Kampala — Uganda's environment minister has refuted the recently released findings by Friends of the Earth International (FOE) that growing palm oil trees is causing environmental destruction and also leading to land grabbing in the islands district of Kalangala.

Kenya-based Bidco, processes the Kalangala output, in the multimillion dollar project backed by the government and the International Fund for Agricultural Development (IFAD).

Professor Ephraim Kamuntu, the Minister of Water and Environment told East African Business Week the research carried out by the FOE is faulty. "The project is environmentally friendly. No encroachment has been registered on all our central forest reserves in the island district of Kalangala. In addition to that, the managers of the project are also participating in tree planting. Then how come FOE say that the Bidco project is causing forest depletion in the country?" he queried.

In 2002, Bidco signed an agreement with the government to develop an integrated palm oil project on Bugala island. According to Bidco, 'Kalangala Oil Palm Project was and still is part of the Ugandan Government Vegetable Oil Development Project (VODP) initiative geared towards increasing vegetable oil production in Uganda. The project is supported by IFAD and the World Bank with BIDCO and Wilmar Plantations playing a major role as the private investors.'

Kamuntu said the project is not even emitting industrial pollutants in the atmosphere because all the waste from the processing plant is re-used in the production of power at their Bugala Island power plant and the rest are used as fertilizer.

The Minister's reaction comes after FOE claimed in its report that international banks were financing Wilmer International, (a Singapore-based leading palm oil dealer), which has shares in the Kalangala project on the shores of Lake Vitoria.

FOE claims Wilmer International has had a hand in destroying the Bugala Island environment by way of deforestation to make way for palm oil plantations. FOE adds that have been cases of people being displaced from their land holdings.

However, Kodey Rao, the Bidco Uganda managing director said all their palm oil projects are on private land outside the central forest reserves.

He clarified that Bidco acquired land from the locals and compensated them using government rates at the time and that the government itself also bought land from the locals but outside the Central Forest Reserve through the National Forest Authority (NFA). "The Government acquired land for the nucleus estate. A total of 8,500 hectares for the nucleus estate, although only 6,500 hectares was accessible by the company for planting oil palm. One thousand, five hundred hectares was within the 200-metre buffer zone and therefore could not be used for planting palm oil trees Another 1000 hectares was left for the communities to plant palm oil and also use for other agricultural and settlement activities" Rao said last week.

When asked how the project has helped the local communities in Kalangala District, Rao said the project has supported the restoration of environment in the degraded Islands in Kalangala District.

He said some islands in Kalangala and Buvuma District, also on shores of Lake Victoria where there is no farming of palm oil, there is considerable charcoal burning and firewood harvesting, which has left big chunks of natural forests being degraded by the locals themselves.

"At Bugala Island, where we are operating, locals have stopped charcoal burning but now concentrate on palm oil farming which is environmentally friendly. But let those environmentalists (FOE) go to Buvuma islands and see the rate at which forest have been cut off for both timber and charcoal burning" he said Rao said since the project started, over 3000 people are benefiting directly and another 10,000 indirectly. That however has not stopped activists from complaining.

In June, David Kureeba, FOE Uganda representative said, "Communities in Kalangala, living and working on land acquired for palm oil plantations have been displaced, often with no compensation or alternative livelihood options. About 3,600 hectares of forest have been destroyed, negatively affecting the environment and livelihoods of local people."

"Instead of importing what could be domestically produced, it made sense to grow oil palm locally, support the farmers to grow the crop and use the limited foreign exchange to import what the country could not produce," Rao said