Land investment threatens Africans' right

Agriculture in Africa is in urgent need of investment. Nearly
550 million people there are dependent on agriculture for
their livelihoods, while half of the total population on the
continent live in rural areas.
The adoption of a framework called the Comprehensive
African Agriculture Development Program (CAADP) by
Africa's leaders in 2003 confirmed that agriculture is crucial
to the continent's development prospects. African
governments recently reiterated this commitment at the
Malabo Summit in Guinea during June of this year.
The need for private sector investment in Africa is manifest,
but the quality of those inflows of capital is vital if it is to
enhance the livelihoods of millions of food producers in
Africa.
After decades of underinvestment, African governments are
now looking for new ways to mobilise funding for the sector
and to deliver new technology and skills to farmers. Private
sector actors are also looking for opportunities within
emerging markets in Africa.
Large-scale public-private partnerships (PPPs) are an
emerging trend across the continent. These so called 'mega'
PPPs are agreements between national governments, aid
donors, investors and multinational companies to develop
large fertile tracts of land found near to strategic
infrastructure such as roads and ports.
Tanzania, Malawi, Mozambique, Ghana and Burkina Faso
all host this type of scheme. Several African countries have
signed up to global initiatives such as the New Alliance for
Food Security and Nutrition, supported by the rich,
industrialised economies of the G8; and GROW Africa, a
PPP initiative supported by the World Economic Forum.
For governments, these arrangements offer the illusion of
increased capital and technology, production and
productivity gains, and foreign exchange earnings.
But as Oxfam reveals, mega-PPPs present a moral hazard
with serious downsides, especially for those living in areas
pegged for investment.
In particular, the land rights of local communities are at
risk. Within just five countries hosting mega-PPPs, the
combined amount of land in target area for investment is
larger than France or Ukraine.
While not all of this land will go to investors, governments
have earmarked over 1.25 million hectares for transfer.
This is equal to the entire amount of land in agricultural
production in Zambia or Senegal.
Due to weak land tenure found in many African countries,
this land transfer places local communities at significant
risk of dispossession or expropriation.
These arrangements also threaten to worsen inequality,
which is already severe in African countries, according to
international measurements. Mega-PPP investments are
likely be delivered by - and focus on - richer, well
connected companies or wealthier farmers, bypassing those
who need support the most. More land will also be placed
into the hands of larger players further reducing the amount
available for small-scale producers.
The ability of small and medium sized enterprises to benefit
from these arrangements is also in doubt. The size of just
four multinational seed and agro-chemical companies
partnering with a mega-PPP in Tanzania have an annual
turnover of 100 billion dollars - that's triple the size of
Tanzania's economy.
These asymmetries of power could lead to anti-competitive
behaviour and squeeze out smaller local and national
companies from emerging domestic markets. Larger
companies may also gain influence over government
policies that perpetuate their control.
These types of partnership also carry serious environmental
risks. An example of this is the development of large
irrigation schemes for new plantations. They can reduce
water availability for other users, such as local
communities, smaller farmers and important other rural
groups like pastoralists.
The need for private sector investment in Africa is manifest,
but the quality of those inflows of capital is vital if it is to
enhance the livelihoods of millions of food producers in
Africa. The current mega-PPP model is unproven and risky,
especially for smallholder farmers and the poor.
At the very heart of the agenda to enhance rural livelihoods
and eradicate deep-seated poverty in rural areas should be
a clear commitment towards approaches that are pro-
smallholder, pro-women and can develop local and regional
markets. The protection of land rights for local communities
is also - and equally - paramount.
Oxfam's experience of working with smallholder farmers
shows that private sector investment in staple food crops,
and the development of rural infrastructure such as storage
facilities, combined with public sector investment in support
services such as agricultural research and development,
extension services and subsidies for seeds and credit, can
kick-start the rural economy.
Robust regulation is also vital, to ensure that private sector
investment can 'do no harm' and also 'do more good' by
targeting the areas of the rural economy that can have the
most impact on poverty reduction. African governments
should put themselves at the forefront of this vision for
agriculture.
These represent tried and tested policies towards rural
development in other contexts. This approach, rather than
one that subsidises the entrance of large players into
African agriculture, would truly represent a new alliance to
benefit all.