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Profit from ELCs ‘doesn’t rectify ecological impact’

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A woman collects cassava at an ELC in Kratie’s Snuol district . Heng Chivoan

Profit from ELCs ‘doesn’t rectify ecological impact’

The government has collected over $6 million in revenue so far from more than one million hectares of economic land concessions (ELC), says a report from the Ministry of Agriculture published this week.

However, the amount collected has been criticised by NGOs which say ELCs do not provide economic benefits.

The ministry’s figures show that the government has validated a total of 1,178,646ha as ELC to 229 companies across the country, collecting $6.64 million in rental fees.

Affiliated Network for Social Accountability head San Chey said the revenue [earned from the companies] is worthless compared to the ecological impact [they have caused]. He insisted the ministry increase the value of the ELCs according to the market prices.

He said when calculated, the amount is only $5 per hectare on average which is less beneficial for the economy while emigration continues to rise.

“What the government is doing with these land concessions in terms of Agriculture development is not enough to justify the losses from them. Neither are they beneficial for the Cambodian people as those companies only hire workers from their own countries."

“Some companies only come to clear the forest and make a profit. Then they stop operations,” Chey said.

However, ministry spokesman Srey Vuthy said the profit does not only come from rental fees, and that the government benefits more from the companies’ business operations.

“There is a lot of tax money going to the state. It is not based on the land concession only,” he said.

He said the 229 companies that received ELCs from the government are the most active ones in business.

Those companies, he said, had cultivated 438,250ha and cleared 515,701ha. They provided 64,119 jobs.

Vuthy said the ministry had also cancelled the licenses of 248 companies which were inactive after receiving ELCs.

“We follow the ELC companies closely. We can compromise if any one of them has financial problems. But if a company is inactive, we’d withdraw approval. We need the international investors to work along with our local investors too,” he stressed.

Chey said the government should increase its profits from ELCs, as the land offered a high potential for the agriculture sector.

“The government should increase the fee based on the environmental impact, surveying the current market, and opening it to public auctions to look for potential investors."

“This will make the sector well developed and profitable for the people. We should encourage local agricultural investors,” he said.

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