This note proposes how the Voluntary Guidelines on responsible governance of tenure of land and other natural resources, prepared by the Food and Agriculture Organisation (FAO), can best address the macroeconomic impacts of corruption and governance failures in large scale land acquisitions.1
Global competition to secure access to sources of food, energy, forest and mineral resources has specific risks if not governed effectively: corruption and accompanying failures in the rule of law frequently undermine participation, transparency, accountability and equity in the access to and allocation of largescale land acquisitions. Responsible governance of land and natural resource tenure therefore depends on recognising and mitigating against these risks. The new Voluntary Guidelines being developed by the FAO provide an opportunity to realize this. Global Witness believes that these guidelines crucially may not prevent corruption from occurring unless the scope is expanded to require transparency and accountability at two key stages in the lifespan of such projects:
(1) Management of the access to and allocation of concession contracts;
(2) Management of the revenues generated by such projects. Introduction to Global Witness Global Witness2 is a London-based non-governmental organisation that investigates and campaigns to prevent natural resource-related conflict, corruption and associated environmental and human rights abuses. We aim to improve governance, transparency and accountability in the management of the natural resource sector to ensure that revenues from resources are used for peaceful and sustainable development rather than to finance or fuel conflicts, corruption or state looting. Globally, our investigations and campaigning have been a key catalyst in the creation of the Kimberley Process, to tackle the trade in conflict diamonds, and the Extractive Industries Transparency Initiative, to encourage transparency over payments and receipts for natural resource revenues. In 2003, we were co-nominated for a Nobel Peace Prize in 2003 for our work on conflict diamonds. How large scale land acquisition can fuel corruption and governance failures Large-scale land acquisitions for food, energy, forestry and mineral resources are becoming increasingly problematic, despite supposedly having economic development objectives. The findings of Global Witness and others3 in post-conflict, resource-rich developing countries or so-called “fragile states” reveal how such competition between powerful actors can fuel corruption, conflict, environmental or human rights abuses. In such contexts, land tenure and markets can become distorted in several ways. Firstly, the values at stake create incentives for corrupt elites to capture long-term control (frequently more than 50 years) of large-scale concessions which serve only their short-term interests. Secondly, companies and regulatory agencies can ignore safeguards, even when sufficient legislation exists, at least on paper. For example, concession impact assessments which do not account for secondary impacts on local water and other infrastructure. Thirdly, the effectiveness of tenure security systems and dispute resolution mechanisms in such situations can be radically undermined. Finally, these contexts enable revenues generated from developmentally significant resources to be captured for personal gain, rather than channeled towards national development. Sudan presents an example of the way in which international competition to access and control land and the resources above and below it can exacerbate violations of the land rights of already vulnerable people.be better placed to protect and promote fundamental rights to adequate food and shelter and property tenure, in resource-rich developing countries
The way in which large-scale land acquisitions are allocated has critical implications for governance for the entire project’s lifespan. It is at the point of access that the powerful gain at the expense of the weak. Likewise, it is crucial that governments put in place transparent systems for managing concession revenues before they come on-stream. Global Witness recommends that the following steps are taken to ensure that parties entering into large scale land transactions promote participation, transparency, accountability and equity:8
- A commitment by the State to formulate a long-term strategy for managing land and natural resources, prepared through open consultation, including human rights, environmental and social safeguards.
- Specifically, customary tenure rights must be recognized and arable land must be ring-fenced for projected national food security requirements;
- A commitment by the State to have in place strong, independent laws, public institutions and policies to regulate the land and natural resource sectors before concessions are granted. Specifically, legislation and policies must promote openness and limit secrecy;
- Provisions for allocation processes must be open, competitive and include full public disclosure, including:
o Details of all “signature payments” made to the government;o Publication prior to formal allocation of additional rights assigned with the land (such as subsoil minerals and access to water sources), with mechanisms for such assignments to be challenged;
o Consideration the company’s beneficial ownership and exclusion of companies with records of corruption, human rights abuses or destruction of the natural environment;o A commitment by all parties to submit to continuous oversight by independent and multistakeholder monitoring and dispute resolution mechanisms;
- A commitment by the State to adopt best practice revenue transparency management structures, along the lines of the Extractive Industries Transparency Initiative, for revenues generated by largescale concessions.
For further information please contact Jenny Bromley at Global Witness on [email protected] or +44 (0) 207 492 5845.
1 Land acquisitions considered to be “large-scale” depend on the local context but they are generally considered to be areas above 1,000ha and potentially economically transformative.
2 For more information about our work and for copies of our reports, please see our website at www.globalwitness.org
3 See, for example, the 2009 report entitled “Land grab or development opportunity?” produced by the IIED, IFAD and FAO.
4 See the Sudan Millennium Development Goals website at http://www.sd.undp.org/mdg_fact.htm for the Southern Sudan figure for 2006.
5 See, for example, Institute for War & Peace Reporting (London), “Sudan: Land Rights Hinder Dafur IDR Returns”, 25 November 2009.
6 Blas J and Wallis M, “Buyer sees profit in warlord’s land”, Financial Times, 10 January 2009; Jarch Capital public release, “Jarch Capital and Leac Capital did not engage in future oil deals in southern Sudan” dated 23 February 2009; and generally, SPLA website at www.splamilitary.net as accessed on 6 July 2010.
7 BBC Today programme, 14 January 2009. Accessed on 6 July 2010 at http://news.bbc.co.uk/today/hi/today/newsid_7827000/7827793.stm
8 Global Witness is developing an “Access Checklist” which compiles best-practice guidelines for citizens in areas where concessions are being allocated. This guide provides further details which could be considered for inclusion within the FAO’s Voluntary Guidelines.
