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The World’s Thirst for Palm Oil Is About To Destroy Asia’s Largest Remaining Rainforest

The demand could spell disaster for Indonesia’s Papua province.

By GRID-Arendal

August 16^th, 2021

This story was supported by GRID-Arendal's Investigative Environmental Journalism Grants programme. Learn more.

By Peter Yeung

Around a decade ago, outsiders began to appear more and more regularly on Linus Batia Omba’s land. Sometimes these were shabby-clothed labourers, at other times they were bespectacled men wearing shirts. Often camouflaged soldiers wielding rifles would be in tow.

Before then, the 32-year-old tribal chief often saw great beauty in his remote corner of Papua, Indonesia’s far-flung eastern province: rainbow birds of paradise, the glint-eyed New Guinea crocodile, and the cassowary, a large ostrich-like creature that is one of the world’s closest living descendants of dinosaurs.

But they started to disappear, says Omba, leader of the indigenous Mandobo clan of Papua, which has occupied that pristine tropical rainforest since long before colonising Dutch missionaries arrived hundreds of years ago.

“Poachers came to catch the animals using guns, snares, dogs and night flashlights, slashing with machetes, and sometimes using poison for fish and shrimp – cutting our food supply,” he told VICE World News. “Rivers and streams became dirty, so we could no longer drink the water or wash and bathe in them because we would get sick.”

“Rivers and streams became dirty, so we could no longer drink the water or wash and bathe in them because we would get sick.”

According to Omba, those devastating changes were triggered by the arrival of men who came to cultivate plantations of palm oil, a multibillion dollar crop used in a vast array of products around the world from shampoo to lipstick and pizza dough. They also happened without his permission, “even though I am the customary owner of the land and forest.”

“This is still ongoing today,” says Omba, whose clan is part of the island’s indigenous Wambon Tekamerop tribe.

A palm oil concession in Papua, Indonesia. Photo: Ulet Ifansasti / Greenpeace

An investigation by VICE World News shows that Papua’s unique rainforest is being destroyed by palm oil companies with murky ownership structures and that a million more hectares are under threat of deforestation despite the Indonesian government’s pledges to protect it.

Interviews with corruption investigators, former officials and rights groups in Papua, as well as independent analysis of satellite data and government permits for palm oil concessions, have uncovered allegations of corruption involving palm oil licenses and raised doubts over the legitimacy of climate efforts by Indonesia, which received more than $150 million from global climate funds last year.

Indigenous peoples across the region also say they are being systematically denied free, prior and informed consent over development on their ancestral land.

“It’s a travesty to see one of the world’s great remaining rainforests being imperilled by major palm-oil interests,” says Bill Laurance, one of the world’s leading tropical forest researchers, in response to the investigation’s findings. “The current scheme is likely to have severe impacts on biodiversity, indigenous peoples and greenhouse gas emissions. It strikes me as a lose-lose-lose proposition.”

Indonesia has long been the world’s largest exporter of palm oil, which generated around $23 billion for the Southeast Asia nation last year alone. But as arable land has become scarce in regions such as Sumatra, Java and Kalimantan after decades of cultivation, the country’s least-developed province Papua – home to the third largest stretch of rainforest in the world – is palm oil’s final frontier.

In a region where extrajudicial killings have gone unpunished, anti-racism protests are crushed, and soldiers often accompany palm oil investors, companies have been accused of earning millions through land grabbing and destroying precious forest.

Portrait of Markus Aute, an elder from Wambon Tekamerop community, Mandobo tribe in Subur village, Boven Digoel, West Papua in June, 2019. Photo: Nanang Sujana

The consequences are disastrous for one of the most biodiverse regions on the planet. A study published in the journal Nature in August last year revealed that the island of New Guinea (which contains Papua) has the greatest plant diversity in the world – with over 13,000 species. Separate research found its vibrant rainforests, wetlands and savannahs contain at least 602 bird, 125 mammal and 223 reptile species, many found nowhere else on earth, such as tree kangaroos and birdwing butterflies. The island is also home to 312 indigenous groups, including some never contacted by the outside world.

The provinces of Papua and Papua Barat (also known as West Papua), which comprise the Indonesian half of the island of New Guinea, are home to 40% of Indonesia’s remaining primary rainforest – the oldest, densest and most ecologically significant kind. The region has not yet suffered the historic levels of deforestation seen in other parts of Indonesia, and in 2018 the governors of the two provinces committed to conserve 70% of forest cover.

“It’s truly unique,” says Wirya Supriyadi, head of the Papua branch of the Indonesian Forum for the Environment (WALHI), the country’s largest and oldest green group. “There’s nothing else like it on the planet. But if business continues as usual, all that flora and fauna will disappear and so will the indigenous people who live very closely with it.”

Chief Omba’s clan, which hunts wild boar, harvests tropical fruits, and processes starch from the common sago palm tree, has for centuries had its identity and culture deeply bound to the surrounding natural world. Any disruption to that balanced ecosystem, sustained in harmony for generations, could be perilous.

“My sons and grandsons will depend on the forest just as I have,” he says.

But years of satellite data collected by Global Forest Watch, a database of global tree cover change, and analysed by VICE World News reveals that cultivation of palm oil has already wrought major ecological damage.

A chart showing cumulative forest loss in Papua. Graphic: Vice World News

VICE World News’ calculations found that between 2001 and 2020, the region lost 955,000 hectares of tree cover – the equivalent of more than ten times the size of New York City - with more than 70% of that coming in the last decade as rainforest has been replaced by palm oil monocultures.

Scientists say this acceleration means the effects of palm oil cultivation are already significant – parts of Papua are now more prone to outbreaks of fire as plantation companies have drained peat swamps, and other landscapes are susceptible to deadly flooding and landslides as the terrain has been radically altered.

“There’s been a rapid acceleration of deforestation that’s led by palm oil,” says David Gaveau, an environmental scientist who runs Nusantara Atlas, a research project tracking deforestation and fires in Indonesia. “It’s had a visible impact on Papua already. And this is only the beginning.”

The World’s Thirst for Palm Oil Is About To Destroy Asia’s Largest Remaining Rainforest

But while Papua’s landscape is being irreversibly transformed, serious concerns remain over how companies are being allowed to cultivate palm oil on areas of land demarcated by the government known as concessions. Dozens of plantation companies in the region have successfully requested for their concessions to be excluded from a moratorium by claiming that there was no peat or primary forest in them, according to publicly available government records reviewed by VICE World News.

Since 2000, the land released from the forest estate for plantations in Papua province alone has totalled nearly a million hectares – an area more than one and a half times the size of the popular tourist destination of Bali, according to Greenpeace estimates. In Papua, nearly half of all concessions which have been released contain areas which had previously been covered by the forest moratorium, according to public documents seen by VICE World News.

In September 2018, Indonesian president Joko Widodo declared efforts to halt deforestation by announcing a review of all existing licenses and introducing a three-year moratorium on new permits for palm oil plantations. However, independent experts told VICE World News that Indonesia’s policy, introduced in addition to an existing moratorium from 2011 on permits for development of primary forest and peatland, amounts to nothing more than a “paper tiger … with no legal teeth,” according to Kiki Taufik, global head of Greenpeace Southeast Asia’s forests campaign.

“Deforestation and forest fires have continued inside moratorium areas,” adds Taufik. “The policies have arguably achieved more for the government’s international image than they have for actual forest conservation.”

An aerial view of a palm oil plantation bordering the customary forest belonging to the Wembon Tekamerob community of the Mandobo Tribe in Selil Village, Subur District, Boven Digoel Regency, Papua in June 2019. Photo: Nanang Sujana

Taufik points to the land releases as a significant factor in the failure to protect forests, saying that there were “highly questionable decisions” to release the forest and that there is “strong evidence that in many cases this claim was incorrect”.

Critics point to a slew of recent policy decisions that threaten conservation. Indonesia’s plans to promote palm oil as a biofuel will require 15 million hectares of new plantations, and the food estate program will see millions of hectares of land in Papua developed for domestic food production. A 4,325-km highway is also currently under construction across the region. Opponents of the government’s Omnibus bill, which was passed in October and aims to create jobs and stimulate investment, say it will remove key legal protections for forests such as the requirement for environmental permits. But deputy foreign minister Mahendra Siregar has defended the bill, stating in a letter last year that “the concerns expressed are understandable but unfounded”.

Greenpeace’s Taufik offers an explanation as to why it is so difficult to create and enforce legislation on the industry in Papua.

“Former cabinet ministers, members of the House of Representatives, and retired high-ranking military and police have all been identified as shareholders or board members of plantation companies in Papua,” he says. “This allows for a culture where legislation and policy making are distorted and law enforcement is weakened.”

A small boat travels through marshes in Papua province, Indonesia. Photo: Ulet Ifansasti / Greenpeace

Sulis Abinesa, an agent for Indonesia’s Corruption Eradication Commission (KPK) who is monitoring graft in Papua’s natural resources sector, said investigations were ongoing into a significant number of palm oil concessions overlapping with protected forest as well as into related tax evasion. “So many are overlapping,” he says. “That is an indicator that there has been corruption and bribery.”

Indonesia’s Ministry of Environment and the Indonesian Palm Oil Association (GAPKI) did not respond to multiple emailed requests for comment.

A scheme once known as the Tanah Merah project and billed as the world’s largest oil palm plantation project – covering 270,000 hectares of rainforest in Papua’s remote Boven Digoel regency – is at the heart of concerns. If completed, the project, which is no longer being developed as a single entity, could generate $6 billion worth of timber and create a plantation twice the size of London within Asia's largest remaining stretch of rainforest, according to an internal analysis seen by Mongabay and the Gecko Project, who found that key permits granted for the Tanah Merah project were signed by an official who was serving a prison sentence for embezzling state funds.

Four of the concessions are mere kilometres from the land of tribal chief Linus Batia Omba. They are owned by the Hayel Saeed Anam Group, a Yemeni conglomerate, and Pacific Inter-Link, its Malaysian palm oil processing and trading subsidiary, according to concession records on the company website.

Greenpeace research from April shows the concessions were sold to four offshore companies registered in the United Arab Emirates – Green Resources Ltd, Crescent Investments Ltd, Prestige Holdings Ltd and Malindo Investments Ltd – and a majority of the directors and commissioners also held roles in Pacific Inter-Link and associated companies. VICE World News could not find any information for the named offshore companies, raising questions on their legitimacy.

Boven Digoel regency and Papua province did not respond to emailed requests for comment and also failed to produce copies requested by VICE World News of the environmental impact assessment evaluations required for permits to be issued or land cultivation rights (HGU). However, the project at the time of the release was more than 200,000 hectares according to public concession data, rendering it ineligible according to Papua Province law.

The Roundtable on Sustainable Palm Oil (RSPO), an industry-led body that runs the palm oil global certification standards scheme, is currently investigating whether Pacific Inter-Link controls these companies. When contacted, Pacific Inter-Link said that it “had no investment or association with any plantation in Papua or for that matter in other parts of the world”. It declined to comment on the RSPO investigation.

Despite the lack of clarity over ownership and allegations of malpractice over the granting of permits, deforestation is continuing in these concessions. To date, some 8,491 hectares of rainforest – an area nearly the size of Paris – across three of the four concessions has been cleared and converted into palm oil plantations, according to Nusantara Atlas data.

If development in these concessions is mirrored across the region, there could be significant repercussions for the climate. The forests within Papua’s undeveloped concessions store 71.2 million tonnes of carbon – equivalent to half of the international aviation industry’s entire annual greenhouse gas emissions, according to Greenpeace estimates.

Campaigners say few benefits from this destructive development will reach the poorest in Indonesia, which has the sixth greatest wealth inequality in the world, even though they are on the frontlines of climate change. The poverty rate in Papua, which was subsumed into the Indonesian state in the 1960s, is the country’s highest – 27.53%, compared to 3.47% in the capital Jakarta.

“The creation of palm oil monocultures is terrible for Papua,” says Timer Manurung, chairman of Indonesian conservation NGO Auriga. “But for politicians, there’s a huge amount of money to be made. Exploiting natural resources is seen by politicians as a way to fill their pockets and gain funds to win elections. It’s not benefiting Papuans.”

Indigenous peoples that VICE World News spoke to allege palm oil companies in Papua have failed to obtain consent from clans for development despite legal requirements – Indonesia’s Plantation Law and Papuan Special Autonomy Law should guarantee indigenous peoples’ consultation in decisions around plantations.

Chief Omba says that he only agreed to allow a palm oil company called PT BIA on his land to construct a corridor road from the oil palm plantation through his land – not to give away the land rights to them. “I am not involved in granting permits to release customary lands and our customary forest,” he says.

Omba alleges the company also failed to live up to a number of commitments including funding education for children and supplies of rice. “We want the company permits to be revoked,” he adds. “Our lives are very uncomfortable. Please support us weak communities, help us and save us from colonialism and suffering.”

Aerial view of a palm oil plantation in Papua province. Photo: Ulet Ifansasti / Greenpeace

Markus Baba, a 36-year-old member of the Awyu-Jair tribe, also in the Boven Digoel regency, spoke of similar concerns. “We never gave approval to the company [PT Tunas Sawa Erma Group], but we got information that a certain person gave the company a letter of handover of land,” he says. “The company promised to bring prosperity, provide assistance with food, health, education and money, but this has not been fulfilled.”

PT BIA and PT Tunas Sawa Erma Group did not respond to repeated requests for comment via email.

Rukka Sambolingi, general secretary of the Indigenous Peoples Alliance of the Archipelago (AMAN), an Indonesian NGO founded in 1999, said the lack of informed consent is widespread. “There’s been a lot of tricks and foul play,” she said. “People don’t know oil palm is coming. Consent hasn’t been given. It’s not acceptable. The livelihoods of Papuans are being destroyed at the hands of palm oil companies.”

“People don’t know oil palm is coming. Consent hasn’t been given. It’s not acceptable. The livelihoods of Papuans are being destroyed at the hands of palm oil companies.”

Franky Samperante, director of Pusaka, an Indonesian nonprofit documenting the effect of the palm oil industry on indigenous groups in Papua, said malnutrition and extreme poverty was increasing rapidly. “It’s been devastating,” he said. “They don’t have any income. They can’t pay for their children to go to school. They can’t pay for food.”

The conversion of forest to palm oil has also caused a huge amount of conflict over land rights, community compensation and employment, according to findings by independent researchers. A report by the Consortium for Agrarian Reform (KPA), an Indonesian NGO, found the plantation sector accounted for the largest number of land conflicts in 2020, with 101 of these relating to palm oil.

“These conflicts are littering the landscape wherever palm oil is,” says Ward Berenschot, a researcher at Leiden University who is documenting conflicts between companies and rural communities in Indonesia. “And they’re not being resolved because there is a close, collusive relationship between these politicians and palm oil companies.”

But campaigners say these conflicts could be stopped and that vast tracts of forest in Papua could be saved if the licenses under scrutiny – like those in Boven Digoel regency – are revoked by the Indonesian government. In the neighbouring province of Papua Barat, a palm oil licence review in February examining 24 concessions recommended that 13 permits covering 52,000 hectares be immediately revoked.

“It’s a massive opportunity,” says Cindy Junicke Simangunsong, policy manager at the NGO Econusa, who was a legal expert on the permit review process. “But the openness and acceptance from the government institution is hugely different in Papua. It seems there is not the political will to do it.”

A source involved in the government’s efforts for a palm oil license review in Papua told VICE World News that the process is “very sensitive” and that any local government employees found to be discussing the issue with an external party would be fired.

Recent moves by the Indonesian government have underlined the lack of political will to halt deforestation and development in Papua, which is home to a wealth of natural resources including the largest gold mine in the world, according to Teguh Surya, executive director of Indonesian NGO Madani.

“Indonesia has already committed to reduce deforestation,” he says. “But it is doing something with one hand, and doing something else with the other hand.”

A spokesperson for the Green Climate Fund, which last year paid the Indonesian government $103.8m through the United Nations REDD Programme for reducing its deforestation-induced emissions, said it took “all allegations of corruption, misconduct, and other prohibited practices seriously” and that its Independent Integrity Unit would investigate the reported allegations. In a statement, the United Nations Development Programme acknowledged “environmental and social challenges” surrounding palm oil production in Indonesia and said it was supporting “ongoing efforts to pivot the palm oil industry towards a sustainable and more socially responsible pathway”.

With the government’s palm oil moratorium set to expire in September, and the clearing of Papua’s forests steadily continuing, Surya believes time is running out.

“Indonesia will lose the opportunity to meet its goals,” he says. “But the world will lose much more.”

Peter Yeung is an award-winning freelance journalist who has reported from across Europe, Africa, Asia and Latin America for publications including The Guardian, National Geographic,The LA Times, The BBC, Reuters, and VICE World News.