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Heed alert by Bank Negara on so-called ‘environmental investments’

  • Publication Date | July 3, 2017
  • Document Type | Media Statement
  • Programmes | Climate Change
  • Issues | REDD-plus, Trade & Investment
  • Tags | Bank Negara, carbon offsets, Kelantan
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Sahabat Alam Malaysia (SAM) wishes to draw the attention of the State Governments and the general public to the listing of Climate Protectors Sdn Bhd (CPSB) and EcoBit (a cryptocurrency-based investment project) on Bank Negara Malaysia’s (BNM) Financial Consumer Alert service on 23 June, 2017 as ‘companies and websites which are neither authorised nor approved under the relevant laws and regulations administered by BNM.’ (See http://www.bnm.gov.my/documents/2017/20170629_FCA_EN.pdf)

We welcome the alert by BNM as the ‘investment’ promoted by these entities is purportedly banking on the Kelantan forest carbon offset project that was signed early this year between Climate Protectors and the Kelantan State Government.

On 3rd May 2017, SAM had alerted BNM by letter about the purported investment, and also wrote to the Ministry of Natural Resources and Environment regarding the same.

According to the website offering the cryptocurrency-based investment opportunity by Ecobit (http://www.ecobit.io/), the Kelantan project is billed as the flagship investment that will have a recurring income for 30 years in the carbon market.

The operator of this scheme claims that ‘all EcoBit projects are sustainable, with green initiatives and are health-oriented’; and that ‘every purchase of EcoBit will contribute to projects that will directly reduce the carbon footprint in our atmosphere’.

Based on SAM’s research, EcoBit is linked to Climate Protector SdnBhd, the company that signed an agreement with the Kelantan State Government on January 9, 2017. The Kelantan forest carbon offset deal forms the backbone of EcoBitinitial coin offering (See https://bitcointalk.org/index.php?topic=1861730.0) The chief executive officer of Climate Protector, Tang Too Siah, is also the board advisor of EcoBit. (https://www.ecobit.io/en/team.html)

While it has been reported that the realisation of the Kelantan forest carbon offset project will depend on the outcome of the two years’ audit on the value of the carbon stock of the concession areas, nonetheless, EcoBit is already promoting the project as ‘the world’s largest REDD+ forest preservation project’with an emissions avoidance capacity of over 800million tonnes.

(REDD-plus is a United Nations initiated mechanism in reducing emissions from the forestry sector known as Reducing Emissions from Deforestation and Forest Degradation.)

In an interview with radio station, Business FM (http://www.bfm.my/current-affairs-is-kelantan-trading-away-carbon-or-forests.html),Tang clarified that the Kelantan carbon offset project ‘use the United Nations concept’ but the carbon credits will be traded in the voluntary market.

However, on the EcoBit’s website, references were made to the REDD-plus mechanism of the United Nations Framework Convention on Climate Change (UNFCCC) as well as the United Nations-REDD Programme, as ready proof for the carbon offset project model (http://www.ecobit.io/en/faqs.html).

Following the signing ceremony, SAM has pointed out the misrepresentation involved in the promotion of the deal as a United Nations- initiated mechanism, when it is not the case.

We further warned that carbon-offsetting deals pursued by the private sector is not to be confused with the UNFCCC’s REDD-plus mechanism that to this day, has only been agreed to for results-based payments to developing countries that are eligible to be rewarded for keeping their forests as carbon sinks. There is at present no carbon-offsets under the REDD-plus mechanism.

The agreement purportedly awarded 396,000ha of forests to Climate Protector SdnBhd for a 30-year period for a carbon-offset scheme where the credits generated will be sold to the European carbon market.

Given that the carbon-offset scheme will derive its return from the sale of carbon credits from the European carbon market, it is perplexing to note that Climate Protector and EcoBit are tapping into the capital market for funds and in return investors are promised that they will purportedly benefit from the carbon offset project. This is beyond the business model of the voluntary carbon market which is payment for every tonne of carbon stock generated by a particular project according to an agreed price.

We, therefore, called upon the Ministry of Natural Resources and Environment as the focal point of the country to the UNFCCC to clarify this latest development with the Kelantan State Government and Climate Protector as we are deeply concerned by the fact that the cyptocurrency investment is not regulated and the project appears to be more than a straight-forward carbon-offset scheme with potential risks.

It is incumbent upon the Kelantan State Government to respond to the BNM’s move and to clarify the claims linked to the carbon offset deal made on EcoBit’s website.

We reiterate our call to BNM to continue with appropriate investigations and take the necessary actions to protect consumers as well as the government’s effort to obtain international financial assistance for its REDD-plus initiative.

The State Governments and the general public must be wary about such dubious schemes in the name of safeguarding the environment and advancing climate change.

S.M. Mohamed Idris

President

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Testimonials

Sahabat Alam Malaysia adalah satu badan bukan kerajaan (NGO) yang telah sekian lama berjuang mempertahan kelestarian alam. Ia juga mendidik masyarakat tentang pentingnya kebersamaan dalam pemikiran dan tindakan agar alam ini dapat kita wariskan kepada generasi hadapan dalam keadaan yang elok dan terpelihara. Dalam pada itu juga SAM giat membantu golongan nelayan pantai dalam memperjuangkan hak-hak mereka sehinggalah tertubuhnya Persatuan Pendidikan dan Kebajikan Nelayan Pantai Malaysia (JARING). Nelayan pantai sepenuh masa ini dididik oleh SAM sehingga mereka mampu memainkan peranan sebagai pemimpin nelayan yang meneruskan kesinambungan memperjuangkan hak-hak nelayan pantai lainnya. Sebagai contoh SAM telah berjaya menyedarkan masyarakat nelayan keperluan menjaga hutan paya bakau untuk kebaikan hasil tangkapan nelayan itu sendiri.
Jamaluddin Mohamad Bualik
Jamaluddin Mohamad BualikPersatuan Pendidikan dan Kebajikan Jaringan Nelayan Pantai Malaysia (JARING)
During the 1980s, I used to read about the Consumers’ Association of Penang (CAP) in the news. After retirement, some time in 2001, while lazing around, I read news about the construction of a carbon in leach plant using sodium cyanide to extract gold in Bukit Koman. My friends and I visited CAP and we were introduced to SAM and her legal team. We discussed the details of filing a case against the gold mining company and the department of environment with Ms Meenakshi Raman and her legal team. That was the beginning of a beautiful friendship between lawyers from SAM and many of us from Bukit Koman. We had many ups and downs in our struggle to shut down the gold mine that was causing a nuisance in our village. But, as a community we never gave up because SAM had our backs.
Hue Fui How
Hue Fui HowSecretary, Bukit Koman Ban Cyanide in Goldmining Action Committee (BCAC)
Sahabat Alam Malaysia adalah sebuah NGO yang memperjuangkan nasib masyarakat luar bandar khasnya. SAM menerima aduan-aduan masyarakat dan menyelesaikan masalah yang dihadapi. SAM telah mewujudkan ramai aktivis-aktivis sosial dan alam sekitar. Pada era 1980 dan 90an SAM sangat dihormati oleh masyarakat dan agensi kerajaan. Apabila media sosial menguasai maklumat maka SAM pun terkesan dan masalah masyarakat terus disalurkan dengan pelbagai cara. SAM perlu mewujudkan aktivis-aktivis pelapis yang muda untuk terus membantu masyarakat. SAM juga perlu membuat perubahan supaya banyak turun kelapangan dan jangan mengharapkan laporan media sahaja. Tingkatkan prestasi sebagaimana pada zaman kegemilangan SAM di era 80-90an.
Che Ani Mt Zain
Che Ani Mt Zain
SAM taught me the importance of social activism and the role it plays in upholding the rights of people and the protection of the environment. In my experience, SAM has never hesitated to speak up in defence of people and their environment, and has gone the extra mile to champion their rights, by helping communities take their battles to the higher ups and even to the courts.
Jessica Binwani
Jessica BinwaniPublic/Private Interest Lawyer
Semenjak kami kenal SAM, banyak pengalaman dan pengetahuan yg kami dapat. Kami telah belajar cara membuat baja asli daripada SAM. Semenjak itu, bermulalah minat kami dalam aktiviti pertanian. Dengan memperolehi kemahiran dalam membuat baja asli dan penanaman lestari, kami juga telah dapat menambahkan pendapatan sampingan kami. Ini lebih baik daripada tanah kami terbiar dan tidak diusahakan. Terima kasih SAM kerana sudi memberi bantuan dan tunjuk ajar kepada Persatuan kami.
Chedo Anak Nyuwen
Chedo Anak NyuwenPersatuan Penduduk Sg Buri, Bakong, Marudi
My journey with SAM started when her community organisers took me to the meet the paddy farmers of Kedah, connecting my growing interest in environmental law with our people who struggle to work the land in the face of pollution, replacement of traditional seeds with commercial hybrids and their accompanying chemical package of fertilisers and weedicides. I then had the honour to work with SAM in the struggle for the rights of the native communities of Sarawak, in defence of their forests from massive logging and destructive mega-projects. In every issue that SAM takes up, she combines rigorous research with the realities and voices of the communities to advocate for policies and laws that care for people and nature. From the courts to the elected legislators to policy makers and implementers and to the United Nations, SAM walks side by side with the communities in Malaysia. How can I not be inspired by the vision and passion of the generations of women and men who coalesce to form SAM?
Chee Yoke Ling
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Sahabat Alam Malaysia (Headquarters)
No. 1, Jalan Joki, 11400 Penang,
Malaysia
Tel: +604 827 6930
Fax: +604 827 6932

Sahabat Alam Malaysia (Marudi Office)
129A, First Floor,
Jalan Tuanku Taha,
P.O.Box 216,
98058 Marudi, Baram, Sarawak,
Malaysia
Tel & Fax: +6085 758 973

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