Palm Oil, Human Rights and the World Bank - Update

Since the 1980s, the World Bank Group has invested more than US$2 billion to promote the global trade in palm oil. The expansion of the crop in intensive mono-cultures, especially in Southeast Asia, has been associated with the extensive clearance of tropical forests, land grabbing and widespread human rights abuses. In response to our complaints, the World Bank Group froze funding for the sector worldwide while it came up with a comprehensive strategy for engagement. A first draft document was released in July for comments. It has failed to address the main issues raised in the consultation, therefore Forest Peoples Programme and its partners have again appealed to the World Bank President for a rethink. 

That the World Bank is listening to its critics is certainly encouraging. They agreed to extend the consultation period, issue the draft for comments and then, after further appeals, to convene a meeting to discuss these inputs (see article in our July Enewsletter). However, the draft document which was issued in July 2010 has been heavily criticised: firstly, for not being the promised strategy at all but just a very general framework; secondly, for failing to address the legal problems in Indonesia and Malaysia which bring companies into violation of World Bank standards (read draft paper); and lastly, for ignoring demands for redress of past grievances before getting back into investing. The document was also internally inconsistent (see August Comments).

The draft document noted that that World Bank Group was ‘aware of negative environmental and social impacts, including deforestation, biodiversity loss, greenhouse gas emissions, land use conflicts and questions over land tenure and human rights’. However, as Norman Jiwan, a Dayak from West Borneo and department head in the Indonesian oil palm monitoring NGO, SawitWatch, points out:

“The ‘framework’ document they have produced looks like business as usual to us. No new standards, nothing about how they address the deficient legal frameworks in Indonesia and Malaysia, and no measures at all to curb global warming.”

FPP and partners have written again to the World Bank President appealing for a real strategy which does address their concerns (see letter to World Bank), including in particular that more attention be paid to securing the rights of indigenous peoples, smallholders, women, stateless persons and other vulnerable groups. Meanwhile, we have urged that the World Bank maintains its freeze on funding. At the time of writing, the Bank has yet to respond in writing but discussions about the draft document by the World Bank’s Board of Executive Directors have been pushed back a month.