DEVELOPMENT: LAND GRABS FOR FOOD PRODUCTION UNDER FIRE

COMMENTARY ARCHIVES, 28 Oct 2009

Thalif Deen

A move by governments and rich investors to raise food crops on farmland purchased in some of the world’s poorer countries is coming under fire.

"The purchase of vast tracts of land from poor, developing countries by wealthier, food-insecure nations and private investors have become a widespread phenomenon," says a new study by the Oakland Institute, an independent policy think tank based in San Francisco.

The sudden rush for these "land grabs" – prompted primarily by the global food crisis – is threatening food security and the livelihoods of some 1.5 billion small farmers worldwide, according to the study titled "The Great Land Grab", released early this week.

Between 2006 and mid-2009, some 37 million to 49 million acres of farmland have changed hands or are under negotiation.

A number of rich investors in countries such as Saudi Arabia, Kuwait, South Korea, China and the United Arab Emirates (UAE) have either been buying land or negotiating to buy land in Sudan, Pakistan, Madagascar, Cambodia, Ethiopia and the Democratic Republic of Congo to raise food crops in an attempt to beat future food shortages in their own home countries.

In an editorial titled "Cornering Foreign Fields", the London Economist said last May that as much as 20 million hectares of farmland worth some 20 to 30 billion dollars has been quietly handed over to capital-exporting countries such as Saudi Arabia, Kuwait and China.

For a start, the Economist said, most deals are shrouded in mystery – "rarely a good sign, especially in countries riddled with corruption".

Asked if there is any possibility of regulating these deals by an international organisation, Shepard Daniel, the main author of the Oakland Institute report, told IPS that both the Food and Agriculture Organisation (FAO) and the International Fund for Agricultural Development (IFAD) have on several occasions called for a code of conduct, or some form of guidelines, to protect local people and farmers from land acquisitions that could threaten their livelihoods.

However, the basic assertion from these two UN agencies was that cross-border farmland deals could be mutually beneficial, by both helping to boost global food security and by providing urgently-needed investments in agriculture in developing countries, and helping to raise farm production, exports and provide jobs, he added.

"This implies no intention of regulating the land deals, but rather, a suggestion or hope they be mutually beneficial," said Daniel, a fellow at the Oakland Institute.

Ernest Corea, a former senior consultant with the Washington-based Consultative Group on International Agricultural Research (CGIAR), told IPS the surrender of nationally-owned farm land and land rights to foreign interests – whether individuals, the corporate sector or governments – amounts to an erosion of sovereignty.

"The Oakland Institute has done developing countries a service in raising red flags about this practice," he said.

Having said that, however, it must also be noted that few developing countries can progress without external resources, Corea pointed out.

At a time of uncertainty concerning Official Development Assistance (ODA), foreign direct investment can therefore be an important asset, provided it is received within the sovereignty of the country concerned.

Food insecurity continues to be a major human problem whose resolution requires the mobilisation of multiple resources, he said.

"Perhaps U.S. President [John F.] Kennedy was right when he said that the world has the capacity but not the will to end hunger," Corea said.

The FAO says that about one billion people are currently living in hunger or are undernourished, including 100 million added to the total after the recent global financial crisis.

The largest number, about 642 million, is in Asia Pacific, followed by 265 million in sub-Saharan Africa. In contrast, only about 15 million people live in hunger or remain undernourished in the industrial world.

The study points out that those who promote the benefits of private sector growth in agriculture fail to recognise that acquisition of crucial food-producing lands by foreign private entities poses a threat to rural economies and livelihoods, land reform agendas, and other efforts aimed at making access to food more equitable.

"Much press coverage and research has focused on the food security motivations of food import-dependent countries," said Daniel.

"We forget, however, that the main thrust of investment is coming from the private sector, whose interests do not lie in establishing food security, but rather in making a profit in international food markets," he said.

The study also singles out "the insidious role" played by international financial institutions like the International Finance Corporation of the World Bank and Foreign Investment Advisory Service (FIAS), as well as rich nations, in promoting and facilitating widespread land re-appropriation – all in the name of promoting food security through foreign investment in agriculture.

The report concludes that the current debate surrounding the land grab phenomenon fails to adequately and rigorously examine the consequences of this trend, and exposes how the huge sell-offs of resources undermines food security and land reform efforts.

Daniel told IPS that the government of Japan, in association with the World Bank, FAO, IFAD and the UN Conference on Trade and Development (UNCTAD), hosted a roundtable "Promoting Responsible International Investment in Agriculture" last month in New York.

He said representative stakeholders from 31 governments and 13 organisations attended the meeting.

The idea was to address the "growing trend of major agricultural investment associated with acquisition of rights to land and related resources", marking the first step towards framing a coordinated response to the issue, and developing principles and an international framework to promote responsible investment in agriculture.

The meeting achieved a consensus of principles, such as the recognition of land and resource rights, transparency in land deals, and the importance of strengthening food security rather than jeopardising it.

The general conclusion, he said, was that land deals should aim to be win-win to the extent possible.

However, this by no means provides any form of regulation over land deals, and in effect, business will only continue to proceed as usual.

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