South Korea, Asia’s second-biggest grain importer, will lend money and give technology to companies to develop farms overseas to ensure the nation’s food security after prices surged last year.
Saudi investors launched agricultural projects in Indonesia worth $1.3 billion last year, a top business official said on Monday, as the world's top oil exporter seeks to secure food supplies from abroad.
Indonesia will allocate at least 2 million hectares of farm land to joint ventures with Saudi investors to be used mainly for the cultivation of rice, a Saudi newspaper reported on Saturday.
Growing crops for strangers, of course, is nothing new. The long, grim march of colonialism was driven by Europe’s penchant for sugar, tea, tobacco and other crops that don’t flourish in northern climes. But as climate change and growing populations put ever more pressure on the earth, state-backed searches for land and food contracts as part of a national food-security strategy strike many as fundamentally new.
The United Arab Emirates plans to invest up to 700 billion US dollars in East Asia as the country had huge profits from soaring oil prices in recent years, Head of the Indonesian Capital Investment Coordinating Board Muhammad Lutfi said in Jakarta Thursday. Among the sectors for possible investment are energy, agriculture, tourism and food security.
The Saudi Binladin empire has frozen its plan to invest $4.3 billion in developing rice crops in Merauke in Papua Province and a separate project in Southeast Sulawesi Province.
Governments in developing countries should exercise caution when granting land concessions to foreign governments and corporations. Despite the short-term investments, most – if not all – of the production will be exported, making the long-term food security situation even worse in these host countries.
Saudi Arabia and the UAE are worldwide leaders in buying farmland in third-party countries, followed by China and Japan, says the World Bank.
PT Daewoo Logistic Indonesia and Cheil Jedang Samsung will jointly build an integrated corn industry on the islands of Buru and Sumba with an investment of US$50 million.
Qatar and Malaysia have agreed to look at the possibility of investing in Islamic countries, particularly in growing food. Malaysian Foreign Minister Dr Rais Yatim told Gulf Times that certain states in his country did have land for joint cultivation but “what we are encouraging is for the two countries to go, for example, to Indonesia, or to another (Muslim) country”.
Tanri said the government was eager to encourage and provide support to deep-pocketed business leaders from the Middle East to invest in Indonesia.
The government aims to net more investment from Middle East oil state main players next year, in particular in the agricultural sector, despite the global economic downturn, says a government official.