International beverage companies like Coca-Cola and PepsiCo should do more to prevent land grabs in countries such as Cambodia by refusing to buy sugar from companies that have driven farmers off their land, a report released today by Oxfam International argues.
The report, titled Nothing sweet about it: How sugar fuels land grabs, states that two companies belonging to Thailand’s Kon Kaen Sugar Co. Ltd. (KSL) are responsible for evicting 456 families from Koh Kong province’s Sre Ambel district.
Because the companies have supplied sugar to global giant Tate & Lyle, which in return sells sugar to Coca-Cola and PepsiCo, Oxfam says that the companies should “publicly disclose who and where they source their commodities, publish assessments about how the sugar they purchase affects local communities’ land rights, and use their power to encourage government and the wider food industry to respect land rights.”
“[T]he biggest sugar buyers and producers have failed to keep tabs on their industry’s insatiable demand for land, and the lengths to which the third party companies they work with will go to acquire it,” the report says.
“Without better preventive measures Coca-Cola and Pepsi-Co have no way to guarantee to customers that the ingredients used in products like Coke and Pepsi were not grown on land that was grabbed from farmers without their consent,” it adds.
In 2010, KSL reported that it exported 10,000 tons of sugar, at an estimated value of $3.13 million, according to the report. By 2011, Cambodia’s annual sugar export had jumped to $13.8 million.
Tate & Lyle has denied it has a contract with KSL and says that it only received sugar shipments from them on two occasions and have no plan to receive any more in the future.
Oxfam argued that major brands like Coca-Cola and PepsiCo, which make $9.6 billion and $6.18 billion in annual profits, respectively, have done little to make sure that the sugar in their beverages was produced without violating land rights.
“We found evidence that sugar production has a large influence on land rights, and there is more and more evidence of the effects sugar has on land grabs,” said Gertjan van Bruchern, Oxfam’s associate country director in Cambodia.
As the global demand for sugar, which already covers an area of land the size of Italy, is expected to rise by 25 percent over the next seven years, Oxfam also said it expects to see more land grabs in countries like Cambodia.
“This spike in demand is creating a kind of ‘sugar rush’ for agribusiness, which need no other incentives to use aggressive tactics to push current residents without formal legal rights off the land they hope to cultivate,” the report says.
In an article published by The New York Times on Monday, European Union Ambassador to Cambodia Jean-Francois Cautain said that exports had helped Cambodia to triple its annual income per person to $980 over the past 10 years.
“We also need to consider the benefits the overall Cambodian economy gets from the ‘Everything But Arms’ scheme and the harm the country would suffer if we remove it,” Mr. Cautain was quoted as saying.
Coca-Cola and PepsiCo did not immediately reply to requests for comment. But their websites state that they are committed to helping poor, local communities.
“[O]ur Company is focused on initiatives that…create a safe, inclusive work environment for our associates, and enhance the economic development of the communities where we operate,” Coca-Cola’s website says.