Corporate land grabs in PNG - independence betrayed?

PNG Prime Minister Peter O'Neill and other Pacific leaders met President Obama. Photo: East-West Center /
PNG Prime Minister Peter O'Neill and other Pacific leaders met President Obama. Photo: East-West Center /
Papua New Guinea is among the most culturally and biologically diverse nations on earth, and its laws enshrine the customary land ownership of indigenous tribes. Yet a massive land grab is under way with 12% of the country's land leased out to foreign corporations ...
The looting of the country's resources continues in plain sight of the government and - in the absence of any action to stop it - with its de facto stamp of approval.

Papua New Guinea (PNG) is one of the most culturally diverse countries in the world, with more than 800 indigenous languages and over 600 islands. Among its many natural treasures, a unique asset is its rainforest, the third largest in the world and home to endangered wildlife, plants, and diverse groups of people.

It has been said that PNG has the most equal distribution of land on earth. The country's constitution protects customary land rights and there is virtually no private ownership. Land is almost entirely controlled by clans and tribes. The constitution sets self-reliance, sovereignty, and the sustainable management of natural resources as overarching principles for the country.

Yet, even with these legal protections, a massive land rush is currently taking place in the country. In recent years, 12 percent of the country, 5.5 million hectares, has been leased out to foreign corporations. Dozens of foreign companies have signed land deals under a government scheme called Special Agriculture and Business Leases (SABLs).

Ostensibly formed to launch agricultural projects, these firms appear to be mostly occupied with harvesting timber that is then exported to overseas markets. With the SABL scheme, foreign companies have found a new and relatively easy way to open new areas for logging.

PNG - the world's #2 log exporter

As a result of the SABL framework, PNG has seen a sharp increase in logging and log exports. It is now the second largest exporter of tropical logs in the world, after Malaysia, and exports more than 3 million cubic meters of logs every year, primarily to China.

In 2011, the government established a Commission of Inquiry (CoI) into the SABLs that confirmed dire facts about these recent land allocations in PNG.

The commission's findings included widespread lack of free, prior, and informed consent of the local people; failure by state agencies such as the Lands Department, the Department of Agriculture and Livestock, and the Forest Authority in performing their duties; and fraud, misconduct, and incompetence as well as overall lack of adherence to proper procedures. In many deals, landowners were blatantly misled about the size and the nature of an agribusiness project.

On September 18, 2013, Papua New Guinea's Prime Minister Peter O'Neill tabled the commission's report in Parliament and stated that it revealed a shocking trend of corruption and mismanagement. Despite the alarming findings, the government has not taken any concrete or decisive action to cancel deceptive land deals, stop illegal logging, nor return land to traditional owners.

Instead, the prime minister has confirmed the official policy that has enabled these land deals. Freeing up land for development and "unlocking" it for "productive use" remains the first priority of the government's development strategy, which aims to develop agricultural plantations, primarily palm oil.

With this strategy, the government planned to reduce the amount of customary land from 97 percent in 2009 to 80 percent by 2030. With the SABLs, it has reached its 2020 goal nine years ahead of schedule.

The looting of the country's resources continues in plain sight of the government and - in the absence of any action to stop it - with its de facto stamp of approval.

Making customary land "productive"

The government asserts that making land available for productive use is required to bring development to the country. Offering Papua New Guinea's natural resources to foreign interests has made the country one of the fastest growing economies in the world.

But economic growth dependent on the export of natural resources has not brought benefits for most citizens. Commenting on the poor human development records of the country, the World Bank describes the situation as a "paradox of wealth without development."

Through extensive field research, the Oakland Institute (OI) and the Pacific Network on Globalisation (PANG) have examined what development looks like on the island of West New Britain, home to the largest and oldest palm oil plantations in Papua New Guinea. The island is held up as a model for what the government intends for the rest of the country.

Yet there is no sign of development in the villages that have been cultivating palm oil for several decades. A lack of basic infrastructure and services is a common feature in all villages visited in West New Britain. People have little or no access to safe drinking water, health facilities, nor schools.

The largest palm oil company operating in PNG is New Britain Palm Oil, a member of the Roundtable on Sustainable Palm Oil. The company has been praised in some quarters for its efforts to avoid deforestation and for not grabbing land like most of the logging companies. Despite its efforts towards sustainability, the corporation has not brought any lasting positive improvement in people's lives.

No Change in Sight

The 2012 change of government and the work of the Commission of Inquiry created hope that the land grabbing in Papua New Guinea would stop. Those expectations were initially reinforced when the new Prime Minister Peter O'Neill recognized in October 2012 that the country had made a fundamental mistake with the SABLs.

On September 18, 2013, two years after the CoI started its investigation and following months of questioning about the reasons for the non-release of the report, Prime Minister Peter O'Neill tabled the report in parliament. He said that the report revealed a shocking trend of corruption and mismanagement, and that the policy of using SABLs to free up customary land "had failed miserably."

According to the report,186 only four out of the 42 SABLs examined had the consent of local landowners and consisted of viable agricultural projects. While acknowledging the major failure of the government and the administration, the prime minister chose to not question the policy that led to this debacle and did not announce any steps to cancel the fraudulent leases nor to stop the illegal logging. On the contrary, he announced the establishment of a task force "to develop a new legislative framework to free up customary land for development."

By calling for a new legislative framework, Prime Minister O'Neill is deliberately ignoring the true nature of the problem with PNG's land-freeing development strategy and implementation. The problem does not lie in the law. Like previous assessments cited in this report, the CoI report clearly indicates that PNG shows no capacity to "free up land for development" in a manner that will be beneficial to landowners and operate within people's constitutional rights.

While a new task force is created, the looting of the country's resources continues in plain sight of the government and - in the absence of any action to stop it - with its de facto stamp of approval.

This article is drawn from the new report On Our Land - Modern land grabs reversing independence in Papua New Guinea. Its principal author is Frederic Mousseau, Policy Director at the Oakland InstituteSerah Aupong of Pacific Network on Globalisation (PANG) organized and coordinated in-country research.