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International investments and the conquest of land

International investments and the conquest of land Africa Renewal

Wide agricultural spaces in the less advanced world economies have drawn the attention of public and private investors from richer countries, intent on exploiting them to produce food and obtain biofuels. This practice is known as 'land grabbing'.

 

An August 2013 article in La Stampa drew attention to this phenomenon and a wide range of countries have proved particularly successful at conducting this form of 'business', including the United States, Malaysia, the United Arab Emirates, India, Great Britain, Singapore, Saudi Arabia, China, South Korea, Egypt, and Japan.


According to work published by Limesonline, land grabbing is a practice that has grown significantly during the last decade, largely inspired by the price increase in agricultural products (especially cereals) which occurred between 2007 and 2008. This was caused by a combination of factors, including adverse climate, reduced quantity of crops and, in some states, dwindling stocks of products. A “resource struggle” emerged, in which governments and multinationals from a wide range of states - including advanced economies, emerging countries and importers of agricultural goods - competed for land in order to ensure the availability of agricultural products or to make profitable business speculations.


Between 2000 and the beginning of 2012, more than 1,200 contracts were agreed relating to approximately 83 million hectares of land, all intended for grand-scale agricultural exploitation. In large part, this land is located in Africa, in Sudan, Tanzania, Ethiopia and the Democratic Republic of Congo, but it is also in some parts of Asia and Latin America. According to a report published in autumn 2012 by Oxfam, the quantity of land that has been sold or granted over the past decade is equivalent in size to an area almost seven times the size of Italy. The process produces and encourages the concentration of land in the hands of a minority and, in developing countries, often leads to the further impoverishment of wide segments of the local population, due to resource alienation and a loss of rights.


But this phenomenon no longer concerns only the global South, as research published by the “Transnational Institute (TNI) for European Coordination Via Campesina and Hands off the Land network” in April 2013 shows. A few big business groups have extended their control over wider and wider shares of European land. For example, in the European Union, only three percent of farms are over 100 hectares in size. However, this three percent equates to half of all the land being farmed. New actors have also started to take possession of plots, especially in Eastern Europe. These include Chinese companies producing maize in Bulgaria, Middle Eastern investments in Romania and European interest groups dedicated to acquiring land in other parts of the 'Old Continent'. In brief, land grabbing (with the presence of multinationals and foreign sovereign funds) has begun to spread across Europe, often accompanied by opposition and protest from local populations. There is now concern about how the phenomenon might begin to affect Western Europe.


Moreover, as the TNI research shows, subsidies distributed within the Common Agricultural Policy framework tend to support the concentration of land and wealth. In Italy in 2011, for example, 0.29 percent of farms accessed eighteen percent of CAP incentives. Of these, 0.0001 percent, or 150 farms, received six percent of all subsidies. In 2009, 75 percent of the subsidies in Spain went to only sixteen percent of the largest farmers.


One of the main reasons for the increase in investment in land can be explained by the reduction of rich soil on the earth's surface. According to Beverley Henry we are losing approximately 24 billion tons of rich soil annually. In arid regions, this translates to an area of around 12 million hectares becoming desert.


About one and a half billion people already live in eroded areas and the majority of these people constitute the world's poorest populations. They find themselves deprived of their main resource - the land - both due to foreign expropriation and the erosion processes that occur mainly as a result of the intensive methods of farming usually practiced by foreign investors.


Land fertility was one of the main subjects under discussion during Global Soil Week, which took place in Berlin at the end of October. The erosion of the soil and its sustainability in the Sub-Saharan region cued a debate between those who find the use of certain chemical fertilisers acceptable and those who support a decisive conversion to organic agriculture, like the WWF and NGOs like the Tanzania Organic Agriculture Movement. Many African governments support methods similar to the first option, advocating the use of mineral fertilisers which offer more promising and productive advantages in the short-term than more environmentally friendly and economically sustainable approaches. The question is whether such an approach, which may be convenient at present, will concretely improve the living conditions of poor populations in the long-term.


In the global context, the balance between available resources and demographic growth is becoming an increasingly topical problem. The possession of land is acquiring new importance. The problem is that many international investors see it, first of all, as an opportunity to make money; a goal which all too often does not coincide with local inhabitants’ well-being.


Angelo is a Trainee at United Nations Regional Information Centre for Western Europe (UNRIC Brussels).