deals under the spotlight in
foreign investors continue to make more forays into
Chee Yoke Heong
of land in
Lured by the prospects of high returns and attractive incentives offered by African governments, foreign and domestic investors are buying or leasing land across the continent as a means to secure land to grow food for markets back home, engage in export commodity production or merely for speculation. In return, the investors offer to provide jobs and development to the areas they have acquired.
instead of bringing hope to the local population, large-scale unregulated
investment in land in
Indian and Middle Eastern parties may have been actively buying up land
firms are also involved, often with support from their governments.
Swedish and German firms have strong interests in the production of
'The same financial firms that drove us into a global recession by inflating the real estate bubble through risky financial manoeuvres are now doing the same with the world's food supply,' said Anuradha Mittal, executive director of the Oakland Institute. She warns that the conversion of African small farms and forests into a natural-asset-based, high-return investment strategy can drive up food prices and accelerate climate change.
justifications put forward by the governments of Africa, investors and
international institutions for the large-scale leasing and sale of lands
are that investment is needed to modernise
But the Oakland Institute study, which covers seven African countries, confirms many existing findings which show that large-scale land acquisitions do not necessarily produce the promised benefits for local populations. The investors, government officials and the local elites are among those who would gain most from the leasing and sale of land, with limited positive impacts on the livelihoods of the local communities.
This situation is attributed to the land policies and generous fiscal incentives which facilitate what has come to be known as 'land grabbing', as investors - foreign, domestic and diaspora - cash in on the very attractive investment climate.
instance, contracts for large-scale agricultural investors in
These prices are a bargain for the investors but they do not provide greater incomes for the host governments. The International Monetary Fund (IMF) has also shown that generous tax incentives aimed at attracting foreign investors in developing countries will only reduce much-needed tax revenues for the government without promoting growth.
Oakland Institute study further shows how local economies are negatively
impacted where investments took over land from active and productive
businesses and farms. An example is the case of women farmers in
investments were supposed to improve food security of the countries
targeted by the investors but instead many small farmers are being forced
out of their lands and small and local food farms had to make way for
export commodities such as biofuel crops and cut flowers. In
Instead of developing marginal or infertile land, most land deals take place near water resources offering irrigation potential, on fertile soils and close to infrastructure such as railroads and railways. They tap into major African rivers, hence controlling not only the land but also the water resources. Because water is available either without restriction or at extremely low costs, this raises major questions over the impact this will have on the rest of the area and on the rivers themselves and how they will provide for the needs of other users.
land investments are also controversial in their immediate impact on
the lives of local communities and smallholders. The construction of
a canal resulted in massive disruption in the region of Kolongo in
As to whether land investment will create jobs as touted by its proponents, the Oakland Institute research finds that in the countries it covers, the promises of job creation are often overstated or have yet to materialise.
Group has leased 100,000 ha of land on the western border of Malibya
The lack of transparency and the violation of human rights in these land deals are matters of concern. While investors have benefited from extensive assistance and fiscal incentives from the government and international organisations, any opposition to the land deals has largely been ignored or repressed.
There is almost no transparency regarding land investment negotiations and agreements. In the countries covered by the study, villagers on the acquired land are usually not informed or consulted, or adequately compensated if at all. The non-recognition of the rights of local villagers to their land is one reason why they are not able to claim compensation. In some cases they are regarded as 'squatters' and forcibly removed to make way for the takeover of the land by investors.
was with bulldozers that they [the investors] consulted with the smallholders,'
says Ibrahim Coulibaly, president of the National Coordination of Smallholder
Organisations (CNOP) in
Samana Dugu in
In many agreements, the investors are required to produce Environmental Impact Assessments and/or Social Impact Assessments. Based on the findings of the Oakland Institute study, these assessments are often not carried out or, if they are done, the non-binding nature of the requirements and their lack of enforcement allow investors to ignore the health of the ecosystems and the welfare of the local populations.
Given all these problems, the promotion of land investment raises important questions regarding who benefits from these investments. Unless they are addressed and principles of good governance are adhered to, the study stresses, the situation is ripe for social, economic and political fallouts.
Yoke Heong is a researcher with the
*Third World Resurgence No. 250, June 2011, pp 7-8