Mar 22, 2010

Land grabs

We talked about a year ago about the spread of land deals in Africa. Well, it seems the practice is alive and well according to a recent article in The Guardian.

One of the cited examples is in Ethiopia, where millions of tomatoes, peppers and other vegetables are being grown in 500m rows in computer controlled conditions. Spanish engineers are building the steel structure, Dutch technology minimises water use from two bore-holes and 1,000 women pick and pack 50 tonnes of food a day. Within 24 hours, it has been driven 200 miles to Addis Ababa and flown 1,000 miles to the shops and restaurants of Dubai, Jeddah and elsewhere in the Middle East. Ethiopian-born Sheikh Mohammed al-Amoudi, one of the 50 richest men in the world plans to spend up to $2bn acquiring and developing 500,000 hectares of land in Ethiopia in the next few years. So far, it has bought four farms and is already growing wheat, rice, vegetables and flowers for the Saudi market. It expects eventually to employ more than 10,000 people.

Isn't this great news?

Well, it seems that in many areas the deals have led to evictions, civil unrest and complaints of "land grabbing". There is no consultation with the indigenous population. The deals are done secretly. The only thing the local people see is people coming with lots of tractors to invade their lands. Thousands of people will be affected and people will go hungry.

But people have been hungry for the past decades, and local farmers refuse to use fertilizer! Land deals may be bad, but are they worse than the proper counterfactual?

1 comment:

Sebastian said...

Well let us imagine someone would do the same here.... It would be great news. However, in a place where most people have no land titles but still have lived of a piece of land for most of their life the whole thing may be disastrous for a single household.
But their is also a flip side to it.
The winners will certainly be the migrant workers and the ones living in towns. Although the latter may only be marginally affected by some services the new industry requires. Local sales of the products seem less likely since they are from the onset on targeted at export markets.

Hence, it is as with trade in final goods: Overall there is a big gain to make out of the whole thing. However, the distribution of the gains may make the rich richer and the poor poorer. In a context of no land titles and greedy elites this seems to be particular likely for the case of land sales.

However, it remains a great topic to be investigated whether the trickle down effects are not at least better than the status quo. Any ideas how to go about?