Yves here. Yesterday, we featured Michael Hudson’s post about how the US has used agriculture, especially grain control, to strengthen its power. Here we see another form of exploitation, here wealthy interests acquiring productive land in low-income countries. Jomo cites data from 2008 but this practice has been going on before then. I remember meeting a hedge fund manager in 2000, and his fund was buying farmland in Africa and Latin America.
By Jomo Kwame Sundaram, former UN Assistant Secretary General for Economic Development. Originally published on Jomo’s website
Since 2008, farm purchases have driven up prices around the world, putting pressure on family farmers and other poor rural communities. Such land grabbing exacerbates inequality, poverty, and food insecurity.
Weeding the Land with Farmers
The new IPES-Food report highlights land grabbing (including the obvious ‘green’ objectives), the financing methods used, and other key impacts.
Powerful governments, financiers, speculators, and agribusiness gained control of more arable land. The report notes the rise in food prices in 2007-08 and the collapse of the currency led to more land acquisitions.
Limited austerity and financial inclusion after the 2008 global financial crisis allowed for more land expropriation. Investors, agri-food companies, and private equity funds have acquired farms around the world.
Agricultural businesses and other investors want the land to be more profitable, urging governments to be able to take it. Arable land is used for cash crops, natural resource extraction, mining, real estate and infrastructure development, and ‘green’ projects, including biofuels.
Land compaction has developed in new ways, many of which are large concessions that divert farms from food production. Instead, environmentally damaging ‘industrial farming’ has become widespread, increasing rural poverty and emigration.
The new exploitation of land has displaced small farmers, indigenous peoples, pastoralists, and rural communities or disrupted their access to land. It has exacerbated rural poverty, food insecurity, and land inequality. Discrimination against local land users has weakened family farming.
‘Green grabbing’ involves governments and corporations taking land for questionable large-scale tree plantations, deforestation, carbon sequestration, conservation, biofuels, and ‘green hydrogen’ projects. Demands for water and other resources also threaten food production.
Land exploitation has slowed recently, but pressures and trends persist. The epidemic, the wars in Ukraine and Gaza, as well as the government and market responses have renewed the news of the alarmist food shortages, setting the grounds for holding more.
Investing in expropriation
Investment in agriculture increased tenfold between 2005-18. By 2023, 960 investment funds operating in food and agricultural commodities had assets worth more than $150 billion.
About 45% of all farm investments in 2018, worth $15 billion, were pension funds and insurance companies. In 2005-17, pension, insurance and endowment funds invested $45 billion in farms.
Unsurprisingly, world prices have risen continuously for two decades in North America and three in Canada. During 2008-22, world prices almost doubled worldwide, and even tripled in Central and Eastern Europe!
Pension funds and other private investments doubled UK property prices between 2010-15. Recently, investment in US farms has doubled since the pandemic!
One percent of the world’s largest farms now own 70% of the farms. In Latin America, 55% of the farms own only 3% of the arable land!
More than half of the agricultural land thus available is for the production of water-intensive crops. Although a fifth of the world’s major concessions are ‘green’, 87% are in areas with high biodiversity!
Mining accounted for 14% of the world’s largest land deals over the past decade.
Growing demand for rare earths and other valuable minerals drives mining in former agricultural land, exacerbating environmental degradation and conflict.
Instead of protecting national, social or public interests, laws seem to protect the guilty. The terms of such deals often make matters worse. So, foreign organizations successfully sued the Colombian government for trying to stop their massive mining operation.
Green Land Grabs
Some governments and big businesses encourage compliance with environmental, social and governance (ESG) standards. They invoke sustainability, including climate goals, to justify elitist conservation and carbon offset schemes.
More than half of the government’s decarbonisation pledges involve the land of smallholder farmers and indigenous peoples. The ‘green deal’ – carbon reduction, biodiversity, conservation and biofuel projects – is a fifth of the world’s biggest deals.
The government is promising to absorb carbon from the soil by creating almost 1.2 billion hectares, which is equal to the area of plants on earth! Despite the climate benefits, the problematic carbon offset markets are expected to quadruple in the next seven years, driving more land acquisition.
Carbon offset and biodiversity markets drive such transactions, drawing large polluters into global markets. Oil giant Shell alone has contributed more than $450 million to offset projects.
African Land Grabbed
Global warming is global, affecting different areas differently. Land grabbing has particularly affected Sub-Saharan Africa and Latin America, while land inequality is growing in Central and Eastern Europe, Latin America, and South Asia.
Susan Chomba and Million Belay secured nearly a thousand land deals in Africa since 2000. Mozambique had 110 such agreements, followed by Ethiopia, Cameroon, and the Democratic Republic of Congo (DRC).
About 25 million hectares include Blue Carbon, which is owned by the royal family of Dubai. The company bought rights to forests and farmland to sell carbon offsets. This land comes from five Anglophone African governments, including one-fifth of Zimbabwe, one-tenth of Liberia, Kenya, Tanzania, and Zambia.
Major land deals put indigenous and pastoral communities at greater risk. In Ethiopia, Ghana, and elsewhere, land sales have forced farmers to work on small, isolated farms, become wage laborers, or migrate, harming their ability to support themselves, their communities, and others.
African smallholder farmers, pastoralists, and indigenous communities have long protected their land and biodiversity. However, many now lack the rights and means to do so effectively, let alone feed Africa and improve the climate. Therefore, the climate problem is applied to rural communities in Africa.
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