A New York tycoon won a sweetheart deal to build a massive “sustainable” palm oil plantation in Cameroon. What followed were accusations of intimidation, corruption, bribery, and deceit. BY Christiane Badgley* TALANGAYE, Cameroon — At the main gate of the Herakles Farms plantation, a large billboard reads, “Contributing to a sustainable future for Cameroon.” The gate is little more than a bamboo pole hung across a dirt road, but security guards won’t let just anyone in. “No visitors,” one said when I asked permission to enter. “You need a pass from management.” This is no ordinary farm. Several years ago, Herakles Farms — then an affiliate of Herakles Capital, a New York private investment firm — negotiated a deal with the Cameroonian government to develop a palm oil plantation in the country’s Southwest Region, a province known for its lush rain forests and volcano, Mount Cameroon. The plantation would be massive: some 280 square miles, more than 12 times the size of Manhattan. Upon full implementation, Herakles Farms claimed, the plantation would be one of the biggest commercial palm oil operations in Africa. But the project, now in its fifth year, is highly controversial; it faces strong opposition both at home and abroad. Local opponents have accused the company of using donations of goods and services to garner support. Scientists have challenged Herakles’s claims of environmental sustainability. And numerous observers question the economic benefits promised for the surrounding region, fearing the project is much more likely to strip communities of land and livelihoods than it is to lift them out of poverty. In 2012, I set out to investigate the claims against the project, but my queries to Herakles managers all went unanswered, save for a single, brief conversation with the Cameroon in-country manager of operations — an American — that ended with him angrily telling me to never contact the company again. So on a return trip to the area in early 2013, I went directly to the plantation. When I was stopped at the gate, I decided to access the plantation through the forest that surrounds it, with two local human rights activists and a hunter, who served as a guide. The hunter, a compact, muscular man in his early 30s, cleared brush with his machete as he walked. He pointed out his own farm — where he plants cocoa, plantains, and pineapple among the towering trees — as well as wild nutmeg and cashew trees, bush peppers, bush mangoes, leaves for wrapping and cooking food, and a tree with nuts used to make cooking oil. There were also animal tracks and an uprooted area where, the guide said, river hogs had recently been digging. He showed us where he hunts crocodiles and porcupines. Under the canopy the scene was dark and damp. Butterflies flitted in and out of the light shafts, amid a cacophony of buzzing, chirping, and hooting. After walking for about two hours, a bright, white light shone ahead: the edge of the forest. As we walked past the last trees into an empty field, the sounds of the forest ended abruptly and all was silent. The cleared area was a desert: dry and brown, dotted with stacks of giant logs. Everything had been bulldozed — tangled heaps of dead wood and vines running up and down the length of the clearing created borders for planting rows. Giant black flies hovered around the piles of rotting vegetation. This was the plantation. In the middle of each row stood scraggly oil-palm seedlings recently moved from a nursery. The guide explained that many of the plants would die; they had been transplanted too late and would not survive until the next rains. Standing there, amid the desolation, I recalled the voices of local villagers: The forest is our life. Because of the deal their government struck with Herakles Farms, that life is now in danger. Today, everyone from Hillary Clinton to Bob Geldof — the rock star most famous for his Band Aid and Live Aid projects — is praising the virtue of private investment in Africa. “Trade not aid” has become a catchy development slogan. In 2000, the U.S. Congress passed the African Growth and Opportunity Act, which eliminated many tariffs and quotas for African goods. The act has not yet had the widespread development impact that many hoped for, but this hasn’t slowed U.S. interest in promoting trade: Although short on details, the 2012 U.S. Africa strategy paper talks up trade and investment, with hardly a mention of aid. Investors are listening and increasingly looking to Africa, where returns on investments can be high. From 2002 to 2012, for instance, private investments on the continent produced annualized returns of 11.2 percent. On paper, the Herakles Farms project in Cameroon looks like a promising investment. Herakles Capital was founded by the late Bruce Wrobel, a prominent New York investor whose African interests included major energy, telecom, and mining ventures. Wrobel described himself as a lifelong environmentalist and activist for the poor and often spoke of a life-changing trip he made to Africa in 1999. That experience prompted Wrobel to focus his efforts on the continent, seeking investment opportunities designed, he said, to generate sustainable economic growth. In 2009, the advisory firm Africa Investor honored Wrobel with its “International Business Leader of the Year” award. In September 2009, Herakles Farms, then operating under a different name (Sithe Global Sustainable Oils Cameroon), secured a contract to develop an industrial palm oil plantation and refinery in Cameroon’s Southwest Region. It was a major coup for Wrobel: 73,000 hectares, granted for 99 years to a company with no prior experience in Cameroon and no agricultural track record of which to speak. Discussing Herakles Farms in 2011, Wrobel said, “We expect that when complete we’ll move half of families in the economic impact area into the middle class. We have lofty social ambitions there.” Yet on the ground, the deal seemed troubled from day one. A number of government officials told me that Herakles had avoided the standard legal procedures for agricultural land acquisition. That process should have involved several officials and ministries, including the Ministry of Agriculture and Rural Development. Instead, Herakles signed a secretly negotiated “establishment convention” with Louis-Paul Motazé, then Cameroon’s minister of the economy. The establishment convention, leaked and later posted online, created shock waves. Cameroon has a notorious record for corruption, but this deal startled even the most jaded observers. According to the convention, Herakles Farms would rent at a starting rate of $1 per hectare per year for developed land (and half that for undeveloped land) — a virtual giveaway on property that could generate tens of millions of dollars in annual revenues. The convention also allowed Herakles to acquire additional land, exempted it from most taxes and duties, and granted the company valuable rights to water, sand, gravel, and any potential carbon credits (which could come about for forested areas the company left intact). Publicly, Wrobel claimed the Cameroonians were “extremely tough, excellent negotiators, and they knew exactly what they were doing.” But privately, Herakles told a different story, depicting the project as an incredible bargain. In a confidential 2013 “Value Drivers” prospectus for potential investors, the company described its evaluation of more than 20 large tracts of land across several West African countries. “Of all of the parcels evaluated,” the prospectus gushed, “not one came close to the potential value of [Herakles Farms’] current land concession in Cameroon.” In addition to the very low land costs, the investment pitch highlighted the exceptional tax breaks. Cameroon is not alone; many African governments are offering increasingly lucrative terms to attract foreign investment. But will the cost of these incentives outweigh the benefits to Africans? For now, extractive industries and export-oriented agro-industries attract the bulk of Africa-focused private investment. Will these investments, couched in the language of development and sustainability, improve peoples’ lives? Many are far from convinced. When Olivier De Schutter, U.N. special rapporteur on the right to food until this past May, visited Cameroon on an official mission in July 2012, he singled out the Herakles Farms project for criticism, chiding the government (along with foreign investors) for accepting such unfavorable terms. “By forgoing these tax revenues,” De Schutter later wrote on the Guardian‘s website, “developing countries critically undermine their own ability to build infrastructure, drive development and create jobs — therefore making themselves perpetually dependent on the inflow of foreign investment.” “The government of Cameroon seems unable to maximize its revenues or leverage investments for its own interests,” Samuel Nguiffo told me after De Schutter’s visit. Nguiffo is the founder and director of the Center for Environment and Development, a Cameroonian NGO that works to protect the rights of forest communities. He described an investment climate in the country that attracts speculators who can procure land for next to nothing and then flip it for a quick profit — all with the assistance of officials who place their own financial gain over the greater good. “At the same time Cameroon is giving away the country to export-oriented agricultural ventures, the country is importing 300 billion FCFA [$600 million] of food each year,” Nguiffo said. “The world is upside down.”
* * *Not long after signing the establishment convention, Herakles Farms employees began demarcating land at the northeastern end of the concession area, near the town of Nguti, a farming community where smallholder farmers grow cocoa, oil palms, plantains, pineapples, and other food crops. Like most of the villages in the area, Nguti is not electrified and lacks piped water and paved roads, which limits farmers’ ability to scale-up operations or get perishable produce to market. Besides a few roadside stands and a bar at the main crossroads where women set up tables and sell food, there is not much commerce in the town. When I first traveled to Nguti in 2012, I met with Dominic Ngwesse, head of Nature Cameroon, a local NGO working on environmental education and community development initiatives. Ngwesse took me to several neighboring villages to talk to people about Herakles Farms. I learned there had been little contact between the company and villagers over the previous three years. “The company did not come to us directly,” one man told me. “We simply learned that they had picked our forest.” Another man said he was surprised one day to find a wooden marker stuck in his field. Herakles’s failure to consult with local communities spooked many villagers, who feared a land grab was in the works. Cameroon’s land-tenure laws are complex, with most people claiming land rights based on various customary laws. But when traditional claims conflict with governmental desires, the state simply uses statutory law to seize land. The Herakles plantation could affect land on which an estimated 15,000 people live or work, from Nguti in the north to the small town of Mundemba at the southwestern end of the concession area. Herakles officials have assured locals that the project will not displace farms or farmers, but many people remain skeptical. Among other things, they are asking how plantation labor will lift anyone out of poverty. The Southwest Region is already home to some of Cameroon’s largest industrial plantations — and has been since the colonial era, when villagers were forcibly evicted from their lands. These plantations may no longer be colonial enterprises, but they remain notorious for low pay and terrible working conditions. According to Bernard Njonga, a Cameroonian agronomist who works to promote the interests of local smallholder farmers, an average cocoa farmer in the region works four hectares of land and earns significantly more than a typical plantation laborer. “We can anticipate a drastic decline in earnings” for those who lose their farms, even if they were hired by Herakles, Njonga said. Herakles’s confidential investment documents also seem to contradict Wrobel’s promises of middle-class wages. To potential investors, Herakles has pitched low pay as part of its competitive edge: “Daily wages for manual labor in Malaysia average 5 to 6 euros per day, nearly double the average wage in Cameroon…. The massive unemployment in Cameroon suggests that wage pressures will not be experienced for many years.” Peter Okpo wa Namolongo, the deputy mayor of Mundemba, has been talking to villagers about the importance of keeping their land. “Herakles Farms has thrown money around and polluted the mentality of the people. I’m sensitizing people, so they understand that if we give our land away, we’re finished,” he said. But he is up against even more than Herakles and the government “The sensitization campaign is working,” Namolongo explained, “but some of the elite, the traditional chiefs, are misleading the people.” Indeed, some chiefs and local officials who initially spoke out against the project are now among its most prominent boosters. Namolongo’s boss, Mayor Elizabeth Iselle Bekomba, is one of them. Iselle told me she initially had problems with the way Herakles barreled in without consulting local officials, but not anymore. “I love the project. It has come to alleviate poverty and provide employment for our youth…. The company will build hospitals. They can make this town beautiful. They may even plant flowers,” Iselle said. “They will bring development and piped water…. They can help me grade my streets. They can tar my roads…. We need this place to be opened up.” Atem Ebako, a medical doctor and the traditional chief of Talangaye, a village south of Nguti, agrees. Already, Herakles has set up a large nursery in Talangaye and is clearing a road and constructing a multi-building complex. The Herakles project is also creating business opportunities for Ebako, who told me he was building rental housing in Talangaye in anticipation of a future influx of workers and fortune-seekers. Ebako is making sure views critical of Herakles do not infiltrate his village. A Herakles Farms employee — a white South African — stopped me on a public road in Talangaye and said the chief did not want foreigners there. Later, one of Ebako’s personal assistants told me that no one in the village could talk to me without approval from the chief. When I finally caught up with Ebako at his office, he confirmed that outsiders were not welcome and that he was tired of dealing with foreigners and journalists who do not comprehend what his community will get from the Herakles project. When I asked Ebako whether his villagers really wanted this plantation, he told me I didn’t understand his culture: “You’re American, and you have a different form of representation.” Ebako said he alone made the decision to welcome the company because he knew what was best for his people.
* * *Iselle, Ebako, and every other project supporter I met in 2012 and 2013 spoke glowingly about the infrastructure development that Herakles had pledged to bring to local villages. Herakles had already awarded 26 college scholarships, dug several water wells, and improved the road near Nguti, village chiefs told me, and they trusted the company would continue its good works. One of them said the company’s oral promises were backed by handshakes. But according to an executive at an international NGO who is very familiar with the agreement, Herakles Farms is not contractually bound to any social projects. There is nothing in writing that compels the company to electrify a single village or build a clinic. And troublingly, Herakles’s charitable deeds in recent years may have been motivated by something other than altruism — and they may not be signs of good things to come. Unbeknownst to many, Herakles Farms, even with the establishment convention, still needed to secure a land lease to begin full-scale operations. That lease would require a presidential decree. Herakles started setting up its first nurseries and clearing roads a few years ago, likely assuming the decree was assured. And as I saw, the company had even started clearing one area of the forest and planting palms. But as the controversy surrounding the project grew, with the possibility that a lease might not materialize, Herakles changed its approach. Asoh Ebi Epey, a local attorney who has pursued legal action against Herakles, told me the company began to negotiate land-use deals with individual villages in order to put pressure on the president. If villages across the concession area were giving their lands to Herakles Farms, how could the president refuse to sign the decree? Epey accused Herakles of exploiting local poverty — of using social projects and handouts to win support. In January 2013, Herakles announced that it had donated 11 tons of rice and 10 tons of fish to more than 8,000 individuals over the recent holidays — “just one of Herakles Farms’ diverse social programs to support the communities within its project areas,” the company said. Soon after, I visited a village called Lipenja II, located deep inside the Herakles Farms concession area, with Namolongo, Mundemba’s deputy mayor. People gathered in a central clearing, where they set up chairs and benches under a palm-frond canopy, to talk about the forest and why Herakles Farms would be a terrible project for the village. The discussion went on for some time, with everyone in seeming agreement that Herakles should not come. But then one woman began to talk about the rice and fish. The company is good, she said; it will bring a road and other development. Another person told her she was wrong, that the rice and fish were no more than bribes. Before long, the peaceful village meeting had turned into an angry shouting match. On the day I interviewed Mayor Iselle in Mundemba, I noticed a Herakles Farms pickup truck loaded with crates of beer outside a bar. Inside, I found the Herakles driver with several uniformed soldiers. His boss was meeting with a town official, the driver said, and when he returned, they would all set out to visit a few villages. One of the Mundemba city councilors later told me that companies such as Herakles should apply American standards. “They can’t just come here and impose their projects on us,” he said. “Did you see them today? They came here with armed soldiers! That is how they are going into the villages. With soldiers and guns to impose their project.” The councilor’s concerns were echoed a month later, in February 2013, by members of a German government-supported fact-finding mission to the concession area, who reported that Herakles Farms was actively negotiating with local communities that were not sufficiently informed of the project’s impacts. The mission report accused Herakles of using “intimidation and bribery” in its negotiations over land and took note of the food and beer the company provided to settle land negotiations. Beer, at $1.25 a bottle, is an unaffordable luxury for many villagers in this region who get by on only a few dollars a day.
* * *In addition to its potentially significant economic and social impacts, the Herakles project has huge environmental implications. The concession area is ringed by parks and nature reserves, including Korup National Park. Situated in a global biodiversity hot spot, Korup is home to hundreds of species of trees and plants, along with an incredible array of insects, birds, and animals, including the highly endangered drill (a type of primate) and the forest elephant. But parks have a checkered history in Cameroon. When Korup was created in the 1980s, many people in the region saw it as a government land grab. Villagers lost access to their ancestral lands where for generations they had farmed, fished, hunted, and harvested the forest’s bounty. With so few alternative livelihoods available, local people were left worse off than before. (To make matters worse, difficult access and a lack of tourist facilities mean that, even today, only a few hundred visitors make the trip to Korup each year.) In other words, people in the area have a profound respect for the forest — but conservation is a loaded word. A number of local leaders who support Herakles Farms are happy to exploit villagers’ frustration with the parks. They play conservation against development, claiming foreign environmentalists and their local cronies are working against village interests to stop the project. They speak disparagingly of environmental organizations such as Greenpeace and the World Wildlife Fund that have taken positions against the project. Chief Ebako, for one, told me that foreign journalists have the wrong picture. “They come from the perspective of conservation — trees and wildlife. No one is talking about what the community will get from the project,” he said. Wrobel always maintained that the palm oil project would be environmentally benign. In an open letter he penned in September 2012, in response to growing criticism, Wrobel stated that the land granted to his company had “been logged and farmed repeatedly over the years and the area is classified as secondary forests.” Wrobel’s statement implied that the concession-area forests are degraded and of minimal conservation value. He cited an environmental and social impact assessment (ESIA) his company commissioned from H & B Consulting in Yaoundé, the capital, in 2011 to back up his assertions. That report refers to the vegetation across the concession as “predominantly a mosaic of actively cultivated farmlands, fallows, secondary forest and relic patches of evergreen forest at various stages of degradation.” But many in the scientific community question Herakles Farms’ assessment and are worried about the long-term impacts of razing the forest to make way for the plantation. In March 2012, 11 scientists from institutions around the world wrote an open letter expressing “deep concerns” about the project. Several months later, a study supported by the German government and the Cameroonian Ministry of Forestry and Wildlife concluded that the Herakles concession area is in fact roughly 88 percent forest, with the remaining 12 percent comprising villages and mixed agro-forestry agriculture. Later, a 2013 survey of the concession area conducted by Cameroon’s University of Dschang, in collaboration with Germany’s University of Göttingen, recorded 23 large mammal species, including nearly every diurnal primate found in Korup National Park. The survey — far more extensive than the limited fieldwork conducted for the ESIA — also recorded a new fish species, chimpanzee nests, the feeding signs of drills, and elephant trails and dung. In the concession area, opponents and supporters alike told me the project would lead to widespread deforestation. But they disagreed about the merits of cutting down the forest. Chief Ebako, for instance, said there could be no economic development without razing the forest. “We have chosen agriculture, and so the trees must go,” he insisted. Other project supporters told me they would prefer something less destructive than a massive plantation, but they had to take whatever investment they could get. Eben Nkongho, chief of the village of Manyemen, not far from Talangaye, said he was not happy about giving away the forest, but “wherever a good road passes, development comes.” Almost as an afterthought, Nkongho said he would have refused Herakles “in a second” if carbon credits for protecting the forest went to his village. “Do you think that if there were a possibility for us to get carbon credits we would give away this land? No way! If it was possible for us to have the carbon credits directly, we would stop all cutting of the forest.” But Nkongho said he feared that conserving the forest would only benefit corrupt politicians. “The carbon credits will go to the government and the money will be embezzled,” he said. “It is a sad situation.” Nkongho was surprised and dismayed when I told him that the government had relinquished all carbon rights to Herakles Farms. Should it wish to implement a carbon project in the forest, money from the sales of carbon credits would go solely to the company.
* * *Opposition to the palm oil plantation remains strong, but there are risks in criticizing Herakles Farms. Local activists and ordinary citizens who do not want the project say they have been harassed, arrested, even thrown in jail. When a French TV news crew in 2012 interviewed Nasako Besingi, the head of a local NGO and plaintiff in a lawsuit against Herakles Farms, project supporters assaulted the activist on camera as he walked down the road. Later that year, Besingi was arrested and jailed along with four local project opponents. (No charges were filed against them until December 2013, more than one year after their arrest. One of those arrested said the episode was part of an ongoing campaign of intimidation intended to keep villagers quiet.) Besingi’s four-day detention coincided with the visit of a high-level official to the area. More recently, in September 2013, the Cameroonian government suspended the right of Nature Cameroon — the Nguti NGO headed by Ngwesse — to organize public meetings. Prior to the suspension, Ngwesse had been conducting informational meetings on the status of the Herakles Farms project. Cameroonian attorneys have filed multiple suits against the project, which are working their way through the courts. Herakles, in turn, has sued project opponents for defamation. An American attorney familiar with the cases said that in the United States, these cases would be called SLAPP suits (strategic lawsuits against public participation), which are intended to censor or intimidate critics through the burden of legal proceedings. Cameroon has no statutory protection against such lawsuits, and they can have a powerful silencing effect. That said, opposition has affected Herakles Farms’ operations. Since at least 2011, Herakles had touted its membership with the Roundtable on Sustainable Palm Oil (RSPO), an international organization that brings stakeholders together to promote best practices in the palm oil industry, as proof of its high standards. But when the company attempted to certify the project, in accordance with RSPO procedures, a number of organizations and individuals opposed to the Cameroon project filed formal complaints. The RSPO began an investigation and attempted to set up mediation between the company and project opponents. But before anything could be resolved, Herakles Farms left the RSPO in August 2012. The company claimed compliance with RSPO procedures was slowing down its work to address “a dire humanitarian situation” in Cameroon. In April 2013, the Cameroonian government suspended Herakles’s operations, referring to the company’s violations of the country’s forestry law. Several weeks later, however, the government reversed its decision and lifted the suspension. Then, over the summer, officials from different ministries took contradictory actions relating to the project’s status and future — indicative, according to a local observer, of disagreements inside the government about the plantation. Months of speculation about the project finally ended on Nov. 25, 2013, more than four years after the initial contract was negotiated, when Cameroon’s president, Paul Biya, signed the necessary decrees granting Herakles Farms a land lease for the plantation. At first glance, the decrees looked like a partial victory for the project’s opponents: The scope of the concession had been cut significantly from the original 73,000 hectares to just under 20,000, and the 99-year deal was now a three-year provisional lease. Surface rental rates also increased from $1 per hectare per year to $6 — still exceptionally low, but an improvement nonetheless. Wrobel committed suicide the following month. A lengthy CNBC feature on his death mentioned several factors that might have contributed to his decision to take his own life, including the trajectory of the Herakles Farms project. A friend said he took criticisms of it “very personally.”) Yet many close to the project say the decrees have left gaps and ambiguities that do not bode well. Nothing in the decrees prevents the company from acquiring more land or eventually getting its 99-year lease. Nor do the decrees address other controversial aspects of the establishment convention, such as the rights to water and carbon credits. Moreover, as Malle Adolf Nganya, one of the local attorneys fighting Herakles Farms in court, explained to me, there is the troubling matter of existing farmlands within the mapped concession zone: Herakles Farms will need to occupy those lands in order to fully develop the 20,000 hectares. “Unfortunately,” Nganya said, “the decrees make no mention about compensating those individuals who would suffer personal loss as a result of the plantation development.”
* * *Herakles Farms may also just be the tip of an iceberg. At Cameroon’s Ministry of Agriculture and Rural Development, technical advisor Andrée Caroline Mebande Bate said she was aware of requests to lease more than 2 million hectares of land. “Are we going to transform the entire country into an oil palm plantation?” she asked. “Does oil palm development respond to the needs of Cameroon, or are these companies coming here to make money and further impoverish the people?” Her sentiments were echoed by De Schutter, then the U.N. special rapporteur, during his July 2012 visit. He warned that industrial palm oil production could actually increase hunger in Cameroon by reducing the amount of land available for farming and putting upward pressure on food prices. (In an interview in June 2013, Robert P. Jackson, then the U.S. ambassador to Cameroon, expressed strong support for U.S. private investment in Cameroon, including agricultural investment, but would not comment on Herakles Farms.) For Nguiffo, of the Center for Environment and Development, the Herakles Farms project sets a dangerous precedent in Cameroon and beyond, as a new wave of oil palm investment sweeps across Africa’s Congo Basin, home to the world’s second-largest tropical rain forest. In May, Greenpeace issued a report accusing Herakles Farms of conducting illegal timber trade in the concession area, which according to the organization is indicative of a wider problem in many African land deals. Activists warn that significant action is needed to prevent the kinds of environmental destruction and social strife that have already accompanied oil palm development in Southeast Asia. “There have already been deaths over land, and this will only get worse,” said Nguiffo, who has called for an urgent review of the regulatory framework for land concessions in Cameroon. During the visit of a senior government official in 2012, a group of villages in the Nguti area had anti-Herakles T-shirts and banners printed. Samuel Ajang Akepe, the chief of the village of Ntale, said people believed it was the only way they could express their message of opposition to the official. Ajang Akepe, who spent seven years as a political prisoner in the 1960s, after fighting for Cameroon’s independence, is now fighting to keep his land. Like other villagers who have lived through usurpation of their forests and fields — first by foreigners, and later by the government when it created national parks — Ajang is not about to give up what’s left to any foreign investors. “They want to turn us into plantation slaves. We’ll fight until our dying breath,” said Ajang. “And if we can’t stop them by legal means, we’ll use traditional methods.” This article was reported in partnership with the Investigative Fund at the Nation Institute, with support from the Fund for Investigative Journalism. Photos by Christiane Badgley *Source FP]]>