ELCs: THE GOOD, THE BAD AND THE UGLY
Cambodia works for economic and social gains
Many countries l ease out public land to companies to develop – for industry, mining, oil wells and other economic activities. Government and industry argue it is vital for national economies and economic development.
And it can often be controversial, raising protests from environmental groups or locals who may be adversely affected.
Few issues are as controversial or stir emotions in Cambodia as much as the Economic Land Concessions (ELCs) leased to companies to clear the land to develop industrial-scale agriculture and build local infrastructure for surrounding communities.
ELCs are meant to develop processing plants for local agricultural production or plant plantations for everything from cassava to oil palm to rubber.
But Prime Minister Hun Sen, with an eye on the 2018 election, on February 25 announced the government would claw back almost half the land for ELCs, to hand out to poor families. He gave no details of how the land would be reallocated.
“(A review) … is completely finished,” he said. “Now, only 1,090,000 hectares of land are allowed to remain for investment and almost a million hectares was taken back.”
Supporters say ELCs boost the economy and government revenue, create jobs and sustainable incomes in rural areas and develop infrastructure such as housing, roads, schools – tasks the government doesn’t have the money or the resources to do – and combat poverty.
“We make full use of the land,” Ith Nop, general manager of the Mong Reththy Group, the largest agro- industrial conglomerate in Cambodia and the fifth- largest in Southeast Asia, told Cambodia Business Review.
“We employ a huge number of local communities. We build roads etcetera, infrastructure. That’s part of the terms of our concession. But we need the help and cooperation of the local people. We need to get along with them, so we do our best. You cannot operate without them.”
Critics say many ELCs displace impoverished locals, including tribespeople, hasten deforestation and destroy the environment. They say some concession-holders grab extra land, strip the concession of timber instead of developing it, or just sit on it speculating to selling out to another investor.
Rights group LICADHO estimates well over half a million people have been affected by land disputes involving ELCs since 2000, with thousands still unresolved.
“Each number represents a potentially ruined life, an individual who faces severe and long-term hardship,” says the group’s Naly Pilorge.
“Without land, they no longer have the means to provide themselves with the basic requirements for a decent life. The government must act now to end this epidemic of landgrabbing.”
Until recently, ELCs covered about two million hectares across the country.
The World Bank estimates about 80 percent of Cambodians live in rural areas, despite increasing urbanization fuelled by the country’s strong economic growth.
ELC’s are a key plank of the government’s economic development policy, using the private sector to help develop the economy and boost social development.
We make full use of the land. We need the help and cooperation of the local people. We need to get along with them. - Ith Nop
But stung by accusations of abuse by some concession-holders of the system, the government – which issues ELCs through the Agriculture Department – is now cutting back lease terms to 50 years from up to 70, or even 90, years, changing the terms of the lease.
Others are being downsized or having their leases revoked altogether.
In the same announcement in which he cut back the land for ELCs, Hun Sen streamlined the concession issuing process by handing sole responsibility to the Agriculture Department. Previously, the Environment Department had also issued and controlled ELCs.
Holders of concessions such as rubber plantations complain arbitrarily cutting terms ignores the production cycle of their trees, which take years to mature and produce.
“Yes. There are some bad (concession-holders),” says Ith Nop. “Some companies do not follow the rules. That’s no good. There are a lot of complaints. They make it hard for the rest of us. We are very responsible. We help the communities.
“Maybe only 20 percent (of ELCs) are good. The problem is enforcement.”
And some critics say the government is cracking down as a gimmick ahead of the 2018 national election and listening to the “noisy minority”.
Many concession-holders say the responsible operators are being penalized for the, admittedly significant number, of bad ones.
Many concession- holders complain of corruption and blackmail and coercion hampering their operations and driving up costs.
“We suffer the indignity of having to face off with villagers who were not even in existence when the concession was granted – before infrastructure was developed and before the concession started work,” said.
ELCs come with a requirement to set aside some of the concession for families already living in within the boundaries.
Costs are driven up further by inflated “fees” and corruption, including in the tendering process, they say.
In January, corruption watchdog Transparency International rated Cambodia the most corrupt country in Southeast Asia. Local authorities are often accused of gouging money from the ELCs.
Hun Sen in 2012 ordered a moratorium on new concessions and ordered the seizure of those not living up to the conditions of their lease.
Rights groups and other NGOs say the moratorium has dramatically reduced the number of disputes, but complain little is being done to resolve existing ones. They also say the government has no power to punish those companies who breach their conditions.
Concession-holders and critics agree on almost nothing. ELC operators say the courts do not enforce their legal rights; NGOs say the courts throw villagers into jail for trying to get their land back.
Possibly the one thing they do agree on is tougher enforcement of the law, including a crackdown on concession holders who breach the terms of their lease and proper enforcement of “claim-jumpers”.
Even rights groups such as LICADHO often admit some protesters demanding compensation or land have no right to be in the demonstration.
“But it’s hard to weed them out,” said a worker from another NGO, who did not want to be identified for fear of retribution.
Cambodia is not alone in leasing concessions on state land – including forests – to companies. And other countries, too, work hard to find a balance between all groups involved.
In the United States, about 24 percent of government land is accessible under standard industry lease terms, says the American Petroleum Institute.
“It is important to note that we are talking about multiple use public lands, where development of energy resources is allowed, along with grazing, recreation, hunting, fishing, and other uses,” the Institute says in a policy issues paper.
“These are government lands designated for use for economic, recreational and scientific purposes. Around one-third of the land in the United States is controlled by the government.” We stress “the importance of collaboration by all stakeholders to assure environmentally sound and economically feasible development of these important … resources”
Extracts latex oil from rubber trees.
Insepceting a young cassava crop.