The Dubai-based think-tank Gulf Research Centre, in its food inflation report released last month, noted that agriculture production in the six-member Gulf Cooperation Council’s (GCC) countries is on the decline, and its exposure to unstable global food supplies would increase in the future. It called on the GCC to develop links with countries rich in arable land.
Leasing farms on contract in Arab countries such as Iraq, Egypt and Sudan might be an option to deal with severe shortage of agriculture lands and water in Bahrain.
The high-profile economist Prof Jeffrey Sachs says plans by Gulf countries to invest in developing world farms could be “win-win” for both sides, but cautions that the schemes could end in “disaster” if the focus is solely on profits.
The UAE and its food-importing neighbours are “particularly vulnerable” to spiralling costs and should make significant investments in “contract farming” in Africa and Asia, says the UN’s Gulf food chief, Dr Kayan Jaff.
Recent attempts by Persian Gulf countries to invest in farmlands abroad to counter soaring inflation and guarantee long-term food security could prove to be a win-win situation in the short term for both the oil-rich region and its investment-hungry neighbors, but continued high oil prices may neutralize the gains in the long-run, say experts.
The Rivers State Government has reiterated its resolve to create an enabling environment to enhance rice production and processing, as well as promote and protect other agricultural business interests in the state.
The cooling domestic equity and bond markets has prompted endowments and foundations to give niche alternatives, such as farmland, a closer look.
“Look at the colour, what a beautiful crop,” says Richard Spinks, pointing to wheat and rapeseed fields that his company sowed this season in western Ukraine. “If all of Ukraine’s farms could produce the yields we are getting, this country could play a big role in feeding the world and establish itself as a geopolitical power,” says the British chief executive of London-listed Landkom.
A new joint strategy for agricultural investment will be launched by the GCC soon, it was announced in Bahrain yesterday.
The Arabian Peninsula is currently flooded with petrodollars, giving the Gulf Arabs a wide array of investment options abroad. But while these countries are winners in the oil market, they are losers in the food market. As a result, the Gulf Arabs - with Saudi Arabia at the fore - are pursuing a strategy to buy their food security through overseas agribusiness investment.
The Saudi government announced that it would co-ordinate with local private-sector companies and invest in strategic agricultural interests in key producer countries such as Brazil, Ukraine, Thailand and India, guaranteeing for itself supplies of cereals, meat and vegetables. It is already in advanced negotiations with Thai investors and a deal on rice farms in Thailand is likely before the end of the year.
UGANDA is to benefit from $100m contribution by Kuwait to support food production and agri-businesses development, James Mugume the permanent secretary in the foreign affairs ministry has said.
