Food shortages puts rural Asia at risk of international exploitation

Dr Sumiter Broca of FAO: "It's a business opportunity, I don't see it as a food security issue."

Radio Australia | 12 July 2010

The Asian Development Bank is warning the region's rural sector could be expoited by international investors as concerns about global food and fuel security intensify. The Manila-based ADB, along with other UN food and agriculture agencies say there's a danger foreign players bringing new money into south east Asia may exploit the region's rural landowners. Countries seeking land opportunities include those in the Middle East, China and even India.

Presenter: Claudette Werden

Speakers: Katsuji Matsunami, Asian Development Bank; Sana F.K. Jatta, International Fund for Agricultural Development; Sumiter Singh Broca, Food and Agriculture Organisation of the United Nations

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WERDEN: Official figures show 60 per cent of the world's poor and malnourished are to be found in Asia. The Asian Development Bank is concerned the current investment environment is unregulated . The ADB's Katsuji Matsunami says whatever deals are done need to take into account the food production needs of a growing Asia.

MATSUNAMI: The world has recognised for a long time that agriculture was a sleeping rural activity but now looks like the world has awakened that agriculture can make a business and partly fueled by this concern about food security, market volatility, so lots of new players, new money has started flowing in and definitely the foreign land, foreign agriculture investment is something already reshaping Asia's rural sector, the way I see it and they offer opportunities but also significant risks, like substantial environmental and social impacts and there are no clear framework, these things are being done in isolation in that country and in this country but it oftens lacks transparency in now the deals are being done.

WERDEN: Original reports two years ago linked oil rich Arab states with land investments in Cambodia and the Philippines, saying the investments were due to food and water shortages in the Middle East. Now new reports are emerging about Chinese investments in Burma and India being a potential new player. The United Nations Food and Agriculture Organisation believes their involvement is more to do with profitable business opportunties than food security. The FAO's Sumiter Singh Broca says strong economic growth in both countries has lead to a demand for food diversity.

BROCA: If it's cheaper in an outside country than it is in yours then why not. It's a business opportunity, I don't see it as a food security issue.

WERDEN: So what's prompted that kind of review of business opportunity?

BROCA: Well as these economies develop and people get richer they start demanding higher value commodities, the food chain gets longer, people are pressed for time, they need pre-packaged processed food because the opportunity cost of time goes up and gradually agriculture has to transform, the traditional model of people selling basically unprocessed food grains, vegetables, fruits to housewives, that model has broken down, is increasingly breaking down, so they have to move in that direction, there's no choice.

WERDEN: The FAO believes Asia can produce enough food to meet its growing demand but the main problem is to do with effective distribution. The United Nation's International Fund for Agricultural Development is working with the region's small farmers to strengthen productivity. IFAD's Sana FK Jatta says its important those farmers don't lose out in any foreign agricultural investments.

JATTA: We think that by strengthening the hand of the small land holder, considering them as a private and profitable enterprise, not just as safety nets they cannot be treated as safety nets but if you encourage them and allow them to participate actively in the market they will be able to produce food and ensure the food security of the billions of the region.
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Source: Radio Australia

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