The Military-Aid Complex, Agrofuels and Land Struggles in Aguan, Honduras

The current rural development model, based on agribusiness and land grabbing, is not only worsening poverty levels, but also affecting the food security of the entire rural population. At the same time it is generating intense conflicts that frequently turn into open and systematic violations of people’s most basic rights. -International Fact Finding Mission Report, Bajo Aguan, Honduras, July 2011 [1]

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Tanya Kerssen
Food First

As elsewhere, land-grabs are not a new phenomenon in Honduras. The country is known as the quintessential “banana republic”, where U.S. companies took over massive swaths of land at the turn of the twentieth century for plantation fruit production. The current wave of land-grabs and rural violence results, in part, from this legacy of powerful agribusiness interests. In the Aguan region, a fertile river valley in Northern Honduras, peasant organizations have been struggling for over fifteen years to recuperate lands grabbed by large African oil palm growers in the early 1990s. Following the coup that overthrew president Manuel Zelaya Rosales on June 28, 2009, these movements have come under increased attack by agro-industrial elites seeking to entrench their power. An historical analysis of the Aguan case shows that land-grabs are not single moments in time, but often highly-contested processes that are part of long struggles for agrarian reform and peasants’ rights.

Background: Land reform in the Aguan Valley

In the 1950s, the North American banana companies’ stranglehold on the Honduran economy met with increased organizing by rural workers. The General Strike of 1954 became a watershed moment in Honduran political history, leading to two decades of government reforms intended to quell social unrest by alleviating land pressures. With the backing of the U.S. Alliance for Progress initiative, the agrarian reform process begun in 1961 was unsurprisingly opposed to expropriating large landholdings (such as those of American companies). Instead, the government promoted a “colonization” of the agricultural frontier (rainforest) by land-poor campesinos. Then-president Villeda Morales argued: “This [reform] is neither communist nor socialist; it is a purely liberal and democratic agrarian reform that will not take away any lands from latifundistas” [2]. Thus, despite reforms, the landed oligarchy would remain intact and politically influential to this day.

The State-owned lands of the Aguan River Valley in the Northern department of Colón became one of the reform’s main colonization sites. Formerly a jungle backwater, the colonization of Aguan with poor peasants was a difficult process with a high abandonment rate in its early years. Initial failures required the State to adopt a more integrated development approach than just doling out plots. In 1970 the National Agrarian Institute (INA) began actively promoting the formation of African palm oil and citrus “peasant enterprises” (empresas campesinas). These cooperatively-owned enterprises received State support in the form of inputs, credit, price supports and infrastructure.

In order to further ensure that the reformed lands would remain in peasant hands, a 1974 agrarian reform law (Decree Law 170) placed limits on the size of large properties. Decree Law 170 also prohibited the sale of lands received through the reform process, stating that they could only be reverted to the State for re-distribution to landless peasants. During the three decades of reform, 409,000 hectares were awarded to 60,000 families, covering 12.3% of the country’s total agricultural land [3]. The wave of poor migrants drawn to the Aguan in the 1970s, primarily from the South of the country, worked tirelessly in harsh conditions in the hopes of a better life -clearing the forest, building infrastructure and preparing the land.

Neoliberal land-grabs of the 1990s

In the wake of the Latin American debt crisis of the 1980s, the World Bank and IMF required Honduras to implement Structural Adjustment Policies (SAPs) including the typical combination of privatization, liberalization and deflationary monetary policy. The impact on agriculture, especially smallholders, was brutal. One of president Callejas’ (1990-1994) first policies was to devalue the national currency against the dollar to make Honduran exports more competitive and lift agricultural tariffs, leading to a flood of highly subsidized imports from the U.S. In addition, the State’s Agricultural marketing board (IHMA) was privatized and price guarantees were withdrawn, leaving farmers at the mercy of global markets. This devastated the Honduran basic grains sector. By the early 1990s, many Aguan cooperatives teetered on the edge of bankruptcy. The Agricultural Modernization Law of 1992 also known as the “Norton Law”-for Roger Norton, the USAID economist who drafted the legislation-pushed many over the edge.

The 1992 law reversed the 1974 Agrarian Reform, removing limits on large properties and legalizing the private transfer of lands acquired through the reform process. Aid agencies like USAID and the World Bank had already been pressuring Honduras since the early 1980s to implement extensive land titling programs to promote a free market in land [4]. These pressures found expression in the Norton Law, which replaced the State-managed “land to the tiller” development model with a “willing buyer – willing seller” free market model promoted by the World Bank. With peasant cooperatives hurting, this abrupt liberalization of the land market led to a massive sell-off of peasant lands in Aguan Valley. These “voluntary” land sales, however, were helped along through varying degrees of intimidation and manipulation: from bribes to peasant leaders, to menacing letters from INA, to violent threats from large landowners.

Countrywide, approximately 30,500 hectares (over 75,000 acres) of peasant lands acquired through the agrarian reform were sold between 1990 and 1994. These lands were concentrated in the most resource-rich parts of the country: areas with the most fertile soils, water resources and access to communication, energy and transport infrastructure. So while the national average for land re-concentration during this four-year period was less than 10 per cent, in the Aguan Valley and Atlantic coast regions (areas suitable for high-value crops like bananas and African palm) it was over 70 per cent [5]. In Aguan, of the 28,365 hectares awarded to peasant cooperatives by the agrarian reform, 20,930 were sold off. Three oil palm magnates were the primary beneficiaries: René Morales Carazo, Reynaldo Canales and the richest man in Honduras, Miguel Facussé Barjum (who has earned the nickname palmero de la muerte or “palm grower of death”). In all, 40 peasant cooperatives lost their lands in Aguan [6]. This is also where one of the strongest movements for land rights would emerge.

Modern land struggles in Aguan

Peasant organizations quickly began mobilizing to challenge the legality of the land acquisitions of the early 1990s and carrying out peaceful occupations as political leverage. One of the oldest land struggles is that of the Aguan Peasant Movement (MCA), over lands of the former Regional Center for Military Training (CREM), which was created under the auspices of the U.S. in 1983 as a training camp for counter-insurgency forces. After having served their purpose, CREM’s 5,724 hectares were reverted to the State for redistribution, as mandated by the agrarian reform law. When the municipality illegally sold the lands to local cattle ranchers, peasant communities came together to form MCA and carried out their first occupation in 1999.

Shortly before he was overthrown in June 2009, Zelaya had agreed to grant land titles to peasants in the region who had peacefully occupied and produced on their lands for ten years or more. Decree Law 18-2008 would have given communities of MCA, as well as other peasant organizations, legal title to the land. Another peasant organization, the Unified Movement of Aguan Peasants (MUCA) had reached an agreement in early June 2009 with president Zelaya to buy their land back from Facussé. But the coup put an end to all such negotiations, as well as the new legislation.

The post-coup government of Porfirio “Pepe” Lobo’s response to the peasant movements was a complete militarization of the Aguan. On March 12, 2010, 10,000 soldiers entered the region, with helicopters hovering low to the ground, supposedly looking for weapon stockpiles. In November 2010, the military occupied the Aguan Valley’s National Land Reform Institute for two month during which the private security guards of Miguel Facussé ambushed and killed five peasant farmers from MCA. Between June 2009 and August 2011, Aguan communities attribute at least 45 peasant murders in the region to private security guards of large African palm growers, often acting in concert with State police and military forces [7].

The violent advance of agrofuels

The current land-grabs are tied to the increased demand for “green” fuels in North America and Europe. Aguan landowners who expanded their holdings dramatically in the 1990s have invested heavily in the production of African oil palm, an agrofuel feedstock. Honduras currently produces more than 300 metric tons of African palm oil, 70% of which is exported. The area dedicated to the crop has increased from 40,000 hectares in 1990 to 80,000 hectares in 2005 to 120,000 hectares in 2011, most of which is grown in the Aguan Valley. This expansion has come at the expense of food crops such as corn, beans, rice and sorghum, which have been pushed further into the agricultural frontier, onto poor soils and steep hillsides.

Large palm growers also receive a substantial amount of international financing. Miguel Facussé’s Dinant Corporation-a vertically integrated agro-food giant that produces edible oils, snacks and biodiesel-has received millions of dollars in loans from bilateral and multilateral Aid agencies. In November 2009, the World Bank’s International Finance Corporation (IFC) invested 30 million USD in Facussé’s oil palm enterprise, citing the company’s important contribution to providing employment and developing infrastructure in remote rural regions [8]. In addition to the World Bank, the IADB and the Bank of Central American Integration (BCIE), Facussé has also received support for his supposed contributions to combating global climate change.

In July 2011, despite the international outcry, the Executive Board of the UN’s Clean Development Mechanism (CDM) approved a Dinant palm oil biogas project as a recipient of carbon credits. The approval comes after a German investment firm (DEG) and a French utility company (EDF) both withdrew from the project citing human rights concerns. Despite the questionable contribution to reducing carbon emissions, and the rising body-count linked to Facussé, CDM’s decision will “almost certainly allow Grupo Dinant to have their palm oil classed as ‘sustainable’ as an EU biofuel feedstock,” according to watchdog group Biofuel-Watch. World Wildlife Fund (WWF) also lent legitimacy to Facussé in May 2010, by signing a memorandum of understanding toward Dinant’s certification under the Roundtable on Sustainable Palm Oil (RSPO). In response to a letter signed by 70 human rights NGOs deploring Facussé’s track record, CDM’s European chairman Martin Hession from the UK responded that the board was simply “not equipped” to investigate the human rights abuses.

The advance of African oil palm in the Aguan goes hand in hand with the increasingly militarized approach to crushing peasant movements. In June, 120 families in the Peasant Movement of Rigores were violently evicted (their homes burned, animals killed and crops destroyed) from lands they had farmed for over a decade by State police and private security forces of local palm grower Eric Rivera. Fifteen people were killed in August [9], including five peasants shot on a Dinant plantation, the vice-president of MUCA and his wife. The government has responded to the violence by sending in 600 soldiers and 400 police to pacify the region. Meanwhile, he U.S. military presence and security Aid-heightened in recent years in the name of combating narco-terrorism-have bolstered Honduran security forces’ capacity for repression.

Peasants and the popular resistance

The Honduran elite has long looked outward-especially to the United States-for investments, foreign aid and legitimacy, thus leading to extremely weak democratic institutions, as evidenced by the overthrow of president Manuel Zelaya in 2009. Supported by the country’s landowning and business elite, the coup marked the intensification of state-sponsored violence and repression of peasant communities. But the coup also catalyzed a national resistance movement, embodied in the Frente Nacional de Resistencia Popular (FNRP), uniting virtually every sector of Honduran civil society, from teachers and students to peasants, workers, indigenous peoples, faith-based organizations and LGBTQ groups [10]. The peasant movements of Aguan are a pillar of the broader movement for democratization in Honduras, fighting for the most important source of political power throughout Honduran history: land.


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