Even Sudan, emerging from civil war, is not off-limits to investors seeking land and profits, John Vidal writes. Ethiopia, too, is a land-rush centre where many deals are condemned as “new colonialism”.
Nowhere is now out of bounds. Sudan, emerging from civil war and mostly bereft of development for a generation, is one of the new hot spots. South Korean companies last year bought 700,000 hectares of northern Sudan for wheat cultivation; the United Arab Emirates have acquired 750,000 hectares and Saudi Arabia concluded a 42,000-hectare deal in Nile province in February.
The government of southern Sudan says many companies are now trying to acquire land. “We have had many requests from many developers. Negotiations are going on,” said Peter Chooli, director of water resources and irrigation, in Juba recently. “A Danish group is in discussions with the state and another wants to use land near the Nile.”
In one of the most extraordinary deals, buccaneering New York investment firm Jarch Capital, run by a former commodities trader, Philip Heilberg, has leased 800,000 hectares in southern Sudan near Darfur. Heilberg has promised not only to create jobs but also to put 10% or more of his profits back into the local community. But he has been accused by Sudanese of “grabbing” communal land and leading an American attempt to fragment Sudan and exploit its resources.
Devlin Kuyek, a Montreal-based researcher with the NGO Grain, said investing in Africa was now seen as a new food-supply strategy by many governments. “Rich countries are eyeing Africa not just for a healthy return on capital, but also as an insurance policy. Food shortages and riots in 28 countries in 2008, declining water supplies, climate change and huge population growth have together made land attractive. Africa has the most land and, compared with other continents, is cheap,” he said.
“Farmland in sub-Saharan Africa is giving 25% returns a year and new technology can treble crop yields in short time-frames,” said Susan Payne, chief executive of Emergent Asset Management, a UK investment fund seeking to spend US$50 million on African land, which, she said, was attracting governments, corporations, multinationals and other investors. “Agricultural development is not only sustainable, it is our future. If we do not pay great care and attention now to increase food production by over 50% before 2050, we will face serious food shortages globally,” she said.
But many of the deals are widely condemned by both western non-government groups and nationals as “new colonialism”, driving people off the land and taking scarce resources away from people.
We met Tegenu Morku, a land agent, in a roadside café on his way to the region of Oromia in Ethiopia to find 500 hectares of land for a group of Egyptian investors. They planned to fatten cattle, grow cereals and spices, and export as much as possible to Egypt. There had to be water available and he expected the price to be about 15 Ethiopian birr (US$1.10) per hectare per year – less than a quarter of the cost of land in Egypt and a tenth of the price of land in Asia.
“The land and labour is cheap and the climate is good here. Everyone – Saudis, Turks, Chinese, Egyptians – is looking. The farmers do not like it because they get displaced, but they can find land elsewhere and, besides, they get compensation, equivalent to about 10 years’ crop yield,” he said.
Oromia is one of the centres of the African land rush. Haile Hirpa, president of the Oromia studies’ association, said in a recent letter of protest to UN secretary-general Ban Ki-moon that India had acquired one million hectares, Djibouti 10,000 hectares, Saudi Arabia 100,000 hectares, and that Egyptian, South Korean, Chinese, Nigerian and other Arab investors were all active in the state.
“This is the new, 21st-century colonisation. The Saudis are enjoying the rice harvest, while the Oromos are dying from man-made famine as we speak,” he said.
The Ethiopian government denied the deals were causing hunger and said that the land deals were attracting hundreds of millions of US dollars of foreign investments and tens of thousands of jobs. A spokesman said: “Ethiopia has 74 million hectares of fertile land, of which only 15% is currently in use – mainly by subsistence farmers. Of the remaining land, only a small percentage – 3 to 4% – is offered to foreign investors. Investors are never given land that belongs to Ethiopian farmers. The government also encourages Ethiopians in the diaspora to invest in their homeland. They bring badly needed technology, they offer jobs and training to Ethiopians, they operate in areas where there is suitable land and access to water.”
The reality on the ground is different, according to Michael Taylor, a policy specialist at the International Land Coalition (ILC). “If land in Africa hasn’t been planted, it’s probably for a reason. Maybe it’s used to graze livestock or deliberately left fallow to prevent nutrient depletion and erosion. Anybody who has seen these areas identified as unused understands that there is no land in Ethiopia that has no owners and users.”
Development experts are divided on the benefits of large-scale, intensive farming. Indian ecologist Vandana Shiva said in London recently that large-scale industrial agriculture not only threw people off the land but also required chemicals, pesticides, herbicides, fertilisers, intensive water use and large-scale transport, storage and distribution, which together turned landscapes into enormous mono-cultural plantations.
“We are seeing dispossession on a massive scale. It means less food is available and local people will have less. There will be more conflict and political instability and cultures will be uprooted. The small farmers of Africa are the basis of food security. The food availability of the planet will decline,” Shiva says. But Rodney Cooke, director at the UN’s International Fund for Agricultural Development (IFAD), sees potential benefits. “I would avoid the blanket term ‘land-grabbing’. Done the right way, these deals can bring benefits for all parties and be a tool for development.”
Lorenzo Cotula, senior researcher with the International Institute for Environment and Development (IIED), who co-authored a report on African land exchanges with the UN fund last year, found that well-structured deals could guarantee employment, better infrastructures and better crop yields. But badly handled they could cause great harm, especially if local people were excluded from decisions about allocating land and if their land rights were not protected.
Water is also controversial. Local government officers in Ethiopia told the Observer that foreign companies that set up flower farms and other large intensive farms were not being charged for water. “We would like to, but the deal is made by central government,” said one. In Awassa, the al-Amouni farm uses as much water a year as 100,000 Ethiopians.
Part one: A historical land rush
Copyright Guardian News & Media Limited 2010
Homepage image from United Nations Photo