Thursday 28 Mar 2024
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KUALA LUMPUR (Apr 16): "Forest corruption" in Sarawak has been linked to the expansion plans of a company that is said to be illegally clearing large tracts of rainforest in Peru, according to the Environmental Investigation Agency (EIA), which named former Sarawak minister Tan Sri Leonard Linggi as a key figure in a complex structure of corporate ownerships.

These ownerships and investments that stripped large parts of Sarawak of its natural forests and turned it into oil palm plantations are funding moves by Dennis Melka, the chief executive officer of a London Stock Exchange (LSE)-listed company, United Cacao, to accumulate forested land in Peru and clear them for plantations, the EIA said.

In its recent investigative report, "Deforestation by Definition", the London-based EIA linked Linggi to Melka, noting that both were directors of Asian Plantations Limited (APL), which was listed on the LSE's Alternative Investments Market (AIM) and which was sold to Felda Global Ventures in 2014.

It said Melka made his money through APL in Sarawak, thanks to political connections, such as Linggi's.

But the former Kapit MP still has stakes in APL through other subsidiaries, noted the report, which focuses largely on Melka's business empire and is aimed at making governments and potential investors of his ventures in Peru aware about his money trail and links to forest corruption in Sarawak.

The EIA's naming of Linggi, however, follows previous investigative reports by other environmental non-governmental organisations (NGOs) like Global Witness and the Bruno Mansor Fund in trying to expose Sarawak's web of politics and timber corruption.

"APL’s success and profit started with allocation of valuable forest land by the Sarawak state government, under the control of the (former) chief minister, to political allies and family members for well below market value.

"The giveaway of state forest land for plantations, at substantially below market value, amounts to theft of the Malaysian people’s common resources," said the report by the EIA, an international NGO founded 26 years ago dedicated to fighting and exposing environmental crimes. On its website, it says it is funded by public donations and various grants.

"Theft of public forest lands is not new in Sarawak. Scholars have noted how, since the 1970s, Leonard Linggi, the chairman of APL, his immediate family members, and other political leaders have acquired logging concessions in return for political favours to Sarawak’s ruling leaders – and subsequently profited from these concessions on a massive scale."

Linggi, now in his 70s, was former secretary-general of Sarawak's ruling party, Parti Pesaka Bumiputra Bersatu (PBB). His son Datuk Alexander Nanta Linggi is now the Kapit MP and the Deputy Minister of Rural and Regional Development.

The senior Linggi was described in the EIA's report as one who had "strategically" established himself in former Sarawak Chief Minister Tun Abdul Taib Mahmud's political structure in the PBB.

"Since the 1970s, loyalty to Sarawak’s ruling political party was rewarded with enormous timber and land concessions throughout the state," the EIA said.

"Leonard Linggi, son of a traditional leader of the Iban ethnic group, received such handouts, and established himself strategically in a political power structure led by Taib Mahmud."

The Malaysian Insider could not contact the senior Linggi, and tried contacting his son Alexander Nanta for a response to the EIA's claims that his father had benefited because of his political links to Taib.

When contacted, Alexander said "No comment" and also indicated that it was unlikely his father, who has been out of politics for some 20 years, would want to comment either.

Taib, who is the current state governor, has been accused of amassing billions through illegal timber sales and corruption during his tenure as chief minister. He stepped down last year in February after 33 years in power, to become Sarawak Yang di-Pertua.

Swiss-based rainforest advocacy group Bruno Manser Funds (BMF) had previously estimated Taib's worth at US$15 billion, and said 20 of his family members had a collective wealth of US$21 billion.

An earlier undercover investigation by international NGO, Global Witness, had also implicated Taib with involvement in corruption, land seizure and tax evasion.

The EIA report said that Linggi, a former Sarawak Cabinet minister, had been awarded three massive timber concessions through his companies – Rajang Wood, Keresa Timber and Raplex – where he was director and shareholder.

"Through its fully-owned subsidiary, Keresa Plantations Sdn Bhd, Rajang Wood owned an approximately 30% stake in APL – worth a market value of RM129,620,031 by December 31, 2013.

"By the time of APL’s sale in late 2014, its directors were declaring that initial shareholders, including Rajang Wood, by way of Keresa Plantations, made a 300% return on investment after only five years of public trading.

"In this way, the public listing of APL on AIM, its increase in value, and its final sale, in essence, raised funds for timber companies linked to forest corruption in Sarawak," the report noted.

Although the report noted that public statements about APL's involvement in Peru are limited, however, several mentions have been made so far, including by Melka.

"A publication covering agriculture business news, Agrimoney.com, stated in a July 2010 article that Asian Plantations owned a subsidiary in Peru," the EIA report said.

It also noted that there had been other indications about APL's involvement in Peru through news articles in August 2011 on investors's plans to use money made in APL for new agricultural plantations in Peru, Ecuador and Colombia.

"In late 2014, Melka appeared on investing news segments to promote the launch of United Cacao Limited369 on AIM. In those appearances, Melka stated that the management of the newly-formed United Cacao Ltd. included the same management group as APL, including himself and 'a few others'," the report stated.

"The history of the group’s (APL's) activities in Malaysia, via Singapore, illustrates what effects the Melka Group’s investments in the Peruvian Amazon, via the Cayman Islands, may have on forests, lands, and local communities in Peru, if current investments in that country are allowed to move forward," the report said.

EIA also said that tracing the finances of these companies through its subsidiaries and investments in new organisations with different names shows that corporate records, transparent and fair land transactions, and accompanying concession or land ownership maps, were of importance.

"When companies with known links to corruption can reinvest in new land using a complicated network of related companies, subsequent deforestation or degradation of forests is difficult and time-consuming to trace," it said.

"Making links between the powerful players in the land sector, and the financing behind them, will be crucial to identifying which corporate and individual actors must be held accountable for destroying forests, in Sarawak and around the world."

The EIA report said that Melka has been responsible for illegally clearing 7,000 hectares of mainly primary rainforest, a charge which the businessman has denied.

According to its website, 30% of EIA's funding is sourced from public donations while 70% comes from grants, trusts, foundations and government bodies.

The NGO says its long work in campaigning against environmental crimes have resulted in securing a worldwide ban on the ivory trade in 1989, as well as the closure of illegal mines in India which were destroying prime tiger habitat, as well as uncovering a rhino horn poaching operation. – The Malaysian Insider

 

 

 

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