Burst and bubble: the scramble for Africa’s land, who benefits?
by Paul Frimpong | [email protected]/[email protected]
Land grabbing is not a new phenomenon. For centuries, communities have been forcibly removed from their land. However, we are now witnessing a new aggressive land grab, driven by high food prices and growing global consumption, with multinational corporations, often in partnership with governments, seizing the land.
High food prices, combined with growing demand for land and other natural resource as well as a financial crisis that forced investors to look for new investments opportunities, have triggered a new global land grab.
Where the culprits were largely governments and authoritative bodies, now multinational governments are working in conjunction with these entities to take lands and subsequently deprive local communities of critical resources. These companies often secure long leases to exploit the land for profits, extract natural mineral resources, or grow crops for food, fuel or carbon credits.
Over the last couple of years, large-scale acquisitions of farmland in Africa, Latin America and Asia have made headlines across the world. Africa is in the period of witnessing one of the biggest transfers of lands in its history. Foreign investors are leasing hundreds of thousands of hectares of farm lands to giant agro-business firms--billions of dollars are being invested and this is raising a number of important questions.
Who actually plans these mega deals? And who actually benefits from them?
Land is very essential to the survival of people; without lands many will starve and die. There are very real implications to land ownership being largely transferred to foreigners at the expense of the livelihood of local inhabitants. .
Where it all starts from:
Land grab in Africa basically emanates from three sources; first of all by governments, especially those in the Middle East, Asia looking at their food security initiatives. Land and resource rich, but cash poor governments are seeking foreign direct investment in land and agriculture. While many of the governments involved are seeking to expand their domestic production of food crops and crops for fuel, agribusiness is seeking to expand its operations and boost profits, increasing yields and decreasing costs – as well as gaining access to new markets in rapidly developing economies. Investors and speculators are looking for good investment returns.
Secondly, institutional investors who have diversified away from the equities market to longer term investment such as land to hedge against inflation. Private companies are both keen to gain access to fertile land at a low cost.
Countries such as China and India want to ensure they have access to rice and grain. Other countries such as Saudi Arabia have recognized that the changing climate and limited water supplies mean that some crops can no longer be grown at home. Instead they are looking to outsource production to areas where fertile land and water are in greater supply. A number of these multinational and private equity investors who are doing the land deals are using the land to farm for their own food security.
Lastly, we are looking at the previously small scale farmers within Africa also scaling up as a result of the attractiveness of the agricultural sector, which is a good story in itself.
Again, most countries in Africa practice a dual system of land administration. Acquisition and disposal of land rights are managed by these two systems. There is the state system operated by written rules and statutes; and there is the customary system operated by unwritten rules of custom and tradition. About 70% of the total land area in Africa falls under the customary system and the traditional leaders play a significant role in providing leadership and the institutional arrangement for the administration of such lands.
Recent trends in the land sector have shown remarkable increases in land transactions in customary land areas. Typically, the commoditization of land and the disposal of large tracts of land for investments pose increasing threats to customary land rights holders. Evidence suggests a marked increase in the rate of dispossession being experienced by customary rights holders and the non-compliance to the principles of free, prior and informed consent. The requirements for the payment of fair, adequate and prompt compensation to those who have been dispossessed of their rights have not been enforced adequately. This trend has serious implications for rural incomes and livelihood, food security, environmental management, sustainable natural resource management and distortions in social identity and social organization. Apart from the concerns about the acquisition of large parcels, the nature of investment on the land also gives cause for concern, especially as evidence points to increasing investment in feedstock for biofuel production.
This incidence of land grab has led to uproar on the continent. It is probable this unrest due to the fact that people want to see more transparency and greater benefits. Perhaps if the method of engagement with the people interested in the land acquisition in Africa were more participatory, it would allay some of the uneasiness in the local areas. . For instance, no information is given to local owners while taking up their lands depriving them of the opportunity to feed themselves whiles at the same time, exposing them to negative environmental implications of the activities on such lands. Furthermore, there is little information about appropriate recourse available to local land users concerning how they can seek reparations when health deteriorates or it becomes difficult to
Government policies are very critical in this regard; to what extent are government policies directed towards systematically attracting institutional investors in such way that there are long term sustainable benefits to both investment companies and also to the host communities? This is where a number of the engagement methodologies need to change to a more transparent ones. This again will require that government policies are geared towards addressing the social implications, environmental implications and also the engagement with the local partners.
A secured right to land is therefore important for ensuring the enjoyment of fundamental human rights, particularly, the right to adequate standard of living which includes access to water, food and housing. The lack of adequate and secure access to land and natural resources by the rural and urban poor is a prime cause of hunger and poverty across the continent. They provide the basis for income and livelihood, food and shelter. In addition to being an important economic asset, land also contributes to the identity, dignity and social inclusion of the individual rights holder.
In addition, inequalities in land contribute directly to inequalities in health and quality of life. These inequalities cannot be reduced without addressing the over-consumption that lies behind this growing demand for land. Sometimes entire villages are displaced.
Land grabbing undermines food sovereignty. The farming taking place on these lands is not for local consumption but for export. Practices of industrial agriculture are geared to quick profits. They endanger biodiversity and water resources and damage the quality of the topsoil.
There is the complete lack of prompt and adequate compensation to displaced citizens. Experiences so far show that arranging to get compensation has been challenging for smallholders farmers. There is no support for the farmers in assessing compensation.If for the right reasons and using the right procedures, any particular smallholder is be dispossessed of land rights, there are legal requirements for the payment of fair, prompt and adequate compensation. This limits their ability to negotiate for fair compensation. Smallholders have little option and therefore are compelled to accept any amount paid by investors, if any.
In addressing the issues of scramble for Africa lands, governments and stakeholders on the continent must ensure they respect constitutional provisions on land tenure. Thus move quickly to design, move a bill, enact and enforce a law to protect citizens who own land under customary tenure system. A first step would be to make the processes more transparent. There should be a greater level of sensitization of local inhabitants about their rights and recourse when land is being grabbed.
Measures must be put in place to stop the grabbing of land for agro-fuels, carbon credit trading and other monoculture systems and instead support policies and laws that promote agro-ecological farming systems and practices. Policy discussions on the creation of feedstock for biofuel should be anchored in the overall land and agricultural policy of member countries and should address issues relating to the governance of large scale land acquisition for non-food crop production. Public investments should include peasant agriculture, family farming, artisanal fishing and indigenous food procurement systems that are based on ecological methods so as to protect local business while taking into account environmental need.
The Author is a Chartered Economist (Ch.E. |ACCE Global)) writes on the macro-economy and global affairs.He is also an African Affairs Analyst and Emerging Markets Strategist.