526<http://www.pambazuka.org/en/issue/526>
http://pambazuka.org/en/category/features/72721
<http://www.pambazuka.org/en/category/features/72721/print>
*cc IRRI* <http://www.flickr.com/photos/ricephotos/4754022118/>Nebiyu Eyassu
cuts through the supposed benefits of foreign agricultural investments -
so-called land grabs - for a country like Ethiopia. Far from boosting
employment and local food security, land grabs are likely to prop up a
discredited government and increase hunger.
In recent years there has been an upsurge of agricultural investment in the
developing world. Its alleged purpose is to curb the recent global food
crisis that has seen serious volatility in the global food market system,
causing significant price hikes on key global foods, such as rice.
The price hike in global food has prompted certain countries to seek cheap
and fertile farmland beyond their borders in order to guarantee food
security for themselves. To achieve this goal such states are encouraging
their domestic agro-businesses, tied to their national interests, to invest
in countries like Ethiopia, Sudan, Madagascar, Tanzania and Argentina, to
name a few. Capital invested in far-away farms will produce food cheaply,
which will then be exported back to the country where the original capital
came from. In this way, the volatility of the international food market can
be avoided and national food security achieved.
To accomplish this goal, a key step is to convince developing nations to
give up their fertile land to foreign investors. One of the baits designed
for the purpose of persuasion is the promise of infrastructure and the
sharing of information and technology in agricultural science. The other
promise made to host nations is of capital gained from food exports, which
can then be reinvested in the country. For underdeveloped countries, who
face serious food insecurity, and who are often unable to feed their
population, this may sound too good to pass by, particularly if host nation
governments are too naive, or are otherwise unconcerned.
In Ethiopia, we have had hundreds of foreign investors grabbing fertile land
at incredibly low cost. The scale of the spree is unprecedented. Investors
are describing the deal as ‘green gold’. Ethiopia’s untilled land, located
in some of the most fertile parts of the country, is now being sold to
foreign interests for less than its true worth. Foreign investors are given
perks, tax holidays lasting years, and essentially they are exempt from any
royalties.
The government of Ethiopia promises this process will mitigate the nation’s
chronic food insecurity and allow domestic farmers to gain knowledge from
the expertise of foreign agro-business. It also says dollars gained form
exporting food can alleviate Ethiopia’s endemic food crises. By this
analysis, the premise of the EPRDF government seems to be ‘we export food to
import food’. Leaving aside the initial absurdity of the claim, it is
necessary to note that the inadequacy of this argument has been amply
demonstrated in many developing countries.
Although this issue of land-grabbing by foreign interests is new to
Ethiopia, it is no stranger to other parts of the developing world. The
history of foreign agro-business intrusion in some Latin American and
Caribbean countries is enlightening to say the least. In northeastern
Brazil, the region was extensively farmed by foreign agricultural interests
for centuries. Unfortunately this region has nothing to show for it now.
Today the region is the poorest part of the country with the least food
security and one of the highest malnutrition rates in Latin America.
Contrary to the promises made by companies that farmed Brazil’s fertile
soil, the outcome has been very grim. In his famous book ‘Open Veins of
Latin America’, Eduardo Galliano, commenting on Brazil’s northeast, says,
‘Naturally fitted to produce food, it became a place of hunger. Where
everything had bloomed exuberantly, the destructive and all dominating
plantation left sterile rock, washed out soil, and eroded lands.’ Are
Ethiopia’s own fertile lands headed for the same fate? What makes the
current foreign agricultural adventure in Ethiopia any different?
In fact, the environmental destruction of the land has already begun in this
initial phase. Around Gambella region, Karuturi, an Indian company, which
owns large swaths of the region, is heavily involved in burning forests and
grasslands to make way for potential farmland. It would be unfair to single
out Karuturi alone. Other foreign companies who have settled in the region
are no more saintly. They are also using slash and burn techniques to clear
land. There is no doubt the flora and fauna will be lost forever as a
result. Pastureland is fast becoming eviscerated, affecting local herders,
who depend on their livestock for survival. This process of pastoral land
elimination could have negative consequences for currently inflated meat
prices in Ethiopia, which will undoubtedly exasperate existent levels of
high malnutrition in the country.
According to the government, these lands given to foreign investors were
idle lands, ready to be gobbled up into the global food system without much
disturbance. However, this view depends on one’s definition of ‘idle land’.
Pastureland may seem idle, but its usefulness is undeniable.
Another key consideration should be about the inevitable damage and cost to
future generations. Given the fact that Ethiopia is very much a country of
the future, demographically speaking, this should concern us. Intensive
farming by foreign agro-business has a history of ravaging the land and
turning fertile soil into depleted soil in a short period of time. Other
parts of the globe where this has been practiced testifies to the
inevitability of environmental destruction. In a land that is potentially
the breadbasket of Ethiopia, if not the whole Horn of Africa, such
degradation is a real loss for future generations and therefore presents a
moral challenge for us today.
Employment offered by these farms is purported to be a benefit for local
communities. Never mind that the main reason why locals seek this work is
primarily because the agro-businesses have forced them to abandon their old
pastoralist way of life.
Take away this option of survival and people are left with no other choice
but to accept slave wages working on foreign farms. In a way the
agri-business creates the labour surplus for itself and manages to keep
wages extremely low. The wage paid to workers, on average about $1.50 (25
Birr) for a day’s work, is nowhere near enough to survive without additional
food aid. According to a recent documentary, some farm workers in southern
Ethiopia complained they were getting paid seven birr per day, instead of
the 25 birr initially promised. That is about 50 cents a day in dollar
terms. By these estimates the lives of these workers were considerably
better before the introduction of foreign agri-business. Instead of food
security, food insecurity is created, perhaps even serious malnutrition.
To add insult to injury none of the produce from these farms will be
available to local markets. However, there is talk of selling some of the
produce to aid agencies. The World Food Program intends to buy some of this
grain in order to assist hungry people. Ironically, this group of intended
food aid recipients will include those working to produce it in the first
place. Ethiopia’s government is calling this sustainable development.
In an effort to rush through this controversial issue unimpeded, the
government has sought to bypass all transparency. It is fully aware that an
open discussion on the issue would expose the absurdities of its claim.
Deals with foreign investors were approved backhandedly for this reason.
The government expects a few scattered utterances here and there by its
officials to be accepted as a national discussion on the matter. The
government also knows it has no chance of convincing people because further
evaluation of the agreements reveals gaping holes. The people of Ethiopia
are being asked to believe absurdities such as ‘we export food in order to
import food’ as a viable economic option to guarantee national food
security. However, the most basic comprehension of economics tells us this
is nearly impossible. Given Ethiopia’s dwindling currency exchange, what
sense is there in purchasing grain from the international market, while
exporting domestic grain? Can exported grain used as a cash-crop generate
enough capital to be able to import food affordably and sustainably?
Muddying the waters and diverting the issue under the guise of food security
is certainly a cruel way of hoodwinking a hungry population. It is not clear
what the benefit will be to Ethiopia. In most instances the harm done is
much greater than the gain.
Perhaps the EPRDF government views these deals as solidifiers of its
international connections, especially with emerging markets. Gifting land
can guarantee political support. As a beleaguered party, EPRDF knows its
survival depends on bringing some particularly heavy hitters into the fold.
What better way to bring them on board than to give them what they most
require and what Ethiopia has to offer, namely land and water?
It is important to point out that some of these excited shoppers include
states with dreadful human rights records. One of these, among several, is
Saudi Arabia. Surely if the going gets tough for Ethiopia’s ruling party,
the Saudi’s can be counted upon to prop up their friend in need, no matter
how badly democracy and human rights are trampled. It seems these two are a
match made in heaven. Generally, although the loss is great for Ethiopia,
the gain has been significant for the ruling party. Is the EPRDF trying to
garner vested interest in the country for its own political existence and at
the cost of the nation?
Politics aside, there are other alternatives for agricultural development in
Ethiopia. If the government was truly interested, Ethiopia’s agricultural
output can be developed in a way that is much more sustainable and
equitable. For instance, although small, there is a significant amount of
capital within the country to boost farming capacity in hitherto unexplored
areas of the country.
Perhaps a genuinely interested government can enhance and facilitate the
efforts of investors within Ethiopia’s borders to import technology and to
train domestically run agro-business interests. The aim here is not to blow
the bank, but to increase investment in a sustainable way. After all, isn’t
this how major agri-businesses got their start in their country of birth?
Another option to boost domestic farm output would have been to invite
wealthy Ethiopians living abroad, especially those with interest and
knowledge, to invest in the area.
Even though these later approaches were never discussed, for political
reasons, there is a strong argument for their viability. Certainly they are
much more likely to produce the intended result than the mostly
unaccountable foreign companies ever will.
The scale of farming that is based on domestic investment would be smaller
and thus friendlier to the local environment and local communities, while
simultaneously allowing for a significant increase in domestic farm output.
Most importantly, this option would have placed domestic interests in
control of national food production, a much more viable and positive
proposition for Ethiopia’s prospects. If Indian, Saudi, and Chinese
companies are extending their reach beyond their borders to secure national
food security for their domestic economy, why can’t Ethiopia do this within
her own borders?
In terms of food availability, it seems like we are in a much more dire
situation than they are. Moreover, the involvement of global agribusiness in
Ethiopia would have been more acceptable if Ethiopia’s own farm industry was
given priority. This is not xenophobia; it is how the most food secure
nations in the world came into being. However, the guise that the local farm
industry will develop alongside major foreign agricultural companies does
not make economic sense. It is only a matter of time until they are eaten
up. A developmental state does not endorse such an unfair take over of key
national assets in this way. It is simply not developmental policy. It is a
give away.
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