A new investigative report, Pulping Borneo, finds that the Royal Golden Eagle (RGE) Group, the world’s largest viscose producer and major paper products company, continues to rely on deforestation in its supply chain despite a high-profile commitment to “No-Deforestation”. The report, co-published by five organizations, also reveals a chain of offshore shell companies pointing to RGE Group control behind a new mega-scale pulp mill in North Kalimantan, putting some of the world’s largest remaining rainforests at risk.
“The RGE Group and its subsidiaries, APRIL, Sateri, Asia Pacific Rayon, and Asia Symbol promised that RGE companies have eliminated deforestation in their supply chains, but this report shows that promise has not been kept,” said Sergio Baffoni, the Senior Campaign Coordinator of the Environmental Paper Network. “Ordinary people around the world are using these companies’ products in their everyday lives: the viscose is in clothes from global fashion brands, paper packaging in grocery stores, and tissue products in our kitchens and bathrooms,” added Baffoni.
The investigative report published today reveals that Asia Symbol, RGE’s pulp mill in China has been using wood from companies that have recently cleared large tracts of tropical rainforest in Kalimantan, Indonesia’s territory on the island of Borneo. Much of the rainforest, before it was destroyed, was habitat for endangered Bornean orangutans, according to data published by Indonesia’s Ministry of Environment and Forestry. Evidence presented in the report was obtained through analysis of satellite imagery, and the review of export data, vessel tracking reports and supplier disclosure data.
“RGE’s role in forest destruction is only made possible by those bankrolling and excusing their destructive practices,” said Tom Picken, Campaign Director for Forests & Finance, Rainforest Action Network. “RGE’s top 15 banks have pumped more than USD 5 billion into the group’s forest sector operations since 2016. For example, Mitsubishi UFJ Financial Group has provided more than USD 430 million — despite the bank having policies against financing deforestation. Meanwhile, the Forest Stewardship Council is pushing to bring APRIL back into the FSC system despite these links to ongoing deforestation. These banks and other facilitators must stop willfully ignoring the deforestation which remains part of RGE’s business model,” added Picken.
The investigative report examined corporate records to document RGE’s links to a new mega-scale pulp mill, which PT. Phoenix Resources International is currently constructing on the island of Tarakan in northeastern Kalimantan. “The Phoenix mill is expected to drive the development of large areas of monoculture pulpwood plantations, placing pressures on natural forests. Areas most directly at risk include portions of over 600,000 hectares of tropical rainforest in RGE-linked forestry concessions in South and West Papua, as well as in RGE supplier concessions in Kalimantan,” said Syahrul Fitra, of Greenpeace Indonesia. “The demand for wood to feed this mill threatens communities in these regions, as well as biodiversity loss and greenhouse gas emissions,” added Syahrul.
“This mill is a flashing red-alert signal for a new wave of industrial-scale deforestation, this time in Kalimantan and Papua,” cautioned Syahrul. He added, “In Sumatra, the demand for wood from mega-scale pulp mills drove catastrophic and irreversible deforestation. Now the same pattern could repeat itself in Kalimantan, starting with this new mega-scale pulp mill.”
