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Investment sounds good, but no land grab please!

ASEAN, or the Association of Southeast Asian Nations, is a political and economic organization of ten Southeast Asian countries – Singapore, Malaysia, Thailand, Vietnam, Laos, Cambodia, Myanmar, Indonesia, Philippines and Brunei. The year 2015 has scheduled to be the birth year of ASEAN Economic Community (AEC). The commencement will mark a new regional economic integration on the world map and the new economic region would rank as the seventh largest economy in the world, behind the US, China, Japan, Germany, France, and the UK.
Nattawat Theeralerttham
15.4.2015

This year, 2015, is a very crucial year for Thailand, as one of the most vocal countries in ASEAN and in fact the location where the association was officially founded. People in Thailand are now very excited about the commencement of the ASEAN Economic Community (AEC) later this year. But people are also very concerned about the negative impacts this integration may bring, especially how it might benefit mostly the big businesses at the expense of the poor.

One of the hot issues now is around the ASEAN Comprehensive Investment Agreement (ACIA). In February, a committee in charge of ACIA gave a green light to a proposal to facilitate foreign private investments in large-scale monoculture plantations in Thailand. This has raised many concerns for civil society and activist groups including National Farmers Council and BioThai Foundation, a member organization of Kepa’s partner in Thailand, who have been calling the government to review the decision. The committee nonetheless just met again in March and affirmed the decision.

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Below is an excerpt from a news article “Activists slam timber investment plan” on Bangkok Post dated 19 March 2015 which nicely encapsulates the growing concerns in the civil society.


"Investment in forest plantations will allow foreign investors to rent or have rights over large areas of land. I believe this is a threat to the country's security in terms of sovereignty and people's,” said Prapat Panyachatrak, chairman of the National Farmers Council (NFC). "The NFC hopes the government will be more concerned about the impact on millions of households of landless farmers than foreign investors," he added.

“The government has promised to solve land rights problems for Thais, but allowing foreign investors to have rights over forest plantations will make the goal hard to achieve,” asserted Mr. Witoon Lienchamroon, director of BioThai Foundation. "I don't think forest plantations are necessary. We have a lot of alternative ways to make our land productive using sustainable methods such as agroforestry, traditional agriculture and tree bank schemes — where tree planting is encouraged on a massive scale so that locals can generate income from the valuable trees," he said.

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These concerns are completely valid because there are already many ongoing conflicts between private companies and local communities, notably in the cases of palm oil concessions in the South of Thailand. Large-scale land rental to foreign palm oil investors have resulted land grabs, loss of local livelihood and public protests. Making a decision to facilitate even more large-scale land rental should not ignore these accounts.


Furthermore, the forest plantation program under the ACIA is claimed to increase forest area in the country. But this is not a very strong claim. The fact that monoculture is not forest – rich and diverse. Promoting large-scale monoculture may lead to seemingly more green mark on the map, but adds very little to the biodiversity in the country and in fact may even seriously damage it.

These concerns are valid and it is saving grace that there are active citizens out there trying to make their voice heard. The decision makers need to listen to these voices and see all the angles of the issue.

When a company overpowers a state

ACIA is intended to create a free and open investment environment for foreign investors which would enhance the attractiveness of ASEAN as an investment destination and boost economic growth in the region. In a practical term, the ACIA entitles foreign investors to a number of protections, most of which oblige the host state of such investments to provide compensation should it fail to provide a free and competitive investment environment. One of the provisions, for instance, is full protection and security from physical dangers, e.g. riot, demonstration, armed conflict, etc. It states that in the event of losses experienced by the investors the host government must be accountable and must compensate the investors accordingly.

Empowering foreign investors to hold the state accountability as such has led to a hot debate at all levels. The fact that private company will find it ever easy to sue the state and get compensated by taxpayer money is worrying. There have been numerous examples which set off alarm bells throughout the public interest world. In 1997, Ethyl Corporation filed and won a lawsuit against a Canadian government for its new environmental law to ban MMT. MMT is a compound added to gasoline to enhance the capacity, but contains heavy metals proven toxic to public health. The Canadian decided to ban MMT to protect the Canadian public. However, Ethyl claimed that the new environmental law violates various protection conditions of North American Free Trade Agreement (NAFTA) and demanded compensation of $251 million to cover losses resulting from the "expropriation" of both its MMT production plant and its "good reputation." MMT won the lawsuit and the compensation was paid by taxpayers’ money.

The case of Ethyl Corp. v. Government of Canada suggests that agreements like ACIA could pose a threat to national sovereignty. It can, and have, significantly restrict the ability of democratically elected governments to enact a law to protect public interests on issues such as public health and safety and environmental protection. This threat is often discarded by the advocates of the agreements. The case of Ethyl Corp. v. Government of Canada warns the decision makers that the threat is not small and is real.

Civic Engagement as a Solution

Large-scale land rental to foreign palm oil investors has resulted in land grabs, loss of local livelihood and public protest. Recklessly facilitating more large-scale land rental is nothing but a facilitation of more land grabs. Environmentally, forest plantation program under the ACIA would not fulfill the green ideal it is claiming because monoculture and forest are two different things. Likewise, agreements to facilitate trade and investment do lead to more trade and investment, but they also do come at a cost as demonstrated in the case of Ethyl Corp. and Canadian government. These angles reflect the complexity of issue and are the call for more careful and thorough analysis in political decision making.

One of the antidotes to the negative results of political decision making, I argue, is civic engagement. In the meetings of the ACIA committee in Thailand, no civic groups were invited. Only representatives from the military, business and ministries attended. This shows that the problem of the content came, at least partly, from the problem of the process. Exclusive process often results in exclusive benefit – favoring certain groups at the expense of the others. An inclusive process is needed, and civic groups have been invited to attend ACIA committee meeting in order to bring about a comprehensive and well-thought policy.

According to UNDP, “a fundamental aspect of a democratic state is the right of its citizens to participate in decision-making processes. The success of development and participatory governance depends on both a robust state and an active civil society with healthy levels of civic engagement. Empowered and active citizenship is an end in itself: essential for inclusive growth and national ownership.”

“Civic participation and empowerment refer to a condition in which every citizen has the means to actively engage in the public sphere, including political processes. Under this condition, civil society is empowered, protected, and accountable; equal access to information and freedom of expression is upheld. […] Without opportunities for civic engagement, motivations for violence may be more likely to increase, as the population seeks to ensure their voice is heard and their needs are met”, stated the United States Institute of Peace.

Kepa Mekong Regional Office works to empower local civil society groups in the region to have meaningful and consistent engagement in political decision making in their countries. Recently, Kepa Mekong has supported People’s Council for Reform, Thailand’s largest people platform consisting of 30 networks of 15,000 people organizations across the country, founded in late 2014 to influence the policy and action of the military government in post-coup d’etat era. Clearly, what the People’s Council is doing is not enough and can never be enough. More empowerment is needed and it has to come also from the decision makers. Civic engagement and empowerment are a fundamental aspect of a democratic state. The decision makers, representing the people, are required to always listen to the people they serve. This article is a call for more civic engagement. It calls for acknowledgement, but more importantly, action. As the Thai government, be it being headed by a military general, is carrying out a series of reform agendas in the country, the best time for that action is now!