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Policy brief: The role of European development finance institutions in land grabs
Published: 13 May 2013
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APRODEV, May 2013

Policy Brief: The Role of European Development Finance Institutions in Land Grabs

Introduction and framing of the issues

Land investments in Africa and other developing countries have been on a very large scale in recent years: at least 80 million hectares of fertile farmland have been leased to foreign investors, involving some US$100-140 billion. The need for increased investments in agriculture, especially in Africa, is broadly recognised and foreign investors are generally welcomed by host governments. However, expected benefits to local development, poverty reduction and food security often fail to materialise. Too often, large-scale land investments are associated with loss of livelihood for the local populations and land grabs.

The drivers of large-scale land investments include increased demand for food production from countries facing water shortages and EU targets on biofuels in its Renewable Energy Directive. Also important are, the availability of cheap land and weak land governance - especially in customary and state land tenure systems in Africa and other developing countries - as well as carbon markets and offsets under approaches like the European Trading Scheme.

Key triggers of the recent wave in large-scale land investments are the 2007-8 food and financial crises, with equity investors and pension funds now seeking new asset classes for investment. This is leading to land being regarded as just another commodity to be bought and sold by international investors.

The impacts on communities affected by large-scale land investments are all too often loss of land and access to water and loss of biodiversity, which can increase poverty, malnutrition and food insecurity. Land grabs also often involve human rights violations and conflict, as demonstrated by case studies done by APRODEV Agencies or other civil society organisations.

Aprodev commissioned research to investigate the involvement of European Development Finance Institutions (DFIs) in land grabs, of this involvement. The evidence cited in this briefing shows that European DFIs are indeed involved in some land grabs, and there are real risks of being complicit in others in the future. Our research does not claim to present the full scale of this involvement; research was limited to scanning DFI websites, secondary research and information gathering3 with partners. Further work is needed to gather information on other large-scale land acquisitions and other funds supported by the DFIs.

Download the full briefing here: http://aprodev.eu/files/Trade/aprodev_policy_brief_dfi_and_landgrabs_final_may2013.pdf

1 Surface estimates are from Land Matrix Project while financial estimates are from High Quest Partners presentation to Global Agro-investing Europe, December 2012.
2 The Role of DFIs in Land Grabs, internal report by Curtis Research for APRODEV, February 2013.
3 One of the tools we worked with is a collaborative database maintained by CSO cooperating through an informal network on the financing of land grabs, which APRODEV participates in.
Source: Aprodev

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