Land Grabs

Micah Albert, Courtesy of Photoshare
Nigerian women head out to harvest cassava, a staple food crop.

The Food and Agriculture Organization (FAO) of the United Nations estimates that investing $30 billion annually could eradicate global hunger and meet many of the UN’s Millennium Development Goals in the third world. Two-and-a-half billion people depend directly on agriculture, including 800 million who are smallholder farmers. Seventy-five percent of the global poor currently live in rural areas, and the majority will continue to do so until about 2040.

These statistics have contributed to a dramatic increase in overseas investment in foreign farmland, particularly in Africa. Last year, the FAO estimated that nearly 20 million hectares (50 million acres) of farmland—almost half the size of all the arable land in Europe—was sold or had been negotiated for sale or lease in the space of just six months.

The other factors driving the trend are the market for biofuels and increasing fears about global food security. Land purchasing in the developing world first came to prominence during the 2008 world food crisis. As riots raged from Mexico to Bangladesh, many countries and corporations quietly sealed deals with African nations, leading to accusations of a neocolonial “land-grab” that could devastate, rather than ameliorate, the plight of the rural poor.

But several leading development organizations, including Oxfam and the World Bank, see overseas investment as a way to modernize agriculture by providing local people with jobs, higher yields, and some share in the profits and crops. The World Bank estimates that gross domestic product growth from agriculture benefits the income of the poor two to four times more than GDP growth from nonagriculture sectors.

So is foreign investment in the developing world’s agriculture a good or bad thing? One of the difficulties in assessing the impact is that many of the transactions are opaque and the extent of investment unclear. Survival International highlights the example of the Omo valley in Ethiopia where local people lost their land to a state-run park that is now being leased out to foreigners to grow cash crops like biofuels. To avoid such cases, Japan, a net food importer, proposed in July’s G8 meeting to set up common guidelines to promote responsible global agriculture investment. The UN is working on a set of guidelines that includes transparency, social sustainability, and the protection of land and resource rights.