Published November 23rd, 2009 by Future Atlas
Locking In World’s Agricultural Land
The WaPo reported today on a trend that could have impacts from African stability to the global food supply: companies and governments from developing nations are leasing or buying large swaths of agricultural land, especially in Africa, but also in Southeast Asia and Latin America.
The WaPo article focuses on Ethiopia, which uses only about a quarter of its arable land despite facing chronic food shortages. Indian investment there has already reached $2.5 billion, and Saudi Arabian and Chinese firms are moving in as well, with active encouragement from the Ethiopian government.
This could have positive effects:
- This kind of project could increase global farmland and the global food supply.
- This could bring new flows of investment to poor nations, and improve their infrastructures.
- Access to inexpensive food might rise in the land-leasing countries.
- People could gain access to paid work, and learn modern farming skills.
However, the potential downsides seem serious:
- Land may be diverted from local food production to exports, increasing hunger.
- Poor locals might be deprived of land and water so that governments or elites can profit from it.
- This could extend the “resource curse” to agriculture, as it could enable elites to make money from farmland while largely excluding their own countrymen from the benefits. The WaPo article notes an Ethiopian river that is now to be used for irrigation, with locals banned from watering their cows in it.
- With many of the companies coming from India, Saudi Arabia, and China, the potential for serious ill-treatment of workers, and even human rights abuses, is vast. Indian and Chinese companies often treat their own workers abysmally, and Saudis sometimes revert to near-enslavement of foreigners, so the fate of African workers could be grim — especially if their own governments fail to protect them, which is likely in many poorly governed countries.
- The land leases run for as long as 99 years; exactly what this means, and how far the rights of the leasing country extend, could bring diplomatic clashes.
- The sum of the problems above points suggests that this trend could drive instability in some land-leasing countries.
(Image courtesy mrflip, Flickr)