Sarawak's annual logging reached up to 19 million m3 in the peak years. From 1980 to 2000, the east Malaysian state was the largest wood exporter in the world. (Image: Sandro Tucci / Life / Getty)

SOMETHING ABOUT SOMETHING - .....!!! 11/22/2019

Petroleum and tropical wood are anything but a blessing for Sarawak

The majority of Sarawak's oil proceeds go to the Malaysian treasury. Companies that are known as the “Big Six” - and a family clan around a regional prince who has ruled for decades - benefit above all from the clearing of the primary forests in the eastern Malaysian state.

Manfred Rist, Miri11/22/2019, 6 a.m.

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“Before every choice, they promise asphalting the road; then they hand over a few hundred ringgit to the village chief. But then another five years pass without anything happening. »65-year-old Richard Engan Ang grew up in Mulu and knows the machinations of the politicians in Sarawak. He also knows the potholes of the streets that swallow half wheels; and he knows the failures in the power supply and the interruptions in the telephone network that sometimes last for days.

Petronas as a profiteer

The east Malaysian state in the north of the island of Borneo is a country of great contrasts. Sarawak is the largest member state of the Malaysian Federation, the area is three times that of Switzerland - with the smallest population, mind you, of just 2.7 million inhabitants. Sarawak could also be one of the richest areas in terms of mineral resources, including oil, like neighboring Sultanate of Brunei, whose per capita income is close to that of Singapore.

The comparison with the two highly developed small states creates mixed feelings and frustration in Sarawak's population today. According to the original plans from 1963, the three - all former British colonies - should have been integrated into the Malaysian Federation. Brunei, knowing of his immense oil treasure and because the then Sultan sensed a loss of status, withdrew at the last moment; Singapore then separated again in 1965 for ethnic-political reasons. Only Sarawak remained true to the initial project, but negotiated extensive autonomy rights that still apply today.

The relationship with Malaysia has remained ambivalent. On the one hand, this has to do with the different ethnic composition and religion, and on the other hand with the oil deposits. Because of an agreement signed almost 50 years ago (Petroleum Development Act), only 5% of the income of the Petronas oil company remains in Sarawak; 95% go to the Kuala Lumpur Treasury in western Malaysia. The statistics therefore show a different picture: in terms of income per capita and share of the poor, Sarawak is among the bottom of the 14 Malaysian sub-states . According to a 2009 survey, 242,000 households lived there with less than 2,300 Rin. Monthly income, i.e. just under CHF 600

Sarawak's opposites include the gap between rich and poor and the stark income and development gap, even for Southeast Asia. Most of the lower secondary schools in Sarawak, which according to a recent survey in 1002 , are in a desolate condition. And there are quasi-feudal conditions: While people like Richard Engan Ang and the families of his eight siblings hardly make ends meet, a family clan has dominated events in Sarawak for decades, whose assets are estimated at $ 10 to 20 billion. The figures come from extensive research in the “Sarawak Report” , Global Witness and the Bruno Manser Fund . In the specialist literature on Malaysia's economic development there is talk of "looting of public resources and illegal drains".

The person at the center of this network, Abdul Taib Mahmud, is not an entrepreneur or self-made man in the classic sense. He has chosen a more lucrative career, which is not atypical for Malaysia, namely as a politician. Today, the 83-year-old has the more representative function of a governor of Sarawak. Until 2014, however, Taib was the so-called chief minister of the state's government for thirty years; at the same time he held the office for resources, was finance minister and also chief of the authority for the measurement of the territory. Thanks to this abundance of power, Taib was able to switch and rule at will. He also benefited from being an important coalition partner of the party that dominated Malaysia from 1957 to 2018, namely the United Malays National Organization (Umno).

Sovereignty over other natural resources

Paradoxically, Taib Mahmud owed the central role as chief minister not least to the fact that in the early 1970s, when he held the post of minister for natural resources in Kuala Lumpur, he negotiated the rather miserable 5% deal for Sarawak. For the Taib, who was trained as a lawyer in Australia, this worked out very well: In return, the government in the provincial capital Kuching received unlimited sovereignty over all other natural resources, including the raw material that is inextricably linked to the construction industry in Asia that has been booming for decades: wood from Sarawak's huge forest.

The machinations that have decimated the rainforest in East Malaysia are now well known: Since 1970, the government in Sarawak has been granting logging permits that are used either by the licensees themselves or by subcontractors. From 1970 to 1981, around 1.4 million hectares of forest area were cleared in a first phase; at that time, Taib's uncle Abdul Rahman Yakub was on the government's levers. In the following ten years after Taib Mahumd took over in 1981, the system was «optimized», and then it was 8.8 million ha. For such timber concessions, as documented by Lukas Straumann in his book «Raid on the Rainforest» , millions moved under the table. Thanks to whistleblowers and secretly recordedInterviews with family members and lawyers from Taib prove that extensive kickbacks were paid for logging and plantation concessions.

An exploitation in stages

The locks in Sarawak have been open to overexploitation of nature for decades. The annual logging reached up to 19 million m ³ in the peak years . From 1980 to 2000, the east Malaysian state was the largest wood exporter in the world - and thus paved the way for a massive expansion of palm oil plantations. Incidentally, the fact that those wood exports had little impact on the official revenue of the state of Sarawak and never had a major impact on Kuala Lumpur's tax revenue is - as Global Witness also documents - connected with transfer pricing via bogus companies in Singapore. This not only masked the true value of exports, but also kickbacks.

The expansion of palm oil production in Malaysia and Indonesia also took place from the beginning of the 1990s. These are the two most important countries, which together cover 93% of global demand, which has increased sixfold to 73 million tonnes since 1992. The connection between wood and palm oil is clear, according to Clare Recastle, the initiator of the “Sarawak Report” : The six large logging companies that are considered “Big Six” (see text box) would have palm oil as a logical extension of theirs early on Activities understood: first wood, then land, then contracts for oil, natural gas and construction projects, she explains in an interview.

"The big six" behind the deforestation

While the major Southeast Asian palm oil companies such as Wilmar International, Kuala Lumpur Kepong, IOI, Sime Darby and Golden Agri-Resources are relatively well known, the companies that mainly do business in tropical woods are silent groups. It is also called "The Big Six". These are the Shin Yang companiesForestry, Samling Global, Ta Ann, WTK, KTS Forest Plantations and Rimbunan Hijau. Their characteristics: They come from Sarawak, are under the control of local Chinese and are now active worldwide, including in Cambodia, China, Guyana, New Zealand, Tasmania and Papua New Guinea. They operate as conglomerates with subsidiaries and extensive activities, including transportation, construction, real estate, financial services, as well as tourism and the media; the latter area includes the publications “Borneo Post” and “Utusan Borneo”). Together they have over 70% of the approximately 5 million ha of licensed forest area, of which approximately 3 million ha are intended for plantations (mainly palm oil).

The concessionaires in Sarawak also include the actual palm oil companies such as IOI and Sime Darby, which are based in West Malaysia and are listed there on disallowed. These are the companies that are particularly active today in the defense of palm oil and the certification of the harvest as part of the Roundtable on Sustainable Palm Oil (RSPO). The industry, which has sales of around $ 70 billion worldwide, remains under attack - and Sarawak has made a significant contribution to this. For example, the UK-based Environmental Investigation Agency (EIA) published a report in October that accused RSPO of violating sustainability standards and greenwashing .

Early World Bank warning

It is noteworthy in this context that the World Bank had already pointed out in 1991 that the deforestation of the tropical forest in Sarawak is always a fatal race against time. On the one hand, animated high and hidden sums for licenses for rapid grubbing up and marketing of construction timber. On the other hand, the political situation in Sarawak led to rapid looting of the forest, since the rulers there could withdraw the permits at any time. With regard to sustainability and the climate discussion, the result is devastating: Sarawak's primary forests, with an area of over 100,000 km ^2, the third largest contiguous tropical forest area, have disappeared 90% today.

A glance from the plane initially deceives. From the bird's eye view, Sarawak still presents itself in large areas in green garb inland. The goal that Malaysian minister Xavier Jayakumar, who is responsible for natural resources, recently reaffirmed to this newspaper that half of the area in eastern Malaysia must be forested, appears to have been narrowly met; In order to defend this 50% goal, Jayakumar has also declaredly wants to stop the expansion of the Pamöl plantations. However, a large part of the green surface is overgrown with greenery, or it is a monoculture of palm oil, acacia or rubber. The 50% share does not distinguish between primary and secondary forest anyway. The primary forest, which is so valuable for flora and fauna, has already been largely sacrificed.

Whether in the Malaysian part of Borneo, which also includes the state of Sabah, or in the Indonesian part of the island of Kalimantan, the images from the air are the same everywhere: the lumberjack streets still run across the green thicket. For the numerous indigenous peoples such as the Iban, Bidayuh, Kayan, Kenyah, Berawan and Penan, these slopes, on which the large articulated lorries run with felled jungle giants, may initially have meant a connection to the outside world and better care. It is now clear that this development has a high price due to the destruction of livelihoods .

Sarawak is an area of contrasts

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White rajas, hornbills and the end of the British colonial empire

The land of the hornbill in northern Borneo has always been a slightly cranky member of the Federation of Malaysia. Sarawak was originally part of the Islamic Sultanate of Brunei, whose rulers ceded the area to the British James Brooke in 1841, who was there to help put down an uprising. After a reign of the white Rajas lasting three generations, it was integrated into the British colonial empire immediately after the Second World War - as the last colonial area and only for a short time.

Who first came up with the idea in 1961 to bring Sarawak together with West Malaysia is controversial: Was it the British, following the spirit of the times and to get rid of the financial burden, or the leader of Malaya, who had become independent in 1957, Tunku Abdul Rahman? In any case, the latter fitted the idea well into the concept, since a population expanded to include Malays and indigenous peoples would relativize the influence of the Chinese-influenced crown colony Singapore, which was also part of the fusion project at the time.

In Sarawak, which is predominantly Christian, whose heterogeneous population mix is also very different from that in western Malaysia, people originally feared a new colonization - through Kuala Lumpur.

NZZ Live

Corruption and political upheavals: where is Malaysia heading?
Manfred Rist, NZZ Southeast Asia correspondent, talks to investigative journalist Clare Rewcastle Brown and political scientist Bridget Welsh about felt and nepotism in Malaysia. Rewcastle Brown uncovered one of the world's largest corruption scandals in recent history: Almost $ 5 billion disappeared from the Malaysian sovereign wealth fund 1MDB. For many years, Malaysia was considered a model boy among Asia's emerging countries - today corruption and nepotism cause great resentment among the population. Together with the Asia Society Switzerland, the NZZ invites you to a discussion about the future of Malaysia and Southeast Asia.
The interview will take place in English.
November 25, 2019, NZZ Foyer
Program and tickets: nzz.ch/live