Sam Lawson, Earthsight 30 th October 2013

1. Forest conversion for industrial oil palm: Recent developments in the Congo Basin and lessons from SE Asia Sam Lawson, Earthsight 30th October 2013

2. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) Who am I? Which major market req… - Consultant, Director of Earthsight Investigations (research consultancy) Recent relevant activities: 1. Carried out research on oil palm development in the Congo basin for Rainforest Foundation UK (recently published in report ‘Seeds of Destruction’ aka ‘Planter pour Détruire’) 2. Running global research prog with Forest Trends, looking at conversion of forests for large-scale agricultural developments (inc how much such conversion is illegal) 3. Also carrying out research for Chatham House to measure illegal logging & response in DRC, Rep of Congo (REPORTS DUE OUT SOON)

3. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) Lessons from SE Asia: Oil palm v Forests Which major market req… - By far the largest driver of deforestation in SE Asia - 2.8 million hectares of forest in Indo/Mal cleared to make way for oil palm in 15 yrs - 50-60 per cent of all OP expansion in Mal-Indo occurred at the expense of natural forests - massive carbon emissions; loss of biodiversity; endangered species - conflicts with and devastating detrimental impacts on local people - OP co’s favour forested areas (fewer land rights issues; timber values) - much of the expansion has been illegal; lots of corruption involved

4. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) The Congo basin: terrifying potential Which major market req… DRIVERS - Indonesia & Malaysia expected to run out of suitable land by 2020-2022 - Global demand expected to outstrip supply – 7 million ha of additional expansion required, in excess of current BAU expansion - Labour and land costs inc in SE Asia - Two-thirds of the Congo basin’s rainforest area has suitable soils and climate for oil palm - Cheap land, cheap labour, good EU market access, compliant govts

5. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) The seeds of destruction Which major market req… - Congo basin govts actively targeting large-scale expansion - Many of the world’s largest OP companies expanding to Congo basin - Area encompassed by announced OP projects expanding rapidly since 2010 - 1.6 mill ha announced, of which 0.5 mill ha confirmed, but only a few thousand ha cleared and planted so far - Expansion can be expected to continue (other companies known to be scoping for land) - Even though the process has barely begun, the first few projects already demonstrate some of the same env & social impacts & issues seen elsewhere

6. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) Impact of just the first 3 plantations Which major market req… - Cameroon, Gabon, Republic of Congo - Only 1 large new project actually broken ground in each country so far - Increased deforest due to these projects ALONE: Cameroon: ▲ 30% Gabon: ▲ 140% Republic of Congo: ▲ 90%

7. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) Case Study: Atama Plantations, Rep of Congo Which major market req… - Largest oil palm development in Congo basin - Total area 470,000ha; at least 180,000ha to be converted - Most of the land is intact, primary forest, habitat for chimpanzees and gorillas - Large area of overlap with new National Park - This one project will most likely DOUBLE the deforestation rate in RoC - No social or environmental impact assessment - Highly secretive: even most basic documents such as concession maps withheld; Identities of owners shielded through web of off-shore shell companies - Co’ with no prev exp will be catapulted into top 10 OP co’s in world

8. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) Case Study: Atama Plantations, Rep of Congo Which major market req… ‘TIMBER-GRAB?’ - Potentially 22.5 million m3 of timber to be harvested, worth $2.3 billion - This is 15x the annual legal selective cut in the whole country - This one concession could DOUBLE Congolese log exports for 10-20 years - Clear-felling in first 5000ha area began in 2012 - Numerous illegalities identified already (one inspection, v small area) - Implications for EU FLEGT VPA

9. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) Case Study: Herakles/SGSOC, Cameroon Which major market req… - Largest oil palm development in Cameroon; started 2011 - Total planned planting 60,000 hectares - Forest logged in past but remains v dense & intact - Surrounded by important protected areas w/ Chimps/Eles - Dropped plan for RSPO after HCVF assessment criticised - Cleared forest for nursery site illegally without required permissions - Leaked internal documents suggest corrupt payments made to secure deal - Internal documents also admit that company does not have all required permits - Operations officially suspended by govt during Apr/May 2013 (but evidence suggests may have illegally continued) - Govt now talking about cancellation and re-negotiation, reducing size

10. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) Case Study: Olam, Gabon Which major market req… - Largest oil palm development in Gabon; started 2011 - Extremely generous terms from govt - Total planned planting 130,000 hectares - Pursuing RSPO certification - Vast majority of the land allocated by govt thus-far has proven to be HCVF (Ramsar wetlands, primary forests, Great Ape habitat, etc etc) - Olam committed to protect such areas, but other companies offered such land by govt may not be so circumspect - Even non-HCV is still relatively intact forest, and clearance will produce circa 4 million tonnes of CO2 emissions (double Gabon’s current annual emissions)

11. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) Conclusions Which major market req… - Unless urgent action is taken now, the Congo basin is likely to follow the same path as SE Asia - RSPO is not going to prevent this- only 2 of 17 new projects committed to meeting the standards, and one has since dropped plans after facing probs - RSPO standards are also too low, and enforcement poor - Promoting planting on degraded land will only help if coupled with steps to prevent development in forests - REDD+ & FLEGT activities in Congo basin countries have yet to properly recognise the scale of the conversion threat

12. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) What can be done? Which major market req… CONGO BASIN GOVTS - Prioritise development on degraded land and renovation of existing dilapidated plantations - Make high social & environmental standards compulsory (inc HCV, HCS, FPIC) - Map & recognize customary land tenure & user rights - Improve transparency, including legislating to require automatic publication DONORS - Actively promote the necessary changes in government response - Make better use of leverage under REDD+ - Support NGOs & research orgs to help them closely monitor OP development in the region and act as watchdogs - Provide assistance in mapping of customary land tenure - Any support to private sector to prioritise degraded land MUST be coupled with measures to prevent conversion of forested land

13. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) What can be done? Which major market req… DEMAND-SIDE MEASURES - Maximise use of existing measures related to timber (VPAs; EUTR) to block access to markets for timber from illegal conversion - BUT much conversion will probably be legal, and not prevented by VPAs and EUTR: need to block overseas markets to unsustainable wood as well - Demand-side measures in key markets also need to target palm oil, ensuring it is legally & sustainably produced - BUT cannot rely solely on voluntary measures, and RSPO is not enough FINANCE - Measures needed to constrain sources of financing to destructive oil palm expansion in Congo basin

14. Which major market req… Which major market are requiring proof of legality / sustainability? Which major market requirements are changing?How important are their consumer markets to global trade?(net imports, RWE) THANK-YOU Which major market req… More information: - Rainforest Foundation report available in French and English at http://www.rainforestfoundationuk.org/palmoilreport - Contact me: sam DOT platypus gmail DOT com