Development, 2011, 54(1), (91–97) r 2011 Society for International Development 1011-6370/11 www.sidint.net/development/

Local/Global Encounters

Whose Lands? Whose Resources?

SHALMALI GUTTAL

ABSTRACT Shalmali Guttal looks at shifts in agriculture policy in Cambodia and Laos as governments aim to transform the structures of their agriculture towards greater commercialization and markets. She argues this has far reaching impacts on rural social structures, and rural peoples’ access to land and security of tenure. KEYWORDS extractive development; biodiversity; farmers; monocrops; land acquisition

The forests that the company is clearing are not degraded; they are forests from which we get food, roots, medicinal plants and things for our life.We have protected these forests for decades. Now the company will pull these forests out from their roots, they will take everything; they will sell the hardwood and take out all the plants. Nothing will grow there naturally.What the company will plant in this area will not be a forest; they will plant trees that we cannot even eat the leaves of. (Woman community resident. Ansar Chambok Commune, Krakor District, Pursat Province, Cambodia, on 9 April 2010)

Introduction In Cambodia and the Lao PDR (Laos), unbridled exploitation of natural resources by state and private investors is increasing land insecurity, landlessness, environmental degradation and poverty. Joined by the Mekong river, rural populations in both countries depend on the natural environment for food and livelihood security. Agricultural production is largely rain-fed and integrated with local eco-systems: streams, ponds and wetlands provide fish, frogs, crustaceans and molluscs, seasonal flooding regenerates soil fertility and biodiversity, forests and woods provide wild foods, fibres and medicinal plants, and common lands and fallows serve as grazing lands for cattle. Laos, a country of about 6.5 million people and 160 ethnic groups, lies at the very heart of the Mekong region. Rich in natural resources and biodiversity, the country boasts stunning landscapes of rivers, mountains, forests, plateaus and alluvial plains. Over 80 percent of the population resides in rural areas and is engaged in subsistence agricultural production. Laos is home to about10,000 species of animals, plants, insects and fish, and considered one of the world’s hotspots in rice biodiversity. Generations of local experimentation, seed exchanges and seed selection among its various ethnic groups has resulted in an astounding variety of traditional seed varieties and indigenous knowledge about rice cultivation and resilience. The country is the second largest contributor in the world to the International Rice Gene Bank. Development (2011) 54(1), 91 – 97. doi:10.1057/dev.2010.109

Development 54(1): Local/Global Encounters Cambodia, Laos’ southern neighbour, has a population of about 14.5 million, only 22 percent of which is urban. With a topography as varied as Laos, Cambodia contains approximately 10.7 million hectares of tropical forests of various types. Its landscapes are shaped by numerous streams, lakes, wetlands, rivers and coastlines, which spawn a large variety of fish, crustaceans and molluscs. The country is home to the famous Tonle Sap lake, the largest freshwater lake in Southeast Asia that expands almost three times in size during the monsoon season.

Extractive development

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Although both countries are extremely dependent on foreign aid and credits for core budgetary support, ‘development’ in Laos and Cambodia is becoming increasingly synonymous with private investment. The prevalent model is market oriented and prioritizes rapid economic growth, integration with regional-global markets, trade and investment liberalization, and privatization. Private investment is sought in virtually every sector of the economy from energy, oil, minerals, agriculture and food processing to education, health, tourism, manufacturing, pharmaceuticals, transportation and urban infrastructure. National development plans are augmented by regional/global economic arrangements promoted by the Asian Development Bank (ADB), the World Bank Group, the Association of Southeast Nations (ASEAN) and bilateral donors. Bilateral aid is generally tied to investment opportunities for private firms from donor countries. In 2009, Laos registered an economic growth rate of 7.7 percent and is now aiming for at least 8 percent growth over the next five years, primarily through private investment. On 20 November, marking Vientiane’s 450th anniversary as Laos’ capital and the 35th anniversary of the country’s founding (Vientiane Times, 2010), the Ministry of Planning and Investment, Vientiane authorities and Lao National Chamber of Commerce and Industry hosted a seminar on investment opportunities in Laos and Vientiane. The Government of Laos (GoL) promotes Laos as a desirable investment destination citing among its advantages an

abundance of natural resources, large areas of fertile land, a flourishing tourism industry, reliable power supply, low risk of natural disasters, political stability, socio-economic and financial stability, high security, and privileged access to European Union (EU) and several other markets. The Royal Government of Cambodia (RGC) offers generous incentives to foreign investors with few restrictions on imports from abroad or repatriation of profits. An emerging urban middle class makes Cambodia an attractive market for private education, health and financial services, fast food and beverage franchises, and luxury goods.1 The Cambodian economy grew by about 11 percent a year, spurred by booms in the tourism, garment manufacturing and real estate sectors but slowed down tremendously in 2008^2009 because of the global economic crisis. At the heart of most large-scale investment projects in Laos and Cambodia is the exploitation of environmental and natural wealth, water resources and agricultural potential. Agriculture, forests and fisheries, the mainstays of majority of the populations in both countries, have taken heavy blows from free market policies, privatization and liberalization, resulting in displacement from traditional occupations, food insecurity and distress migration. In Cambodia, ruling elites have facilitated a frenzy of land-grabbing in rural and urban areas, creating landlessness, homelessness and destitution on a massive scale. Vast tracts of farmlands, forests, wetland and common lands (from 10,000 to 300,000 hectares) have been given away as economic land concessions (ELCs) to domestic and foreign companies for tree and cash crop plantations, mining, oil and gas exploration, tourism, luxury housing and recreation, high end retirement complexes, etc. A growing, middle class has joined the band-wagon, buying up land from rural families unable to meet the rising costs of agricultural production, health care and food (Guttal, 2009). In 2009, Cambodia signed a financial deal worth over US$ 500 million with Kuwait, which supposedly includes 50,000 hectares of farmland for food production for Kuwait (The Economist, 2009).

Guttal: Whose Lands? Whose Resources? In Laos, timber exports, hydropower development and mining have been the most common revenue earners for the state. By the mid-1990s, however, plantations for industrial trees and crops started booming across the entire country with the purported objectives of increasing FDI, fully realizing agri-investment potential and checking swidden cultivation. By 2007, an estimated one million hectares of land had been leased to foreign investors for a minimum of 30 years. In May 2007, Lao Prime Minister (PM) Bouasone Bouphavanh announced an indefinite moratorium on large ELCs for industrial trees, perennial plants and mining, citing social, economic and ecological problems that had arisen from past concessions. The PM acknowledged that investors had destroyed valuable forests and villagers’crops and trees without prior notification and compensation (Hansen, 2007). However, ELCs continue to be granted for tourism and other infrastructure, and the problems created by past/existing plantations have not been addressed.

Selling the forests and grabbing the lands The forests, woodlots and wetlands of Laos and Cambodia are dwindling and degrading rapidly because of dam and other infrastructure construction, indiscriminate commercial logging, industrial tree plantations, urban expansion and land grabbing by local/national elites and foreign companies. Forests, fields and water bodies are crucial repositories of biodiversity and integral to the lives, cultures and economies of rural communities in Laos and Cambodia. They are sources of medicinal herbs/plants, fuelwood, housing materials, fibres, resin, and a variety of wild foods such as roots/tubers, herbs, fruit, mushrooms, bamboo/rattan shoots, honey, fish, frogs and small crustaceans and animals. They are also the only safety nets that rural populations have. Wild, foraged foods are significant components of regular diets and non-timber-forest products (NTFPs) provide income much needed in times of cash and rice shortages.

Many communities have sacred ‘spirit forests’ that are sources of local rivers and streams; protecting the forest also means protecting the communities’ water sources. Forests are also important for local education and knowledge; children learn the value of plants, animals, poisons and medicines by accompanying their elders to forests. The demarcation between forest and agricultural lands is often blurred. The system of rotating production fields and fallows is common in both swidden and lowland farming. Fields left fallow for long become forests, and vegetable gardens and orchards are often planted in forests to ensure hospitable growing conditions. Strangely, governments tend to hold swidden and foraging practices responsible for forest destruction while they continue to permit commercial logging in primary and secondary forests. In Cambodia, forestry officials and experts estimate that the country has lost about 2.6 million hectares of forest over the past 20 years, much of it to logging companies. Cambodian hard-wood fetches a high price (US$ 120 per metre) and companies have generated tens of millions of dollars from Cambodian timber. A forestry law passed in 2002 made it illegal to log outside forest concession areas and in areas designated as national parks and wildlife sanctuaries; during the same period, the RGC placed a moratorium on new forestry concessions.While these reduced logging, the moratorium does not cover ELCs, which are owned by the same companies responsible for logging and on which logging continues regardless (Guttal, 2006). Commercial logging has been going in Laos for more than 30 years. By the end of the 1980s, timber products accounted for half of the country’s export earnings. Commercial logging in Laos has been supported by the World Bank, the ADB, UNDP, the Food and Agriculture Organization (FAO) and bilateral donors such as Sweden, Australia and Finland. In 1990, Laos adopted the World Bank-UNDP-FAO-initiated Tropical Forest Action Plan (TFAP), which laid out a framework for land and forest management, and recommended a logging rate of 280,000 cubic metres a year and the establishment of industrial tree plantations. With the TFAP came categorization of

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Development 54(1): Local/Global Encounters forests as production, conservation, protection, regeneration and degraded forests, a key objective of which was to restrict the access of ‘unauthorized’ rural people into some types of forest. Thus, forests that rural communities had used for decades for foraging and firewood were declared off bounds, while logging companies could continue their operations at will (Guttal, 2006). Rural communities report that human pressure on the natural environment has greatly increased because of logging, land preparation for ELCs, over extraction of NTFPs for external markets and national development policies. Because of developmentinduced relocation/resettlement, more people are foraging and fishing in the same forest and stream, depleting food sources and biodiversity.

Agricultural transformation In earlier days we had cows and buffaloes, but since we started growing corn we sold them all. We don’t have grazing lands anymore because we are growing corn in the upland fields. We also don’t have time to look after large animals. (Woman community resident. Baeng District, Oudomsai Province, Lao PDR, on 17 March 2010) Agricultural production is changing: there are rubber plantations now so no more grazing lands; we are not allowed to do swidden cultivation so everyone is using the land more intensively; this will have bad consequences for all of us. (Woman community resident. Meungsai District, Oudomsai Province, Lao PDR, on 10 March 2010)

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In Cambodia and Laos, governments plan to transform the structures of their agriculture towards greater commercialization and markets. This has far reaching impacts on rural social structures, rural peoples’ access to land and security of tenure. In both countries, all lands within national boundaries are under state control. Citizens have the rights to use, manage and transfer particular types of land for specified purposes, which can be formalized into ‘land ownership’ through land titles. Most rural people, however, do not have land titles. Access, use and management of lands are generally governed through customary practice. In areas claimed by

indigenous peoples and where swidden cultivation is practiced, the nature of land and forest use favour collective arrangements for resource management. However, the state can seize/expropriate any land at any time for national development and security. In the1990s, in a bid to check forest degradation from swidden cultivation, the GoL embarked on an ambitious programme of reforms in natural resource management called the Land and Forest Allocation Programme (LFAP). LFAP was intended to control shifting cultivation and support community resource management by defining clear resource boundaries for agricultural, forest and other lands, prescribing how different lands should be used and managed, transferring resource management responsibilities to village committees, and allocating farmland and degraded forest lands to households by issuing temporary land use certificates (Fujita and Phanvilay, 2008). The goal of ‘stabilizing’ shifting cultivation was supported by the ADB, conservation organizations and bilateral donors. Farmers hoped to acquire tenurial security through land titles, which would then entitle them to legal protection and compensation in the event of their lands being confiscated for dams, plantations, roads, etc. (Vandergeest,2003). Studies show that contrary to expectations, the LFAP increased land and food insecurity, poverty and distress migration. Because of land allocation criteria and restrictions on land use, farmers were forced to shorten fallow cycles and farm fewer fields more intensively, which resulted in soil degradation and lower rice yields (Vandergeest, 2003). In many areas, upland communities were forcibly resettled to the plains where fertile lands suitable for permanent cultivation were already taken. Communities that were not resettled were exhorted to shift from swidden farming to permanent cultivation of cash crops such as corn, cassava, sugar cane, rubber and increasingly, bio-energy crops. Communities report that such cultivation has degraded the quality of farmlands and streams, diminished the availability of wild foods and fish, and made them dependent on cash purchases of rice. Shifts in land use policies and cultivation practices have led to the burgeoning of ‘boom crops’

Guttal: Whose Lands? Whose Resources? such as corn, cassava, coffee, sugarcane, rubber, eucalyptus and other fast growing trees. In northern Laos, farmlands in many districts are used solely for commercial corn production, while hillsides and commons are converted to rubber ‘farms’. Many of these are owned by provincial/ district government officials and business-people, who are able to access land, capital, agricultural inputs and machinery and are becoming new rural entrepreneurs. Farming communities no longer grow rice and vegetables in their upland fields, or graze their livestock in former open access lands; many report that they work on lands owned by new entrepreneurs to make ends meet. In both countries, smallhold farmers often produce cash crops under contract arrangements with agribusiness companies and traders who supply them with seeds, equipment and promises to buy the harvests. Such contract farming (CF) is being actively promoted by governments and donors as ways to integrate subsistence farmers into regional and global economies. CF has existed in Cambodia since the 1960s, mostly focussed on tobacco, cotton and jute, and has since expanded to include animal feed, livestock and rice production. The RGC is currently preparing a decree on CF to facilitate agribusiness operations, food processing and agrifood exports. In Laos, CF has received a boost in the 6th National Economic-Social Development Plan (2006^2010), which states that,‘private initiatives including those by foreign investors and traders from neighbouring countries to promote contract farming, especially in horticulture and tree crops are being encouraged’. In 2007, alongside the moratorium on ELCs, the Lao PM highlighted CF as the preferred alternative, emphasizing that the GoL will promote the ‘2 þ3’ policy as a way to divide benefits between investors and farmers: farmers contribute land and labour while investors contribute inputs, technical support and access to market (Fullbrook, 2007). While contract arrangements provide income to farmers in the short term, contract terms do not generally favour subsistence and smallhold producers who have neither the capital nor liquidity to absorb production or market failures. In Cambodia and Laos, smallhold farmers are already

facing financial distress because of CF-related debts. The migration of youth to urban areas to find wage employment to repay debts is now a common phenomenon in both countries.

Monocrop disasters The best known and arguably the most destructive mode of boom crop production is industrial monocropping in plantations, which have become scourges in Cambodia and Laos. Hundreds of thousands of hectares of agricultural and forest lands have been handed over to state and private companies for plantations of rubber, pine, acacia, eucalyptus, hard-woods, corn, cassava and sugarcane. The tree/crop species that are planted are generally fast growing in order to maintain a steady supply of raw materials for industry, and all of them are usually alien to local eco-systems. On the rise are agroforestry ‘carbon sink’ plantations. The investors come from neighbouring India, Vietnam, China and Thailand, but also further afield from Singapore, South Korea and Australia. Plantations have been promoted by donors, ADB, World Bank, Export Credit Agencies and private consulting firms as a strategy to maximize the economic uses of ‘degraded’ forests and ‘idle’ lands, prevent soil erosion and flooding, increase reforestation and alleviate poverty. Despite minor variations, the overall story of plantations is one of forest destruction, land grabbing and impoverishment of peoples and environments. Many plantations are accompanied by processing plants close at hand, which consume huge amounts of energy and water that are denied to local communities. Plantations are monocultures and require intensive use of chemical fertilizers, pesticides and herbicides, which create aridity, poison the soil and deplete it of nutrients, and contaminate aquifers and surface water sources. Plantations have displaced local peoples from their villages, fields, forests and traditional occupations. In many cases, local communities are forced to relocate altogether. In cases where people can remain in their villages, they are not permitted to use the surrounding forests and commons for foraging and grazing since these now

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belong to plantation companies. Encroachment by plantation companies on village, forest and public lands is common. Communities in southern Laos report that companies have fenced their grazing lands and claim them as part of the concessions. Communities in the Pheapimex plantation area in Pursat and Kampong Chnang provinces in Cambodia report the loss of community forests, wild food sources, sanctuaries for rare wildlife, sacred spirit sites, streams and water sources, grazing lands, rice fields and even their homes and villages. Plantation companies frequently violate written agreements but rarely face state censure or punitive action. Companies promise jobs, schools, health centres, roads and other infrastructure but generally do not deliver. Promises of employment and better standards of living are belied by actual experiences. According to villagers in Kampong Chnang, ‘People who work on plantations work under very bad conditions: their sources of food are destroyed, they have no money to buy food and only get a few cups of watery rice for long, hard days of work ^ no nutrition. They are not paid for several months. Workers come home sick, tired, weak and without any money’. In both countries, governments have promoted plantations and other ELCs to increase foreign exchange revenues and extract maximum monetary value from natural resources. A core mechanism of state support has been the provision of land to investors through outright seizures of farm, forest and common lands, with little or no compensation for local communities, many of who are evicted and resettled to other areas where as migrants, they are inevitably pushed into conflicts with locals already farming those areas. State seizures of land and evictions are frequently brutal, backed by politically powerful actors and accompanied by state security forces. Cambodia abounds with such examples, most famous among which are allocations of tens of thousands of hectares of lands for Pheapimex and the LYP Group. In February 2010, the RGC issued a document that grouped sections/battalions of the Royal Cambodian Armed Forces (RCAF) with private businesses and entrepreneurs, who are expected to provide monetary and material support to their designated RCAF outfits.

Land acquisitions for investors also work through coercion. Farmers are told that they will lose part or all of their lands anyway to the company; they can either sell willingly today, or have their lands seized without compensation in the future. People with formal land titles are entitled for higher compensation than those without titles, though actual compensation packages are pitiful substitutes for lost livelihoods and fractured communities.

Listen to the people What kind of development is this? If the government cares about development, they should take the people along so that we can own the development and what comes out of it. But in this type of development, people lose everything. (Focus group discussion with residents affected by the Pheapimex ELC in of Krakor district in Pursat and Boribor district in Kampong Chnang, March 2010)

For people dispossessed and displaced by investment-driven-development, survival is a daily struggle. Language by governments about encouraging ‘high quality and environmentally and socially responsible investment’, ring hollow in the absence of appropriate regulatory frameworks that protect the land, resource, food and livelihood rights of their rural populations, especially those who are most vulnerable. Cambodia and Laos may well achieve higher levels of economic growth through more open investment regimes, but this growth will come at even higher costs to their rural populations, who create real value for society by producing food, nurturing fragile eco-systems and regenerating biodiversity and environmental wealth. Before these governments rush to let more investors through the door, they would do well to first listen to the voices of their rural citizens. It is our land and our labour, but we have to work our own land for the company and we get nothing in return y In the past we had our lands, we could grow what we wanted and even if we ate little, it was food that we produced. But now we are the slaves of the company. (Discussion with village residents in a plantation area; Bachieng District, Champassak Province, Lao PDR, on 24 February 2010)

Guttal: Whose Lands? Whose Resources? Note 1 See, for example, http://www.buyusa.gov/thailand/en/cambodiamktprofile.html and http://www.austrade .gov.au/Doing-business-in-Cambodia/default.aspx; accessed 15 November 2010. References Fujita, Yayai and Khamla Phanvilay (2008) ‘Land and Forest Allocation in Lao People’s Democratic Republic: Comparison of case studies from community-based natural resource management research’, Society and Natural Resources 21:122^33. Fullbrook, David (2007) ‘Contract Farming in Lao PDR: Cases and questions’, Laos Extension for Agriculture Project (LEAP) for the Government-Donor Sub Working Group on Farmers and Agribusiness, October. Guttal, Shalmali (2006) ‘Development and Plunder in the Mekong Region’, in Revisiting Southeast Asian Regionalism, Bangkok,Thailand: Focus on the Global South. Guttal, Shalmali (2009) ‘New and Old Faces of Hunger: Cambodia, Timor Leste and food crises’, Review XXXII(1), pp 61^89 Hansen, Cor H. (2007) ‘Lao Land Concessions, Development for the People?’, Proceedings: International Conference on Poverty Reduction and Forests, Bangkok, September. The Economist (2009) 23 April http://www.economist.com/node/13527987?story_id=13527987, accessed 22 November, 2010. Vandergeest, Peter (2003) ‘Land to Some Tillers, Development Induced Displacement in Laos’, ISSJ 175, UNESCO. Vientiane Times (2010) ‘Laos Raises Profile Among Private Investors’, 22 November.

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