2010-03-30
MONTPELLIER, France (Reuters) - Large-scale foreign leases of African farmland risk driving conflict and fuelling corruption in the region without regulation, regional experts told a conference on agricultural development.

If rules for responsible foreign land investment can be drafted and followed, leases could provide a much-needed cash infusion for African agriculture, which has struggled to find investment elsewhere.

"What's missing is that it has not been done responsibly enough," said Kanayo Nwanze, president of the International Fund for Agricultural Development (IFAD). "Food security is a global issue and global partnership can contribute."

Rattled by the 2008 food crisis, when falling supplies and surging prices sparked unrest in several poor countries, and by the prospect of climate change denting farm output at home, countries such as Saudi Arabia, Kuwait and Qatar have paid millions of dollars for long-term farmland leases across Africa.

Investors looking for higher returns have also jumped into the market, and countries like China have locked up African land not just for food but for biofuel production.

Altogether close to 20 countries have leased tens of millions of acres of land in Sudan, Ethiopia, Congo, Nigeria and other African countries, agricultural experts say.

The deals have provoked international criticism, not least because opponents fear the proceeds may end up in the hands of politicians rather than small farmers who could be pushed off their land.

FOOD SECURITY AT HOME

"The real issue in Africa is that a lot of these deals are done in secret," said Namanga Ngongi, president of the Alliance for a Green Revolution in Africa, a project funded by the Bill and Melinda Gates Foundation.

"The small-holder farmers who stand to lose their land are not consulted. No one is sure the amount of money declared is the real amount," he added.

"Increased foreign investment is what everyone has been crying for for years," he said, adding though that on a continent already struggling with widespread hunger, investment that did not build food security at home did not make sense.

Regulating new investments, however, could help ensure Africans, notably farmers, get some benefit, IFAD's Nwanze said.

The IFAD and others are trying to create a new international framework on responsible land investment, which would set out guidelines on how local people must benefit from such deals.

That could require investors to hire local farmers already on the land rather than bringing in their own workers.

Land investors cannot be forced to sign on to such rules, Nwanze said. But faced with international criticism, many might sign up as a way to defuse tensions and improve their image, particularly in the countries where they are leasing land.

The reality, Nwanze said, is that the investment is going to happen, and "I'm looking for a win-win situation."