The Compliance Advisor Ombudsman (CAO) of the International Finance Corporation, the World Bank's private sector arm, has just issued a strongly worded report which formally closes its efforts to mediate the resolution of land disputes between affected communities and the oil palm company PT Asiatic Persada (PT AP) in Jambi Province in Indonesia.
Nearly 150 homes were reportedly destroyed in the latest incident in a long-standing conflict between indigenous Batin Sembilan residents and former Wilmar unit PT Asiatic Persada.
This report summarises the various phases of the mediation process between PT Asiatic Persada and the Batin Sembilan communities in Jambi, Sumatra, including the initial phase of mediation by SETARA and the second phase of mediation facilitated by the Joint Mediation Team of the International Finance Corporation Compliance Advisor/Ombudsman (IFC CAO) and the Jambi province government.
The International Finance Corporation Compliance Advisor/Ombudsman (IFC CAO) has formally announced its withdrawal from the case of PT Asiatic Persada, following the sale of the concession by Wilmar in April 2013, and the new management’s decision to continue mediation through a government team instead. This is despite the fact that the affected Batin Sembilan communities and complaint signatory NGOs have repeatedly called on the IFC CAO to continue its role as mediator and to encourage the company to pursue this avenue towards conflict resolution.
Nurman Nuri, Leader of the Suku Anak Dalam group 113 of Pinang Tinggi in the Indonesian province of Jambi, stated in a press conference held on 3 October 2013 at the office of Indonesian NGO CAPPA: "We demand that the Governor of Jambi Province immediately revokes the HGU (Business Use Permit) of PT Asiatic Persada, as since its establishment in the 1980s no benefits at all have been derived by the indigenous Suku Anak Dalam living in this territory, only misery."
Oil palm giant and Roundtable on Sustainable Palm Oil (RSPO) member, Wilmar, has agreed the sale of its oil palm concession PT Asiatic Persada, without prior consultation or respect for the Free, Prior and Informed Consent of indigenous Batin Sembilan communities already engaged in a land conflict mediation process.
This complaint is directed to Wilmar Group regarding its sale agreement of PT Asiatic Persada (Jambi, Indonesia) to Prima Fortune International Ltd and PT Agro Mandiri Semesta.
In 2011, the World Bank Group (WBG) adopted a Framework and Strategy for investment in the palm oil sector. The new approach was adopted on the instructions of former World Bank President Robert Zoellick, after a damning audit by International Finance Corporation’s (IFC) semi-independent Compliance Advisory Ombudsman (CAO) had shown that IFC staff were financing the palm oil giant, Wilmar, without due diligence and contrary to the IFC’s Performance Standards. Wilmar is the world’s largest palm oil trader, supplying no less than 45% of globally traded palm oil. The audit, carried out in response to a series of detailed complaints from Forest Peoples Programme and partners, vindicated many of our concerns that Wilmar was expanding its operations in Indonesia in violation of legal requirements, Roundtable on Sustainable Palm Oil (RSPO) standards and IFC norms and procedures. Almost immediately after the audit was triggered, IFC divested itself of its numerous other palm oil investments in Southeast Asia.
This report provides an account of a short investigation carried out by the RSPO's Ad Hoc Working Group on High Conservation Values in Indonesia. It is being circulated to promote comprehension and discussion about the legal and procedural obstacles to securing such values in the oil palm sector in Indonesia with the view to promoting changes and legal reforms in order to secure these values more effectively. This version includes detailed comments on the report by Wilmar International.
Click here to read the full article from the Norwegian Broadcasting Corporation (in Norwegian only), which features an interview with FPP's Sophie Chao.