Oil palm plantations in Liberia

Expansion of palm oil production in Liberia by Malaysia-based industrial conglomerate Sime Darby is rapidly swallowing up farmlands and forests used by local communities to sustain their livelihoods. Sime Darby Plantation, the agri-business division of the Sime Darby Group, is one of the world’s largest palm oil producers, with an annual output of 6 per cent of the world’s crude palm oil output – 2.4 million tons. On July 23, 2009 Sime Darby signed a 63-year lease agreement with the government of Liberia, for 311,187 hectares of land. The government agreed to allocate the land ‘free of encumbrances’ to Sime Darby, with the understanding that the company would cultivate 220,000 hectares within twenty years of signing the agreement, and that it would pay US$5 per hectare per year for land it cultivates for oil palm.

Palm oil is a flex commodity, which means it can have multiple end uses once the crops reach global markets, including food and agrofuel production. While it is not possible to say what the end use of Sime Darby’s Liberian palm oil will be, it is likely to be used for both food and agrofuels.

Sime Darby started operations in western Liberia in 2010 and since then has expanded into new areas of Liberia. There has been strong opposition from local communities to Sime Darby plantations in some places. A 2012 report by Friends of the Earth Liberia found significant negative impacts from oil palm plantation expansion on communities in the Garwula District. Farms and farmlands providing livelihoods and food for the local communities were swallowed up by the Sime Darby plantation, with very few alternative livelihoods available to those not in the company workforce. No compensation is paid to families for land taken over by the company, and forest areas used for various cultural practices were destroyed and planted with oil palm in 2011.

An independent Environmental and Social Impact Assessment (ESIA) of 20,000 ha of land targeted for clearance in another area – Bopolu District, Gbarpolu County - by the University of Reading found the risk of similar impacts there. According to the ESIA, Sime Darby operations could lead to a loss of biodiversity, particularly in the Upper Guinean Forest Ecosystem, which includes globally endangered and vulnerable bird species. Other likely impacts include land clearance of substantial areas of closed forest (more than 40 per cent tree cover), loss of livelihoods, increased food insecurity, the potential for chronic poverty, and increased risk of conflict and rural-to-urban migration.

The contracts for land concessions signed by Sime Darby and the Liberian government violate several Liberian laws and regulations, as exposed by a government agency report released in June 2013. They also violate several human rights principles in conventions ratified by the Liberian government as well as principles enshrined in Liberian law. In November 2012, communities from concession areas wrote an open declaration stating that they had not been consulted before their lands were taken and reaffirming their status as owners of the land.

While Sime Darby committed itself to conducting free, prior and informed consent (FPIC) negotiations in early 2103, it only did so after extensive civil society pressure. In at least one instance, despite local communities' customary ownership of land that was part of an old concession area, Sime Darby attempted to bypass an FPIC process with them. Affected communities and civil society have organised to demand from the company and the Liberian government that communities’ rights are recognised and the contract between Sime Darby and the government is renegotiated to ensure that it is compliant with these human rights principles and laws.

For more on this case read the Friends of the Earth International fact sheet: Sime Darby and Landgrabs in Liberia