Banks and hedge funds behind land grabs in developing countries

July 30, 2011 – AFRICA – Large land grabs by foreign countries and corporate entities are endangering food security in sub-Saharan Africa, an area already under pressure from famine, drought and endemic conflict, the State of the World 2011 report said. Hundreds of millions of dollars of international investor funds, including hedge and pension funds, are known to have gone into the massive land deals on the two continents. Unless properly managed, large-scale land acquisitions by foreign governments and firms could trigger “xenophobia, riots, coups and more hunger,” the report warned. The report was published by the Worldwatch Institute, which has headquarters in Washington, and follows similar warnings by the Genetic Resources Action International, Oxfam, the Oakland Institute, the World Bank and U.N. agencies. “Deals that focus solely on financial profit can leave rural populations more vulnerable and without land, employment opportunities or food security,” said the report. “Investors claim that land grabs can help alleviate the world food crisis by tapping into a country’s ‘unused’ agricultural potential,” said Danielle Nierenberg, director of the Worldwatch Nourishing the Planet project. “But such investments often do more harm than good, disrupting traditional land-use patterns and leaving small-scale farmers vulnerable to exploitation.” The trend has accelerated as countries that lack sufficient fertile land to meet their own food needs, such as wealthier countries in the Middle East and Asia, particularly China, have turned to new fields in which to plant crops, she said. Growing demand and rising prices for food are leading some wealthier developing countries to seek secure access to food-producing land in the territory of lower-income ones,” said Worldwatch Executive Director Robert Engelman. “It’s critical that international institutions monitor these arrangements and find ways to block those that are one-sided or benefit only the wealthy.” About 15 million-20 million hectares of farmland changed hands in deals or proposed deals involving foreigners from 2006 to mid-2009, the International Food Policy Research Institute reported. Critics of large-scale land acquisitions believe the land grabs are marginalizing the land rights of indigenous populations and compromising food security in the host countries. –Seed Daily

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