ASIA

• Bangladesh: Local people react at possible seismic survey in the Sundarbans
• Indonesia: Mounting opposition to mining in protected areas
• Laos: French company pulls the plug on Nam Theun 2
• Thailand: Certified firm is in breach of FSC Principles

LOCAL STRUGGLES AND NEWS

- Bangladesh: Local people react at possible seismic survey in the Sundarbans

The Bangladeshi organisation BanglaPraxis, together with other local groups, have reacted against a reported move from Shell Bangladesh to conduct an aerial and seismic survey in the Sundarbans mangrove forest from September 27.

Bangladesh is primarily agricultural, although urbanisation is proceeding rapidly, and it has moved increasingly towards a market-oriented economy since the mid-1970s, making industrial development a priority and following a path towards privatisation, free market reforms and incentive to foreign investment, most of which goes to the natural gas, electricity, and physical infrastructure areas.

Until the beginning of the 1990s, state oil and gas company Petrobangla, along with its eight operating companies (OCs), was the sole player in the Bangladeshi oil and gas sectors. Over the past few years, however, Bangladesh has encouraged foreign oil companies to do business in the country. At present, Shell, Texaco, Scotland's Cairn Energy PLC; Holland Sea Search, Unocal, Rexwood-Oakland, and UMC Bangladesh Corporation are active in exploration under six Production Sharing Contracts (PSCs) partnerships with Petrobangla.

One of the most affected areas by the "development" push is the Sundarbans mangrove swamp forest, in the country's southwestern coastline, considered a world heritage and the world largest mangrove forest. More than four million people who live around the Sundarbans derive part of their subsistence extracting resources of this forest --wood products, non-wood products, fisheries and other services like tourism. And millions of others are indirectly dependent on the Sundarbans.

Recently, SBCP Watch Group, a network of organisations monitoring Asian Development Bank funded projects in the Sundarbans, organized a programme on conservation of the Sundarbans. When the co-ordinator of the Watch group raised the issue of the Shell survey in the forest, the multinational company responded by sending a media briefing pack to every participant of the programme. There, Shell Bangladesh authorities explained that they would not explore the Sundarbans forest itself but that they will conduct an aeromagnetic survey in block 10, which is just beside the Sundarbans, and has a patch of forest in it. The blocks are land divisions leased out by the government for oil/gas exploration and extractive activities by multinational companies.

The company also claims that the survey will be conducted 10 kilometres away from the forest. However, environmentalists consider 20 kilometres as the impact zone of the forest. 'Tremors' to be generated for the seismic survey would have far reaching consequences for the Sundarbans, destroying the fragile ecosystem. Any drilling in the upstream of the forest is bound to carry polluted waters downstream in the Sundarbans. Drilling in block 10, next to the forest, carries the same risk, because many rivers flow into the forest from the areas of block 10.

Local organisations feel that if it were true that Shell does not plan to drill in the forest then there is no need to conduct any survey. However, they have evidence that the multinational company is going ahead with the exploration and that it has been conducting some biased people's consultation in the region through BETS, a local firm recruited by Shell.

The huge peoples' movement in Bangladesh against export of gas has built up awareness. Local people are now fighting back and the local organisation AOSED --a member of the network Coastal Development Partnership (CDP), which has been working on the Shell issue-- is launching a campaign against Shell's move. They demand that Shell should not start any initiative within or around the forest, in block 5 or in the nearby block 10, without consulting people's groups concerned. The multinational should consult not only the organizations who are working with them but also other organizations who are critical of Shell.

Concerned people feel that they don't need any "scientific" information since it is their home where the survey or drilling may be done, and they know too well that the impact on them and their livelihood will mean depredation, destruction, and displacement.

Article based on information from: "Grave concern over move to explore gas in Sundarbans", M Shafiqul Alam, The Financial Express, http://www.financialexpress-bd.com/index.asp?aday=9&amonth=6&aYear=03&Submit=+++Submit+++ ; State Of Sundarbans, Anisur Rahman, Bangladesh Door, http://www.bangladesh-door.com/ ; "Sundarban Threatened Anew By Shell Oli", Late Friday News, 117th, Urgent Notice Addendum, sent by Alfredo Quarto, Mangrove Action Project, e-mail: mangroveap@olympus.net , http://www.earthisland.org/map/ltfrn_117.htm ; direct information from Zakir Kibria, BanglaPraxis, e-mail: banglapraxis@yahoo.com , and Alfredo Quarto, e-mail: Late Friday News, 117th Urgent Notice Addendum

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The "Coalition to oppose mining in Indonesia's protected areas" has issued a media release to expose how mining activities are encountering strong and mounting opposition at various levels. The Coalition is composed of the following ten groups: JATAM; WALHI-Friends of the Earth; Indonesian Center for Environment Law; WWF Indonesia; Kehati; PELANGI; Forest Watch Indonesia; MPI; POKJA PSDA; PELA.

Reactions at open pit mining in protected forests have been coming from civil society in Sumatra, Kalimantan, Java, Sumbawa Besar (south-east Indonesia), Sulawesi. These include letters of protest, postcards, demonstrations, declarations and statements by provincial governments, students, academics, indigenous peoples, ordinary Indonesians and by the international community.

It seems that public perception is that things have gone too far with mining activities. That's how the Canadian mining company Placer Dome's plans to mine for gold in the protected forests of South Kalimantan's Meratus Mountains --home of the Dayak peoples and the orangutans-- have sparked a passionately worded letter of protest by Indigenous Dayak representatives, a demonstration in the South Kalimantan provincial capital on the 1st of July demanding government action to reject Placer Dome's lobbying and a declaration of the Provincial Government calling on the Indonesian national parliament not to permit mining in the Meratus protected forest. It's high time, since 44% of Dayaks' forests have been degraded in just 12 years!

In Palu, capital of central Sulawesi island, sustained community opposition have included protests directly against Rio Tinto and Newcrest's plans to build a gold mine in the Poboya Protected Forest Park. Actions have yielded statements by both the provincial House of Representatives (2 July 2003) and by Prof Aminuddin Ponulele, Governor of Central Sulawesi, that they will refuse any central government attempts to permit the mine to go ahead. The threat posed by heavy metals, dust and other mine wastes to the Poboya Protected Forest Park and the water supply for 200,000 residents of Palu is too great a risk according to Governor Aminuddin, who was quoted by local paper Radar Palu on 3 July 2003 requesting Rio Tinto / Newcrest's joint venture company PT Citra Palu Minerals to leave Central Sulawesi province.

Even the usually apolitical UNESCO Asia Pacific office in Jakarta (United Nations Educational, Scientific and Cultural Organisation) have appealed to Indonesian parliamentary committees currently considering government plans to mine in protected areas. They sent a letter with specific reference to tiny Gag island in West Papua where BHP Billiton plans to build the biggest nickel mine in the world and dump mine waste into the sea. An IUCN / UNESCO International Workshop held in Hanoi in February 2002 had chosen the Raja Ampat archipelago including Gag Island as one of seven sites to consider for World Heritage listing from a field of 25 potential sites in Southeast Asia for its high biodiversity: 505 species of coral --which is an extraordinary 64% of all known coral species in the world--, 1,065 fish species --amongst the highest fish diversity in the world. UNESCO's intervention is a blow to BHP Billiton's lobbying to overturn protected forest status and the company's plan to use STD - Submarine (ocean) Tailings (waste) Disposal, despite it's claims to have reformed after the Papua New Guinea Ok Tedi disaster. BHP's Ok Tedi mine in Papua New Guinea caused severe, long-lasting pollution of the Fly River, and local communities successfully sued BHP for multi-millions of dollars in damages.

The international community has also reacted. Over 1,100 letters have been sent by individuals and organisations in 43 countries addressed to Indonesian President Megawati and including testimonials such as this from Beth Partin, who heard of US mining company Newmont's push to expand into Indonesia's protected forests: "I live near Denver, Colorado where Newmont is based. In Colorado, we live every day with the damage caused by mining, for example, the Alamosa River was poisoned more than a decade ago by a cyanide leak and after years of cleanup is only beginning to show signs of life."

To date around 6,000 sets of three postcards, one addressed to the House of Representatives, another to the Forestry Department and the third one to the Minister for Mineral Energy and Resources have been signed and sent by ordinary Indonesians as an expression of support for existing environment protections against mining. Student environmentalists have staged protests at the Australian Embassy in anger at Australian and other foreign government lobbying on behalf of mining companies. Protests have also been held at the House of Representatives and the Forestry Department, with more planned. Heads of forestry education at five prestigious universities: Bogor Institute of Agriculture, Gajah Mada University, Mulawarman University, Hasanuddin University and Lampung University Groups, have issued a declaration of opposition to mining in protected areas on 3 July 2003. Students and academics highlighted the total economic contribution made by sustainable forestry and environment protection, which according to Indonesia's national budget, outweighs that of mining, with much more potential untapped.

Article based on information from: "Indonesia regional govts, civil society: More speak out for forest protection from mining", 13 July 2003, statement by Coalition to oppose mining in Indonesia's protected areas, e-mail: inform@mpi.org.au , sent by Mauricio F. Ferrari, Forest Peoples Programme, e-mail: mfferrari@pd.jaring.my , http://www.forestpeoples.gn.apc.org/

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Electricité de France has pulled out of the Nam Theun 2 dam project in Laos. EDF announced its departure on 17 July 2003, a day before the consortium developing the dam, the Nam Theun 2 Power Company, was to have signed a power purchasing agreement with the Electricity Generating Authority of Thailand (EGAT).

The French state-owned EDF was the biggest investor in the proposed dam. In June 2001, EDF and Harza Engineering (now Montgomery Watson Harza) formed a joint venture as head contractor to build the dam.

EDF's pullout followed a French parliamentary commission which reported that EDF's expansion plans were "a failure" and involved taking unnecessary risks with taxpayers' money. Last year, the Financial Times described EDF as "a loss-making state-controlled group which faces years of work to dig itself out of the hole in which it has landed after a string of overpriced international acquisitions."

The remaining members of the consortium are Electricity Generating Company of Thailand (25%), Ital-Thai Development of Thailand (25%) and the Lao government (25%). The Lao government has given the project developers three months to find a replacement investor, after Thailand issued a one-year ultimatum to sign the power purchase agreement.

EDF's exit has left Nam Theun 2's future looking shaky. "This raises some questions over the future of the project. EDF was more than just the main investor, they were also the lead technical agency," World Bank spokesperson Peter Stephens told Reuters.

Without a US$100 million partial risk guarantee from the World Bank, commercial investors are unlikely to risk getting involved in the project. In 1997, Jack Cizain, president of EDF International told the Bangkok Post that without the Bank's guarantee, it would be difficult for the developers to continue with the project.

Although the Bank has supported the project since it funded a feasibility study in 1989, it has repeatedly put off taking a decision on whether to provide the guarantee.

According to an August 2001 World Bank Aide Memoire, the Bank will not make a decision on the guarantee until the Lao government has met a series of conditions. Among these is "The development of a full PRSP [Poverty Reduction Strategy Paper] to underpin poverty alleviation and progress in meeting program targets."

Enter the International Monetary Fund. The IMF's advice to the Lao economy is identical to its prescription for all governments: "financial, fiscal, and trade reforms". In 2001, IMF staff wrote, "Real GDP growth of about 7 percent by 2003 is achievable, if structural reforms are pursued in earnest and the country's considerable hydropower resources are tapped for further development." In other words, force open the economy and dam the rivers.

As is often the case, however, the IMF's medicine is making the patient sicker. Last year, the IMF pressured the Lao government to increase revenue collection. The government increased tariffs on goods from Thailand. Far Eastern Economic Review correspondent Bertil Lintner described the results as "counterproductive". Smuggling increased and inflation shot up from 7 to 16 per cent. Government revenue improved only slightly and budget shortages meant no pay for teachers and other civil servants -more poverty rather than less.

In May 2002, Electricité du Laos increased the price of electricity. At its annual meeting this year EDL announced that its clients owed it almost US$8 million. "We cannot cut the electricity, because most of the debtors are the state organisations," an EDL official told the Vientiane Times.

Over the past two decades, EDL has received a huge amount of "aid". By the end of 1999, as a result of this generosity, EDL owed a total of almost US$300 million. The Asian Development Bank alone had lent EDL more than US$200 million. ADB's consultants Electrowatt estimated that servicing this debt in 2000 would cost EDL more than US$28 million.

Hans Luther is a German economist who worked since the early 1990s at the National School of Administration in Vientiane. Before he returned to Germany recently, the Lao government awarded him the prestigious Labour Medal. In an interview published in the Bangkok Post, he offered some advice to the Lao government: "Foreign aid is like a drug. . . . Instead of putting up your own money for building roads and repairing them, you get rich foreigners to do it for you. There are also kickbacks and all kinds of other benefits. It is the easy way out in economic development. Now what should a poor country like Laos do? They should be modest and have some clear priorities. But most opt for foreign aid as it seems to promise everything at the same time. . . . I believe hydro-electricity will not help. Firstly, there is the matter of demand; there is only one customer, Thailand. Also, once the investment is done there are ongoing costs for repair and maintenance and these costs are high, so I don't think this is a sustainable solution."

By: Chris Lang, e-mail: chrislang@t-online.de

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Two plantations managed by Thailand's Forest Industry Organisation (FIO) are currently certified as well managed under the Forest Stewardship Council system (see WRM Bulletins 48 and 64).

When FSC's assessor SmartWood awarded a certificate for FIO's plantations at Thong Pha Phum and Kao Khra Yang in July 2001, it also issued 26 conditions which FIO had to meet in order to retain the certificate. The following year, SmartWood's auditing team found that FIO had failed to meet five of the conditions and had only "partially met" seven more conditions. However, instead of revoking the certificate, SmartWood issued 13 "corrective action requests" (CARs), six of which had to be met within six months.

In January 2003, SmartWood's audit team was back. This time, they found that FIO had met two of the CARs but had only "partially met" the remaining four. SmartWood issued six new CARs which were to be "effective immediately". SmartWood's report of the audit states that "If [FIO] is not able to close out the significant CARs issued, the certificate will be suspended until that time by which FIO can demonstrate compliance."

Jeff Hayward, SmartWood's Asia-Pacific Regional Manager, explained that a SmartWood auditing team was in Thailand in June to check whether FIO had met the latest series of CARs. The auditing team will write up a draft report by the end of July, which will be sent to SmartWood and then to FIO for comments. A public summary of the report will be available "hopefully by mid-August 2003" according to Hayward. "We will also make clear whether or not we have suspended or terminated the certificate," he added.

Based on the record so far, it seems unlikely that SmartWood will suspend or terminate FIO's certificate. It also seems unlikely that FSC will put any pressure on SmartWood to make it do so.

While visiting FIO's Thong Pha Phum plantation in January, SmartWood's audit team found a 14 year old boy working in the plantation. This is in breach of Thailand's Labour Protection Act of 1998 which states that employers must not employ children less than 15 years old. It is also in breach of FSC Principles and Criteria. SmartWood's public summary comments, dryly, "Some informal employment without proper identification and official age details for a younger contracted individual would be outside of FIO policy and ILO conventions."

Instead of withdrawing the certificate, SmartWood issued a corrective action request stating that FIO should "terminate all employment of any person under the age of 15 years".

At the same time SmartWood was carrying out its audit of FIO, FSC's Accreditation Business Unit was also in Thailand, to conduct an accreditation monitoring audit of SmartWood. FSC found that SmartWood was in breach of several FSC rules.

As a result, FSC issued six minor and five major "corrective action requests" which must be addressed "in a timely manner" according to Hubert de Bonafos, FSC's Accreditation Officer.

FSC confirmed that SmartWood's public summary on FIO indicates "a number of significant shortcomings in FIO's level of compliance with FSC Principles and Criteria." In other words, SmartWood awarded the certificate to FIO despite the fact that FIO's management of the two plantations does not meet FSC Principles.

FSC's audit also confirmed that SmartWood awarded the certificate to FIO based on an assessment using guidelines which do not conform to FSC rules. Before an assessment can be carried out in a country without FSC recognised national standards for forest management, FSC rules require that the assessor must develop an "interim standard" for assessing forest management.

FSC requested that SmartWood produce an interim standard "through an appropriate stakeholder consultation process". Thus, in May 2003, almost two years after awarding the certificate to FIO, SmartWood produced an "interim standard" for Thailand.

It is difficult to see how FSC can consider the consultation process to be in any way "appropriate". FSC's Hubert de Bonafos claimed that SmartWood has already translated its interim standard for Thailand "into the national official language", but according to SmartWood's Jeff Hayward, "We are in the process of getting this document translated into Thai." Apparently FSC and SmartWood expected "stakeholders" to comment on a 21-page document written in a foreign language. Hayward confirmed that "input has been rather limited."

SmartWood's interim standard for Thailand is very similar to SmartWood's Generic Guidelines for Assessing Forest Management. The section on Indigenous Peoples (FSC Principle 3) is word for word identical to the corresponding section in SmartWood's Generic Guidelines. It fails to address important issues faced by Indigenous Peoples in Thailand, such as, for example, the fact that the Thai State does not recognise many of Thailand's Indigenous Peoples to be Thai citizens.

In May 2003, Veerawat Dheeraprasert of the Foundation for Ecological Recovery, a Thai NGO, wrote to FSC. Veerawat explained that FIO is in breach of Thailand's 1989 Logging Ban and the 1997 Constitution. "The SmartWood report contains a number of flaws and omissions that reveal the numerous problems surrounding the SmartWood certification of the two teak plantation areas," he wrote. Veerawat concluded by demanding that "FSC cancel the FIO certification with immediate effect in the two plantations in order to prevent the further destruction of the ecosystem, local culture, local economy and livelihoods by the FIO."

Two weeks later, FSC's Hubert de Bonafos, replied to Veerawat. Instead of responding to Veerawat's request that FSC cancel the certificate, de Bonafos thanked Veerawat and his organisation for their "positive contribution to this FSC monitoring process".

By: Chris Lang, e-mail: chrislang@t-online.de