African Palm Oil – Boosting Livelihoods While Protecting Forests

This impact story was originally posted in TFA Perspectives here.

Imagine you’re going on a night out, to an Italian restaurant for example. You may have a shower first and shampoo your hair. Roll on some deodorant and perhaps pop on some lipstick. You share a lovely evening over some pizza and chocolate fudge cake. Back home, you brush your teeth and head for bed. Every one of those products you used or ate that night contains palm oil. And it would be the same if you’d feasted on Nigerian jollof rice or Ivorian sticky alloco plantains. Why? 

Because palm oil is the most widely consumed, efficient and versatile vegetable oil on the planet. It stops chocolate melting and it makes fried food crispier.  It conditions your hair and it makes lipstick smoother. Oil palms provide nearly five times more oil per hectare than sunflower or rapeseed, and supply 40% of the world’s vegetable oil demand on less than 6% of the land used to produce all vegetable oils. 

But – as we all know – palm oil continues to be a major cause of deforestation, especially in the carbon-rich and biodiverse tropical forests of Asia. Conversion of swamp forests in Malaysia and Indonesia to palm oil plantations is responsible for up to 0.8% of all greenhouse gas emissions – equivalent to almost half the global aviation industry. While these two countries account for most global production, over 20 African countries now grow oil palm on almost 6 million hectares of land, sharpening concerns around potential deforestation and exploitation of Indigenous peoples and local communities in the tropical forests of the Congo Basin and West Africa. 

And despite nearly two decades of action to tackle the problem by organizations such as the Roundtable on Sustainable Palm Oil (RSPO), the battle is by no means over. According to WWF, which surveyed 227 global palm oil buyers in 2021, only 67% of total palm oil reported by respondents is certified sustainable – a figure that drops to just 23% for palm oil bought by companies based in Africa and Asia. 

Africa Palm Oil Initiative seeks to bring jobs while protecting tropical forests

Six years ago, Greenpeace issued a warning: “Africa has become the new battleground of oil palm and rubber tree companies.” That same year, in a timely move, seven African nations came together at COP22 in Marrakesh to sign into existence the Africa Palm Oil Initiative (APOI). This “public-private-community partnership” of governments, rural people and businesses has a shared vision of “a prosperous palm oil industry that brings jobs and wealth to local communities in a way that is environmentally and socially sustainable and protects the rich tropical forests of the region.” 

So what is APOI doing differently from what’s happened before? It’s a combination of getting the right government policies in place, building local capacity and engaging the different stakeholders who matter when it comes to understanding the underlying processes behind deforestation, according to Abraham Baffoe, Africa Regional Director for Proforest (the NGO leading on the implementation of APOI). “Most importantly, the initiative realized that local farmers and Indigenous people depend on forests for their livelihoods – but they’re often left behind”, says Baffoe, who adds:  “The people living with the resources understand why deforestation is happening – so they need to be at the centre, in terms of identifying the issues and agreeing the solutions.” 

The people living with the resources understand why deforestation is happening – so they need to be at the centre, in terms of identifying the issues and agreeing the solutions

Abraham Baffoe, Africa Regional Director, Proforest

As well as bringing these varied stakeholders together under national and regional platforms, APOI has brokered a set of regional guiding principles addressing deforestation, community rights, labour conditions, smallholder development and biodiversity protection. The message is clear: Africa is open for investment in the palm oil sector, but will only welcome investments that comply with these principles. 

The principles apply as much to local producers as to international investors. One of Africa’s challenges is that it consumes around 15% of global palm oil production – far more than it produces. Imports of palm oil topped nearly 8 million tonnes in 2020, putting pressure on local producers to grow more. In 2019, for example, the Nigerian government created a new policy to provide for 100% of national demand through domestic production by 2027. As food prices soar due to the war in Ukraine, this has proved a prescient move. 

However, if countries are to avoid imports, domestic production will have to scale up significantly to meet the demand of rapidly growing populations across West and Central Africa. And the signatories to APOI are determined that growth in the domestic palm oil sector must enhance the livelihoods of smallholders, while preserving pristine forests and engaging with local communities. 

Engaging with governments is vital to the success of APOI

Although 85% of the world’s palm oil comes from just two countries – Malaysia and Indonesia – the palm oil plant is native to West Africa. However, it thrives in the same warm, damp equatorial climate as some of the planet’s most biodiverse and carbon-rich tropical forests. The challenge for Africa is to avoid the mistakes made in South-East Asia where, for example, the palm oil industry was responsible for at least 39% of tropical forest loss (2.4 million hectares) on the island of Borneo from 2000 to 2018. 

Vital to the success of APOI is its engagement with governments – the only entities capable of determining (and enforcing) which land should be protected and which can be leased out for food production. The Nigerian state of Edo, whose local government joined APOI in 2018, is a good example. Home to the 11th century Benin Empire, Edo is one of the top five palm-oil-producing states in the country. The state government’s first step towards sustainable and equitable land-use practices was to commission accurate GIS maps of all forest areas. They were alarmed to find that 80% of Edo’s 625,000 hectares of forest reserves had been encroached on, while just 200,000 hectares could be called “real forest”

This prompted Edo’s government to frame a new forestry law, which permits agricultural production only on degraded land. Furthermore, all private companies engaged in palm oil or any other food production will be required to provide the resources to restore an area of degraded forest equivalent to 25% of their land holding. “We’re not going to cut down forests to grow palm oil”, said state governor Godwin Nogheghase Obaseki in a recent interview, adding: “We will grow palm oil and encourage the growers to invest to grow back our forests.”

Edo state has set up a new forestry commission empowered to manage forests and enforce the new law. The same is happening in the Republic of Congo, another APOI member where the national government has passed a law decreeing that palm oil production must move from forests to savanna regions. 

Engage with local communities and seek their consent

For Governor Obaseki, while it’s vital to preserve the state’s remaining forests, it’s just as important to ensure that Indigenous people and local communities grant their permission for any agricultural development on their ancestral lands, through a process known as “free, prior and informed consent” (FPIC). 

This might seem a self-evident requirement, but it has long been ignored in the region. Take Liberia, for example. Following the country’s civil war from 1989-2003, government officials sitting in the capital Monrovia signed away a quarter of Liberia’s total land mass in concessions to foreign companies farming rubber, palm oil and lumber. Their scant regard for seeking the consent of local communities, whose livelihoods were sustained by the land, led to riots and legal challenges that froze the country’s palm oil production in the mid-2010s. It also pushed communities off their customary land into forest areas, further aggravating deforestation.

In a landmark legal process culminating in 2018, Liberia’s President George Weah signed the Land Rights Act into law. It asserts that customary land can be claimed through oral testimony and community agreement. The law also makes FPIC a legal requirement for all land allocations. However, critics point out that the law is not retroactive, so contracts already signed by the state will be honoured. 

Photo Credit: Ahtziri Gonzalez/ CIFOR

Work with the private sector to boost productivity

While framing and enforcing the right forest laws and seeking the consent of local people are vital prerequisites to the sustainable production of palm oil, the battle against commodity-driven deforestation badly needs economics on its side as well. Farmers must be able to generate meaningful livelihoods from their work – and this requires investing in higher productivity to deliver higher returns on less land.  

A key competitive advantage of APOI is that its members include the private sector companies driving palm oil production. While a typical company can expect palm oil yields of 20 tonnes per hectare, local smallholders struggle to generate more than a tenth of this amount. The pattern is the same across the region – in Ghana, for example, smallholders farm eight times more land for palm oil than large companies but account for less than a quarter of all production. 

In Nigeria’s Edo state, the government requires companies to help smallholders improve their productivity by providing training in best agronomic and management practices. 

A similar programme in Ghana has helped smallholders to double their productivity in just 18 months. Direct financial support is also vital for smallholders. For example, the Nigerian government subsidizes inputs including seeds and fertilizers, while the Central Bank has made $500 million of low-interest loans available to Nigerian palm oil producers. 

The strength of the APOI lies in its ability to build alliances between farmers, government and agribusiness to help ensure that socioeconomic development and forest conservation – so often in conflict – become mutually reinforcing. And if the coalition can make this work for palm oil, then why not for other commodities too? 

Governments realized that sustainable principles for a single commodity won’t deliver the wider impact on the ground

Future – broadening action to include other communities

Today, membership of APOI has grown to 10 countries that account for 75% of Africa’s forests – Cameroon, Central African Republic, Côte d’Ivoire, Democratic Republic of Congo, Edo State (Nigeria), Gabon, Ghana, Liberia, Republic of Congo and Sierra Leone. Critically, membership includes the countries of the Congo Basin, one of the world’s most biodiverse ecosystems that stores an estimated 25-30% of the world’s tropical forest carbon stocks

To further protect these carbon stocks, APOI has secured the consent of its member governments to expand its mandate into other commodities, including rubber and cocoa, which face similar issues as they grow in similar ecosystems.

“Governments realized that sustainable principles for a single commodity won’t deliver the wider impact on the ground,” says Abraham Baffoe, who adds: “The principles have to be applied across landscapes for all commodities.”

Consequently the coalition will transform itself from the APOI into the Africa Sustainable Commodities Initiative (ASCI). This cross-commodity approach will build on the work that the coalition’s 10 members have already done – around issues such as deforestation parameters and public-private partnerships – and leverage that capacity to enhance the sustainability of other forest products.

This marks an important strategic step forwards for the coalition, according to Felipe Carazo, head of public sector engagement at the Tropical Forest Alliance, who says: “Instead of each commodity sector coming up with its own separate metrics and working relationship with the government, ASCI will drive alignment and integration across all forest-risk commodities in the West Africa region.” 

There are other advantages to this cross-commodity approach as well, points out Carazo. It will position members to respond more effectively to demand-side measures, such as the European Union’s impending new regulation to outlaw the import of any commodities linked to deforestation. And it will help build the case for government investment in tackling bottlenecks that affect the sustainability of all forest-based commodities, such as transport and public health infrastructure. “This in turn would create a more enabling environment for foreign direct investment”, says Carazo.

Aerial view of Transition Forest area in Bokito, Cameroon. Photo credit: Mokhamad Edliadi/ CIFOR

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