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Hunger and food security: Is Africa selling the farm?

Foreign investors see Africa as a breadbasket. Done well, investment could help with African hunger but create food security for the rest of the world.

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Often, such long-term development goals are the furthest thing from the minds of the people who sign such deals. And in a region where government transparency is nearly nonexistent, the question of who benefits from a deal depends most upon who negotiated and signed it. In many poor countries of Africa, power is heavily centralized, often in the hands of a political elite that has ruled more or less nonstop since independence in the early 1960s.

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Legal systems little changed since colonial times don't offer individual farmers much protection in terms of land rights, and they offer little in terms of government assistance such as agricultural extension agencies. National leaders – sometimes more impressed by gleaming developments like glass-and-steel skyscrapers than by less-glamorous development like tractors and training – have often ignored farmers' needs. Even enlightened African leaders who see the benefit of improving the rural farm economy are often hampered by stodgy old laws and meet with resistance from a rural population that distrusts their motives.

"As much as 90 percent of Africa is under customary tenure, which means it's held by the state on behalf of the community, who are then given the customary right to the land," says Ruth Meinzen-Dick, a land-rights ­specialist at the Consultative Group on International Agriculture Research, the one responsible for India's green revolution in the 1960s.

Many African small-holder farmers know they can be moved off their land at any time, and the growing number of farming deals confirms their worst fears. As a result, many African farmers are reluctant to invest in their land or to improve their techniques, knowing the benefit may be taken away in the future.

"The question is, do people have an expectation that they will have their land in 10 years?" says Ms. Meinzen-Dick. "If they don't, they're not going to plant a tree that will give fruit later.... [T]hey're not going to make long-term decisions that increase their productivity."

Legal reforms in each of Africa's 53 nations may slowly start to improve the ability of small-holder farmers to lift themselves out of subsistence farming into more profitable and productive commercial agriculture. Many development agencies say Africa's best bet seems to be a bit of outside investment.

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For a country like Madagascar – poor, rural, and increasingly young and ­unemployed – the attraction of foreign investment is easy to understand. The population doubles about every 25 years, but the amount of arable land doesn't. Madagascar's economy has grown little, if at all, since the French colonial era, but like many developing countries it needs to grow at a robust 8 to 10 percent just to absorb its growing population.

When Daewoo – the world's third-largest corporate importer of corn – came knocking, asking for access to some of Madagascar's relatively inexpensive agricultural land, Ravalomanana, Madagascar's president at the time, could hardly sign the deal fast enough.

For Daewoo, the 99-year deal to lease 3.2 million acres was sweet. The Madagascar government was prepared to lease a long stretch of coastline to grow corn and oil palm, all of it for export. Much of the land had fallen into disuse because it was in a part of the island that receives little rainfall. But deep underground, there is fossil water locked up in limestone formations, estimated to be enough to irrigate dryland crops for a century or more.

Daewoo's investment in drawing out the water would have revived the region's job prospects as well as its fallowed land.

"It was a lot of land that was not utilized, and it could have been utilized if you brought in modern technology, such as deep well irrigation systems," says a longtime foreign businessman based in Antananarivo who has access to the country's political elite. But local people still viewed that land as belonging to their ancestors, he adds, and were bound to oppose any deal with a foreign investor, unless the government took a leading role in helping to persuade them.

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