By The people of Oro, Papua
New Guinea
Subject: Small Holder Agriculture
Development Project Loan
This is to register our concern
that the Small-holder Agricultural Development Project (SADP) Loan
approved in May this year (2008) has been hijacked by the Oil Palm
Plantation Companies in Papua New Guinea to push for the expansion
of oil palm rather than expend it in areas that will enable greater
economic benefits for the agricultural dependent rural masses of
Papua New Guinea. We object to the loan being spent on oil palm
expansion for various reasons.
To substantiate our argument,
firstly oil palm is not the only option for active participation
in the cash economy for the rural population as is the view of our
Government and the multinational oil palm companies operating in
our country. The various assessments have been focused on oil palm
rather than alternatives. In the Northern Province, the assessment
teams held discussion only with the stakeholders in the oil palm
industry. These consultations also failed to convene meetings with
non oil palm growers in oil palm growing areas. Therefore, the views
presented to support the loan submission do not reflect a broad
cross section of the community.
Having had not consulted non
oil palm growers, there were important lessons learnt from previous
loans that are not captured and therefore the focus on smallholder
oil palm expansion is likely to replicate the existing socio-economic
problems further with more serious negative impacts. Some of these
problems are the result of structural injustices by transnational
corporations such as Cargill.
Structural injustices include the procurement and supply of farm
maintenance goods to small holders thus entrapping them in vicious
cycles of debts to the milling companies. There are facts to indicate
that the oil palm companies have no interest in our welfare other
than to increase productivity for their palm oil mills hence profit
directly from the loan by pushing it down our throats that planting
oil palm is the best option for us. The social assessment report
also points out that part of the loan is to be used to maintain
roads which is currently under a tax exemption agreement between
the Higaturu Oil Palms Ltd and the Oro Provincial Government.
They use the argument that
with oil palm there is a guaranteed market access. It is however
not so. About 400 block holders, recipients of previous World Bank
loan under the Oro Expansion Program from 1993 to 2002 have to carry
their fruit for more than a kilometer to have it picked up. Only
a small portion of the population is involved while there are many
who are engaged or would rather engage in other agricultural activities.
There are many who are and
are still repaying development and maintenance cost to the Higaturu
Oil Palms Ltd a subsidiary company of Cargill. They were led to
believe that when they plant oil palm they would have road infrastructure
to access local markets for other crops and commodities as well.
There are now some oil palm blocks with no road access and this
promise of easy access to markets has just been a bad dream. In
fact a promise that the PNG Government had made on behalf of the
oil palm companies. If any roads were built most are in a state
of decadence and inaccessible by vehicles other than farm tractors
There are also Oil palm blocks
developed from the ADB loan era, (1979 to 1989), who still have
not realized the dreams of a multi bedroom mansion and cars of their
choice. These loans have been inherited by their children.
Secondly, we are of the view
that for this SADP Loan to benefit more agricultural dependent families
the government should focus on developing and maintaining road access
to rural communities to enable greater participation by the bulk
of the population.
For instance there are more
than 5000 coffee producers from the Afore District of the Northern
Province who have the capability of producing thousands of tones
of organic coffee annually, however lack supporting infrastructure.
Is it not feasibly to put some of the SADP loan money into rebuilding
and enabling required infrastructure to get the people from the
Afore District to release these immense economic potential that
is now locked due to bad infrastructure. Will this not boost the
local economy and support the PNG Government’s export driven
under its Medium Term Development Goals, (MTD)?
There is also a huge potential for a beef industry in the province,
as well as the options to enable other rural Papua New Guineans
to venture into commercializing various organic crops therefore
object to the view that oil palm is the best option for a cash income.
Any further expansion of oil
palm will not be in the best interest of the nation as it will have
serious negative effects on our social and terrestrial environment.
It has already contributed to major losses of forests and biodiversity
in our country bringing with it social and environmental problems
which the oil palm companies have refused blatantly to accept responsibility.
We are aware of the fact that
the World Bank is very well informed of the issues as a direct impact
by the oil palm industry however sees it fit to grant another loan
to the GoPNG in the pretence of agriculture development as a strategy
to alleviate poverty whilst the fact remain the multinational corporations
profit from the loans while we repay these loans.
In fact the previous World
Bank loan for the Oro Expansion Oil Palm Project in Oro province
has done quite the contrary from reducing poverty. Some of our people
have suddenly become landless who will pioneer a class of poor.
This is something we have not known since our ancestors.
