation of local environmental campaigners.

Nasako Besingi, the director of the local NGO Struggle to Economize the Future, told IPS “we won’t stop until environmental justice is done.”

The New York-based agricultural company, Herakles Farms, has been accused of grabbing a piece of this central African nation’s national forest as it goes ahead with a 73,000-hectare palm oil plantation despite a lack of government authorisation – there are claims that the 99-year lease agreement with the government is illegal – and two court injunctions, and in the face of significant community opposition.

The contested land is a “biodiversity hotspot”, a critical area that connects five protected areas in the park, and the project will disrupt the protection and growth of important wildlife, the German Agency for International Cooperation (GIZ) said in an environmental and social impact assessment in August.

A report issued in September by two Cameroonian NGOs, the Centre for Environment and Development and Réseau de Lutte contre la Faim, said “there are over 20 villages with ancestral lands inside the concession, and 31 villages within a distance of the periphery, and over 25,000 people will be affected by this. They depend on that land for small-scale food production, hunting, and non-timber forest products.”

About 46 percent of Cameroon’s 20 million people live in rural areas, but according to a USAID country profile on property rights here “only approximately three percent of rural land is registered, mostly in the names of owners of large commercial farms.” The country is ranked 131st of 169 countries on the 2010 United Nations Human Development Index, partially due to persistent poverty.

Besingi said that he and his colleagues have endured police suppression, arrests and intimidation. His latest arrest was on Nov. 14, when the country’s national military police stormed his office.

“We were told we were required for questioning at the police post, and were detained for a day without charge. But it was only following international and local pressure that we were released (on bail) under the condition that we must appear before the authorities whenever we are (asked),” he said.

Besingi explained that the palm oil plantation project was going ahead despite the lack of a formal government agreement, because Sustainable Oils Cameroon (SGSOC), a subsidiary of Herakles Farms, had the support of those in power.

“SGSOC enjoys support from some elites, the chief of Fabe village (which is on the project site) and some government representatives, including the police. They have been bought over with money and material things. These groups of people, including the government, are misleading the people,” he said.

Excerpts of the interview with IPS follow:

Q: What is your interest in this campaign against SGSOC/Herakles Farms?

A: We cannot just sit and allow a few individuals to ruin the lives of thousands. So we have to make our voices and those of the voiceless heard.

Giving so much forestland to a company that has no real development plan for the people is injustice against a people who cannot have access to one-third of the forestland. Many locals feel there are already too many protected zones in the (forest). This massive plantation will further restrict their access to land.

Q: Bruce Wrobel, CEO of Herakles Farms, said in September that the organisation was already employing more than 500 people, and has committed to hiring among the local villages. He said that once the plantation was fully operational, it would require approximately 8,000 employees. Is this not an opportunity for the people?

A: There is little evidence that large-scale plantations will effectively bring economic development to this area. Past experiences in the country show such promises … to be false. Instead, large plantations have resulted in massive environmental degradation, the destruction of livelihoods, and the transformation of small-scale farmers and indigenous populations into low-paid plantation workers.

The company claims that it will create 8,000 jobs. However, the plantation will economically displace approximately 25,000 people who depend on that land for small-scale food production, hunting, and non-timber forest products. Thus, the net impact on employment will actually be negative.

Q: What is the problem with land management issues in Cameroon?  

A: There are two fundamental problems in my opinion. Firstly, communities do not have legally-recognised land rights that secure their access to the vital natural resources that they depend on; and secondly, Cameroon is still to develop a national land-use plan which would, in principal, evaluate the needs of local communities before granting foreign investors access to land.

Q: What would you want SGSOC/Herakles Farms to do before operating?

A: We demand that SGSOC respect Cameroonian law and the rights of communities.

Unfortunately, SGSOC has repeatedly violated Cameroonian law. They have signed an illegal contract with the government, and have shown no respect to local communities who, on the majority, oppose the project.

Following the 1976 law governing the allocation of concessions on state lands in Cameroon, subsequent to signing the lease agreement, SGSOC was supposed to be given a presidential approval to start cultivation activities. But this was not given, so the project has been in violation of the law since 2010. Moreover, prior to its operations, an environmental and social impact assessment was not conducted.

Q: What is the opportunity cost for the SGSOC/Herakles project? 

A: The opportunity cost for this project is the loss of forest revenue through the payment of environmental services, ecotourism and REDD+ activities.

All these activities can generate more revenue for the state than SGSOC can. For example, the Cameroonian Food Sovereignty Coalition estimates that if the government were to require bread makers to use 20 percent of locally-produced flour, 96,000 farming jobs would be created using just 15,000 hectares of land.

This would generate 13 times more employment and significantly larger government revenue than the SGSOC project and would leave land for peasant agriculture, conservation, and the use of non-timber forest products.

Q: What next with your campaign against SGSOC/Herakles farms?

A: We won’t stop until environmental justice is done. We want a new agreement that takes into consideration the sustainable management of that forest and that gives the locals better access to land and alternative livelihoods. We are currently working with more than 20 community groups and international and local NGOs and using every possible channel, like IPS, to reach the international community.

Environment groups are accusing a New York-based agricultural company, Herakles Farms, of going forward with plans for a 73,000-hectare palm-oil plantation and refinery in southwest Cameroon despite a lack of government authorisation, two court injunctions, and in the face of significant community opposition.

Because Cameroon is a major new palm-oil producer, many worry that what happens with the Herakles deal could set a precedent for the entire continent. Credit: One Villiage Initiative/CC by 2.0

On Wednesday, the Oakland Institute and Greenpeace, two environment watchdogs based here in the United States, released a report suggesting that the project, situated in what is described as a biodiversity hotspot between four major conservation zones, could negatively impact up to 45,000 people.

The groups warn that the project, which is linked to the Blackstone Group, a massive investment group, represents the vanguard of a new “scramble for land” in Africa by Western companies.

“Herakles claims to be engaged in improving Cameroon’s food security and humanitarian situation, but we have found this to be a total fraud. In fact, they are about to destroy the livelihoods of thousands,” Frederic Mousseau, the report’s author, said in a media call Wednesday.

“Likewise, Herakles claims local support, but we found this to be a blatant lie. Finally, the claim that this land is secondary forest and degraded is misleading. In fact, large portions have never even been logged.” (By deadline, Herakles officials had not responded to requests for comment.)

The project, overseen by a Herakles subsidiary called SG Sustainable Oils Cameroon (SGSOC), is still at an early stage, currently consisting of three large nurseries. “We are now waiting for an official decision by the Cameroon government to proceed beyond these nurseries,” Mousseau says. “So this is an important moment – the project can still be stopped.”

The backlash against SGSOC took on new energy over the past week, following the Aug. 24 notification that Herakles was removing the project from formal compliance with a set of eco-friendly industry guidelines called the Roundtable on Sustainable Palm Oil (RSPO).

In explaining the move, Herakles, which describes itself as “committed to addressing the complex issues of food security through sustainable agriculture initiatives”, cited the length of time its RSPO application had been pending, while noting that it was “addressing a dire humanitarian need” in Cameroon.

No formal approval

The legality of the project’s nurseries has already been called into question. Although SGSOC did sign a 99-year agreement with the government in 2009, Cameroonian law requires that the use of such large tracts of land have direct presidential consent.

Given that such a decree has yet to be given, activists suggest that SGSOC had no legal basis on which to start bulldozing the forestland and cocoa and vegetable farms on which local communities depended.

A local judge has filed two injunctions against the company’s actions, but according to local observers the company has refused to comply.

“Not only do they not want to comply with existing law, but the company has clearly turned its back on sustainable practices,” says Samuel Nguiffo, a lawyer and director of the Center for Environment and Development, in Cameroon’s capital, Yaounde. “The government structure in our country is very weak, so we’re asking the U.S. to stop the company.”

Herakles officials do say they have received community support for the project, but eyewitness accounts suggest that this is patchy at best.

“When the company came here, they said that this project had (already) been authorised by the president of Cameroon … So we just kept quiet,” Edward Ndomo, the chair of the local traditional council, told Oakland Institute researchers for a new documentary. “We never had any full meetings with the company.”

Marie Meboka Boya, a member of Parliament representing the area in which the nurseries have been built, told researchers that she thinks the company has taken a “buy-off approach”, offering small amounts of money or food in return for some local backing.

“From the reaction of the community and the dodgy attitude of the company,” she says, “I know that there is no proper agreement.”

Scramble for Africa

The Herakles project is one of a large number of new foreign-invested land deals in Africa. And despite its significant size, it is not the largest – in Congo, for instance, a deal of a million hectares have been discussed.

“There are so many Europeans and Americans looking for new land in Africa right now, we’re worried that a land-rush may be imminent,” Greenpeace’s Rolf Skar says.

Because Cameroon is a major new palm-oil producer, many are now suggesting that what happens with the Herakles deal could set a precedent for the entire continent.

“If we confirm the bad deal we have now, all the companies coming in will have as bad a deal as Herakles,” says Nguiffo. “Cameroon and neighbouring countries are currently experiencing a huge demand for land, and land grabs at this scale are very new for us – it’s frightening.”

Nguiffo says that while Cameroon currently has about 500,000 hectares of land under plantation, mostly on old farms, over the past three years demand for land has shot up to nearly three million hectares, driven by foreign investors backed by pressure from foreign governments and multilateral lenders.

“Donors and international financial institutions have increasingly been asking African countries to open up their economies, despite the fact that in most of these countries there is very little rule of law,” says Anuradha Mittal, the executive director of the Oakland Institute, which in recent years has researched about 70 of the new industrial-scale land deals.

Almost all of these deals, she says, are marked by a lack of both transparency and local involvement, as well as an absence of the many benefits promised to local and national economies – jobs, growth in gross domestic product, the construction of new clinics or water sources for local communities.

“There have also been a lot of myths around who the investors are,” she says. “It’s not just the Chinese or Indians or the Gulf states. The number of investors from Europe and U.S. is huge, including private equity and hedge funds, all looking for opportunities in the next soft commodity.”

Development for whom?

Still, certain oversight trends have changed in recent years, as consumers become increasingly aware of labour and environment issues around the world.

“A company has to sell its product somewhere, and these practices are in direct contrast to other producers and buyers – Kraft, Nestle, Unilever – which are asking for much higher standards for the palm oil they purchase,” Greenpeace’s Skar says. “Herakles is falling off the cart on this issue and will have to answer to its shareholders as to why.”

For many advocates, the issue comes down to the type of development that the international community is pushing.

“Today the big push is to get rid of the millions of smallholder farmers in Cameroon, to transform them into low-paid labourers on large farms,” Greenpeace’s Mousseau says.

“In today’s development discussion we’re told this is necessary, and we give legal and fiscal exemptions to investors. But we don’t actually see any development resulting from investments – what we see is exploitation of human and natural resources.”