The Same Financial Firms Responsible For Our Economic
Crisis Are Driving Us Toward a Global Food Disaster

    Investors are involved in massive land grabs in
    Africa that may cause destabilization of food
    prices, mass displacement and environmental
    damage.

By Tina Gerhardt
AlterNet
June 9, 2011 

http://www.alternet.org/story/151250/the_same_financial_firms_responsible_for_our_economic_crisis_are_driving_us_toward_a_global_food_disaster/

US and EU investors -- including US universities,
pension funds and investment firms -- are involved in
unprecedented land grabs currently taking place in
Africa, according to a series of investigative reports
released on Wednesday by the Oakland Institute.

The Oakland Institute spent over a year working
undercover to gather information on land deals in
Ethiopia, Mali, Sierra Leone, Mozambique, Tanzania and
South Sudan.

The reports show how land deals have a number of
effects, including the destabilization of food prices,
mass displacement and environmental damage.

"The same financial firms that drove us into a global
recession by inflating the real estate bubble through
risky financial maneuvers are now doing the same with
the world's food supply," said Anuradha Mittal,
executive director of the Oakland Institute.

"In Africa," she added, "this is resulting in the
displacement of small farmers, environmental
devastation, water loss and further political
instability."

These deals are often presented as agricultural
investment, providing much-needed economic funds,
creating jobs and infrastructure in developing
countries.

Yet, the report argues, many of the deals have negative
impacts. These include inadequate participation of
local populations, misinformation, lack of adequate
compensation, especially for women or indigenous
populations.

The intention of releasing the reports is not to curb
agricultural investment but rather to ensure that the
funding does what it promises to do and minimizes the
deleterious effects.

The "Understanding Land Investment Deals in Africa"
reports reveal that these largely unregulated land
purchases are resulting in virtually none of the
promised benefits for native populations, but instead
are forcing millions of small farmers off ancestral
lands and small, local food farms in order to make room
for export commodities, including biofuels and cut
flowers.

So there is an inversion of small, local farming to
industrialized agriculture.

As farmers are forced to vacate ancestral lands, they
and their families, who rely on the land for grazing
cattle or planting crops, are left without sustenance.

Frederic Mousseau, the Oakland Institute policy
director, tells of land recently acquired, where "the
investors were required to create 17 jobs. The village
has 7000 people living on and surviving off of that
land. We have spent time with these people. Seventeen
jobs will not suffice. They need the land for the
cattle and for the agriculture."

In another instance, Mousseau says, "One thousand jobs
were to be created for 100,000 acres acquired. But that
is an area that could nurture 25,000 farmers and their
families."

Forced off the land, these farmers often find
themselves struggling even more simply to survive.

"In many East African countries," Obang Metho said, "we
have customary rights. We have systems that can be
turned around to take advantage."

The reports charge that this acquisition is increasing
in breadth and in speed. Mousseau stated, "in 2009
alone nearly 60 million hectares -- an area the size of
France -- were purchased or leased in these land grabs.
It is estimated that 80 million hectares were acquired
in 2010." By contrast, prior to 2008 the annual
expansion of global agricultural land was less than 4
million hectares.

Not only are these land grabs, the land acquired is
often also located near water resources. The reports
state that major African rivers, including the Nile,
the Niger and the Zambezi, are tapped by these land
grabs. Hence, these land grabs are actually often water
grabs, intended to stabilize not only food supplies but
also water access in other countries.  Countries that
often acquire the land include China, India and the
Gulf States.

According to Mittal, "Universities such as Harvard
University, Vanderbilt University, Wake Forest
University are investing in hedge funds that are
involved in these land grabs."

These universities put their money into a direct
investment fund, which then purchases the land.
According to the Oakland Institute's reports, these are
"investment funds with ties to major banks such as
Goldman Sachs and JP Morgan."

When asked if these universities are aware of their
implication in these land grabs, Mittal replied: "We
would like to believe that these universities are not
aware. But an educational institution also needs to be
informed about the kinds of returns that these funds
deliver, which are around 25 percent, 30 percent and
more, and in this kind of economy, should raise some
questions."

"While countries such as China, India and Gulf States
acquire the land, the financial sector involved also
needs to be examined," Mousseau added. "There is a high
level of fiscal incentives." These include exemption
from VAT taxes. Moreover, the land is often acquired
for very little compensation; some land parcels were
even documented as being given away for free.

Obang Metho underscores the financial motivations,
stating "These people are not there to feed the
Ethiopian people. They are here for the profit. If this
is not allowed in the free world, it should not be
allowed in Ethiopia."
______________________________

Tina Gerhardt is an academic and journalist whose
writing has appeared in Grist, The Huffington Post, In
These Times and The Nation.

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