Did you know that this month (June 2012) pension fund managers and hedge funds in the UK gathered in London for a summit to discuss the next big investment opportunity: buying up swaths of African farmland?
The Agriculture Investment Summit promises guidance through the “complexities of investing in agriculture as an asset class” to benefit from “one of the greatest investments in the world”.
An estimated 70m hectares of agricultural land – or 5% of Africa – has been sold or leased to western investors since 2000, according to a public database of international land deals. British companies have bought the rights to more than 3m hectares of land in poor countries – the equivalent of almost two-thirds of the UK’s total farmland, according to the International Land Coalition.
Grain, an NGO that promotes sustainable use of world resources, estimates that investors have spent between $5bn and $15bn on farmland. They expect that investment to double by 2015.
“Farmland is a big attraction for them [pension funds and other investors],” Grain said. “They see in farmland what they call good ‘fundamentals’: a clear economic pattern of supply and demand, which in this case hinges on a rising world population needing to be fed, and the resources to feed these people being finite.”
The £3,660-a-head conference at the Victoria Park Plaza hotel, in central London, promises a “unique opportunity to gain insights from an A-list of speaker faculty on how, where and why to invest in this emerging and expanding asset class”.
One of the talks at the fifth annual summit is titled: Agriculture in Africa: land grab or untapped opportunity?
A coalition of 60 international development, environment and farming charities will gather outside the hotel to demand that pension funds and other investors “stop the land grab”, which is claimed to be taking local people’s land at the fastest rate since colonial times.
Tim Rice, an adviser at ActionAid, said: “The summit organisers cheerily call this devastating trend an ‘emerging and expanding asset class’ and bill the summit as an opportunity to ‘overcome the perceived obstacles to investment’.”
But, he says, they are “glossing over” the real impact on the ground. “They are displacing farmers, up-rooting communities and food production and destroying ecosystems on a massive scale. They are increasing hunger and poverty globally. In a world where 1 billion people already go hungry, land must stay in the hands of local communities so that they can feed themselves.”
Kenneth Richter, of Friends of the Earth, claimed square-mile investors are the “key players” fuelling an industry which leads to “peasants, herders, fishers and other rural households being dispossessed of their means to feed themselves and their communities, sometimes through promises of jobs, sometimes at gun point”.
Nyikaw Ochalla, of the Anuak people in Ethiopia, said “land-grabbing” is accelerating at “a rate not seen since colonial times”.
“Land is the lifeline of hunter-gatherers, pastoralists, fishing and farming communities in the Ethiopian lands targeted by land grabbing policy.”
In 2008 a quarter of Mhaga village in rural Tanzania was acquired by a British biofuels company Sun Biofuels, with the promise of financial compensation, 700 jobs, water wells, improved schools, health clinics and roads. But the company later went bust, leaving villagers not just jobless but landless as well.
Omot Ochan was sitting in a remnant of forest on an old waterbuck skin and eating maize from a calabash gourd. He was lean and tall, wearing only a pair of combat pants. Behind him was a straw hut, where bare-breasted women and barefoot children cooked fish on an open fire. A little way off were other huts, the remains of what was once a sizable village. Omot said he and his family were from the Anuak tribe. They had lived in the forest for 10 generations. “This land belonged to our father. All round here is ours. For two days’ walk.” He described the distant tree that marked the boundary with the next village. “When my father died, he said don’t leave the land. We made a promise. We can’t give it to the foreigners.”
Only three flights a week go to the provincial capital, also called Gambella. When you get there, there are no taxis, because there is no demand. The road from the airport is a dirt track through an empty landscape. Gambella town is a shambles. Its population of 30,000 has no waste collection system, so garbage piles up. The drains don’t work, public water supplies are sporadic and electricity is occasional. There are few public latrines. The couple of paved roads are heavily potholed and give out before the town limits. My billet, the Norwegian-built guest house at the Bethel Synod church, was probably the dirtiest, bleakest and most ill-kempt building in which I have ever rested my head. The only vehicle in town for hire was a 40-year-old Toyota minibus of dubious roadworthiness, with a crew of three. I took it.
Of late, the central government in Addis Ababa has stopped pretending that the province of Gambella doesn’t exist. It now seems intent on taming a populace that might prefer rule from Juba, the capital of South Sudan. In practice, that means bringing in foreign agribusiness and collecting the province’s dispersed population in state-designated villages, while their forests, fields and hunting grounds are handed over to outsiders. In the service of capitalism, the Gambella “villagisation” programme will relocate a domestic population much in the manner of Stalin, Mao and Pol Pot.
I set out along the only road south from Gambella town to find the land grabbers. On the outskirts, as we hit the dirt, my driver decided to pick up a dozen hitchhikers. From then on, we were the local bus service. To an outsider, much of the province looks deserted. For miles, the only obvious sign of human activity was the odd cellphone tower, usually with a generator to power it and a native guard. But there were hidden villages in the bush. Their members would sit by the roadside trying to sell mangoes and other fruit to any vehicles that passed. Mangoes cost less than three cents each and the price had halved by late afternoon. Soon after the small town of Abobo, the road passed through a landscape of ash, smoke and charred trees. This was land newly acquired by my first land grabber – Sheikh Mohammed Hussein Ali Al Amoudi, a Saudi oil billionaire with large holdings in Ethiopian plantations, mines and real estate. In 2011, Fortune magazine put his wealth at more than $12bn. Ethiopian-born, he is a million-dollar donor to the Clinton Foundation and also a confidant of Ethiopia’s prime minister, Meles Zenawi, and his ruling party, which had granted a 60-year concession on 10,000 hectares of Gambella to Amoudi’s company, Saudi Star.
Amoudi has been eyeing agriculture since the world food price spike in 2008 sent Saudi Arabia into a spin about its food supplies. He is intent on shipping most of his intended produce, including in excess of a million tonnes of rice a year, to Saudi Arabia. There, he has been feted by the king for making investments abroad to keep the kingdom fed. To smooth the wheels of commerce, Amoudi has recruited one of Zenawi’s former ministers, Haile Assegdie, as chief executive of Saudi Star.
Saudi Star’s concession is based around the Alwero dam, built in the 1980s to irrigate a state cotton farm that never happened. The dam’s rusting sign still advertises the consulting services of Soviet engineers Selkhozpromexport. Amoudi is digging a 30km canal from the dam to irrigate rice paddies. Once the old state farm is watered, he wants to expand to at least 250,000 hectares, to grow sunflowers and maize.
Our next hitchhikers were a couple of schoolgirls who wanted a lift to their home 2km away. It was there, in a small clearing in a forest by the road, where we found Omot Ochan in his combat pants, describing how Amoudi and his company were destroying his world. Hearing his testimony of ancestral connection with this patch of forest, and his determination to keep it, I was struck by how most westerners have lost any sense of place and attachment to the land. I move around all the time and buy and sell houses without feeling ties to the soil. But here in Gambella, their land is like their blood. It is everything. And to lose it would be to lose their identity.
Omot insisted Saudi Star had no right to be in his forest. The company had not even told the villagers that it was going to dig a canal across their land. “Nobody came to tell us what was happening.” He did remember officials from the “villagisation” programme dropping by to say the families should go to the new village at Pokedi, across the River Alwero from Saudi Star’s compound. But that was all. Omot had no doubt the purpose of the new village was to clear them and others off land taken from them to give to Saudi Star. So far, his family and their neighbours had refused to go, even though their children walked to the school at Pokedi on a Monday morning and didn’t return until Friday evening.
“In our culture, going to a different place is unusual. You get different people and there is quarrelling,” he told me, as his children gathered and grabbed the remaining maize. “We should remain in our own area. We won’t go unless we are forced. God gave us this land.” Another truck rumbled past, spraying dust over the tiny forest community now ostracised by its own government and under siege from a Saudi billionaire. After the truck had gone, I noticed a large, dead stork in the road. A woman headed off down the road with a bucket, on a long walk to find water.