The new ‘Brazil of Africa’: How development institutions are financing land grabs in the DRC

Photo: Belgeo Revue

Pambazuka News, July 2015

In this interview, Devlin Kuyek, Senior Researcher at GRAIN, talks about a report that reveals how a Canadian agribusiness company, Feronia, financed by American and European development institutions, is involved in land grabbing, corrupt practices and human rights violations in the Democratic Republic of Congo.

ZAHRA MOLOO: Your recent report looks at what you call ‘agro-colonialism’ in the DRC, and in particular at a Canadian company that’s investing in palm oil plantations in the Congo. Perhaps we can start with some historical context. We think of agribusiness and land grabs more in a contemporary sense on the continent, but in the DRC there’s a whole history to palm oil. Can you go back a bit and give some historical context to palm oil plantations in the DRC?

DEVLIN KUYEK: Yes, many of the current land grabs are actually new companies taking over old plantation concessions. This is the case in the DRC with Feronia (a Canadian company). These plantations go back over 100 years and were set up by the Lever brothers at the time, which became Unilever, now one of the largest food multinationals in the world. They were given an enormous concession by King Leopold along the Congo River, which is a beautiful area of forest. Palm oil is a traditional crop of the people and has hundreds of different uses, one of which is palm oil. They started forcing people to collect and harvest palm oil for them. So initially it wasn’t plantation agriculture, but it quickly moved to a plantation model as they took over vast areas of land. Their concessions were for around 100 000 hectares. It was the most severe and grave forms of colonial plantation exploitation you can imagine. Most of the local people would describe it as slavery and this is how it was for about 80, 90 years. Then into the 90s, with war in that part of the Congo, Unilever’s activities started to decrease and they put their plantations up for sale. And you now have this new investor, Feronia, set up by financial players that have no experience in the agricultural sector, but were interested in taking advantage of the new push into agribusiness in Africa. They set up Feronia and were going to turn the DRC into the new Brazil of Africa, introducing a Brazilian model of GMO, intensive monoculture, large-scale farming in the Congo, which is a mainly a country of small-scale production.

ZM: Can you tell me more about Feronia, where exactly it is based, what investments it has?

DK: It started off in the Cayman Islands, where it was first registered in 2008. They then acquired the Unilever plantations and paid Unilever 3 – 4 million dollars for those plantations. In about 2010, they became a publicly listed company on the Toronto Stock Exchange. By 2012, their stock prices had collapsed quite significantly. The company had been running losses for a number of years, well, all the years of its existence. Then you had these development funds, DFIs, which are the arms of European and US development agencies; they have these branches that invest in foreign or private companies involved in agribusiness and other activities in developing countries. These DFIs started buying shares in Feronia and today they control over half of the company’s shares. So Feronia itself is now controlled by European and US governments.

ZM: Are there any ethical issues around DFIs investing in private companies like Feronia? Has this become controversial in any way?

DK: A lot of money has been re-oriented from typical overseas aid, which is supposed to go to poverty alleviation and social projects towards straightforward investments in private companies. The idea being that there is not enough of a private sector in places like the Congo, so if European governments can finance private sector activity, it will stimulate further investment and you’ll get economic growth. They claim that they’ll invest responsibly, but just from our simple visit and meeting with the communities, we were able to document a number of violations that quite clearly contradict the policies of the DFI investors in Feronia. This is not only a pretty glaring case of how this form of development finance is contributing to human rights violations and corrupt practices and actually rewarding companies that have been engaged in this, but it also points to how the whole model of agriculture that such kind of investment or aid is encouraging is really problematic. In Congo, just outside Feronia’s plantations, people themselves are producing palm oil locally and they do so in a very sustainable way, with significant production that goes to feed the local economy and food system. Feronia has this plantation model – all of the palm oil is exported out of these communities. The workers are paid abysmal salaries, the poverty within the plantation concessions is severe, and certainly worse than it is outside of the plantation concession areas. And then you have numerous human rights violations, food insecurity, malnutrition, inadequate housing and education.

ZM: In your report, you gave examples of people who have been intimidated by the company for harvesting palm oil in specific areas where there are plantations. There was also a case of a young man who disappeared. Can you talk about some of those incidents?

DK: Whoever we spoke to, one of the first complaints they had was about the local company security. These concessions are like states within a state. So the company controls everything, whether it’s the roads, the social services and their own police force, the company guards. All of the people that we spoke to had stories of intimidation or abuse from these company security agents. What often seems to happen is, given the poverty and lack of access to land and forest that the people have, they will occasionally collect nuts that have fallen in the plantations and apparently, if they are caught by the company security forces with nuts in their hand, they are severely treated. We’ve heard cases of people being whipped, arrested, brought to local prison and in this one case, we were told of a boy who was caught with oil palm nuts and was detained, put on a company vehicle and was supposed to be brought to the local police station, but never made it. He has not been heard of since. The family was afraid that they would be targeted and harassed so they fled as well and have been in hiding ever since. So this is what people have to deal with, this harassment from the local police.

ZM: Have you put any of these findings to the DFIs and Feronia?

DK: Well, the report is very public. It has been covered in the media. We haven’t had a formal response from [the DFI’s]. It’s not really our job to do that. Our intent was simply to give voice to these communities who are very isolated. One community talked about how they only recently got access to a cellphone network. They had previously had to use the phone that was available at the company’s reception, so their capacity to speak out about what has been happening has been really limited for over 100 years now. But they are coming forward – there are petitions, complaints, there’s been work with the local government to improve their conditions and try to get their lands back, but it’s not easy.

ZM: Your report mentioned that there might be an assessment undertaken of all these findings – do you know if that will have any impact?

DK: Well part of the agreement with Feronia when the CDC (a UK DFI) bought shares was that they would have to carry out an environmental and social action plan. But there are a few fundamental problems, the main one being that these communities have really never ceded control over their territories. They were forced to give it up by colonial occupation. The Mobutu regime provided renewals for the company’s concessions. And then Feronia took them over. The communities were never consulted. Communities in the Lokutu concession area – all they’ve ever seen is a copy of this registration certificate or land survey certificate, that they say is false because it doesn’t properly demarcate the area, and then that in itself is not testament to any kind of legal title that Feronia could claim. All these DFIs have in their principles and mandates that they cannot invest in companies that have taken or are occupying lands where they do not have the prior and informed consent of people, particularly when it comes to indigenous people. And these are of course indigenous people in these areas. So that right there, this environmental and social plan, is not going to be able to address. The other issue is corruption. You see quite clearly that they have been giving, we calculated, almost 3 million dollars to the former private secretary of President Kabila, who is his Minister of Information and currently the ambassador to the UK.

ZM: Finally, the push toward large-scale agribusiness and the land-grabs that accompany it seems to expanding all over the continent. Aside from when you go to these communities and see what’s happening on the ground, a lot of the institutions that support large-scale agribusiness projects, for instance the Alliance for a Green Revolution in Africa (AGRA), actually have a lot of legitimacy on the continent. Why is that and how can people challenge it?

DK: Well, I would say that since 2008, when this whole rush for investment and scramble for land in Africa started breaking out, there have been many land conflicts. Organizations like ours and many others in Africa said that this has to stop. It’s taking away land from small farmers and pastoralists, people who need land the most. And immediately, there was a response from the World Bank and others to say no, this new wave of investment is good, finally, we have companies investing in agriculture and we need to turn this into a win-win situation, we need to tame it and make it responsible. So when you see these DFIs investing in Feronia, it’s under the same logic. But when you look at it, these are land grabs. These are companies investing in plantation style agriculture, providing the worst, most exploitative jobs, taking valuable land and water resources away from small farmers and pastoralists. And these projects are almost always for export so they creating greater food insecurity in places that are suffering the most from the global food crisis. So the idea that this wave of investment is anything other than just a greedy rapacious attempt to secure control over resources I think is false. And much more needs to be done to resist things than to regulate things.


To view the full report, please visit here.

GRAIN is a small international non-profit organisation that works to support small farmers and social movements in their struggles for community-controlled and biodiversity-based food systems. In 2011, GRAIN was the recipient of the Right Livelihood Award.