Report Says EU’s Trade Scheme Is Impoverishing Villagers

A preferential trade scheme by the European Union (E.U.) for least developed countries is leading to human rights abuses and destitution among Cambodia’s poor, according to a new report released by two NGOs and sent to the European Parliament in Brussels on Tuesday.

The report, conducted by Equitable Cambodia and Inclusive Development International, focuses primarily on Cambodia’s sugar industry, which has come under intense scrutiny for forcibly displacing families and using child labor and assesses the human rights impacts of the trade scheme known as Everything But Arms (EBA).

“While the EBA scheme is in­tended to benefit the poor through job creation from export-led growth, the case of Cambodia’s rapidly expanding sugar industry tells a different story,” the report says.

A lack of adequate safeguards in the agreement, combined with Cambodia’s concurrent policy of granting long-term and large-scale land concessions to private companies has exposed Cambodia’s poorest families to a host of injustices while enriching a handful of well-connected businessmen and foreign companies, it continues.

“The sugar industry has been one of the worst offenders in Cambodia’s land grabbing epidemic. Its development has been accompanied by violent forced evictions and other human rights violations,” the report states.

In 2009, when the E.U. removed trade barriers in the sugar sector and granted Cambodia duty-free export status, it was hoped that it would have a positive impact for rural communities producing the commodity.

But the report argues that the exact opposite transpired, with Thai sugar companies and other foreign companies swooping in to secure large concessions to cultivate sugar cane.

One of those firms, the U.K.’s Tate & Lyle, signed a five-year deal to buy sugar from Thai firm KSL’s plantations in Koh Kong province in 2009 and has since shipped $32-million worth of sugar back to the U.K.

Hundreds of families were evicted illegally and often violently from the concession’s land, and in July, 200 of those families filed a law suit in the U.K. against the British company, arguing that the firm should be held responsible for their evictions and pay out millions in damages.

“I am sure that this is not what European policy-makers intended when they adopted the EBA agreement over a decade ago,” said Eang Vuthy, executive director of Equitable Cambodia.

“They pledged to make poverty history, but they have made it much worse for many families in my country with the type of investment that EBA promotes—the E.U. should be doing these sorts of assessments so they can see the real impact of their policy,” he said.

Responding to the report, Ambassador Jean-Francois Cautain said that the E.U. continues to take very seriously the issue of alleged land grabbing and human rights abuses in relation to large agricultural investments in Cambodia. He added that the E.U. is also engaged in ongoing dialogue with the Cambodian government, concession companies and NGOs to find solutions for those families affected by land grabs and forced evictions.

“The E.U. continues of course to examine carefully if human rights violations are potentially related to E.U. preferences…. We continuously assess whether the evidence we have warrants an investigation, which could potentially result in removing the duty-free and quota-free access to the E.U. market,” he said.

The report emphasizes that it is not attacking the preferential trade deal in general, which it admits can be a positive force for development. What it asks is that the EBA be modified so that the E.U. can blacklist any company that violates international human rights laws.

So far it has resisted doing so. In May, the trade commissioner and foreign affairs representative of the E.U. turned down a request from 13 members of the European Parliament to investigate Cambodia’s land concessions.

“It should be a no-brainer that firms that grab people’s land, destroy their homes and forests and employ their children should not be rewarded with special trade privileges,” said David Pred, managing director of Inclusive Development International. “We call upon E.U. policymakers to put these common sense reforms into place.”

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