Innovations in access to land: Land grab or agricultural investment?

Between 2006 and mid-2009 alone, there were a reported 37-49 million acres of farmland that were the subject of deals or proposed deals involving foreigners. (Photo: Bernard Pollack)

Huffington Post | August 5, 2010

Danielle Nierenberg and Bernard Pollack

This is a four-part piece about the increasing prevalence of large-scale land acquisition, or "land grabs" in Sub-Saharan Africa originally featured on the Worldwatch Intitute's Nourishing the Planet.

Part I: Innovations in Access to Land: Land Grab or Agricultural Investment?

Background: There has been a documented trend in recent years of foreign governments and private firms investing and acquiring large tracts of land in other countries for the purpose of agricultural production and export. While the trend is global, increasingly the countries where these deals are taking place are in largely under or undeveloped regions in Asia and Africa.

According to the International Food Policy Research Institute (IFPRI), cited in a 2009 article in The Economist, 37-49 million acres of farmland were the subject of deals or proposed deals involving foreigners, between 2006 and mid-2009 alone.

The investments are spurred by concerns over food security and growing populations, as well as the expanding market for bio-fuels. Governments and private investors alike are brokering deals for large swaths of fertile land, sometimes in exchange for promises of investments in infrastructure or education, and sometimes for what amounts to pennies.

In either case, land and water rights, food sovereignty and food security are all at stake.

There are two predominant schools of thought when it comes to these land deals: one is a "win-win" view, typically encouraged by the World Bank and UN Food and Agriculture Organization, where poor countries receive some combination of money, infrastructure and resources, and investing countries increase their food security.

The second, usually supported by numerous farmers' groups and non-profit organizations like La Via Campesina, the Oakland Institute, GRAIN and Food First, believe that these land grabs are exploitative and colonialist, kicking people off of their land and decreasing food security for "host" countries.

Documentation of this increasing phenomenon has been critical in understanding both the extent - and the consequences - of such investments:

  • The seminal report published by Spanish NGO GRAIN: Seized! The 2008 land grab for food and financial security, highlighted 100 cases of both government and private companies in food-importing countries like China, Japan, Qatar and Saudi Arabia making large deals for farms or otherwise non-cultivated land in countries like Ethiopia, Sudan, Uganda and Zimbabwe. GRAIN has since kept an online archive, updated daily, of hundreds of articles from around the world reporting any such deal.
  • The Oakland Institute subsequently published two reports: The Great Land Grab: Rush for World's Farmland Threatens Food Security for the Poor and, a few months ago, (Mis)Investment in Agriculture: The Role of the International Finance Corporation In Global Land Grabs.
  • Investigating the research on some of the suggested "win-win" approaches, the International Institute for Environment and Development just published Making the Most of Agricultural Investment: a survey of business models that provide opportunities for small-holders.
  • Finally, the World Bank itself has been promising to release its own report on more than 389 deals in 80 countries - the largest such report to date - but has delayed publication already three times in the last six months. GRAIN believes the delay is due to unfavorable findings.
Part II: Is There a "Win-Win" Solution to Land Acquisitions?

The Food and Agriculture Organization (FAO) estimates that in order to feed the anticipated 9.1 billion people in 2050, agricultural production worldwide needs to increase by 70 percent. Historically, the response to global hunger has focused on food aid and agricultural investment in chemical fertilizers, pesticides, and increasingly, genetically engineered seeds. More recently, governments of wealthy countries lacking in fertile, arable land or abundant water supplies have begun to buy or lease large tracts of land in poorer countries for agricultural production and export.

While no-one knows the exact number of these controversial deals, hundreds have been reported in the media and in a slew of recent reports on the issue. Increasingly seen as a sound business investment or a means to enter the biofuels market (in addition to ensuring food security) investors are not only governments, but also agribusiness and financial companies. A clickable map created by the International Food Policy Research Institute illustrates a wide range of deals, like South Korea's securing of 690,000 hectares in Sudan for wheat, to 2.8 million hectares in the Democratic Republic of Congo for China's ZTE International's biofuel oil palm plantation.

In his opening remarks at the World Bank's April Annual Bank Conference on Land Policy and Administration, Dr. Kanayo Nwanze, President of International Fund for Agricultural Development, showcased the conundrum for policy makers on this issue. He emphasized the importance of land sovereignty and investments in smallholder agriculture to food security and indigenous identity, but also spoke about how foreign deals could be a "win-win" solution for those involved. He highlighted the need for more community-investor partnerships which "don't require large-scale transfer of land rights. What is important is that they should be long-term. That they should balance profit with social responsibility. And they should be supported by governments, civil society organizations, and the private sector, to ensure that they are mutually beneficial."

Dr. Nwanze pointed to the collaborative example of the West Garo Hills Tea Factory in India, where local communities provided land, bricks and labor while a private company provided machinery, factory design and training. A government agency put up money for the processing machinery and the resulting processed tea is divided between the local community and a private tea company.

The tea company example is just one of many alternative business models promoted at the World Bank meeting , where session themes included discussion of the social, economic and environmental impacts of these deals. Others, like outgrower models and contract farming, offered mixed results. Many suggested these alternative approaches had potential - but only if certain other things were put in place, like securing land rights, giving local community members a role in negotiations, strengthening the integrity of contracts, and establishing robust monitoring mechanisms to oversee implementation of land policies and laws.

Michael Taylor, Program Manager at the International Land Coalition (ILC) outlined in a recent paper a number of inter-governmental and governmental agencies who have proposed their own sets of principles to make these land acquisitions more responsible, including:

  • Minimum Human Rights Principles Applicable to Large-Scale Land Acquisitions or Leases by Olivier de Schutter, Special Rapporteur on the Right to Food (December 2009)
  • Principles for Responsible Agricultural Investment that Respects Rights, Livelihoods and Resources by FAO, IFAD, UNCTAD and the World Bank (January 2010)
  • The six principles in Purchase and Leasing of Large Areas of Land in Developing Countries by BMZ (August 2009)
  • The FAO-led Voluntary Guidelines on Responsible Governance of Land and other Natural Resources (expected October 2010)

To critics, voluntary guidelines and principles are just that: voluntary. At best, they present a mechanism to protect indigenous rights. But at worst they provide a smokescreen, behind which lies the exploitation of workers and their rights to food security and land tenure.

In an interview posted on ILC's website last month, Taylor said the ILC "is actually trying to promote some sort of dialogue between these different proposals. We see the danger that some organizations might rush and put in place a global set of principles without consulting the most important stakeholders that is to say: the people who live on the land, women's organizations, farmers' organizations, indigenous communities, livestock keepers' organizations. They need to be part of this debate."

According to FAO's Director-General Jacques Diouf, "Africa is rich in arable land, water and labour and with the implementation of appropriate policies could increase agricultural production, incomes and food security." The question then, is how best to invest? Nourishing the Planet has been highlighting innovations that improve food security and farmers' livelihoods while also protecting natural resources. These practices have a very different kind of potential for the continent's small-holders than large-scale commercial agricultural production by foreign investors.

Part III: Large Scale Land Investments Do Not Benefit Local Communities

In April 2010, more than 120 farmers' groups and non-governmental organizations all across the world signed a statement declaring their opposition to the guiding principles endorsed by the World Bank, the FAO, IFAD and UNCTAD on "responsible" land investments.

The campaign, spearheaded by NGOs GRAIN, Food First Information and Action Network (FIAN), Land Research Action Network (LRAN) and La Via Campesina, calls for an immediate end to land grabbing, claiming that it "denies land for local communities, destroys livelihoods, reduces the political space for peasant oriented agricultural policies and distorts markets towards increasingly concentrated agribusiness interests and global trade rather than towards sustainable peasant/smallhold production for local and national markets."

The groups also believe that land-grabbing will "accelerate eco-system destruction and the climate crisis" because many of the deals rely on industrial and "mono-culture oriented" production systems.

In an interview with Nourishing the Planet, writer and activist Raj Patel denounced land-grabs as "modern forms of colonialism, except with colonialism there was the argument that the colonizers were bringing civilization to the people they were colonizing. This time around, they don't bother with that justification. There's not even the pretense of bringing civilization - now it's just about efficiency."

Patel noted that when people tout these land deals as an effective means to end hunger, they often ignore the fact that many deals are not growing food at all, but instead pursuing the rapidly expanding biofuels market. "When you're talking about turning arable land into zones of cultivation for jatropha, you've a hard time arguing that anyone's belly is going to be fuller as a result," he said. A 2008 report by the FAO and the International Institute for Environment and Development documents the displacement of households due to this trend in particular. One example the report cites is a multimillion dollar British jatropha project in the Kisarawe district of Tanzania that "has been reported to involve acquiring 9,000 ha of land and the clearing of 11 villages which, according to the 2002 population census, are home to 11,277 people."

The issue of capturing water in these deals is also often not discussed, but it was mentioned in the April statement, as an example of the many factors that need to be included when assessing the value of the land being leased or sold.

In numerous deals, land under negotiation is described as "idle" or "unused" - a glaring misrepresentation of the indigenous people (including many pastoralists) who in fact live on and have worked the land for years. In an interview with GRAIN, Nyikaw Ochalla, a member of the indigenous Anuak nation in Ethiopia describes the government's complete disregard for his people's livelihoods. "There is no consultation with the indigenous population, who remain far away from the deals," he says. "The only thing the local people see is people coming with lots of tractors to invade their lands. And they have no place to voice their opposition. They are just being evicted without any proper consultation, any proper compensation."

"There are 1.5 billion small-scale farmers in the world who live on less than 2 hectares of land," according to Anuradha Mittal, Executive Director of The Oakland Institute and member of the Nourishing the Planet Advisory Group. "Secure and equitable access to and control over land allows these farmers to produce food, which is vital for their own food security as well as that of rural populations throughout the developing world."

The signatories of the April statement (of which Patel was one), demand true agrarian reform, which includes investment in research and training programs for small-holder farmers, overhauling trade policies, supporting regional markets, enforcing strict regulations to foreign direct investment, and promoting "community-oriented food and farming systems hinged on local people's control over land, water and biodiversity."

When asked about alternative business models like contract farming, proposed by many intergovernmental agencies, Raj Patel concluded, "What we need is for people to decide what they want to do with the land. The alternative to contract farming on grabbed-land is if people were able to decide in a community forum, in which women had equal voice with men, what the fate of the land should be. That's what food sovereignty is about. And anything less than that is really just crumbs from the table."

Part IV: Leaked World Bank Report Highlights Extent of Land Grab Problem

Land rights advocates have been eagerly awaiting the World Bank's report on large scale land acquisitions since December 2009. Delayed three times already, the report is supposed to be the most comprehensive analysis of land acquisitions to date, largely due to the Bank's ability to access information unavailable to non-governmental organizations or farmers' groups.

A draft of the report was leaked to the Financial Times (free registration required to view article), which quoted its summary, "Investors in farmland are targeting countries with weak laws, buying arable land on the cheap and failing to deliver on promises of jobs and investments." While this may not be news to those who have been following the issue closely, the Bank has consistently suggested that these land deals could potentially be a "win-win" solution for both investors and developing countries (see: Is There a "Win-Win" Solution to Land Acquisitions?). The leaked draft of "The Global Land Rush: Can it yield sustainable and equitable benefits?" certainly calls this idea into question.

While noting a few deals that were successful for both parties, according to the Times, "the overall picture [the report] gave was one of exploitation, warning that investors either lacked the necessary expertise to cultivate land or were more interested in speculative gains than in using land productively."

In a press release following the Times' article, Anuradha Mittal, Executive Director of the Oakland Institute (and member of Nourishing the Planet Advisory Group) called for "heightened scrutiny of the Bank's activities in promoting investor-friendly policies that spur foreign direct investment in agriculture in poor countries." The Oakland Institute has authored two critical reports on the issue (see: Innovations in Access to Land: Land Grab or Agricultural Investment?) and Mittal suggests we need to start holding the World Bank "accountable instead of allowing it to sweep the damning findings under the rug."
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