Pension fund managers and hedge funds gather in London on Tuesday for a summit to discuss the next big investment opportunity: buying up swaths of African farmland.
The Agriculture Investment Summit promises guidance through the “complexities of investing in agriculture as an asset class” to benefit from “one of the greatest investments in the world”.
An estimated 70m hectares of agricultural land – or 5% of Africa – has been sold or leased to western investors since 2000, according to a public database of international land deals. British companies have bought the rights to more than 3m hectares of land in poor countries – the equivalent of almost two-thirds of the UK’s total farmland, according to the International Land Coalition.
Grain, an NGO that promotes sustainable use of world resources, estimates that investors have spent between bn and bn on farmland. They expect that investment to double by 2015.
“Farmland is a big attraction for them [pension funds and other investors],” Grain said. “They see in farmland what they call good ‘fundamentals’: a clear economic pattern of supply and demand, which in this case hinges on a rising world population needing to be fed, and the resources to feed these people being finite.”
The £3,660-a-head conference at the Victoria Park Plaza hotel, in central London, promises a “unique opportunity to gain insights from an A-list of speaker faculty on how, where and why to invest in this emerging and expanding asset class”.
One of the talks at the fifth annual summit is titled: Agriculture in Africa: land grab or untapped opportunity?
A coalition of 60 international development, environment and farming charities will gather outside the hotel to demand that pension funds and other investors “stop the land grab”, which is claimed to be taking local people’s land at the fastest rate since colonial times.
Tim Rice, an adviser at ActionAid, said: “The summit organisers cheerily call this devastating trend an ’emerging and expanding asset class’ and bill the summit as an opportunity to ‘overcome the perceived obstacles to investment’.”
But, he says, they are “glossing over” the real impact on the ground. “They are displacing farmers, up-rooting communities and food production and destroying ecosystems on a massive scale. They are increasing hunger and poverty globally. In a world where 1 billion people already go hungry, land must stay in the hands of local communities so that they can feed themselves.”
Kenneth Richter, of Friends of the Earth, claimed square-mile investors are the “key players” fuelling an industry which leads to “peasants, herders, fishers and other rural households being dispossessed of their means to feed themselves and their communities, sometimes through promises of jobs, sometimes at gun point”.
Nyikaw Ochalla, of the Anuak people in Ethiopia, said “land-grabbing” is accelerating at “a rate not seen since colonial times”.
“Land is the lifeline of hunter-gatherers, pastoralists, fishing and farming communities in the Ethiopian lands targeted by land grabbing policy.”
In 2008 a quarter of Mhaga village in rural Tanzania was acquired by a British biofuels company Sun Biofuels, with the promise of financial compensation, 700 jobs, water wells, improved schools, health clinics and roads. But the company later went bust, leaving villagers not just jobless but landless as well.
guardian.co.uk © Guardian News & Media Limited 2010