We are representatives of the Auyu, Wambon and Muyu peoples, who live within the administrative area of Boven Digoel Regency, Papua province, and primarily in villages that are targets for investment in the forestry and plantation sector. We have held a dialogue with government and policy-makers from Boven Digoel, along with Civil Society Organisations PUSAKA, SKP Merauke Archdiocese and WWF Papua, concerning government policy to protect and respect the rights of Papuan indigenous people to land and natural wealth. The even was held in the PBHK Convent Dormitory in Tanah Merah, on the 4th and 5th November 2016.

We take the view that the land is like our mother who protects human beings and all living creatures found on or under the earth. For us, land has many uses – it is the place we live, the place we build our lives together, a place for hunting, sacred places, holy places, historic places, our source of food, our source of income, our source of medicines, our particular social and cultural identity, a habitat for animals and plants, the land which is transferred when a marriage takes place, and a place for things visible and invisible.

We indigenous people control and own land and natural wealth based on customary law and the customs alive within each community, such as systems to regulate inheritance, gifts and fines. Land management and land use is still based on local knowledge and customs, decision-making councils, mutual aid, family labour, the use of traditional tools and working at a small-scale to meet life’s needs, also paying attention to protecting the environment.

We are currently facing problems and threats due to the investment activities of logging and oil palm companies which are taking land and forest products from our ancestral domain on a large scale. The companies are: PT Tunas Sawa Erma (Korindo), PT. Usaha Nabati Terpadu, PT. Trimegah Karya Utama, PT. Megakarya Jaya Raya, PT. Manunggal Sukses Mandiri, PT. Megakarya Jaya Raya, PT. Kartika Cipta Pratama, PT. Graha Kencana Mulia, PT. Energi Samudera Kencana, as well as logging companes PT Tunas Timber and PT Bade Makur Orissa, which all together have permits for 1,088,394 hectares.

The government gives out permits to companies without the local indigenous community first holding a meeting to decide what they want and give their agreement. The companies acquire land without a collective community decision or free and fair negotiations. Companies use a method of payment which they call “tali asih” [a vague term used to mean a thank-you payment] to obtain land from customary rights owners. They also organise celebrations, give aid, make promises of development, make open or veiled threats of violence, use manipulative techniques, and ask people to sign empty sheets of paper. When ‘tali asih’ or compensation money is given, it takes place secretively and as the company chooses and so only serves to create conflict and tension between members of the community, mutual suspicion and a feeling of disharmony.

We have witnessed how companies have cleared natural forest, sago groves, rubber farms, fruit trees, sacred places, ancient villages, and how rivers have become sedimented, dirty and polluted.

As a result, we, whose lives are highly dependent on forest products, have lost the forest and our lands. We are finding it difficult to make a living, the places we used to hunt have gone, our historic and cultural places have gone, our sources of food, and our clean water. Disposal of waste into rivers and swamps in violation of environmental standards has made the community afraid to consume what they can take from rivers and sago groves. Many wild animals are becoming rare and hard to find, such as birds of paradise, cassowaries, crowned pigeon, deer, kangaroos, wild pigs, forest chickens, cuscus, lory birds and cockatoos, arowana fish, akasi fish, freshwater lobsters.

We also urge companies to respect indigenous people’s rights, protect places of importance to the community, hold community councils and consensus decision-making, so many people are involved in land acquisition arrangements, and respect community decisions not to cede land and forest to companies.

We urge local government to be actively involved in resolving tensions and conflicts that have emerged as a result of investment activities and violations of the rights of indigenous Papuans, where Papuans have lost their rights over their living space, using the method of peaceful and fair dialogue, and rehabilitating and restoring the rights of indigenous Papuans.

We urge local government to produce policies and programmes to empower and improve the welfare of indigenous Papuans, especially business and structures for community enterprise such as: facilitate the development of rubber cultivation, buying and marketing rubber, forming co-operatives and rubber farmers groups in each village.

We urge the local and national government to produce policies and programmes to secure land as a source of food and businesses to process food crops grown by the community, especially for Papuan women.

Signed by 23 participants from villages including Meto, Yang, Hobinangge, Watemu, Getentiri, Anggai, Ujung Kia and Asiki, as well as NGO representatives.

Source: Pusaka http://pusaka.or.id/assets/2016/11/Pernyataan-Boven-Digoel-05102016.pdf

However, many companies with ambitions to vastly increase their plantation area are still looking to Papua as one of the few areas where large amounts of land are still potentially available. Plantations on this new frontier are often much larger than elsewhere in Indonesia, meaning huge environmental destruction and drastic changes which have a devastating effect on local indigenous populations.

Accurate information on how the oil palm industry is developing in Papua is crucial to be able to assess whether the changes in the industry will actually protect the forest and make a positive difference to the lives of indigenous Papuans, or if it will just give a better image masking the same old problems. Nevertheless, obtaining full data is still a major challenge. This series of articles aims to give it a shot, profiling a few of the newest companies to start operations in Papua, especially companies which have recently started cutting the forest, or appear to be preparing to start work. The first is a particularly worrying case, where forest clearance started last year: Pacific Inter-link.

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In a remote area of Southern Papua an immense block of 2,800 square kilometres (the size of Luxembourg, or three times Singapore) of primary rainforest has been given permits for oil palm, and deforestation has already started. In an incredibly brazen move by local politicians, (later supported by the Forestry Ministry), this whole area was given away to just one company, the Menara Group, divided into seven contiguous concessions.

The Menara Group has since sold most of the concessions to two Malaysian-based companies: Pacific Inter-link took four of the concessions (PT Megakarya Jaya Raya, PT Kartika Cipta Pratama, PT Graha Kencana Mulia and PT Energi Samudera Kencana) and Tadmax Sdn Bhd took two (PT Trimegah Karya Utama and PT Manunggal Sukses Mandiri). The remaining concession, PT Usaha Nabati Terpadu, either still belongs to the Menara Group or has been sold to an unknown buyer.

Pacific Inter-link started work on one of the concessions, PT Megakarya Jaya Raya in mid 2015. Satellite images show that by April 2016, 2,840 hectares of forest had been cleared. About one third of that area was on deep peat, and the area lies within an intact forest landscape. Most of PT Megakarya Jaya Raya’s concession is classified on Indonesian government maps as primary forest, as are the other three concessions.

It isn’t easy to greenwash the conversion of 160,000 hectares of primary rainforest to palm oil plantation. Nevertheless, Pacific Inter-link makes a lame attempt to do just that on its website, stating that “Lots of careful measures are taken to ensure no ecological damage takes place due to this project.” The company did not respond to a request to view high conservation value assessments or social and environmental impact assessment.

How did one company manage to get its hands on so much land? There are no local groups in this remote area which have been able to undertake a full investigation. However, corruption must be suspected. The Boven Digoel Regency Head, Yusak Yaluwo, issued the initial location permits in July 2010, three months after being arrested on unrelated corruption charges. He was found guilty in November that year, and declared non-active by the interior minister. Nevertheless, despite being imprisoned in Sukamiskin Prison, Bandung, there were frequent allegations that Yusak Yaluwo was continuing to run the Boven Digoel government from his prison cell by mobile phone. He was officially removed from his post in May 2013, but wasn’t formally replaced by his deputy until June 2014. The upshot of this bizarre story is that there was no effective local government in Boven Digoel for three and a half years, the time which the Menara Group was engaged in the permit process for the plantations which would later be sold to Pacific Inter-link.

At the same time in the Aru Islands in Maluku, the Menara Group had tried to claim an even larger area for a sugar-cane plantation. However, as a strong local campaign was unearthing irregularities at every level, the Forestry Minister eventually declared that the plantation would not go ahead, giving the reason that the land was not suitable for sugar cane after all.

The land which is being cleared is near an indigenous village, Kampung Anggai, but there have been no reports of how the local people view the company, nor what methods the company used to persuade people to allow it to use their land.

Tadmax, the other company involved, has so far not developed its concessions, claiming to be looking for a partner, or to sell the land. Its 2015 Annual report states that “the Group is in the process of identifying parties to undertake a plantation development (both on its own or through joint ventures) and/or outright disposal of all or part of the land or a combination of the above. “

Previously both Pacific Inter-link and Tadmax had signed up to a joint venture in 2012 for an integrated timber complex which would use the wood from their concessions, but there is no recent news that might indicate the plan is still going ahead.

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Pacific Inter-link is based in Malaysia, but is part of the privately-owned Yemeni conglomerate, the Hayel Sayed Anam Group. Its plantation in Boven Digoel is the company’s first, but palm oil has long been part of its core business and the company has a presence at almost all levels of the industry. It operates refineries on Sumatra, is a trader of crude palm oil which it buys from other plantation companies, and markets consumer goods produced from palm oil under a number of brand names: Avena, Madina, Pamin and Sheeba cooking oils, Saba Juliet and Meditwist Soap and Milgro milk products. As well as South East Asia, Pacific Inter-links products are marketed in the Middle East and Africa, where its brands have a dominant market position.

This high degree of vertical integration in its supply chain insulates Pacific Inter-link from the pressures on other palm oil producers, which have to contend with the possibility that if they continue to deforest, their product may be boycotted by several of the largest palm oil traders.

However, the concessions have caught the eye of Forestry and Environment Minister Siti Nurbaya. In an interview with foresthints.news she described how existing palm oil permits will be reviewed in preparation for a moratorium, “Several of our findings indicate that in areas where forest release permits have been granted since 2011 in Papua, nothing has been done there and they are simply landbanks. We even found that some of these permits have been traded. For example, seven forest release permits for palm oil development in that province [Papua], amounting to almost 300 thousand hectares, were sold to a number of business groups in Malaysia. This practice of trading involves 20 percent of the areas that should be given to communities.”

Pacific Inter-link is an RSPO member as a trading and processing company, but has not mentioned the existence of its plantations in any submissions to the RSPO. Neither has the company responded to requests for information from awasMIFEE.

The situation is extremely alarming: what is likely to be the largest single palm oil plantation development project ever to take place in Indonesia is happening in an area of primary rainforest, containing peat swamps, and with no information whatsoever on how the plantation is affecting the tribes living in one of the remotest areas of Papua. A large area has been cleared already, but this is still only so far only 1% of the total areas under permit. Serious and immediate attention is needed on how the Menara Group, and subsequently Pacific Inter-link managed to get control of such a large area, and it needs to be held to account on its potentially devastating social and environmental impact.

The people of the Aru Islands have hopefully seen off the Menara Group, which had wanted to claim nearly 500,000 hectares out of the 629,000 hectare archipelago for a giant sugar-cane plantation. After a year of concerted local opposition, bolstered by solidarity from activists from Ambon, on April 10th the forestry minister Zulkifli Hasan stated to the press that he will not sign the final permit the Menara Group needs.

This statement came after the Save Aru campaign highlighted flaws at every step of the process which allowed Menara Group access to the islands: Why was Aru’s land-use plan dramatically changed to allow such a vast plantation? Why were permits given when the proper conditions had not been met? Why was an Environmental Impact Assessment which was approved despite containing neither any description of the company’s plans nor any meaningful assessment of environmental impacts? Responding to public pressure, both the newly-elected Governor of Maluku and the Presidential Work Unit (UKP4) had said they would look into the process.

The activists in Aru know that the Menara Group could still make a comeback, and there are plenty of other companies waiting to take their place, notably the Nusa Ina Group. The islands’ long term future is far from assured. But this is certainly good news.

However, this does not mean that the Menara Group is out of the plantations game for good. Apart from the ill-fated attempt in Aru, it has also been trying to get its hands on large swathes of land in Papua, and seems to have been rather more successful. Menara Group moved into Boven Digoel Regency in Southern Papua around a year before emerging in Aru, and has obtained 400,000 hectares of oil palm concession there, mostly in Jair and Mandobo districts.

There are some similarities between the situation in the Aru Islands and in Boven Digoel. Both are huge areas of land – the Boven Digoel land for example is two-thirds the size of Bali. Both include large areas of primary forest containing valuable timber which has never been logged. Both got their permits from local leaders who are currently in prison, having been found guilty of corruption charges, although neither case was directly related to the Menara Group.

Unfortunately, unlike in Aru, no social movement has emerged in Boven Digoel to address the issue, and monitor any possible irregularities. Very little information has emerged from the ground there. The only direct report came in 2013, when villagers contacted a priest from the area who now works elsewhere, concerned that a company called Menara Group had toured various villages handing out several billion Rupiah as they went. The people didn’t know what the money was for. The concern is that the villagers might have been deceived into signing over their land rights in exchange for this cash.

If no-one is monitoring this company, it could well turn out that the next news only comes after the heavy machinery moves in and villagers realise that their forest has gone. Before this happens, here’s an attempt to piece together some of what we do know about the land, and the companies involved.

Who and What is the Menara Group?

The Menara Group is not known to have operated any plantations before it ventured into Aru and Boven Digoel. However, it appears incredibly ambitious, daring to propose plantations on a scale that no established plantation company has attempted in recent years.

The limit for plantation size in Papua is 40,000 hectares, so Menara Group simply created 10 subisdiaries, all located at different addresses in the Grogol district of Jakarta. This is the first sign of dodginess – many of these addresses do not exist, and in those that do, the occupiers when visited had no knowledge of the Menara Group companies.

This is typical of the Menara Group, which appears to have taken many steps to remain elusive. Its president, Chairul Anhar, is an Indonesian businessman who has interests in Malaysia. Its chairman is more well-known: Da’i Bachtiar was the Indonesian Ambassador to Malaysia from 2008 to 2012, and before that was the chief of the Indonesian police, meaning that he is a figure of some influence. Before this foray into mega-plantations, the group was believed to have interests in consultancy, banking software and e-commerce, but as a private company, its full portfolio of interests is unknown. Neither is it known where the company might find the huge amounts of capital necessary to start up plantations on this scale.

One theory is that the Menara Group’s main intent was to sell on the companies once it had obtained the permits, facilitating Malaysia companies which wished to move into Papua. In 2011, the Menara Group sold two of its subsidiary companies, PT Manunggal Sukses Mandiri and PT Trimegah Karya Utama to the Tadmax corporation of Malaysia, giving Tadmax the opportunity to develop a 80,000 hectare plantation. It is likely that another 160,000 hectares (or four subsidiary companies) have been passed onto Pacific Inter-link, another Malaysian-based company.

Tadmax, Clearly after the Timber.

The Tadmax deal reveals a lot more information about plans for the land than Menara Group had chosen to make available. Since it is a publicly-listed company in Malaysia, Tadmax has to publish more details of its transactions and accounts.

Notes published at the time of sale included a valuation of the companies. The valuers noted that the forest in the two parcels was “undisturbed forest”, which had never been logged except for some localised shifting cultivation by villagers. They made an estimate of the value of the timber in the concessions: 218,000,000 Ringgit (99 million US$ at the time) . Then they worked out a value of the palm oil concession, based on comparisons with other recent land sales in Indonesia. That came to 69,000,000 Ringgit (31 Million US$). They assumed that these other land deals had no timber component, noting “Our verbal enquiries with Dinas Perhutanan revealed it is norm in Indonesia for the government to only issue ‘Izin Lokasi’ for worked-over forest lands with timber stand covering less than 30% of the land area”.

What that means is that 75% of the value of the concession in Boven Digoel is from timber extraction, and only 25% is from planting oil palm. Moreover, it is unusual for a swathe of primary forest such as this to get a permit for oil palm. What does that tell us about the Menara Group’s motivation for the remaining 320,000 hectares? Is it a coincidence that the Aru Island concession was also mainly never-logged, containing valuable timber?

Tadmax bought the companies for 40 million USD each. In all company statements and press reports concerning their plans, Tadmax explicitly describes its holdings in Papua as ‘timber rights’. Oil palm, which is what they were actually given the permit for, scarcely gets a mention. In its 2012 Annual Report, Tadmax mentions its hope at the time to “proceed to undertake timber extraction and subsequently the setting up of an oil palm nursery (should the Group decide to embark in this sector) commencing in the 4th quarter of 2013 ”. In other words, the company is not even sure if it will bother with planting oil palm.

Tadmax has an oil palm permit, but doesn’t seem to have thought much about oil palm as yet. The thing is, the Indonesian government does not give out unconditional permits to just clear-fell primary forests like that. Logging concessions include conditions for forest management. It expects something back – an oil palm plantation will yield the state returns for decades, whereas Tadmax’s plan is to clearcut the forest within six years, leaving empty land behind after that. The timber permit Tadmax is fixated on (Izin Pemanfaatan Kayu) is intended as an additional permit to allow a company to market the wood it obtains clearing the forest for a plantation.

Tadmax is a company with a background in timber. It was formerly known as Wijaya Baru Global Bhd and owned by one of Sarawak’s timber tycoons Tiong King Sing, before Major Anuar Adam bought a major stake in 2011. Menara Group’s Da’i Bachtiar was also on the board of directors until February 2014.

Integrated Timber Complex Joint Venture

In August 2012, Tadmax entered into a joint venture with several other Malaysian-based companies in Boven Digoel called Tulen Jayamas . To develop oil palm? No, that wasn’t mentioned. The joint venture would be to develop an ‘Integrated Timber Complex’ with “the business of processing timber logs extracted from the Subject Properties into plywood, sawn timber, wood chips and other timber products”

Tadmax only has a 14% share in the joint venture, with four other companies holding the remainder. The largest stake, 50.5%, is held by a company called Bumimas Raya Sdn Bhd. This is described as a ‘dormant’ company, but its registered address and the names of it’s shareholders suggest it is controlled by the Shin Yang Group, one of Sarawak’s biggest timber firms.

25% of the joint venture company is owned by Pacific Inter-link, a manufacturing and trading company based in Malaysia, but owned by the powerful Yemeni Hayal Saeed Anam group. Pacific Inter-link is believed to have bought, or be buying, four of the Menara Group companies. For some time its website has stated that it is in the “advanced stages of acquiring majority stakes (80%) in several Indonesian companies that have been collectively granted concessions and permits for a land bank of 160,000 hectares”

As a privately-owned company, Pacific Inter-link does not have the same obligation to report on acquisitions, so we can’t be sure whether the sale has been finalised. It is not explicitly mentioned in the Joint Venture notice that Pacific Inter-link’s involvement is connected to marketing the timber contained on these 160,000 hectares (which are also primary forest), but it seems very likely.

Pacific Inter-link probably would also want to plant oil palm, as its core business involves trading palm oil and manufacturing many products containing palm oil, but currently owns no plantations. There has been a trend in recent years for commodity traders trading in palm oil to start their own plantations in order to secure their supply chains, and land in Papua is becoming a key target. Other such companies starting plantations include the Noble Group and Tianjin Julong Group.

Shin Yang may also have an interest in palm oil in the area. As well as its timber business, it also owns Sarawak Oil Palms Berhad, with several plantations in Sarawak.

Smaller stakes in the Joint Venture are held by Al Salam Bank Bahrain (eight per cent) and Yakima Dijaya Sdn Bhd (two per cent). The owner of Yakima Dijaya Sdn Bhd, Yee Ming Seng, has reportedly been involved in the logging industry in Papua since the 1990s.

Tadmax looking to sell

In the first few months of 2014, there have been reports in the Malaysian Press that Tadmax, which has been financially struggling for a while, has been looking to sell its interest in the two ex-Menara Group subsidiaries it currently owns, claiming it wants to focus its business on Malaysia. It is optimistic of using the more-favourable exchange rates recently to make a profit on the deal, but questions have to be asked on why it would wish to sell off its main asset. Something not going right in Papua, maybe?

The wheelings-and-dealings of business and finance are always shrouded under layers of intrigue, and we may never get a full picture of exactly who is hoping to unlock the riches of Boven Digoel’s forest, nor what their plans are for the land.

What is clear however, is that far from the corporate towers of Jakarta, Kuala Lumpur or Miri, there is still a tract of primary forest 400,000 hectares wide along the banks of the Digoel River where the greater bird of paradise can still perform its ritual mating dance undisturbed, the southern cassowary roams the forest floor and cuscus and tree kangaroos find their home amongst the branches.

This forest is also home to the Auyu people, the customary landowners of this land, who have lived in harmony with the forest for many centuries. Are they prepared for the coming violent upheaval in their lives if these businessmen get their way? Have they willingly given their informed consent? For oil palm? To logging? In Aru, the Menara Group never made any attempt to present its plans to most of the affected villages. Can we expect it, or Tadmax, or Pacific Inter-link, to be more responsible in Boven Digoel?