Originally Published 2011-09-17 00:00:00 Published on Sep 17, 2011
The recent years have seen a new trend emerging in the African continent. Representatives from Western conglomerates have been shifting their focus to Africa in order to secure rights to the vast, untapped resources of the ecologically rich continent.
Land deals in Africa: boon or bane?
The recent years have seen a new trend emerging in the African continent. Representatives from Western conglomerates have been shifting their focus to Africa in order to secure rights to the vast, untapped resources of the ecologically rich continent. The scramble, however, isn't for minerals like gold and diamonds as it was in the 80s, but for land to grow food crops for exports and Jatropha curcas, a non-edible plant whose seeds can be processed into "clean" and "green" bio-fuels. The African governments have been leasing huge tracts of land to business interests in Europe, North America and East Asia as they have started moving southwards in search for renewable energy sources.

Development of bio-fuels has been on the rise in the recent past as a replacement for fossil fuels. A number of land deals for biomass plantations have recently been announced. For example, in 2010, a US company announced the acquisition of a 49-year lease on 5,000 hectares of land in Ghana for a plantation to produce feedstock for biomass power plants. The same company intends to establish energy crop plantations in Madagascar, Mozambique and Tanzania to export wood chips for biomass power to Southern Africa and India. The Chinese secured the right to grow palm oil for bio-fuel on 2.8m hectares in Congo. A report produced by a London-based think-tank, International Institute for Environment and Development (IIED) analysed 12 recent contracts through which investors have leased millions of hectares of land in East, West, Central and Southern Africa for farming. According to the report, multinationals have applied for more than 500,000 hectares of land in Kenya, which is five times the size of Nairobi, to do large scale farming and mining. The government earlier agreed to lease 40,000 hectares in the Tana River Delta to the Government of Qatar to grow crops to feed the people of Qatar. Further, an Italian company, Kenya Biofuel Ltd, has been allowed to convert 2000 hectares of Dakatcha woodland at the Coast and plant Jatropha. Half of the 3.2m hectares of bio-fuel land identified in countries from Mozambique to Senegal has been linked to 11 British companies. The countries that have been doing the selling are some of the poorest and unstable ones.

The question increasingly being asked is whether it is ethical for rich countries to buy or lease huge acres of land and produce bio-fuel through biological carbon fixation in places where it will have serious negative impacts on people which are already affected by poverty and hunger. Critics of these new developments have drawn parallels between these land deals and the scramble for land during the 19th century colonialism and have referred to them as "neo-colonialist". One major adverse impact that can be predicted of these contracts is that of displacement of local population. Sections of population, mostly tribal, will be required to vacate these lands and relocate somewhere else. Large scale land acquisition is being justified by the government in terms of "public good". The fact that local populations are not in a position to directly benefit from these deals completely obliterates the argument that bio-fuel cultivation will provide a much-needed source of capital in Africa. According to Oxfam, food prices are likely to double in the next twenty years and bio-fuel will increase hunger.

Besides growing Jatropha, huge acres of land are also being leased to grow food crops for the purpose of exports. In early 2009, Saudi Arabia received its first batch of crop that had been produced in Ethiopia on land leased to them by the government. The Saudis had reportedly invested $100m to raise wheat, barley and rice in Ethiopia. The investors were exempt from tax in the first few years and exported the entire crop back home. Meanwhile, the World Food Programme (WFP) spent almost the same amount as the investors ($116m) providing 230,000 tonnes of food aid between 2007 and 2011 to almost 4 million Ethiopians threatened by hunger and malnutrition.

The real concern regarding this development is that the search for cheap land, suitable climates and competitive transport costs will increasingly lead investors to focus on Africa where many countries are characterised by food insecurity and vulnerable land rights. Most of the land in Africa is formally owned by the state and decisions about biomass plantations are being taken by central government agencies. Local people, however, have often used it for generations and see it as theirs. They tend to have weak and undocumented land rights. With little capacity to exercise these rights, they are likely to be marginalised in the decision making and face displacement. Some national laws require local consultation, for example in Mozambique, but are rarely practised. In some countries, such as Ghana, land is controlled by customary chiefs and they may become the ones who sell or lease land to, and negotiate deals. But there are still questions about the extent to which these chiefs are accountable to their constituents and maximise local public interest. In all these cases, there is a real risk that people will lose the land they depended on to survive. The compensation that they might receive may be inadequate to restore local livelihoods.

Another grave concern is that the biomass plantations may also compete for the best lands with food crops, thus, adversely affecting local food security and further marginalising smallholder farming. In a continent where hunger is widespread, sale of land for a purpose other than growing food seems to be an important cause for apprehension. Adding to this is the fact that most of these deals have been done in secrecy by the governments and barely any details have been provided. Thus, it has been difficult to understand how much and in what way will these deals help the Africans.

On the other side of the spectrum, however, are some analysts who feel that a growing bio energy economy can be the key to driving a much needed agricultural boom in Africa. Since land is in abundance in Africa, land for crops and land for fuel will not necessarily be in direct competition. Africa's vast land resources could make the continent a competitive exporter of bio-fuel which could bring in money for the basic infrastructure needed for agriculture and to transport and process food. The land contracts could also provide an economic incentive for rehabilitating degraded lands. In principle bio energy could be produced from inedible plants that grow on land that is not well suited for growing food. These deals are also being seen as a source of employment for the local population. For instance, an Italian Jatropha project, if given the green light, will be able to provide 7000 jobs in the poor regions of Kenya. The governments of the countries doing the selling have emphasised that these investments will be able to reduce malnutrition and provide better agricultural facilities.

For years domestic investments, international loans and foreign aid have been insufficient in helping Africa. It remains to be seen whether these investments will be able to do better. It is still too early to tell what these land deals might result in and more importantly how they will affect Africa.

Priyanka Mehrotra is research intern, ORF

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