Where will the small farmers go? Kundan Rich countries launch great land grab to safeguard food supply • States and companies target developing nations • Small farmers at risk from industrial-scale deals
- *Julian Borger* <http://www.guardian.co.uk/profile/julianborger>, diplomatic editor - guardian.co.uk <http://www.guardian.co.uk/>, Saturday November 22 2008 00.01 GMT - The Guardian, <http://www.guardian.co.uk/theguardian> Saturday November 22 2008 - Article history<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels-land-grab#history-byline> Rich governments and corporations are triggering alarm for the poor as they buy up the rights to millions of hectares of agricultural land in developing countries in an effort to secure their own long-term food supplies. The head of the UN Food and Agriculture Organisation, Jacques Diouf, has warned that the controversial rise in land deals could create a form of "neo-colonialism", with poor states producing food for the rich at the expense of their own hungry people. Rising food prices have already set off a second "scramble for Africa". This week, the South Korean firm Daewoo Logistics announced plans to buy a 99-year lease on a million hectares in Madagascar. Its aim is to grow 5m tonnes of corn a year by 2023, and produce palm oil from a further lease of 120,000 hectares (296,000 acres), relying on a largely South African workforce. Production would be mainly earmarked for South Korea, which wants to lessen dependence on imports. "These deals can be purely commercial ventures on one level, but sitting behind it is often a food security imperative backed by a government," said Carl Atkin, a consultant at Bidwells Agribusiness, a Cambridge firm helping to arrange some of the big international land deals. Madagascar's government said that an environmental impact assessment would have to be carried out before the Daewoo deal could be approved, but it welcomed the investment. The massive lease is the largest so far in an accelerating number of land deals that have been arranged since the surge in food prices late last year. "In the context of arable land sales, this is unprecedented," Atkin said. "We're used to seeing 100,000-hectare sales. This is more than 10 times as much." At a food security summit in Rome, in June, there was agreement to channel more investment and development aid to African farmers to help them respond to higher prices by producing more. But governments and corporations in some cash-rich but land-poor states, mostly in the Middle East, have opted not to wait for world markets to respond and are trying to guarantee their own long-term access to food by buying up land in poorer countries. According to diplomats, the Saudi Binladin Group is planning an investment in Indonesia to grow basmati rice, while tens of thousands of hectares in Pakistan have been sold to Abu Dhabi investors. Arab investors, including the Abu Dhabi Fund for Development, have also bought direct stakes in Sudanese agriculture. The president of the UEA, Khalifa bin Zayed, has said his country was considering large-scale agricultural projects in Kazakhstan to ensure a stable food supply. Even China, which has plenty of land but is now getting short of water as it pursues breakneck industrialisation, has begun to explore land deals in south-east Asia. Laos, meanwhile, has signed away between 2m-3m hectares, or 15% of its viable farmland. Libya has secured 250,000 hectares of Ukrainian farmland, and Egypt is believed to want similar access. Kuwait and Qatar have been chasing deals for prime tracts of Cambodia rice fields. Eager buyers generally have been welcomed by sellers in developing world governments desperate for capital in a recession. Madagascar's land reform minister said revenue would go to infrastructure and development in flood-prone areas. Sudan is trying to attract investors for almost 900,000 hectares of its land, and the Ethiopian prime minister, Meles Zenawi, has been courting would-be Saudi investors. "If this was a negotiation between equals, it could be a good thing. It could bring investment, stable prices and predictability to the market," said Duncan Green, Oxfam's head of research. "But the problem is, [in] this scramble for soil I don't see any place for the small farmers." Alex Evans, at the Centre on International Cooperation, at New York University, said: "The small farmers are losing out already. People without solid title are likely to be turfed off the land." Details of land deals have been kept secret so it is unknown whether they have built-in safeguards for local populations. Steve Wiggins, a rural development expert at the Overseas Development Institute, said: "There are very few economies of scale in most agriculture above the level of family farm because managing [the] labour is extremely difficult." Investors might also have to contend with hostility. "If I was a political-risk adviser to [investors] I'd say 'you are taking a very big risk'. Land is an extremely sensitive thing. This could go horribly wrong if you don't learn the lessons of history." ____________________________________ The resentment rises as villagers are stripped of holdings and livelihood - *Ian MacKinnon* <http://www.guardian.co.uk/profile/ianmackinnon> in Bolikhamxay - guardian.co.uk <http://www.guardian.co.uk/>, Saturday November 22 2008 00.01 GMT - The Guardian, <http://www.guardian.co.uk/theguardian> Saturday November 22 2008 - Article history<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels-laos#history-byline> The blackened tree trunks say it all. Three times in recent months these tracts of palm oil plantation have gone up in smoke, along with plants and machinery. The neighbouring coconut operation suffered the same fate, but there the Thai owners replanted. Here, the Malaysians had had enough and called it a day. The sabotage is a testament to growing local resentment at the way land is being sold off to big foreign investors with deep pockets. At face value, leasing agricultural concessions looks like a godsend for Laos, a poor country eager to shed its stigmatic designation of "least developed country." With a population of less than six million in a country half the size of France, land is its biggest asset. And as food and commodity prices have surged over the past 18 months, neighbouring nations have been snapping up vast tracts on long leases. "The situation is completely out of control," said one foreign advisor in Vientiane. "It's a fire sale. People in power are just desperate to get their hands on the money so they don't miss out. For the companies coming in it's a massive land grab." Recently, Chinese officials visited Vientiane seeking to lease 1m hectares for rice. Flush with cash from oil that hit $150 a barrel, Middle East states had the same idea, trying to secure 200,000 hectares. Kuwait's prime minister and foreign minister paid two visits in two months. "Countries were traumatised by the food crisis," said a foreign land consultant in Vientiane. "They've money to spend and they're shopping around. "It doesn't matter that oil prices have gone off. They feel this food problem will come back to haunt them. Even if they start something now, they know it'll take years to reach 100% production." Already between 2m and 3m hectares of land - as much as 15% of Lao territory - has been signed away. Some leases stretch for 70 years. Nationwide, there are at least 150 international agricultural projects. Just six projects valued at £8m were agreed in 2002, but that jumped to 39 worth £262m in 2006. Thai, Vietnamese and Malaysian companies dominate the southern lowlands where rubber, sugar and cassava plantations carve out vast swaths. Japanese, Indian and Scandinavian farms cultivating fast-growing eucalyptus and acacia trees for paper pulpwood forests dot the centre. Chinese operations lease the most land in the north, principally to grow rice or rubber trees. The desperation to find land means that village farmers have been stripped of their holdings for minimal compensation. In a country where most are subsistence farmers living on less than $2 (£1.33) a day, some can no longer feed themselves. Tamang, 56, moved to a village built by the Japanese pulp company Oji Paper when the eucalyptus plantation was developed on his land. His children attend the new school, and he works up to seven days a month on the plantation for £1.40 a day. But the rice paddy that was promised as compensation has yet to materialise. "We're waiting for the government to give us land, but we've heard nothing yet," he said. Part of the bonanza is explained by the pitiful prices charged for buying up Laos. The norm of $3 to $9 a hectare each year is a fraction of the market rate. "The low rates of land leasing in Laos [...] were well under commercial value or sometimes free," wrote Glen Hunt, a researcher from Sydney's Macquarie University. Dismal prices are due to the chaotic nature of the "opaque" bidding process that enables Lao district, provincial and national level officials to strike deals. Failure to grasp true land values as Laos shrugs off socialism contributes. But officials desperate to line their own pockets care little for Laos's coffers. Martin Stuart-Fox, a retired professor and Laos specialist from the University of Queensland, casts the trend not as one of rich foreign countries grabbing what they can, but of local greed. "It's simply a matter of greed. Officials are grabbing what they can. Companies need land and are prepared to pay well. It all goes under the table." Recognising the system was out of control, the prime minister, Bouasone Bouphavanh, declared a moratorium last May on large land concession allocations "to address the shortcomings of our previous strategy". But the stop order was ignored. Yet it is becoming clear that Laos does not even have vast amounts of spare land. Oji Paper was in principle granted 50,000 hectares - and its regimented eucalyptus forests line the roads of Bolikhamxay - but is struggling to find even a tenth of its allocation. "It's a myth that Laos has so much virgin land," said one expert. "There's no land left. Plantations promised 20,000 hectares or 50,000 hectares can't find it when they survey. They might get 50 hectares here or there. But they want huge plantations. The dream was Brazil." - More on this story - Rich countries launch great land grab<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels-land-grab> - Deal brings Madagascar jobs, but at what price?<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels-madagascar> - Rush to buy sends prices soaring in Brazil<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels-brazil> - Food crisis leading to an unsustainable land grab<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels> - Graphic: World land grab (pdf)<http://image.guardian.co.uk/sys-files/Guardian/documents/2008/11/21/LANDGRAB.pdf> - Biggest deals<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels1> Related Nov 22 2008 Rush to buy sends prices soaring<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels-brazil> Nov 22 2008 Deal brings many jobs, but at what price?<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels-madagascar> Nov 22 2008 Food crisis leading to an unsustainable land grab<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels> Nov 22 2008 Biggest deals<http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels1>
