Bidco fends off protestors over palm oil

East African Business Week | August 28, 2016

Bidco fends off protestors over palm oil

By Samuel Nabwiiso

Bidco, the Kenya-based vegetable oil producer and manufacturer of detergents and other household items, is not pleased by the protestors who turned up last week in London to highlight the company’s palm oil operations, specifically in neighbouring Uganda. Bidco CEO Vimal Shah, said the people involved lacked credibility and there is no merit in their claims of exploitation.

The Bidco Truth Coalition (BTC) an activist alliance, last week picketed the London headquarters of Barclays and Standard Chartered, who they claim are funding Bidco Africa’s deforestation to make way for palm oil production in places like Uganda writes SAMUEL NABWIISO.

The Coalition says the Banking Environment Initiative (BEI), based at Cambridge University’s Institute for Sustainability Leadership under the patronage of The Prince of Wales, is failing in its mission to lead the banking industry in collectively directing capital towards environmentally and socially sustainable economic development.

BEI has nine member banks comprised of Barclays, Standard Chartered, Deutsche Bank, Goldman Sachs, Lloyds, Northern Trust, RBS, Santander and Westpac.

Shah said in a statement last week, “These guys are just bodies for hire. If you watch the video, the incredible thing is they cannot even get the company name right. They are protesting against ‘Bisco’ and ‘Vamil Shah’, that tells you all you need to know about these people.”

KEPSA, the apex private sector body in Kenya also received emails from the Coalition, but when they invited them to present evidence-no one showed up.

“We asked them to come forward and prove their claims but have heard nothing from them since,” the CEO Carole Kariuki said.

By signing up to BEI’s ‘Soft Commodities’ Compact, the nine banks are expected to only direct capital towards sustainable business models and achieve zero net deforestation among their client companies.

For just over 10 years, Bidco has been developing palm oil plantations in the islands district of Kalangala. on Lake Victoria.

In 2004, the Uganda government set in motion the Vegetable Oil Development Project (VODP) intended to make the country more self-sufficient while at the same time improve the standard of living for communities.

The International Fund for Agricultural Development (IFAD) has been a major backer of the project and Bidco came in later as the private sector partner by registering a Ugandan subsidiary to oversee the venture.

The government signed a tripartite agreement with Bidco Uganda Limited (BUL), a consortium made up of several companies, including a major global producer, Wilmar International, operating out of Singapore.

Under the partnership, Bidco invested $120 million to develop oil palm plantations, put up a mill and build the refinery complex at Jinja.

Under BEI guidelines, member banks must drop clients that don’t measure up to socially and environmentally responsible policies.

However, Kodey Rao the Bidco Uganda Managing Director said, “No forests were taken in Uganda, there have been four independent Environmental Impact Assessments done and they all give the project a clean bill of health.”

But environmental acitivists such as BTC say the palm oil industry is counter productive. Indonesia and Malaysia, the world’s top producers, are often given as examples where large tropical forests, are being cleared to make room for new palm oil plantations.

But palm oil has quickly become one of the most traded items on the international market and is used a wide variety of manufacturing processes.

According to IFAD, because the oil palm was a new crop in Uganda, a 6,500 hectares nucleus estate was planted to be used as a model for smallholder farmers and bridge the knowledge gap. Another 3,500 hectares were to be planted by smallholders.

The palms were first introduced on Bugala island, Kalangala district. IFAD says by integrating small-scale production with large-scale processing, small producers were to become part of the mainstream economy.

IFAD, which is based in Rome, said harvesting and selling of fresh fruit bunches to the palm oil mill started in 2010.

There are now over 1600 farmers, of which 600 are women. Since the start of harvesting in 2010, farmers have seen the benefit of harvesting the crop and Kalangala is progressively being transformed into a modern district with improved infrastructure and facilities such as banks.

IFAD says most of the farmers have been able to build permanent houses and send their children to better schools on the mainland.

The Coalition claims Bidco has deforested 18,000 acres of rainforest in Uganda and has also grabbed land from over 100 smallholder farmers.

Rao said, “On the question of land, out of 9000 hectares acquired for the project, there is only one dispute with one farmer who was a squatter on someone’s land and the case is in court.

“Some 1750 farmers earned UGX1.5 billion (nearly $450,000) last month, I wish someone could talk about that and how their lives have changed, the houses they have built, the cars they have bought and how they are taking their children to private universities,” he said.

In a follow up statement, BTC said the situation in Kalangala District is far from the ideal Bidco presents in its statement.

It reads in part: ‘While Bidco takes credit for building wide roads to accommodate the company’s fume-spewing trucks, a report called ‘Pro-Poor Land Records, Palm Oil and Prosperity: Any Proof from Bugala Island, Uganda?’, presented at the Annual World Bank Conference on Land and Poverty on 23 March 2015, found that “a hospital or dedicated public medical facility is still lacking on the island, alcoholism and HIV/AIDS have been on the rise and require intervention, and environmental risks concerning the chemical fertilizer required for the palms are expected to reduce the fish stock in the medium term.’
  •   EABW
  • 28 August 2016
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