China rules out pursuit of African farmland

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Financial Times | 20 April 2009

By Javier Blas in Cison di Valmarino, Italy

China has said it will not join the growing trend of outsourcing food production by investing in overseas farmland, particularly in Africa, expressing doubts that such deals could improve its food security.

Niu Dun, China’s deputy agriculture minister, said on Monday that Beijing preferred to depend on its own land to maintain self-sufficiency in grain, distancing the country from nations such as Saudi Arabia and South Korea, which are investing in land overseas.

“We cannot rely on [investments in] other countries for our own food security,” Mr Niu told the Financial Times in an interview at the Group of Eight’s first meeting on agriculture. “We have to depend on ourselves,” he said in the first comments on the subject by a senior Chinese policymaker.

As the world’s biggest agricultural economy and its largest consumer and producer of cereals, any decision by China to invest in African arable land would have large implications. But Mr Niu rejected any move in that direction. “We are in a different situation to other countries, for example South Korea,” he said.

The pursuit of foreign farmland signals how countries are seeking to boost their food security after last year’s spike in agricultural commodities prices and trade restrictions led them to believe they could not rely on the global food market.

China’s comments were made as the World Bank told the FT on the sidelines of the conference that it plan­ned to publish a code of conduct for investing in overseas farmland as soon as next month. It wants to “avoid pitfalls” in what a senior bank official described as a “quite significant” new investment trend.

At the same time, the United Nations’ Food and Agriculture Organisation said it would call a meeting to discuss the issue later this year, most likely in July.

Juergen Voegele, the World Bank’s director for agriculture, said on the sidelines of the meeting that the bank’s aim in publishing guidelines was not to endorse or criticise the deals but to “try to help the [host] countries and investors to get the best benefits”.

He added the bank would provide guidance on long-term sustainability and the social and environmental implications. “This is not a black-and- white issue,” he said, adding that the deals could be of mutual benefit to investors and hosts.

Although the issue was not addressed in the G8 communiqué, Hilary Benn, UK secretary of state for the environment, food and rural affairs, said at the meeting that the trend was a clear sign of the seriousness of the global food crisis.
Original source: Financial Times
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