Global Recession And Food Crisis Prompts African Land Deals

Land

VENTURES AFRICA – The first scramble for Africa was over land, with the imperialist powers looking to divide the continent up between them. Now, the purchase of millions of acres of land by companies from Asia and the Middle East is being dubbed the “Second Scramble for Africa”, with corporations, investment funds and governments refocusing their attention on agriculture, Africa’s primary commodity, as a result of the food and financial crisis of 2008.

African governments are increasingly entering into land deals with foreign investors, according to data released by “Land Matrix”, which tracks international land deals. Recent years have seen Africa become the most targeted continent for land deals. Of the known and reported land deals since 2000, 56.2 million hectares are in Africa, almost 5 per cent of the continent’s total agricultural area.

The United States, Malaysia and China have historically been the main countries investing in land deals, but with the threat of food crisis very real in water-scarce countries such as Saudi Arabia and the United Arab Emirates, they have undertaken land acquisition with gusto in recent years and forced themselves into the top 10 countries in terms of land deals. Individual deals can involve hundreds of thousands of acres of land.

“For the Saudi government it is an elevation of food security for long-term structural demand that we are seeing in that economy,” says Simon Freemantle, senior analyst at the Standard Bank African Political Economy Unit.

Yet there is also a benefit to Africa in all this, according to Freemantle.

“For the African (governments), if those deals can be struck pragmatically and if those funds can be channelled into the agri-sectors, they can develop the skills, they can increase the uptake of fertilizer usage, benefit through better use of irrigation mechanisms, for example,” he says. “It should elevate domestic food security, and of course, that influx of capital is a necessary means to elevate agricultural potential and yields on the continent.”

Yet there remains a fear that Africa’s governments are giving away their land too cheaply to investors, with little or no regard for those living off the land. This is something that needs to be addressed.

“What is happening is now they are giving away their land,” said Camilo Nhancale, president of the Youth Development and Environmental Advocacy Organisation. “It’s a sort of land grabbing from the communities, they are giving away the land instead of negotiating and leasing the land to the company so if things do not go well they can say ‘no, this is our land.’”

Those companies involved disagree.

“I think it is a win-win situation,” said Octavio Mutemba of Massingir Agro Industrial, a South African firm that has bought land in Mozambique backed by European investors. “They (foreign companies) would be grabbing land if they came and they did not pay anything, if they implemented their projects, they took money out without any benefit for the population, for the communities.”

“In that case I could say they are profiting from the land but in this particular case, in our project, and in other projects in this country that I am aware of, that situation does not happen.”