Bidco 'invasion' on Kalangala: Is the palm oil project a boom

UGANDA COALITION FOR SUSTAINABLE DEVELOPMENTNsambya Kabalagala (Towards Nsambya Housing Estates) P.O. Box 27551 Kampala- Uganda

Tel: 256-41- 269461 E- Mail:[email protected] Website:www.ugandacoalition.or.ug, www.suswatch.org/uganda

A Bimonthly Publication Issue 04 July - August 2007

A Publication of Uganda Coalition for Sustainable Development

EditorialCall for a mini-

mum set ofprinciples forsustainable

palm oilproduction

From the soil to the frying pan' isthe slogan that sums up Bidco'sPalm oil project expected to be the

largest in Africa covering over 40,000 haof plantation.

This mega project is situated inKalangala district which is made up of atotal of 84 Islands widely scattered inLake Victoria. From the project start,there were reservations expressed duringthe Environmental Impact Assessment(EIA) process related to possible negativeimpacts on this unique island environ-ment especially in relation to forest con-version, modification of water regimes orsoil character, the addition of excessivenutrients and the increased suspendedsolids in water the may affect fish breed-ing among others.

In the spirit of monitoring progress ofthe social and ecological aspects since theproject launch, and also based on conflict-ing media reports on the project progress,UCSD's Biodiversity thematic groupdecided to carry our a rapid assessmentinvolving the different actors (tech-nocrats, CSOs, out growers and others)with an aim of exploring the extent towhich the above reservations that wereexpressed during the EnvironmentalImpact Assessment exercise were beingmitigated by the developers and otherproject proponents.

This issue of UCSD's Uganda

Bidco 'invasion' on Kalangala:Is the palm oil project

a boom or bust?

WHEN you move through the corridors ofKalangala District administration, palm oil pro-

ject is the talk. Any thinking about palm oil is takenseriously.

The reason? Ideally, if the project is implemented thedistrict will get its first tarmacked road, get hybrid elec-tricity, a modern class ship and the economic part of itto the island's population.

Indeed short term benefits have or yet to be yielded.Some palm oil farmers, using loans provided by the gov-ernment, have joined out growers' schemes and are yet

to have their harvest.A team from Uganda Coalition

for Sustainable Development(UCSD) visited Kalangala districtand interacted with across sectionof individuals involved in thepalm oil project as purposely togather their views and commentson the project.

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Mature Palm oil trees.

Some of thechemicals pro-vided by thePalm oil projectin Kalangala.(Photo by DavidSsemwogerere) So

Uganda Coalition for Sustainable Development (UCSD) is a Civil Society membership network dedicated to coordinate advocacy andlobby work around issues and commitments made by world governments towards sustainable development. Collective actions for

UCSD members are encouraged through the five Thematic Groups: Biodiversity; Climate Change and Energy; Integrated freshwatermanagement; Sustainable agriculture; and Sustainable socioeconomic development.

UCSD Secretariat P.O Box 27551 Kampala -Uganda

Tel: 256-41-269461E-mail:[email protected]

JULY - AUGUST 2007

Sustainability Bulletin therefore provides a summary of thefindings that the group found out in September 2007 withissues ranging from land ownership tensions, lack of lawenforcement (management of river banks and lake shores),unclear (and uncontrollable) amounts of agrochemicalsgiven the unique nature and international interest in thisecosystem, and lack of open and transparent methods of com-munication (for example on chemicals used, and prices ofinputs)

This project provides a classic case of the tension betweenthe need to overcome underdevelopment (in form ofwidespread poverty which is also related to micro level,cumulative and unsustainable uses of natural resources) insome remote area of Uganda on one hand, and the caution toavoid overdevelopment in form of agricultural intensifica-tion and the use of all available land for economic benefit asan end in itself. What is needed is a midpoint that avoid thesetwo extremes.

UCSD believes that Bidco, Kalangala District administra-tion, the Out growers Trust, Civil Society Organizations andother project actors should borrow a leaf from Malaysia,Indonesia and South America where palm oil has beengrown, and sustainable production and use is being pursuedthrough cooperation of all the actors based on many decadesof experience, though dotted with numerous challenges. Onesuch voluntary mechanism is the Roundtable on SustainablePalm Oil (RSPO) formed in 2004, and has among others, devel-oped 8 principles and criteria for sustainable Palm OilProduction (refer to link at the back).

For example Criterion 4.6 under Principle 4 on use ofappropriate best practices by growers and millers, notesthat: 'Agrochemicals be used in a way that does not endan-ger health or the environment. There is no prophylacticuse, and where agrochemicals are used that are categorizedas World Health Organization Type 1A or 1B, or listed bythe Stockholm or Rotterdam Conventions, growers areactively seeking alternatives and this is documented'

UCSD shares the view that Bidco, Government of Ugandaand other palm oil actors in Kalangala need to recognize thatthere are environmental pressures on palm oil expansion tosuch eco-sensitive areas, particularly as it can only be cultivat-ed in tropical areas of Asia, Africa and South America (RSPO,2004). It is therefore vital that production and use of palm oilmust be done in a sustainable manner based on economic,social and environmental viability. Short of this, Bidco's wellintentioned slogan may turn sour: 'From the soil to the fryingpan and from the frying pan into the fire' (which may implyirreversible loss of biodiversity, fish economy and soil produc-tivity among others).

The Member of Parliament ofBujumba County, Fred Baddadescribed the project as a successderiving his conclusion from theinterest locals have shown in theproject.

"This project is going to helpreducing poverty levels in the dis-trict," he says.

Indeed, the palm oil project seemsto be making a mark on the Islandthat was well known for its tropicalrain forests. Nowadays forestedareas like the Bugala Islands andsome privately owned land thatwere previously occupied by theforests are palm plantations.

The struggle for land has createdthe initial problem of land in thedistrict and the biggest part of theneeded land belongs to few land-lords who own miles and miles. Mr.Badda and Kalangala DistrictChairman Daniel Kikoola sharethis view.

"The landlords have come backand they are giving the land to theBidco or clearing it for palm oilplantation purposes," Mr. Baddasays.

This has created another problemto the poor people the project initial-ly targeted to uplift.

Landlords are also vital in theimplementation of the project

Bidco 'invasion' on Kalangala:

among the small farm holdersand the out growers.

According to the proceduresof acquiring loans and otheritems like seedlings from thegovernment, the farmers have toget permission letters from thelandlords.

However, the project man-agers are in fear that if landwrangles between the land own-ers and squatters escalate itmight affect the project, infuture.

To the contrary, many land-lords have deliberately refusedto grant the squatters permitson their land. Instead, they havegiven land to Bidco for palm oilplantations.

Bidco looks after the planta-tions until the time of harvestand the landlords come to earntheir profits.

Landlords see this as anopportunity to earn more fromtheir land which has been fetch-ing them only Shs1,000 annual-ly.

Squatters have or are yet toremain with lot or no land infuture if the project succeeds.This means they (squatters) willremain basically on the fishingwhich is the major activity on

EditorialFrom Page 1

Uganda Sustainability BulletinUganda Sustainability Bulletin

Palm oil tree seedlings

Production of this bulletin has been steered by the Biodiversity thematic group led by Uganda Biodiversity Network (UBN), Agency forEnvironment and Wetlands, National Association for Adult Education, Kikandwa Environment Association (KEA), Conservation Trust -

Uganda, Kalangala fisherfolk and Enviroment Protection and Pro- biodiversity Conservationists in Uganda.

JULY - AUGUST 2007

From the soil of Kalangala to the frying pan?Kalangala district which is entirely made up of a total of 84 Islandswidely scattered in Lake Victoria, is located in Lake Victoria - southwestern Uganda along latitudes 00 10`S and 1000`S and longitudes32001`E and 32052`E. It covers an area of 9,066.8Km2 of which only432.1Km2 (4.8%) is land. The total population is 34,766 (20,849male and 13,917 female). The biggest Island is Buggala and coversan area of 296Km2 On the soils of Kalangala Island, Bidco is creating the largest oilpalm plantation in Africa which will eventually cover over 40,000 haof plantation. The first phase of the plantation is already underwayand more than 6,000 ha of land has already been prepared.Transplanting of over 800,000 high oil bearing oil palm trees isunderway. Bidco Uganda is creating a fully integrated edible oil business inUganda. With an investment of over $130 million spread over a peri-od of five years, Bidco will realize its vision of 'from the soil to the fry-ing pan'. According to Bidco, this project is designed to provide immensesocial benefits to the residents of Kalangala - passable all year roundroads, access to water points with ease, more schools, more church-es as well as medical centers and electricity. In addition the long-term benefits to the economy of Uganda will be massive. For exam-ple, the economy will save in excess of $60 million annually, moneynow used to import crude edible oil from abroad. On completionUganda may also become a net exporter of refined palm oil. TheUgandan economy will also in addition benefit from the transfer oftechnology and skills. Critics like Kalangala District Farmers Association (KDFA) haveshown mixed reactions. In addition to economic benefits (above),they note with fear environmental disturbances, increased pressureon public and private forests in search of forest products, reductionin windbreaks, a fear of food insecurity as the out growers schemeand small holders may forego food crop production in the quest forwidespread palm oil growing..Source: http://www.bidco-oil.com/home/index.php and KDFA at the Uganda SocialForum, 2006

Management Authority(NEMA).

"In some areas road reservesand the 200 metres from the lakeare not observed but this is dutyof NEMA to ensure that all theencroachers are evicted," shesaid.

Encroachment on the 200-metre zone would result todiverse effects to the lake includ-ing silting the lake which affectsthe lives of the aquatic animalsthus a reduction in fish produc-tion.

The interim head of the outgrowers who is also the LCVchairperson of Kalangala MrKikoola concedes that there maybe people who violate the zonebut argues that it is the reasonwhy committees on monitoringand regulations are present.

"We expect some people toviolate the rules because youwouldn't say that all people willadhere to the rules. That is whythere over two committees doingthe monitoring,"Kikoola says.

Worse still, farmers are usingherbicides and pesticides to killweeds and termites.

According to one of the promi-nent palm oil out growers, MrSamwiri Ssonko, he uses herbi-cides and fertilizers when thepalms are still young whichmight affect the water cycle.

"Termites are the major pestaffecting these palms. You can'tdeal in palm oil without pesti-cides," Mr Ssonko says. "Butmany times we fail to get the pes-ticides on time because they arenot available at local stores."

But his statement is contraryto BIDCO Uganda LimitedManaging Director

Kodey Rao statement carriedin the New Vision in 2005.

Mr Rao said: "We don't use her-bicides and use minimal fertiliz-ers." he said then

Farmers say the plantationshave to be either sprayed by pes-ticides three times a year whilethe application of fertilizers is

done at the same time for aperiodof three years. Some of thechemicals used by the palm oilfarmers as revealed byKateregga Charles, a field officerbased at the out growers trust,include among others;Ammonium phosphate, NPK,Urea and Pynex.Other chemicalslike Green-Fire 50%SLgLyphosphate were found by theresearch team at one of the outgrower's store whom claimed tohave got it from the Trust.

Surprisingly, when asked to atleast estimate the quantity ofchemicals a farmer could use onone acre for the three years, Mr.Kateregga had no proper answerto give. From the researchers'recommendation, this needs tobe studied further as it seems topose a danger to the aquatic bio-diversity downstream.

During the environmentalimpact assessment exercise,worries of chemicals beingwashed into the lake were soprominent. Environmentalistsargue that since some of the her-bicides affect the hormones ofplants, they can affect the life

Palm oil fruits

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Is the palm oil project a boom or bust?

the Island.Farmers have started

encroaching on the 200-metreembargoed zone which sepa-rates the lake and the cultivatedland.

According to the initial agree-ment, plantation farmers wereto preserve the 200 metres pieceof land between the lake and theplantation. But many farmershave encroached on the zoneand are continuing to cut downtrees near the lake shores.

Kalangala DistrictAgricultural Officer, ProsyNamuddu notes that farmers areviolating the 200-metre area butcouldn't reveal the affectedareas.

She however says that the taskof protecting the zone was left tothe National Environmental