Dirty tricks and broken promises - Monsanto's legacy in Indonesia
[for all the links]
http://www.lobbywatch.org/p1temp.asp?pid=58&page=1

INTRODUCTION

Monsanto achieved commercial approval of its GM cotton in Indonesia faster than in any other Asian country. The company was able to use this success, in commercialising its first GM crop in Asia, as a lever to promote GM crop commercialisation elsewhere in the continent.

By December 2003, however, the Indonesian Minister of Agriculture had announced that Monsanto had pulled its GM cotton out of the country. Monsanto has left behind it a legacy of broken promises and illegality.

MONSANTO'S HONESTY PLEDGE

In early 2004 Monsanto was named Best Multinational Company in the first International Business Awards competition, whose aim is to raise the public "profile of exemplary companies". In making the award specific reference was made to the Monsanto Pledge that Monsanto says guides all its business activities.

"Integrity is the foundation for all that we do," Monsanto boasts on its website. And "integrity", the company says, includes "honesty, decency, consistency and courage". These are all part of the Monsanto Pledge.

THE MONSANTO BRIBERY SCANDAL

In January 2005 it was announced that Monsanto is to pay $1.5m in penalties to the US government over a bribe paid in Indonesia in a bid to bypass controls on the screening of new GM cotton crops.

According to a criminal complaint by the Department of Justice under US anti-bribery laws, the company paid $50,000 to an unnamed senior Indonesian environmental official in 2002, in an unsuccessful bid to amend or repeal the requirement for the environmental impact statement for new crop varieties.

The bribe in question was just the tip of the iceberg and the trail of corruption leads back to the U.S..

BRIBE APPROVED BY SENIOR MONSANTO EXEC

A senior Monsanto official based in the US ordered the bribing of the environmental official. According to the Security and Exchange Commission, "When it became clear that the lobbying efforts were having no effect on the Senior Environment Official, the Senior Monsanto Manager told the Consulting Firm Employee to 'incentivize' the official with a cash payment of $50,000," The Monsanto manager then concocted a scheme "involving false invoices" to hide the bribe.

According to the Financial Times, "The company also admitted that it had paid over $700,000 in bribes to various officials in Indonesia between 1997 and 2002, financed through improper accounting of its pesticide sales in Indonesia."

The bribes were financed, at least in part, through unauthorized, improperly documented and inflated sales of Monsanto's pesticide products in Indonesia, the company admitted.

The Financial Times notes, "The attempt to circumvent environmental controls on genetically-modified crops in a developing country is a significant embarrassment for Monsanto, which is engaged in an ongoing campaign to win public support in the European Union for its genetically modified crops."
http://www.lobbywatch.org/archive2.asp?arcid=4773

MONSANTO GAVE BRIBES TO "AT LEAST 140" OFFICIALS

Over a five year period, it seems, Monsanto gave bribes to "at least 140" current or former Indonesian government officials and their family members.

The recipients are said to have included a senior official in the environment ministry, a senior official in the agriculture ministry, and an official in the National Planning and Development Board (Bappenas).

The largest single set of bribes was for the purchase of land and the design and construction of a house in the name of a wife of a senior Ministry of Agriculture official, which cost Monsanto $373,990.
http://www.lobbywatch.org/archive2.asp?arcid=4776
http://www.lobbywatch.org/archive2.asp?arcid=4780
http://www.lobbywatch.org/archive2.asp?arcid=4793

HOW MONSANTO'S GM COTTON WAS BROUGHT TO INDONESIA

It's interesting, in the context of the corruption scandal, to revisit the extraordinary way in which Monsanto's GM seed was first brought into Indonesia in March 2001. It happened with the Indonesian military riding shotgun for Monsanto.

According to the Jakarta Post, "A total of 40 tons of genetically modified Bollgard cotton seed arrived at the Makassar airport from South Africa amid strong protests from environmentalists... A number of activists, waving banners... tried to intercept the convoy of trucks carrying the cotton seeds, which contain Bacillus thuringiensis (Bt), and block them from leaving the airport...

"The authorities had apparently concealed the seed's arrival from the press... but at approximately 1pm on Thursday The Jakarta Post noticed a Russian Ilyusin transport plane ... unloading the seed in the airport's military area. The wide-bodied plane ... was tightly guarded, and reporters and photographers were barred from approaching the plane. Members of the Indonesian Air Force guarding the area said that reporters must back off for security reasons."
http://www.lobbywatch.org/archive2.asp?arcid=4782

MONSANTO'S LEGACY IN INDONESIA

The farmers who grew Monsanto's GM seed did far less well out of it than the Indonesian officials who took Monsanto's bribes.

Monsanto's entry into the region in 2001, through its Indonesian subsidiary PT Monagro Kimia, was marked by a concerted campaign of promotion of its Bt cotton among farmers. The company claimed that Bt cotton was environmentally friendly, used less pesticide, and would ensure an abundant harvest and increase farmers' welfare.

In the first year of planting, there were reported failures of Bt cotton - the crop succumbed to drought and hundreds of hectares were attacked by pests. The drought had led to a pest population explosion on Bt cotton, but not on other cotton varieties.

As a result, instead of reducing pesticide use, farmers had to use larger amounts of pesticides to control the pests. Furthermore, the Bt cotton - engineered to be resistant to a pest that is not a major problem in the area - was susceptible to other more serious pests.

Moreover, it did not produce the yields Monsanto had boasted about. The poor yields trapped farmers in a debt cycle; some 70% of the 4 438 farmers growing Bt cotton were unable to repay their credit after the first year of planting.

One of the Indonesian farmers who grew Monsanto's GM cotton commented, "The company didn't give the farmer any choice, they never intended to improve our well being, they just put us in a debt circle, took away our independence and made us their slave forever."

More at http://www.lobbywatch.org/archive2.asp?arcid=4783

INDONESIA'S CORRUPTION COMMISSION TO INVESTIGATE MONSANTO BRIBES

Indonesia's Corruption Eradication Commission (KPK) has begun to investigate the Monsanto bribery case.
http://www.lobbywatch.org/archive2.asp?arcid=4780
http://www.lobbywatch.org/archive2.asp?arcid=4793

MONSANTO'S BOSS IMPLICATED AND URGED TO QUIT

In the light of evidence that Monsanto tried to illegally circumvent environmental controls in Indonesia, Monsanto's president and chief executive, Hugh Grant, has been called on to quit the International Advisory Board set up by Scottish Enterprise, which helps Scottish companies develop their businesses abroad.

Jonathan Matthews of GM Watch told the Sunday Herald, "This man is steeped in a company culture that allowed this to happen." He added, "What has emerged about corrupt practices in Indonesia may just be the tip of the iceberg."
http://www.lobbywatch.org/archive2.asp?arcid=4779

Following on from the Sunday Herald's report, Robin Harper, a Member of the Scottish Parliament (MSP), drew to the attention of Scotland's First M