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Past Special Report
Africa for Sale: The Land Grab Landmine
Patrick Mugo Mugo
February 29, 2012
A new phenomenon is taking shape across the developing world, threatening to heighten resource-related conflict, particularly in Africa. Referred to as land leasing, land selling or land grabbing, it affects Africa more than any other region, where land is more than a factor of production, but a lifeline to an individual’s wellbeing, the family unit, the community at large and the stability of the state. In this article, Patrick Mugo Mugo exposes the extent of the land grab phenomenon, arguing that while we debate over whether it is land grabbing, leasing or selling, African countries are already stepping on a potential landmine.
The story is often told that when the first Europe missionaries arrived to Africa, they had a bible in their hand, and that the African had land in his. When the time came to seek divine help, the ‘good’ missionaries are said to have ‘sweet- talked’ the African to cross his eyes and hold on to the bible so that together, they could pray for the ‘uncivilised’ African’s salvation. Soon after, when the ‘obedient’ African did open his eyes, in his hand was the bible, and in the missionary’s hands, the land. This anecdote tells a tale of the 18th and 19th centuries; now, let us fast forward to the 21st.
In the last few decades, millions of hectares have been reported as being under negotiation for lease or sale by developing countries to the rich countries. The land in question refers to 227 million hectares (561 million acres) of land – an area the size of northwest Europe –having been reportedly sold, leased or licensed, largely in Africa and mostly to international investors in thousands of selective deals since 2001(Oxfam, 2011).The World Bank estimates that in 2009 alone nearly 60 million hectares of land were purchased or leased in developing countries all over the world – an area the size of France (Fisher, 2011).
If you pay attention to all the conflicting information about this growing and controversial phenomenon, then one thing is for certain: land grabs by the rich countries reflect the reality that they have found it wise to export their food insecurity and/or industrial demands to developing countries. The scariest aspect of this unfolding phenomenon is that despite the foreseeable terrible consequences, the appetite among the rich countries to own a piece of this developing-country fertile land continues to grow, turning to an ugly competition. Allow me to put it plainly: it’s like witnessing criminal gangs arguing over whom has the right to rob which bank. The only difference in this case is that banks have insurance coverage helping them get back on their feet, while the losers in the land grab phenomenon have no fall back or safety net.
Land Leasing or Grabbing: Contending Arguments
The list of those blessing this on-going land grab business, which has the potential for precipitating conflict - if not heightening it in some regions like Sudan, Kenya, Nigeria, Sierra Leone and Mali - is no different than those who, a few decades ago, advocated for economic liberalisation (free market economics), structural adjustments programmes and commoditisation of food. We are all now aware of the consequences of these experiments and the price that affected populations have paid over time. Others argue that selling or leasing land could work towards taming drought or famine, which is now a common threat in most of the African states slated to be part of the land-grabbing phenomenon.
Land grab advocates argue that as the global population continues to increase rapidly, there is the need to modernize agriculture and find innovative ways of maximizing the production of potentially fertile lands. The World Bank Group, since the 2008 food and financial crisis, has fronted the idea that large-scale land investment in developing countries is a “win-win” situation, whereby investors profit and “host” nations benefit from economic development, improved agricultural infrastructure, and employment opportunities(Oakland Institute, 2011), an argument shared by USAID. But how leasing or selling fertile land will be an answer to the challenge of food insecurity in some parts of the world, at a time of plenty in the Western world, is a very different matter.
Professor Reg Noble of Ryerson University in Toronto reminds us that there is enough food in the world to feed the 7 billion-plus people at current food production rates, if the commoditisation of food was not the driving force of this phenomenon. Anuradha Mittal, founder of the Oakland Institute argues that, according to his organization’s ground-breaking report on African land grabs, "The land grab phenomenon is being done in the name of modernizing agriculture and expanding African economies, but it cuts out the core natural resources that support African livelihoods for the majority – land and water. This huge transfer of natural wealth to outside investors is eroding food security, water security and cultural integrity for local people.” Professor Noble, a research associate in food security and community development, blames the land rush on the increasing demand to acquire fertile land by a corporate global minority seeking bio-fuel crops and the new frontier; the need for carbon credits has now turned into a lucrative business.
Contamination of Information Flow
If you walk into any food security meeting and you happen to be seated next to a land leasing or selling lobbyist, your ears are to be bombarded with arguments in the form of supposed justifications. For example, that the new land rush has been triggered by the food riots of 2006-07, a series of harvest failures following major droughts, and Western investors moving out of the US property market in 2008. Indeed, this is logical but not truthful and begs the question: as this sort of information flows and dominates the land grab debate, could it at the same time be contaminating our ability to understand this phenomenon and gauge its consequences?
In its reports, Oxfam argues that the case of land leasing in Uganda clearly shows how land grab deals are slipping through the net of existing safeguards. Oxfam challenges investors, governments and international organisations to prioritize putting an end to land grabs by fixing current policies and regulations. The group says that such policies in the past have shown that local populations are not consulted or treated fairly. Oxfam says that despite its bad reputation, new demand for agricultural commodities on the world market has the potential to provide opportunities to local communities in areas of increasing investor interest, if the power balance is to be shifted in favour of those most affected by land deals (Oxfam, 2011).
On the contrary, World Bank Group policies and actions have glossed over critical issues, such as human rights, food security and human dignity for local populations, opines the Oakland Institute report. In its findings, the Oakland Institute observes that "modern" agricultural schemes are highly mechanized and provide relatively few jobs, which are often short-term or seasonal.
For instance, in Western Equatorial and South Sudan, Equatorial Teak promised that it would create 6,000 jobs in the state. It initially hired about 600 people from the local community and paid just seven Sudanese pounds per day (which would be just a little more than $2 in the US). By the time it stopped project operations in October 2010, Equatorial Teak was only employing approximately 250 people (Oakland Institute, 2011).
Beneath the arguments and justifications advocated by land grab speculators and institutions like the African Development Bank, World Bank, Western University pension funds and global agri-business corporations, is the need to produce more food for the commodity market and raw materials for the biofuels industries. Yes, Western academic institutions are also part of the game. Land acquisitions in seven African countries suggests that Harvard, Vanderbilt and many other US colleges with large endowment funds have invested heavily in African land in the past few years; with much of the money being channelled through London-based Emergent asset management, which runs one of Africa’s acquisition funds, run by former JP Morgan and Goldman Sachs currency dealers (Population Matters, 2011).
The Masters of Double Speak
Oxfam argues that most of the land deals made in Ethiopia, Ghana, Mali, Mozambique, Senegal, and Tanzania have been to grow crops for export commodities, including cut flowers and biofuels. In Mozambique, where approximately 35% of households are chronically food insecure, only 32,000 hectares out of the 433,000 approved for land deals between 2007 and 2009 were for food crops (Oxfam, 2011). On one side, you have universities carrying out serious research into how to tame African hunger; on the other side, you have the same universities taking away the fertile land that populations in Africa could use for that very purpose - taming hunger.
Africa and Her Contradictions: Land Up for Sale to Lowest Bidder!
Let’s cross over to Ethiopia, where the story cannot be concluded without talking about massive, fertile and arable lands, the River Nile which sustains Sudan and Egypt, as well as drought and famine. These are contradictions synonymous with Ethiopia, and in the last few years, land selling and leasing has joined this list of challenges. Ethiopia is one of the world’s largest recipients of humanitarian food and development assistance, and in 2011, received more than 700,000 tonnes of food and £1.8bn in aid; at the same time, it has offered three million hectares (7.4 million acres) of virgin land to foreign corporations, such as Karuturi (Population Matters, 2011).
Sparsely-populated Gambella is at the centre of the global rush for cheap land, precipitated by the oil price rise in 2007/2008, when many countries racked by food riots encouraged their farmers to invest abroad to grow food. The Ethiopian government says that 36 countries including India, China, Pakistan and Saudi Arabia have leased farm land there. According to Population Matters (2011), the Gambella area has offered investors 1.1 million hectares, nearly a quarter of its best farmland, and 896 companies have come to the region in the last three years.
They range from Saudi billionaire Al Amoudi, who is constructing a 20-mile canal to irrigate 10,000 hectares to grow rice, to Ethiopian businessmen who have plots of less than 200 hectares.
Speaking to the Guardian media team, Karuturi Global terms the deal it has with Ethiopia, “the deal of the century: £150 a week to lease more than 2,500 sq. km (1,000 sq. miles) of virgin, fertile land – for 50 years”. The lowest prices are in Africa, where, according to the World Bank, at least 35 million hectares of land have been bought or leased. Bangalore-based food company Karuturi Global says it had not even seen the land when it was offered by the Ethiopian government with tax breaks thrown in. Karuturi snapped it up, and next year the company, one of the world’s top 25 agri-businesses, plans to export palm oil, sugar, rice and other foods to world markets from Gambella province – a remote region near the Sudanese border.
“It’s very good land. It’s quite cheap. In fact it is very cheap. We have no land like this in India,” says Karmjeet Sekhon, Karuturi Global Project Manager of what is expected to be one of Africa’s largest farms. “There you are lucky to get 1% of organic matter in the soil. Here, it is more than 5%. We don’t need fertiliser or herbicides. There is absolutely nothing that will not grow on it. To start with, there will be 20,000 hectares of oil palm, 15,000 hectares of sugar cane and 40,000 hectares of rice, edible oils, and maize and cotton. We are building reservoirs, dykes, roads, towns of 15,000 people. “This is phase one. In three years’ time, we will have 300,000 hectares cultivated and maybe 60,000 workers. We could feed a nation here.”
While the prospects that they can feed a nation remain undoubtedly real, the harsher reality in this case is that Ethiopia will not be that nation, as she will, for many years to come, remain a hungry nation unable to drop the begging bowl. Ethiopia’s population growth rate of 3.194 per cent is projected to hit 186 million by 2050 from its current 82 million today (CSA, 2011). As the populations of Ethiopia, Kenya, Mali, Ghana, Sudan and Tanzania grow, so does their appetite to lease or sell land. However ironically, given the potential that this land could have for domestic food production, the expectation is that such nations would be agitating for reversing or cancelling existing leases or refraining from selling more land. Unfortunately, this is not the case. Kenya, Ethiopia, and Sudan, for example are key recipients of food aid, as they parade themselves as states capable of meeting the food security needs of developed countries, some of which need more agricultural products for industrial needs.
From Land Grabs to Potential Landmines
Despite their massive numbers, at the end of the day no one is paying attention to their cries or hallowing tales, after all. They are being perceived as obstacles or liabilities to the ‘newfound formula’ of turning mineral-less, but fertile agricultural lands into prime factors of production for the global economy. A capitalist economic system that has been feeding on them, if not exploiting them to destitution for hundreds of years, if we are willing to travel back in time. An economy that perceives the billions of poor people in these countries as disposable elements in the name of maximizing profit margins, thanks to the commoditisation of food. The ugliness of the free market economy is its luring abilities: despite the hunger in many developing countries, lucrative farm investment offers from rich foreign companies may end up compelling them to hand over their only assets to international investors through international contractual agreements (Mersha, 2010).
Beyond that, while African governments can hardly meet their budgets, they are losing further revenue through the land grab by allowing tax breaks for landowners; tax breaks they hardly extend to their local populations who are the labour behind high food production; instead, their reward is making agriculture in their societies unattainable, expensive and heart-breaking, exacerbating food insecurity in the process. For example, profit tax in Ethiopia, estimated at $20 per hectare per year, is exempt for a period of five years. As a result, the 602,760 hectares allocated through documented projects, are estimated to entail a tax revenue loss to Ethiopia of $60,276,000 over five years (Mersha, 2010). Moreover, the land that is being leased or sold is owned by the communities in common, but held by government in trust; it is now being said to be ‘empty’ land up for trade at the whim of respective governments, with no consultation or consent from the communities. And where consultation or consent is said to have been employed, it is through disconnected and corrupt local and national elites.
End result: affected communities are being pushed far away from their fertile land, and are being boxed into corners next to each other, heightening the probability of resource conflict, a common feature in many African countries. Beyond that is the loss of land ownership while at same time remaining physically present, because there are large-scale agricultural activities next to displaced populations who have neither access to nor the ability to benefit from the leased or sold land. Nearly 10,000 people were displaced from the Namwasa and Luwunga reserve lands in Uganda, with no resettlement assistance and no compensation (Oxfam, 2011). The contradiction gets even more complex according to Professor Noble, who argues that compensation for the leased or sold land is poor or non-existent; likely jobs from land grabs do not materialize; the most vulnerable of the population, namely the women and children, suffer more; and there is irreversible damage done to ecosystems, such as draining of marshland and clearing of forest.
Africa: A Strange Place Indeed
While this land grab phenomenon is said to be global, all its trappings reveal that Africa is playing a greater role than all other regions of the world. With her high degree of food insecurity and escalating cases of land-related conflict, many would expect Africa to be very allergic to such land grab issues. However, the opposite has proven true, and key target lands are those found within Africa due to many loopholes that exist when it comes to foreigners acquiring land or investing in Africa. Since colonisation, from in the post-independence era to the age of economic liberalisation thanks to the World Bank and International Monetary Fund through their structural adjustment ‘treatment’, African leaders at both the community and national level have always shown a high degree of propensity towards any investors who knock at their door selling ideas of how to turn around the fortunes of their nations.
But why would this be the case? Because Africa is a very lucrative area due to failed or dysfunctional political systems and a despicable crop of leaders who are easy prey for manipulation, if not exploitation, by any would-be investors. Thus, the blame game is not one-sided. After all, the political elites in African countries have a demeaning attitude towards a majority of their population, and will stop at nothing when it comes to expropriating their people’s resources in an effort to make a ‘kill’ out of anything that previous regimes did not act on during their time in power. When one hears Western media stations preaching that Africa is ‘open for business’, it simply means that Africa hasn’t learned any of the lessons it should have after many years of exploitation, bringing misery to the continent’s vulnerable populations.
Even reliable records are hard to piece together, as few African governments are willing to provide full disclosure, making it difficult for their populations to benefit from indicator-targeted support. Research by the Guardian’s media team sheds light on the scale of the biofuels rush in sub-Saharan Africa – 100 projects and 50 companies in more than 20 countries (Population Matters, 2011). When we scratch the surface, we recognize the misconception of the notion that land leasing or selling stands to help poor Africa or to tame the twin evils of her time, drought and famine, as most of the direct and by-products of land grabbing are products for which Africa has no need.
Crest Global Green Energy based in the United Kingdom has the largest recorded landholding of 900,000 hectares in Mali, Guinea and Senegal. Tom Stuart, the company’s CEO says: “It is true in some cases [that biofuels displace food], but in our projects we ‘inter-crop’, planting as much food as biofuel on the marginal land we have brought into agricultural use. There is a large social element to our projects, with all the local people needing to be in agreement, and that’s normally written into contracts at government level.”
The appetite among British firms does not end there. Another UK company, Sun Biofuels, leased 8,000 hectares in Tanzania, where it grows Jatrophacurcas, a non-edible plant whose oil-rich seeds can be processed into biodiesel. “We’ll start harvesting and producing in two years,” says Peter Auge, Office Manager in Tanzania. “The main attraction for us is exporting to Europe.” British firms have acquired more land in Africa for controversial biofuel plantations than companies from any other country, a Guardian investigation has revealed. Half of the 3.2m hectares of biofuel land identified – in countries from Mozambique to Senegal – are linked to 11 British companies, more than any other country.
Let’s breakdown the facts, the United Nations estimates that 70 per cent more food will be needed by the year 2050 to feed the world’s growing population, now estimated to be way over 7 billion. Those who argue that rising populations in China and India are demanding more food and thus turning to land leasing or buying must recognize that the same behaviour is true for the Gulf States of Saudi Arabia, Qatar and United Arab Emirates, plus the United States, due to economic factors, has turned to farmland as investments of choice. No one can dispute that; however, it is also true that the Global South population is growing at an alarming rate, and the level of food insecurity across these countries is of concern and has, in the recent past, translated into social upheavals and unrest: Kenya, Uganda, Senegal are prime examples.
Pandora’s Box: Are African Governments Dancing with the Devil?
The Director-General of aid and development at the European Commission says, “We are very concerned because this is another way to exploit developing countries. The poorest countries are selling commodities, they are exporting migrants and now they are selling their land from which they will not take any kind of benefit in terms of food or whatever.” When we breakdown the figure about the ratio of people within developing countries who depend on farming or land for survival, we realize that something is going terribly wrong. Why? 75 per cent of the world’s population makes a living from farming, observes Mersha (2010).
The global rush for land could trigger a new wave of civil unrest if governments fail to recognise the rights of those using land without formal legal titles. Research recently published by the Rights and Resources Initiative (RRI) estimates that half a billion people rely on 1.4bn hectares of communally held rural land in sub-Saharan Africa, which has attracted the lion’s share of investor interest. In Liberia, where 30% of the country’s land was reportedly allocated to investors between 2006 and 2011, local communities have temporarily blocked a Malaysian company’s plans to plant oil palms on 220,200 hectares of land leased from the government. In late December 2011, two Liberian campaigners argued in the New York Times that “these concessions come at a delicate time, as violent local-level land disputes both between and within villages are still widespread” (Population Matters, 2012).
South Sudan has also seen a surge of investor interest since the country’s independence in July last year. The South Sudanese government, along with foreign aid agencies, has held a series of events to promote foreign investment in the country, including an international conference in Washington in December. But David Deng, Research Director of the South Sudan Law Society, says that a large number of potential investors have visited the country since the 2005 comprehensive peace agreement, which ended a 22-year civil war between the north and south. Last year, researchers estimated that around 9% of South Sudan’s land had already been leased or bought by investors before independence. Deng said, “Here we have a country that is probably at the most unpredictable time in its entire history, faced with a very real possibility of a return to war, with a government that is just getting on its feet, and it still manages to attract considerable amounts of interest from foreign investors”.
The Oakland Institute contends that Egypt provides a perfect example of how food and water insecurity stemming from land grabs can destabilize African nations and create international conflict between countries (2011). Egypt's revolution was exacerbated by food insecurity caused by the rising price of wheat. Food insecurity could get much worse for Egypt soon because foreign investors are pushing Ethiopia to build a massive dam upriver along the Nile that could drastically decrease the water Egypt will have available for irrigation.
Another example is South Sudan: The world's newest independent country was targeted for land grabs before it even gained its independence. The people of South Sudan fought for their land for decades. Now it's being taken away from them by foreign corporations backed by the World Bank, creating anger and desperation among many of South Sudan's citizens that could lead to further destabilizing conditions (Oakland Institute, 2011).
Beyond that, political leaders from countries leasing land argue that it is prudent to lease land in the name of business and economic liberalization. But the ‘voiceless’ and ‘powerless’ local farmers who bear the brunt of the consequences that come with land grabs have a different take. In short, their patience will run out as they quickly approach the edge with no options; they will either have to accept ‘falling off the cliff’ or step forward and say enough is enough, and seek to reclaim the land. African land experts will tell you that this would be like opening a Pandora’s Box that has been steaming for several decades. Across Africa, the box is full of unresolved historical land grievances, so much so that no African government will withstand its ‘explosion’, as time and again, its ugly face has destabilized populations in Kenya, South Sudan and Zimbabwe. But as Kenya and South Sudan walk down the road of the land leasing business, one needs not be a rock scientist to expect the unexpected.
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Patrick Mugo Mugo is a Multimedia Senior Researcher from Kenya and a masters student in Media, Peace and Conflict Studies at the UN-mandated University for Peace, Costa Rica. firstname.lastname@example.org