THE 2008 LAND GRAB FOR FOOD AND FINANCIAL SECURITY

The 2008 land grab for food and financial security

Grain
October 29, 2008

Today’s food and financial crises have, in tandem, triggered a new global land grab. "Food insecure" governments that rely on imports to feed their people are snapping up farms all over the world to outsource their own food production and escape high market prices. Private investors, hungry for profits in the midst of the deepening financial crisis, are eyeing overseas farms as an important new source of revenue. As a result of both trends, fertile agricultural land is being swiftly privatised and consolidated by foreign companies in some of the world’s poorest and hungriest countries. A new report from GRAIN examines 100 cases of agricultural land grabbing — whether for food or simply for profit — that have exploded this year.

Saudi Arabia and China are just two nations out buying farms, from Sudan to Cambodia, to satisfy their own food needs. In these cases, governments, sometimes through sovereign wealth funds, are negotiating rights to foreign land — whether by purchase, concession or lease — so that their corporations can come in and produce food to export back home. In return, they are offering oil contracts, soft loans, infrastructure projects and development funds. The food-hungry land grabbers include China, India, Japan, Malaysia, Korea, Egypt, Libya, Bahrain, Jordan, Kuwait, Qatar, Saudi Arabia and United Arab Emirates. Those giving up their land, in exchange for the oil deals or investments, include the Philippines, Mozambique, Thailand, Cambodia, Burma, Laos, Indonesia, Pakistan, Sudan, Uganda, Brazil, Paraguay, Uruguay, Ukraine, Russia, Kazakhstan and Zimbabwe.

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Investing in farms abroad to produce food for a tight world market is also, apparently, a hot way to make money these days. Throughout this year, an army of investment houses, private equity managers and hedge funds have been out purchasing farmland throughout the world. The plan is to capitalise on low land costs and high food prices wherever fertile farmland is available, such as in Ukraine, China, Russia, Nigeria, Argentina, Brazil and Kazakhstan. The money-hungry land grabbers include familiar names such as Goldman Sachs, Morgan Stanley, BlackRock and Louis Dreyfus, but there are plenty of others. And they are getting help from agencies like the World Bank, its International Finance Corporation and the European Bank for Reconstruction and Development, who are pressing target countries to change their laws and make stronger land ownership by foreigners possible.

While political leaders and UN bodies are trying to "manage" the potential backlash, farmers’ organisations, opposition parties, human rights groups and others are challenging and resisting these deals. But much more needs to be done to stop this massive sell-out of the very basis of food sovereignty.