From: Berhane Habtemariam (Berhane.Habtemariam@gmx.de)
Date: Mon Nov 23 2009 - 14:49:32 EST
The ultimate crop rotation
Lured by a new business model, wealthy nations flock to farmland in
Ethiopia, locking in food supplies grown half a world away
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Video:
http://www.washingtonpost.com/wp-dyn/content/video/2009/10/21/VI200910210330
2.html?sid=ST2009112201942
By Stephanie McCrummen
<http://projects.washingtonpost.com/staff/articles/stephanie+mccrummen/>
Washington Post Foreign Service
Monday, November 23, 2009
BAKO, ETHIOPIA -- In recent months, the Ethiopian government began marketing
abroad one of the hottest commodities in an increasingly crowded and hungry
world: farmland.
"Why Attractive?" reads one glossy poster with photos of green fields and a
map outlining swaths of the country available at bargain-basement prices.
"Vast, fertile, irrigable land at low rent. Abundant water resources. Cheap
labor. Warmest hospitality."
This impoverished and chronically food-insecure Horn of Africa nation is
rapidly becoming one of the world's leading destinations for the booming
business of land leasing, by which relatively rich countries and investment
firms are securing 40-to-99-year contracts to farm vast tracts of land.
Governments across Southeast Asia, Latin America and especially Africa are
seizing the chance to attract this new breed of investors, wining and dining
executives and creating land-leasing agencies and land catalogues to
showcase their offerings of earth. In Africa alone, experts estimate that
about 50 million acres -- roughly the size of Nebraska -- have been leased
in the past two years.
The trend is driven in part by last year's global food crisis. Relatively
wealthy countries are shoring up their food supplies by growing staple crops
abroad. The desert kingdom of
<http://www.washingtonpost.com/wp-srv/world/countries/saudiarabia.html?nav=e
l> Saudi Arabia, for instance, is shifting wheat production to Africa. The
government of
<http://www.washingtonpost.com/wp-srv/world/countries/india.html?nav=el>
India, where land is crowded and overfarmed, is offering incentives to
companies to carve out mega farms across the continent.
Increasingly, though, purely profit-seeking companies are snatching up land,
making a simple, if somewhat grim, calculation. As one Saudi-backed
businessman here put it, "The population of the world is increasing
dramatically, so land and food supplies will be short, demand will be higher
and prices will rise."
The scale and pace of the land scramble have alarmed policymakers and others
concerned about the implications for food security in countries such as
Ethiopia, where officials recently appealed for food aid for about 6 million
people as drought devastates parts of East Africa. The U.N. Food and
Agriculture Organization (FAO) is in the midst of a food security summit in
Rome, where some of the 62 heads of state attending are to discuss a code of
conduct to govern land deals, which are being struck with little public
input.
"These contracts are pretty thin; no safeguards are being introduced," said
David Hallam, a deputy director at the FAO. "You see statements from
ministers where they're basically promising everything with no controls, no
conditions."
The harshest critics of the practice conjure images of poor Africans
starving as food is hauled off to rich countries. Some express concern that
decades of industrial farming will leave good land spoiled even as local
populations surge. And skeptics also say the political contexts cannot be
ignored.
"We don't trust this government," said Merera Gudina, a leading opposition
figure here who accuses Ethiopian Prime Minister Meles Zenawi of using the
land policy to hold on to power. "We are afraid this government is buying
diplomatic support by giving away land."
But many experts are cautiously hopeful, saying that big agribusiness could
feed millions by industrializing agriculture in countries such as Ethiopia,
where about 80 percent of its 75 million people are farmers who plow their
fields with oxen.
"If these deals are negotiated well, I tell you, it will change the dynamics
of the food economy in this country," said Mafa Chipeta, the FAO's
representative in Ethiopia, dismissing the worst-case scenarios. "I can't
believe Ethiopia or any other government would allow their country to be
used like an empty womb. The human spirit would not allow it."
'Everybody is coming'
Desperate for foreign currency, the government of former Marxist rebels who
once proclaimed "land to the tiller!" has set aside more than 6 million
acres for agribusiness. Lured with 40-year leases and tax holidays,
investors are going on farm shopping sprees, crisscrossing the country on
chartered flights to pick out their swaths of Ethiopian soil.
"There's no crop that doesn't grow in Ethiopia," said Esayas Kebede, who
works for a new government agency that promotes agribusiness, adding that
too many requirements on investors might scare them off. "Everybody is
coming."
Especially Indian companies, which have committed $4.2 billion so far.
Anand Seth, director general of the Federation of Indian Export
Organizations, described Africa as "the next big thing" in investment
opportunities and markets.
As he stood on a little hill overlooking 30,000 acres of rich, black soil,
Hanumantha Rao, chief general manager of the Indian company Karuturi Agro
Products, agreed.
So far, he said, the Ethiopian government has imposed few requirements on
his company.
"From here," Rao said, "you can see the past and the future of Ethiopian
agriculture."
>From there -- a farm just west of Addis Ababa -- it was possible to see a
river designated for irrigating cornfields and rice paddies; it is no longer
open for locals to water their cows. Several shiny green tractors bounced
across the six-mile-long field where teff, the local grain, once grew.
Hundreds of Ethiopian workers, overseen by Indian supervisors, were bent
over rows of corn stalks, cutting weeds tangled around them with small
blades.
Farming for others
Many of the workers were children. The day rate: 8 birr -- about 70 cents.
"The people are very happy," said Rao, who will soon supervise a second farm
spanning about 60 square miles. "We have no problems with them."
As a worker spoke to one of his supervisors, he whispered that the company
had refused to sign a wage contract and had failed to deliver promised water
and power to nearby villages. Supervisors treat them cruelly, he said, and
most workers were just biding time until they could go work for a Chinese
construction company rumored to pay $2 to $4 a day.
"We are not happy," said the man, a farmer-turned-tractor driver who did not
give his name because he feared being fired. "I'm a machine operator and I
make 800 birr [about $65] a month. This is the most terrible pay."
Rao said he had trained about 60 Ethiopians to drive tractors; others would
learn to run shellers, and how to fertilize and irrigate land. If things
work as they should, he said, Ethiopians will adopt the modern techniques in
their own farms.
Along a muddy road leading to Karuturi farm, people said they were hopeful
that might happen. But they were not sure how. Most said they were
struggling just to buy government-subsidized fertilizer, much less tractors.
In any case, Ethiopians cannot own land, instead holding "use certificates"
for their tiny plots, making it difficult to get loans, or to sell or
increase holdings.
"We think they might be beneficial to us in the future," said Yadeta
Fininsa, referring to the new companies coming to town. "But so far we have
not benefited anything."
Correspondent Emily Wax in New Delhi contributed to this report.
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