Transform!

European journal for alternative thinking and political dialogue

04/2009

pp. 162-165

Agrarian Neocolonialism: Feeding People Will be One of the Great Battles of the 21^st Century

John Neelson,

professor of politcal economy at the University of Tübingen/ Germany.

Many countries, importers of foodstuffs, have been affected lately by the food crisis and the rise in prices. While rich nations have been able more or less to cope, they have been particularly concerned by the protec­tionist attitudes of producing nations, which, starting in Spring 2008 have adopted measures to limit food exports. Since then, countries without great agricultural resources and water but with important monetary reserves and rapidly growing populations have decided to assure harvests by buying up large tracts of rural land abroad. At the same time, agricultural land around the world has attracted investors for purposes of speculation. They are con­vinced that food will be the "black gold" of tomorrow. And they calculate that, from now until 2050, the production of food will have to double in or­der to meet world demand.

"Buy land!" and "Invest in farms!" says Jim Rogers, the Amcommodities guru [1]. George Soros, another great speculator, also is betting on bio-fuel and has acquired vast properties in Argentina. Black Earth Farming, the Swedish group, has taken control of some 330,000 hectares of land in Russia, while Renaissance Capital, the Russian hedge fund, has bought up an equivalent amount of land in Ukraine, where Landkom, the British group also has acquired more than 100,000 hectares of wheat-growing land. For its part, Morgan Stanley, the US investment bank, has acquired tens of thou­sands of hectares in Brazil, a country where Louis Dreyfus, the French agro-industrial group, already well established through its local affiliate, Louis Dreyfus Commodities Bioenergia (LDCB), intends to extend the cultivation of sugar cane throughout the country for the production of ethanol.

In the race between governments and speculators to buy up fertile land all ver the planet, governments - motivated by geopolitical concerns - are wining, particularly those countries sitting on important reserves of currency or petrodollars. Thus, for example, South Korea, the world's number one purchaser of land, can count on control of 2.3 million hectares of agricultur­al land abroad (equivalent to the surface of a country like Israel, El Salvador or Albania); China holds two million hectares; Saudi Arabia, 1.61 million; the United Arab Emirates, 1.28 million; Japan, 324,000, and so on. In all, nearly eight million hectares of agricultural land recently have been bought or leased by governments outside their national territories.

Whole regions in under-populated countries, where governments have agreed to give up part of their national sovereignty, have fallen under the control of foreign powers. This is a worrisome phenomenon. In an alarming report, Grain, the NGO, denounced a "land-grab on a global scale[2]".

Almost entirely without arable land and unsalted water, the countries of the Gulf were the first to line up for the land race. Kuwait, Qatar, the United Arab Emirates (UAE) and Saudi Arabia seek out rural property all over the world. "We have the money, they have the land," authorities in these countries explain. The UAE already controls 900,000 hectares in Pakistan and is nego­tiating to acquire several hundred million more in Ukraine. Benladen, the Saudi group, has bought land in Indonesia to grow rice. Libya has obtained some 250,000 hectares in Ukraine in exchange for oil and gas. Investors from Abu Dhabi and Qatar have bought tens of thousands of hectares in Pakistan. Jordan will produce foodstuffs in Sudan. Egypt has moved to control 850,000 hectares in Uganda to grow wheat and corn.

The most compulsive buyer, nevertheless, is China which must feed 1.4 bil­lion people, or 22 % of the world's population, with only 7 % of the fertile land on the planet. The situation is all the more fragile because the brutal in­dustrialisation and urbanisation of the last decades already have destroyed about eight million hectares of agricultural land and because certain regions, suffering from climate change, are undergoing progressive desertification.

”Land for agricultural production is less and less available and it is more and more difficult to increase yields," acknowledges Nie Zhenbang, head of the Central Service of Cereal Supply[3]. This is why Peking has made sure to control vast rural properties in Australia, Kazakhstan, Laos, Mexico, Brazil, Surinam and, most of all, in Africa. China has signed about 30 agreements with as many governments that have ceded land. Sometimes, the Peking auhorities send their own labour, badly paid and recruited on the basis of precarious work contracts with no benefits.

For its part, South Korea already controls more arable land abroad than the sum total of fertile land within its borders. In November 2008, the Korean group Daewoo signed a scandalous and spectacular agreement with the gov­ernment of Marc Ravalomanana - ex-head of Tiko, an economic empire in the agribusiness sector, who became President of Madagascar - to lease 1.3 million hectares or half the arable land on the big island.

South Korean authorities have bought 21,000 hectares of land in Argenti­na in order to raise cattle. About 10% of the land in this Latin American country - that is, some 270,000 square kilometres (the size of the United Kingdom or Italy) - is the property of foreign investors. The largest rural landowner in Argentina is Benetton, the Italian ready-to-wear giant, which owns about 900,000 hectares and has become the leading private producer of wool in the world. Douglas Tompkins, the American billionaire, also has bought land in Argentina: 200,000 hectares not far from the largest sources of water in the country.

Generally speaking, the surrendering of land to foreign states is achieved by the expropriation of small farmers and by an increase in the price of land which makes it impossible for landless rural workers to acquire. Not to speak of deforestation. One hectare of forest produces a profit of four to five thou­sand euros a year if it is cleared and planted with palms that produce oil; that is, ten to fifteen times more than if the land were worked for timber[4]. This is one of the reasons why the forests of the Amazon, the Congo basin and Borneo are disappearing so fast.

The take-over of fertile land in poor countries represents a detestable return to colonial practices. And it is a ticking time bomb[5]. The inclination of foreign states is to pillage resources over the short term. But resistance is being organ­ised. Thus, last January, in Madagascar, President Marc Ravalomanana was ac­cused of giving away the country to foreign companies; his plan to lease arable land to the Korean Daewoo has been loudly denounced. "For the people of Madagascar, for whom this land is the 'land of our ancestors', this surrender to the Koreans is an irreversible betrayal of a sacred trust, all the more so because Ravalomanana has hidden the whole affair from the people".[6] The big island has caught fire. Riots have caused 68 deaths. In Pakistan, peasants have begun to mobilise against the forced displacement of villages in the Punjab because of land purchases by Qatar. Paraguay has passed a law that now forbids the sale of land to foreigners. Uruguay is considering doing the same and Brazil is getting ready to modify its legislation to follow suit.

Agrarian neocolonialism multiplies the risk of impoverishing peasants, of pushing social tensions to extremes and of causing civil violence. The land is  a very sore point that always has provoked passions. Tampering with such a symbol could end very badly.