Everybody Loves Illovo: The bitter-sweet fallacy

 

The South African sugar giant, Illovo, has 6 159 hectares of sugarcane in Malawi, where it is a monopoly, with an annual production of 2.8 million metric tons of sugar. The company denies persistent claims that it has grabbed land from smallholder farmers

“Everybody loves Illovo” is the common slogan emblazoned on millions of sugar packets sold daily by Illovo Sugar (Malawi) Limited, the country’s sole producer.

However, for subsistence farmers at Kachibundi, Muwale, Kazilira and Kalimukhola at Dwangwa about 250 kilometres from Malawi’s Capital City, Lilongwe, the slogan is a bitter-sweet fallacy.

“I was dispossessed of my two-and-a-half hectares – my only source of livelihood,” said farmer Joseph Mwale. “Now, I am suffering because I have to work in other people’s farms to make ends meet,” he told Forum for African Investigative Reporters (FAIR).

At 38, Mwale looks lost and confused as he narrates details of the evictions. There is fear, hatred and resignation that Malawi’s justice system, and the overall structure of land administration favours the rich at the expense of the poor.

“I used to grow maize, cassava, rice and beans but my crops were uprooted; my house destroyed. On top of that, I was beaten for resisting eviction,” Mwale said, sadly, head in hands.

The Dwangwa farmers, under the banner of an association called Mukhuto Kazilira Dambo (food security club), have fought since 2007 to retain their ancestral land or get compensation for property and crops, which were destroyed and looted, by forces including the police.

Mwale is one of the 80 farmers who lost a combined total of 107 hectares to sugar plantations. Documents show that the land holdings ranged from half hectare to three hectares.

One farmer lost 0.2 hectares, her only bequest from her husband.

“If somebody snatches the only land you have then it is as good as murdering you. And above that, if you are poor, then justice evades you,” said another farmer, Ganizani Chinjoka.

 

 

Malawi land status vis-à-vis local chiefs

 

Malawi is yet to assess the overall gains and losses of handing out land to investors. But one thing stands out: the loss of land represents not just a loss of identity, but access to the ecological systems on which farmers, and people, depend for their food security and livelihoods.

In general, African governments have been highly solicitous of multinational agribusinesses.

For instance, in Malawi, a multinational can negotiate with local chiefs and gain access to customary land, and formalised with government by obtaining leases, usually paying very little as compensation. “Malawi lacks a proper land market structure making it difficult to police land deals,” said Mike Chisasula, from the Society for Social Advancement and Literacy. “Consequently anyone can sell land in the face of the country’s numerous laws that target land management”, he noted.

Though Malawi had a few basic laws on land rights, it lacked adequate systemic procedural mechanisms to protect local rights, interests, and welfare.

“In most cases land fees aren’t the main concern of the government,” he told us. “Rather, it is the investor’s commitment on investment levels and employment creation.” While the land deals in Africa are being fast-tracked, there is little legislation in place to protect women, rural farmers and land inhabitants from exploitation by powerful commercial entities and national governments – least of all, when everything hangs on the word of a chief.

“Malawi’s land administration requires revamping as the current situation benefits only a few, said land economist Geoffrey Wawanya. “There are many ridiculous situations that need to be addressed,” he stated.

But proponents of foreign land investments argue that such ventures are in the long run beneficial for host nations as they increase the single yardstick under which the progress of African countries are measured, such as GDP growth, allegedly creating opportunities for economic development.

 

 

New land law

 

In Malawi, land allocations are government-managed through local chiefs as custodians or traditional authorities of the customary land. The Chiefs distribute the land in their jurisdictions according to local dictates and traditions – in theory. More often than not, according to those we spoke with, chiefs negotiate under-the-table deals under the guise of ‘development’ projects.

In August 2013, Malawi’s Parliament passed the Land Bill, which, among other things, seeks to set new conditions for land ownership, and convert foreign-owned freehold land to leasehold.

Freehold land permanently confers title and ownership. In this case, the government does not collect ground rentals, as is the case with leasehold land.

Ironically, the new law has spared sugar estates, targeting mainly those that produce tea, coffee and tobacco or those operating on freehold land, which the British colonisers acquired in the 19th Century. Moreover, it does not specifically engage the issue of gender, despite women being doubly marginalised.

However, the president has so far – allegedly – resisted assenting it into law as it would transfer the ‘eminent domain’ from the Head of State to the State itself.

“Such a change will be extremely powerful and will have far reaching implications,” said Wawanya, also a Chartered Valuation Surveyor. “Effecting changes in land administration will never be a simple matter as it is dealing with peoples’ way of living and culture.”

More importantly, however, and evidencing one core aspect of resistance, resulting in a petition signed by 25 Traditional Authorities in mid-2013, Chiefs will lose all the conclusive power on land to allocation committees.

 

 

High Court intervention

 

At Dwangwa local Chief Kanyenda told the villagers in 2007 to move from the land claiming the land had been earmarked for development.

“In fact, he told us that a certain company wanted to dig irrigation canals through our land,” said Mwale. “Already we have had rumours that the Chief had clandestinely sold the land. So we resisted the move and sought the High Court’s intervention.”

FAIR was unable to get the chief’s views due to his health conditions. His envoy refused to comment on the issue.

But FAIR corroborated the story with several other subordinate chiefs, who preferred anonymity.

The court ordered the government and the unnamed developer to dig the canals. But the Court also restored the villagers’ right to use the land, after the laying of the two-metre deep pipes, noting that it was legal, when allotted customary land, to use the surface only.

“Despite this,” claimed Mwale, “the chief unleashed heavily armed police and bulldozers to clear us from our homes contrary to the Court’s order.”

 

 

Illovo’s involvement and the blame game

 

Illovo already has 6 159 hectares of sugar plantation, with an annual production of 2.8 million metric tons of sugar.

In 2012, the Malawi Stock Exchange listed a company of the Illovo Sugar group of South Africa holding, at an 18 percent increase from 2011 sales. The company attributed this to the ability to optimise market opportunities both local and foreign.

Victor Mhone, of the Civil Society Agriculture Network (CISANET), a grouping of individuals and NGOs in Malawi, said multinationals – some of whom prefer to frame themselves as charitable entities giving back to the people, are to make money only. “There is little we can benefit from them,” if the rules remain the same. Overall, such figures mean nothing to Mwale and some distraught families who now scrape together a living, begging or working on the same land that once belonged to them. Today, they live in straw huts.

Illovo denies complicit in the land grabbing saying land allocations are government-managed through local chiefs or other authorities, or managed through third-party outgrowers. Though the company is the sole producer in Malawi, they claim they have no control.

The villagers, on the other hand, say the heavy-handed nature of their evictions had the hallmarks of a ‘big’ company at work.

Police sources, who preferred anonymity for fear of reprisals, corroborated the villagers’ allegations saying they were hired by Illovo.

“More than 100 heavily armed police came in the wee hours. They destroyed our crops, houses and beat us,” said farmer Chinjoki. “I left everything I had worked for over the years. I could not salvage anything.”

Chinjoka, a father of six siblings, suffered multiple cuts, including a large wound on the ear, incurred during police beatings. He was hospitalised for two days.

“Our clearly stated and only interest around land owned or held by indigenous farmers, is to support – by providing agricultural expertise, assistance and extension services and the development of sustainable, locally-based agricultural businesses… to generate significant revenues amongst rural communities,” said Chris Fitz-Gerald Group Public Affairs Manager.

Fitz-Gerald told us the company’s support results in increased cane deliveries, providing the basis for its continued sustainability. We were told that production expansions promote economic development in poor and isolated rural communities.

“As a group operating in several African countries, Illovo abides by all local laws and regulations in the country of operation … most specifically those relating to land tenure, ownership, re-distribution,” he stated.

 

 

Insider Talk

 

But a local politician, whom the farmers alleged was also complicit in their removal, said the people received their dues long back. He did not indicate when.

“I can confirm that the people were indeed forced off their land. But we resolved the issue. Check with the District Commissioner’s office,” he said.

But an August 2013, High Court order indicates that the Court will have sessions in the area in late 2013, to assess compensations for the displaced farmers.

Member of Parliament for the area, Henry Chimunthu Banda said the issues of Kazilira are between the Company, the Chief and the Villagers.

“Being a local MP, I could not sit idle, hence my mediatory role. Between 2011 and 2012, I led my constituents to Ministry of Agriculture on more than five occasions. Now the villagers have succeeded in de-linking themselves, forming their own company called Umodzi,” said Banda. Also a speaker in the Malawi parliament, and a sugarcane farmer, Banda claimed the displaced farmers have embarked on a land redistribution exercise using the new company.

“By that process, all those who got land illegally have been evicted and the rightful owners (targeted beneficiaries) have been given land,” he further claimed.

But FAIR investigations revealed that Banda is behind the formation of Umodzi and that the 80 families, who still have no land, are struggling to make a living.

 

 

Cane cutters and small 

growers’ plight

 

At Dwangwa, cane cutters get roughly US$37 per month for fixed workload, which in most cases would be completed within around 5-6 hours. This does not include other benefits such as medical services and housing.

The cost of living for a family of six in rural Malawi (as of May 2013) is US$202, according to Centre for Social Concern.

Those were left with small portions of land and grow sugarcane face massive deductions when they sell their crop to Illovo.

For instance, Illovo buys one metric ton at US$314.

So, a farmer who delivered 13.41 metric tons, generating US$3 586 would see 5 percent deducted for administration fees or US$179; 3 percent government withholding tax US$107; farm inputs US$99; association membership fee US$4.6; cutting fees US$171; haulage US$232; and advances US$404.

For the 2013 season, the farmer would have carted home just US$1 199.

 

 

President’s petition

 

“We have had several meetings with the District Commissioner’s office but nothing tangible has come out. Could this be corruption at play or what? Does this means that good land will always be for the rich to become richer while the poor become poorer,” reads part of the Farmers’ petition to Malawi’s President, Joyce Banda, dated May 1, 2012.

She is yet to respond.

“We have exhausted all avenues including trying to engage the president on the issue but we have hit blanks walls,” Chinjika said.

“We are now waiting for divine intervention.”

 

 

 

Comment from Illovo

 

“The Kazilira area is not under Illovo leasehold, but is farmed by a third-party outgrower who, similar to all other outgrowers, supplies cane to Illovo’s Dwangwa sugar mill under a cane supply contract. It is our understanding that the land in question was developed under cane with appropriate statutory approval covering land issues, environmental matters and other pertinent requisites for statutory and local authority approval.

“Accordingly, Illovo is not able to respond to your query as to how the third party acquired the land or how it is dealing with any disputes relative to land allocation or usage. 

However, we are aware that the matter is currently the subject of court proceedings and is accordingly sub judice. It would therefore be inappropriate for Illovo to comment on the matter in any detail at this stage.

“It is important to record that Illovo does not engage in ‘land grabs’ and never has. As a group operating in six African countries, we take any allegation of land grabbing or invasion very seriously and we remain scrupulous in our approach to land rights.

 This involves operating within the specific land regimes in each country, supported by our overarching objective to be welcomed in the communities in which we operate and without whose co-operation we would not be able to sustain our businesses.

 

“This involves:

 

·       Working with local legislative frameworks and land reform programmes set by government;

 

·       Working with reputable development organisations, such as development banks to ensure projects are in line with accepted international standards;

 

·       Consulting with local communities, indigenous peoples and public authorities to understand issues involved, concerns and seek support for any proposal;

 

·       Assessing the social, economic and environmental impact of our activities;

 

·       Using all reasonable endeavours to ensure that the governments of the countries in which Illovo operations prove appropriate and mutually agreed compensation where people are affected by our operations;

 

·       Providing technical and financial support to new emerging sugar cane growers and initiating and actively participating in programmes for the redistribution of land to previously disadvantaged communities;

 

·       Providing education and medical facilities to employees and the communities in which we operate.

 

“Illovo is keen to maintain good relationships and constructive dialogue with surrounding communities and we are optimistic that the spirit of dialogue between the company and community leaders will ensure mutually agreed resolutions to land matters in the longer term. 

Illovo’s inclusive approach to the communities surrounding its operations means working with and supporting these communities and we hope to continue doing this for as long as we continue to grow sugar cane in this area and throughout our other operational areas.

“Illovo’s integrated reports, which are posted to its website at www.illovosugar.com will provide you with full details of how we contribute to the communities in which we operate.” – Pambazuka News

January 2014
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