British, French firms linked to African land grabs

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Pana 06/10/2011

African land grabs: British, French firms linked to African land grabs

A French wealth fund and a United Kingdom-based asset management fund have been named the biggest investors in Africa's farmlands, although their motive appears speculative rather than geared towards increasing farm production, according to a report release in Nairobi. The French Development Agency and the UK-based Emergent Asset Management, a private fund that operates in 18 African countries, with offices in South Africa, have been named as the leading investors in massive land deals involving African leaders, which have been termed “land grabs.”

The Pan African Parliament (PAP), the continental legislative body that retains a largely ceremonial legislative role, issued the report linking Gulf states, fueled by higher earnings from oil prices, sovereign wealth funds and private equity firms as leading investors in African farmlands.

The French agency has been linked to the African Agriculture Fund, a firm set up in 2009 to respond to the global food crisis by investing in cereals production, credit to farmers, fruit and vegetable production.

However, analysts said, the motive for large-scale land acquisitions appeared speculative.

“This group of investors is fundamentally changing the agricultural landscape. We are witnessing the financialisation of the agriculture sector based largely on speculative models,” the report, circulated at a ministerial conference in Nairobi on Wednesday to discuss land use policies, said.

Studies carried out by international charity, Oxfam International, in Ethiopia, Ghana, Mali and Tanzania, said land acquired by the private equity firms have yet to be used agriculturally.

The wealth funds and equity firms are accused of buying the land on large scale for speculative purposes due to trends in the global markets, showing a rise in food prices.

African lands, environment and culture ministers are meeting in Nairobi for a High-Level Forum on land-based investments, to examine whether the growing acquisition of African farmlands would prove positive to the continental development agenda.

“Everyone has heard about private firms acquiring land, we hear about it but we have not seen its direct impacts but we have developed land policy frameworks and guidelines on land use in Africa,” Gaetan Rimwanguiya Ouedraogo, the Executive Director of Coalition for Dialogue on Africa (CoDA), a newly created policy think-tank, told PANA.

African Development Bank (AfDB) Vice-President, Kamal el Kheshen, told the ministerial meeting the main reasons behind the recent interest in large-scale acquisition of land by foreign investors was the rise in energy prices in the Gulf states and the growing investment potential in Africa's agriculture.

“We are witnessing increasing urbanisation in investor countries and changing diets with increasing demand for grains and animal protein,” Kheshen told the ministers.

Former President of Botswana Festus Mogae, the President of CoDA, said the risks that would most likely emerge from African countries embracing the foreign land grabs were a source of worry.

“The ministers gathered here are in a position to ensure what is appropriate is is a highly emotive issue and there are divergent view points towards investment in land,” Mogae said.

He called for the respect of the rights of local citizens in the negotiations for the acquisition of the land.
  •   PANA
  • 06 October 2011
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