Sand Dredging Rampant Despite Ban, Group Says

Despite last year’s government ban, Cambodia continues to feed Singapore’s desire to expand its is­land state, exporting millions of tons of sand without environmental and social safeguards and without proper financial oversight or regulation, according to environmental campaigners Global Witness.

In a report to be released today, the organization accuses the government of allowing politically connected businessmen to continue dredging sand which is then sold for land reclamation and construction in Singapore, a trade which Global Witness says is highly lucrative.

Prime Minister Hun Sen in May 2009 announced a moratorium on all coastal and riverine sand dredging and overseas exports until an industry-wide review of the effect of dredging on the environment had been completed. According to Global Witness, this industry was not halted and may even have been facilitated by the ban.

Officials at the ministries of mines and water resources yesterday denied the report’s allegations, saying the ban on dredging was still in effect. However one official in Koh Kong province said sand dredging had continued in the province’s estuaries.

In a follow-up report to its findings on sand dredging published last year, Global Witness latest in­vestigation claims to be based on signed license agreements and other official records, some signed by a representative of the Singa­por­ean Embassy in Phnom Penh. The report singles out Cambodian agri­business operators and CPP Sena­tors Mong Reththy and Ly Yong Phat, who Global Witness said had been granted dredging licenses after the ban was put in place.

Mr Yong Phat was unavailable for comment yesterday but Mr Reth­thy denied exporting a single kilogram of sand and said he had only conducted dredging to allow larger vessels frequent his private shipping port in Preah Sihanouk province.

The new Global Witness report, titled “Shifting Sands,” said the latest findings on the sand industry matched a trend the group has observed since 1995 “in which local people and Cambodia’s environment are expected to pay the costs of the nation’s economic de­vel­opment, while a small and powerful elite gain the benefits.”

The report said investigations con­ducted since last year found that a few months after the dredging ban was introduced, ostensibly to protect local fishing communities, an interministerial sand management committee granted extensive licenses for dredging sand from rivers in Koh Kong province to CPP senator Mr Yong Phat’s LYP Group, to Mr Reththy’s Mong Reththy Group and to Udom Sei­ma Peanikch Industry and Mine Co Ltd.

In addition, licenses had been issued for dredging in other provinces, including a license to dredge in the Kampot estuary granted to KTA Import Export & Development Co Ltd, owned by Keo Tha. Mr Tha could not be reached yesterday for comment.

Mr Reththy, however, denied the Global Witness claim that he had received licenses to dredge sand in Koh Kong province, adding that he had only received dredging licenses to deepen his port, Oknha Mong Port, which is located in Preah Sihanouk province’s Stung Hav district. Mr Reththy also said he could not find customers for the sand he had dredged at the port.

“I pump [sand] to deepen the ship navigation channels, not for export,” he said. “I did dredging [in Preah Sihanouk] with the intention to export to overseas but no one bought it because it did not meet Singapore’s standards.”

Phat Bun Hour, an assistant to Mr Yong Phat, declined to comment on the Global Witness claims, saying he was unfamiliar with dredging operations by Mr Yong Phat.

Bun Hean, secretary of state at the Ministry of Water Resources and Meteorology, said the government ban on sand dredging for export was still effective, adding that extracting sand in rivers and at sea was only allowed if it was extracted for domestic use.

“Our committee allows [dredging] for using [sand] in the country, but for export we don’t allow it,” Mr Hean said.

He said environmental impact assessments were required for larger dredging operations.

“In the small rivers, for the small businesses no, we don’t require EIAs,” he said.

Sat Samy, secretary of state of the Ministry of Industry, Mines and Energy, which also is responsible for licensing dredging operations, insisted the ban on sand dredging for export was still in place.

“Sea and river sand is still banned in principle for export. Only [sand] used for [domestic] construction is OK,” he said, before declining to com­ment further as he was not the main official at the ministry tasked with sand dredging industry matters.

In today’s report, Global Witness claims that the government sand dredging moratorium had in fact facilitated the expansion of licensing for sand dredging and reduced legal safeguards on how to conduct the operation, since the ban an­nulled provisions contrary to it in environmental and mining laws, effectively reducing oversight.

“Global Witness believes this to be part of a broader trend of lawmaking in Cambodia, whereby parallel structures are created for governing developmentally significant resources, which give undue executive control to central government and undermine existing safeguards,” the report states.

Global Witness estimates that there was 796,000 tons of sand exported each month from the sand dredging concessions granted to the three companies in Koh Kong province.

According to the UN Commod­ity Trade Statistics Database, Singapore reported importing 3.8 million tons of sand from Cam­bodia in 2008, which would indicate a monthly average less than half of that given by Global Witness.

These numbers differ greatly from publicly available government estimates on sand trade. According to Invest in Cambodia, a government-sponsored website promoting investment here, between 480,000 and 720,000 tons of sand is being removed from the province annually.

“The government has imposed a strict limit on the size of the extraction zone and the amount of sand that can be extracted,” according to the website.

According to Global Witness, the sand dredged in Koh Kong alone is estimated to be worth $28.7 million at the point of extraction, but has a nine-fold markup to $248 million in Singapore, where it is used for land reclamation and construction projects—the prime driver of demand for Cambodian sand, according to the report.

A March 2009 government proclamation sets royalties at $1.50 per ton, meaning the Koh Kong sand industry could have generated $10.7 million in government revenues. Due to a lack of public budgetary information, it is unclear what sand revenues have reached the national treasury, Global Witness said.

The Global Witness report goes on to say that government has allowed the sand dredging companies to operate without conducting legally required environmental impact assessments and public consultations. Some concessions are located near or within protected eco­systems such coral reefs, mangrove forests and the sea grass area off the coast of Kampot and Koh Kong, which is the largest such area in the marine ecological region.

“[I]nvestigations could not find any evidence that EIAs or any consultations had been conducted in the areas licensed for dredging in Koh Kong,” the report states. “Commun­ities explained they had not benefited from the sand dredging in any way…. They had not been consulted by companies before they began operations, nor had they been informed by local authorities that dredging licenses had been issued.”

During protests in October and December last year, hundreds of villagers from fishing communities in Koh Kong province gathered outside the provincial government’s office to demand an end to dredging in the province, which they said harmed their livelihoods and was destroying local fish stocks and polluting the water.

Citing scholarly journal articles on the environmental effect of dredging on marine environments, the Global Witness report says that bad sand dredging practices can cause a decline in water quality, alterations in hydrological processes such as the disruption of natural sedimentation.

It can also cause increased erosion of riverbanks, rising sea levels in estuaries, expanded salinity in delta systems and an increased risk of flooding—all of which affects ecosystems, fish stocks and in turn local livelihoods, the report states.

Pich Siyun, director of the provincial department of industry, mines and energy in Koh Kong province, said yesterday that last year’s moratorium allowed dredging operations to continue in the province’s estuaries, but not at sea.

He said Udom Seima and Ly Yong Phat Group had been actively dredging in the province, adding only that operations by the latter had been temporarily scaled down recently as the group’s current contract with its Singapore customers needed to renewed.

“These days, no one company has been stopped,” he said. “Udom Seima is very active. Ly Yong Phat has been a little slow due to the end of a contract with Singapore. Now they are renewing it and hope to restart in late May or early June.”

Mr Siyun said dredging plans had been subject to environmental assessments prior to operations.

“The companies did EIAs with the ministries of environment, water resources and agriculture very well. They did not just dredge without thinking about the impact,” he said.

He said he was unaware of current dredging volumes but that at points last year a total of 500 to 600 tons of sand was dredged daily from Koh Kong’s estuaries for export to Singapore, which amounts to around 200,000 tons of sand per year. He added export companies paid $0.20 per ton in export tax to his department.

“In previous times, between 500 to 600 metric tons a day but now there is not much,” he said.

In its report Global Witness said Singapore was doing to little to mitigate the effects of its consumption of Cambodian sand and called on the Singaporean government to ensure that companies supplying the city state with sand uphold social and environmental safeguards during their dredging operations.

“Global Witness believes Singapore is indeed the most significant importer of sand from Cambodia and therefore has the opportunity to set in place policies which can significantly improve governance of this raw material,” the report states.

Global Witness said the boom in Cambodia’s sand trade directly results from a 2007 ban on sand export from Indonesia, which supplied Singapore with 98 percent of its total sand imports the year before. Indonesia’s ban, according to media reports, was implemented at least partly in response to the environmental destruction in the Riau Islands, where much of the dredging was done.

Representatives of the Singaporean Embassy said officials there were too busy to talk to reporters yesterday. An e-mailed request for comments went unanswered.

In November last year Vietnam issued a blanket ban on all sea sand exports from June 2010 onwards. According to Global Witness, this meant Cambodia “may become an even more significant source of sand for Singapore.”

Deur Sen, a 68-year-old fisherman in Khemarak Phoumin district’s Dong Tong commune in Koh Kong province, said yesterday that sand dredging which he believed was being conducted by LYP Group in the Koh Por river estuary had reduced water quality and destroyed fish stocks in nearby coastal waters on which fishermen relied, adding that throughout 2009 the fishermen had been unable to catch fish.

“During last year we could not catch any fish when the big [dredging] ships arrived,” he said, adding since early this year the situation had somewhat improved. “Now the dredging seems a little bit quiet and we can catch a bit more fish.”


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