The New Land Rush
Fears of violence and a hunger for profit are sparking a worldwide run on farmland
REUTERS / Mohamed Nureldin Abdallah
A 21st-century land rush is on. Driven by fear and lured by promises of high profits, foreign investors are scooping up vast tracts of farmland in some of the world’s hungriest countries to grow crops for export.
As the climate changes and populations shift and grow, billions of people around the globe face shortages of land and water, rising food prices, and increasing hunger. Alarm over a future without affordable food and water is sparking unrest in a world already tinder-dried by repression and recession, corruption and mismanagement, boundary disputes and ancient feuds, ethnic tension and religious fundamentalism.
World leaders feel the heat. Calling food security concerns “extremely significant,” a 2009 U.N. report noted, “The acquisition of land internationally is one possible strategic choice to address the challenge.”
Fortunately for nervous rulers, the strategy of growing food abroad as shelter against the fires of revolution dovetails nicely with the goals of private and public capital. Governments drawing on sovereign wealth funds, and rich investors accessing state subsidies, have negotiated deals to acquire tens of millions of acres of farmland in Africa, South America, and South Asia. When they export the food to their home countries, the valuable water used to grow the crops will ride along as a free bonus.
The largest investors in foreign croplands hail from China, India, and South Korea, along with Saudi Arabia and other oil-rich Gulf states. What these countries have in common is that all were shaken financially or politically by the 2007–08 food crisis. And all lack sufficient land or water to ensure that they can feed their populations in the coming years.
Available for chump change and unsecured promises, land around the world is changing hands at a rate unseen since the colonial era, when white men applied the ink of nationalism and greed to redraw maps of Africa, Asia, and the New World. The “new colonialism” is less like a crusade and more like a business transaction floated on a promise of “win-win.”
The deal-makers include international agribusinesses, investment banks, hedge funds, and commodity traders, as well as pension funds, foundations, and individuals attracted by the lure of cheap land and high profits. Even universities, including Harvard and Vanderbilt, are getting into the act, according to an extensive report by the Oakland Institute, a progressive policy think tank.
Most of the land deals occur in the private sector, “though often with strong financial and other support from government, and significant levels of government-owned investments,” according to the Food and Agriculture Organization. Conforming to this pattern and awash in oil income, the Saudi government “earmarked $5 billion to provide loans at preferential rates to Saudi companies to invest in countries with strong agricultural potential,” reports the U.K.-based Institute of Science in Society, including large swaths of Indonesia and Thailand for rice, and possibly 6,000 acres for wheat in war-ravaged Sudan.
Page: 1 | 2
| Next >>