The National Service for Forests and Wildlife in Peru revealed that two companies are responsible for the illegal deforestation of thousands of hectares in the Peruvian Amazon rainforest.
The agency is part of the ministry of agriculture and the highest authority for the management of forests. The director of the agency, Fabiola Muñoz, gave the information to the investigative journalism portal Ojo Publico. According to Muñoz, in Nueva Requena Forest, in the region of Ucayali, the company Plantaciones Ucayali was responsible for US$65 million worth of damage, while in the protected area called Tamshiyacu, in the region of Loreto, the damage committed by Cacao Peru Norte amounted to US$46 million.
Both companies, Plantaciones Ucayali and Cacao Peru Norte, are financed by what is known as the Melka Group, a transnational conglomerate of companies headed by Dennis Melka. Melka is CEO of the best-known company of the conglomerate, United Cacao, which trades publicly in the U.K. Stock Exchange and is registered in a tax haven in the Cayman Islands. The conglomerate has also invested in some of the largest palm oil plantations in the world, including in Singapore, Malaysia and Indonesia.
When question about what the Peruvian National Service for Forests and Wildlife has done to prevent deforestation, Muñoz responded, “We have denounced this issue with the ministry of environment and the environmental prosecutor, and we have also supported with investigations the millions in economic losses due to the deforestation caused by the palm oil companies in Tamshiyacu and Ucayali.”
Muñoz also stated that her agency has produced and submitted for prosecution “technical information about the damage done by the companies Cacao Peru Norte and Plantaciones Ucayali.” The document includes an estimate of the damage done to the area, which cumulatively adds up to US$111 million.
In 2015, the non-profit Environmental Investigation Agency reported that Dennis Melka is the head of a commercial group which founded 25 companies in Peru dedicated to palm oil and was being investigated by Peruvian authorities for the deforestation of seven thousand hectares. The non-profit group estimates that the wood from clearing this land would fill 125 Olympic swimming pools.
The EIA’s report also showed the 25 companies linked to Melka have bought 450 properties in Loreto and Ucayali and have requested from the corresponding regional governments an additional 96 thousand hectares. Also, through the use of satellite images, the agency has been able to determine that more than 99 percent of the areas under the control of companies associated with Melka were primary forests.
In other words, they were areas where previously the ecological processes were not significantly disturbed and there weren’t visible indications of human activities in these areas.
In 2014, the government ordered the Melka companies to stop the deforestation but the next year the decision was overturned by another court, which ruled the clearing was legal. Since then the deforestation has continued.
Some analysts believe that the problem is that there is a legal loophole through which authorities can allow the deforestation of 20 million hectares of primary Peruvian amazon rainforest that are not yet classified as such, leaving them open to being labeled agricultural land.
Dennis Melka is up front about trying to make United Cacao profitable based on the low costs found in Peru. In a promotional interview with the "U.K. Investors," show on YouTube, he stated, “We intend to be one of the lowest-costing producers in the world. Peru, in our opinion, has an incredible location, rainfall, climate, cost of labor, fiscal and tax policies. So we are very excited about the asset that we are building.”
In another interview, Mr. Melka shares the cacao production goals of the company in Peru by stating that “our goal is to hit 3,250 hectares by the end of next year making us the largest plantation in the world.”
According to the non-profit REDD-Monitor, Melka Group's practices in Peru are very similar to those which led to the deforestation of Sarawak in Singapore. They claim that “Asian Plantations (registered by Dennis Melka) did not buy land in Sarawak directly, but did so through a network of subsidiaries. Three holding companies bought Malaysian companies that held the concessions. This multi-level, non-transparent corporate structure makes finding out the owners of concessions more difficult, and helps Asian Plantations evade responsibility for deforestation.”