Mozambique’s history of Portuguese colonialism, three wars, and then the imposition by the World Bank and International Monetary Fund of a harsh neo-liberal economic model led the government in the 1990s to accept the idea that the only way to promote development and end poverty was through encouraging foreign investment. Mozambique was identified by the World Bank as one of five sparsely populated African countries with large tracts of land available for rainfed cultivation. After 2000 rising food and fuel prices and new climate change-related attention on forests triggered the interest of investors in Mozambique, particularly for trees (for paper, timber and carbon credits) and agrofuels (notably sugar and jatropha).
Understanding Land Investment Deals in Africa: Publications
For decades, Ethiopia has been known to the outside world as a country of famine, food shortages, endemic hunger, and chronic dependency on foreign aid. Despite receiving billions of dollars in aid, Ethiopians remain among the poorest in the world. Our research shows that at least 3,619,509 ha of land have been transferred to investors, although the actual number may be higher.
Based on field research conducted between October 2010 and January 2011, this report provides new and important information on the social, political and economic implications of current land investments in Sierra Leone.
From its very name, American-owned SG Sustainable Oils Cameroon, Ltd. (SGSOC) presents a pro-environment, pro-resources image. This is supported by an impressive-sounding partnership with an NGO by the name of All for Africa and as a package typifies the kind of convoluted modern-day foreign investment going on in Africa. It is sadly all too familiar to communities on the ground. They are unimpressed with promises of infrastructure and jobs, and angry about their loss of land and livelihoods.
In 2011, Socfin Agricultural Company Sierra Leone Ltd. (Socfin SL) secured 6,500 hectares of prime farmland for rubber and oil palm plantations in Malen chiefdom in Pujehun district in the south of Sierra Leone. The firm is now seeking an additional 5,000 ha in expansion plans in the Malen region or neighboring chiefdoms. The initial investment, estimated at $100 million, with promises of job creation, compensation for lost farms, and construction of infrastructures, has enjoyed high-level government support. The 50-year lease was signed by the Minister of Agriculture, Forestry and Food Security, Dr. Sam Sesay.
Oakland Institute’s (OI) investigation into over 50 land investments deals in seven African countries highlights the role played by a wide range of international development agencies, multilateral institutions, and so-called “socially responsible” investment funds. While using the language of aid organizations these institutions speak of “helping Africa feed itself,” “improved food security,” “livelihood creation,” and “sustainable environmental policies.” However a closer look at their agenda and policy prescriptions, and an investigation into the reality on the ground reveals otherwise. Even with growing evidence that the current African land grab is displacing small farmers, indigenous communities, and threatening food and water security, US and international development agencies continue to push for foreign agricultural land investment. This brief explores this issue further.
Cheap land and fairly easy access to water make Africa attractive for industrial agriculture. Investors see Africa as an “uncrowded space of opportunities,” and the prospect of accessing abundant water resources is a focal point in business plans. Some firms are explicit that they are as much agricultural land investors as they are investors in water supplies. Others say that they only select land which has access to water for large-scale irrigation and that land only has value if water is available. The availability of water gains further meaning as estimates show that the increased requirements for food to feed the world’s population – exceeding 7 billion – will outpace existing water resources by 40 percent by 2030.
Emergent Asset Management (Emergent), a private limited liability company based in the UK and minority owned by Toronto Dominion Bank, claims to be managing the largest agricultural fund in Africa. Using private equity to invest in industrial agriculture in sub-Saharan Africa, Emergent is however, a prime example of the troublesome rise in speculative funds that are investing in African agricultural land.