The New African Land Grab

by: Joan Baxter

Foreign investors, with the World Bank, are acquiring vast tracks of land in Africa - at the expense of local farmers.

The "town" chief of the village seemed to be in a state of shock.

Sitting on the front porch of his mud and thatch home in Pujehun District in southern Sierra Leone, he struggled to find words that could explain how he had signed away the land that sustained his family and his community.

He said he was coerced by his Paramount Chief, told that whether he agreed, or not, his land would still be taken and his small oil palm stand destroyed. He didn't know the name of the foreign investor nor did he know that it planned to lease up to 35,000 hectares of farmland in the area to establish massive oil palm and rubber plantations.

Haltingly, he said that without his land, he might as well take his leave of the village. By that he meant that he was as good as dead.

This is a ground-level view of a large land deal in Africa, where in recent years foreign investors have acquired tens of millions of hectares of farmland. In 2009 alone, the World Bank estimates that around the world foreign investors acquired about 56 million hectares of farmland - an area about the size of France - by long-term lease or by purchase. Farmland has become a favourite "new asset" class for private investors; "like gold, only better" according to Capital & Crisis.

The World Bank has its own term for the new global land rush. It calls it "agro-investment" and has developed seven voluntary principles to make the land deals "responsible".

Critics of the phenomenon - farmers' movements, human rights, civil society, women's and environmental organisations, and many scientists - call it "land grabbing". They say there is no way that the taking over vast areas of smallholder farmland and transforming it into giant industrial plantations and agribusiness operations can ever be "responsible".

They argue that land grabs are throwing millions of farming families and indigenous peoples off their land. They say that it's not just land that's being grabbed, but also precious water resources.

The investors are hedge funds, private equity funds (that are attracting even prestigious American universities with their promises of high returns), pension funds, banks, multinational corporations, and sovereign wealth funds seeking to sow capital and grow profits. They are also Middle Eastern and Asian nations anxious to secure their own future food security in the face of climate change, with dwindling water resources and arable land.

An estimated 70 per cent of the demand for farmland is in Africa, where land is cheap and traditional communal ownership makes people particularly vulnerable. Sometimes this can be done for the cost of a few gifts to traditional chiefs and grandiose promises of bringing "development".

Since 2009, in the wake of the food, fuel and financial crises of 2007-2008, the rush for farmland has only accelerated. But it's impossible to know just how much more of Africa's fertile land has now been taken by investors.

Corruption and profit

Recent in-depth research by the US-based Oakland Institute of land deals in seven African countries found that most of the land deals lack transparency, making it almost impossible to calculate their total area. Lack of transparency is a great enabler of corruption.

Yet "transparency, good governance, and a proper enabling environment" is one of the seven principles laid out by the World Bank for "responsible agro-investment". The Oakland Institute found that most of the land deals do not respect any of these principles.

This is ironic, to say the least.

More than any other institution or agency, the World Bank Group has been promoting direct foreign investment in Africa, and enabling the farmland rush. Its private sector arm, the International Finance Corporation (IFC), with its Foreign Investment Advisory Service and its program to Remove Administrative Barriers to Investment, has been working - often behind the scenes - to ensure that African countries reform their land laws and fiscal regimes to make them attractive to foreign investors.

The World Bank Group has funded almost identical investment promotion agencies - "one-stop-shops" - in countries across the continent. It places people in strategic government ministries - even presidential offices - as private sector advisors.

The investment promotion agencies are developing and advertising a veritable smorgasbord of incentives not just to attract foreign investment in farmland but also to ensure maximum profits to investors. These include extremely generous tax holidays for 10 or even 30 years, zero per cent duty on imports, and easy access to very large tracts of land, sometimes over 100,000 hectares. Investors may pay just a couple of dollars per hectare per year for the land, and in Mali, sometimes no land rent at all.

The Sierra Leone Investment and Export Promotion Agency, boasts about the extremely low labour rates and flexible labour laws in the country and about other privileges it accords investors - 100 per cent foreign ownership in all sectors, full repatriation of profits, dividends and royalties, no limits on expatriate employees.

Such giveaways cast doubt on claims by African governments, and others trying to defend the land deals, that this kind of "agricultural investment" will solve unemployment, generate revenue for cash-strapped governments, reduce the dependence on aid, and bring economic development.

In this race to the bottom, African governments are also encouraged by the World Bank Group to outdo each other when it comes to protecting investors. Each year, it grades African on investor protection in its "Doing Business" report cards, praising countries that move up in the rankings in what an IFC official admits is a "horse race".

This means that low-income and food-deficit African countries, some still struggling to rebuild after long conflicts, such as Sierra Leone and Liberia, find themselves competing with each other to offer foreign investors ever sweeter deals on their arable land, so desperately needed for local food production.

The investment promotion agencies quote figures for the vast amounts of "uncultivated" or under-utilised" land in their countries, often without offering any recent land use studies to back up these figures or a thought for the millions of people who depend on that land for their livelihoods.

Nor do they take into consideration the crucial importance of small family farms, which employ more than half the people and produce 80 per cent of the food on the continent. Smallholder farms tend to be extremely biodiverse, involving fallow periods to protect and restore soils and water resources.

Not in Africa to help

Conspicuously absent in the talk about the purported benefits of the land deals is serious discussion of protection of local people, human and environmental health, water resources, biodiversity, human rights, food security, and free prior informed consent of the affected communities.

As the Oakland Institute research shows, many of the land deals are for enormous plantations of palm oil and sugarcane for agrofuels, or for the production of cut flowers and a handful of staple crops - all for export.

The United Nations Food and Agriculture Organisation has just released a "new paradigm" for agriculture, called "Save and Grow". Echoing other recent major studies, it finds that agro-ecological agriculture that emphasises conservation of soil and water resources and reduced use of agrochemicals can "enable low-income farm families in developing countries - some 2.5 billion people - to maximise yields and invest the savings in their health and education."

It states unequivocally that the industrial agricultural model of the Green Revolution, involving monocultures, high-yielding [commercial] crop varieties, heavy use of agrochemicals and mechanisation and irrigation, has "degraded fertile land and depleted groundwater, provoked pest upsurges, eroded biodiversity, and polluted air, soil and water."

And yet this unsustainable industrial agricultural model is the one being promoted by many African governments, donor agencies and foreign investors.

African farmers, left high and dry by their own governments during the decades of austerity programs imposed by the World Bank and the International Monetary Fund, do need investment and support. They desperately need decent roads and access to local markets, processing equipment to add value to their own diverse farm produce, storage and drying facilities to prevent post-harvest losses, and basic amenities such as schools and health centres and water wells to improve rural lives, so that farming communities can thrive.

But foreign investors are not in business to provide any of these things. They are not in Africa to help impoverished African farmers improve their own farms, or to combat hunger. They are far more likely to destroy the family farm in Africa and aggravate hunger, all in the name of economies of scale, a global corporate food chain, and profits.

The same actors - the speculators, bankers, unregulated investors - who have had a hand in inflating food prices and bringing the global economy to its knees are now consolidating control of global food production and of land, to profit from the very crises they provoked.

It is beyond tragic that so many of them have set their sights on the new "asset class" of African farmland - which is the very asset on which hundreds of millions of Africans depend for their livelihoods and their survival.

Joan Baxter is a Senior Research Fellow with the Oakland Institute and author of its investigative reports on land deals in Sierra Leone and Mali. She is a journalist, award-winning author, and development researcher who has lived and worked in Africa for more than 25 years.

The views expressed in this article are the author's own and do not necessarily represent Al Jazeera's editorial policy.
source:
http://english.aljazeera.net/indepth/opinion/2011/06/201162884240129515.html

Senate passes palm oil labelling bill

June 26, 2011 7:07 PM EDT

The Senate has passed an amendment to the Food Act requiring that products containing palm oil be explicitly labelled, rather than described as 'vegetable oil'.

The bill was passed by Coalition votes, and driven by Greens senator Rachael Siewert and Independent senator Nick Xenophon, both of whom have been vocal in their campaigns on the subject of palm oil. Most of the world's supply of palm oil, an extremely common ingredient in foods and food additives, is produced in Malaysia and Indonesia, where it is common practice to clearfell forest for plantations. Zoos Victoria reports that clearfelling results in the deaths of up to 50 orangutans per week.

The issue came to prominence last year, after a grisly ad from Greenpeace featured orangutan fingers in a Kit Kat wrapper. Senator Xenophon also emphasised the consumer health aspect of the labelling, saying that Australians consume 10kg of palm oil a year without knowing it, and that while other products labelled as 'vegetable oil' contain as little as 2% saturated fat, palm oil is 50% saturated fat. While the bill was rejected last week by a Senate committee, the alliance between the Opposition and the two senators was enough to pass the bill, which will likely pass in the House of Representatives if the Coalition-Greens alliance holds.

The Australian Food and Grocery Council decried the bill, saying the cost of changing a single label would be $10,000 to $19,000, and that food and grocery manufacturers were already under pressure from a 'perfect storm' of rising input costs.

"Food labels should be about ensuring consumers have important product information relating to health, nutrition and safety. From a health perspective, it's more important for consumers to know how much saturated fat is in a product rather than where the saturated fat is sourced," said a release from the AFGC.

Malaysia also expressed "grave concern", with the Malaysian Plantation Industries and Commodities Minister Tan Sri Bernard Dompok describing the bill as "discriminatory". Dompok said the bill seeks to encourage "the use of certified sustainable palm oil in order to promote the protection of wildlife habitat".

"In this context, Malaysia is of the view that labeling palm oil purely from the perspective of sustainable production is discriminatory," he told BERNAMA, the Malaysian National News Agency. "In addition, competing vegetable oils are not required to be labeled."

"It is clearly evident that facts and figures provided to the Senate Community Affairs Legislative Committee have been clearly ignored," Dompok said.

"It is with great regret and disappointment that the Australian Senate has not accorded the due attention contributed by the oil palm industry in Malaysia and the sustainable practices adopted."
source:
http://www.ibtimes.com/articles/169702/20110626/senate-passes-palm-oil-labelling-bill.htm

Do we have a plan B for energy?

(from the blogger:
this articles, as many other articles in this blog, not neccesarily represent the blogger point of view. as it purpose written at the blog title, this is also a storage for the relevant topics monitored from many media resources in internet.
thk, sp. siagian)


Are we dangerously dependent on Indonesia? Indonesia is India's top supplier of palm oil and coal - two forms of energy critical for our economic and individual growth. That is in itself not troublesome. But as Jakarta introduces new policies under pressure from environmental groups and local demand, can we ignore questions about future supply and its cost?

Take palm oil. Indonesia produces about 46% of global supply. Unpredictable weather keeps output volatile while new land is scarce. Last month, Indonesian President Susilo Bambang Yudhoyono banned new plantations on 65 million hectares of peat land and primary forests. Indonesian Palm Oil Producers Association says it would slow area expansion from an average of 350,000 hectares in the last four years to less than 200,000 hectares annually over the next two years.

It also triggers a tussle between Jakarta and regional governments which are allowed to explore and manage their own natural and land resources. Local governments have issued thousands of permits in mining and plantation business, the two sectors vital to increase revenues. As most allocations for palm oil plantations are in forests that cannot be used for farming, they could be revoked by this moratorium. Indonesian plantations are already under pressure from environmental groups for deforestation. Big corporate buyers such as Unilever and Nestle are demanding sustainability certification.

Currently, certified oil is a fraction of total sales but a mandatory scheme starts next year. Sustainable measures are expensive and plantations will pass on higher costs to consumers. That means people like us. At the same time, more and more palm oil is being produced by small and marginal farmers in no better condition than our own. By next year, 40% of whose yields are half that of plantations.

As their numbers grow, lower yields and inefficient scale will lift prices. More crucially, Indonesia's own demand for palm oil as food, biodiesel feedstock and industrial raw material is rising. It is world's fourth most populous nation and south-east Asia's largest economy. Affluent middle class accounts for approximately 70% of GDP. As in India, eventually the exportable surplus will dwindle, unless buoyed by faster increase in supply which is doubtful. Indonesia will never stop exporting palm oil because it fetches serious money.

A progressive export tax allows it to earn more revenue when palm oil prices rise. However, with imports expected to supply half the total consumption by 2020, India can't bank on Indonesia being always affordable or ample. Thermal coal burnt in power sta-tions faces similar risks. Indonesia is the world's and India's top supplier. Though only a fifth of our thermal coal consumption is imported today, volumes will spurt as electricity demand expands 56% in next six years. Indian companies are investing heavily in Indonesian mines for long-term supply. Yet, that is no guarantee. Already resource nationalism is raising its ugly head.
source:
http://economictimes.indiatimes.com/markets/commodities/do-we-have-a-plan-b-for-energy/articleshow/8919252.cms

Presidential order vs. forest conversion moratorium

Muhammad Teguh Surya, Jakarta | Mon, 06/20/2011 8:00 AM

Many questions entered my mind when the plan to impose a moratorium on forest conversions was delayed for five months, beginning in January 2011.

I optimistically thought at the time that the President and his staff were pondering appropriate measures to rescue the remaining natural forest in the country.

This hope completely evaporated when Presidential Instruction (Inpres) No.10/2011 on the postponement of new license issuance and the improvement of primary forest and peat land management was announced on May 20.

It turned out the delay was not due to any substantive reason regarding the rescue of Indonesia’s natural forests, but rather a maneuver to accommodate the interests of mining companies, oil palm estates, forest concessionaires and timber estates. In principle, the new instruction enables deforestation.

This is evident because the Inpres only governs the deferment of the issuance of new licenses and concerns only primary forests, which even without the regulation are subject to protection.

In other words, the President is allowing entrepreneurs to go on plundering forests that are not primary forests or peat land.

Additional studies have found primary forests and peat land can still be converted by the timber industry, mining operations and estates, owing to a stipulation regulating exceptions.

In a period of five months, the Forestry Ministry issued a number of preparatory permits so that when the Inpres was signed the relevant companies could enjoy liberties to continue deforestation.

What happened in Central Kalimantan as a pilot province for Reducing Emissions from Deforestation and Forest Degradation (REDD) proves this.

The Forestry Ministry issued the following preparatory permits for mining, oil palm estates and other forestry companies: 1) Letters of approval for the use of forest zones from the Director General of Forest Planning to eight companies from June – December 2010 covering 107,083 hectares and one company in March 2011 covering 4,336 ha. 2) Letters of principle approval for loaned use of forest zones from the Forestry Ministry to three companies from June – December 2010 covering 2,204 ha and six companies from January – April 2011 covering 4,559 ha. 3) Decrees on loaned use of forest zones from the Forestry Ministry to two companies from June – October 2010 covering 2,011 ha.

The data indicates a very strong connection between the delayed moratorium and the Inpres, which is only focused on primary forests with the stipulation of exceptions. It should be stated that the Forestry Ministry plays a very good role in protecting corporate interests instead of Indonesian forests.

The formulation of the Inpres has cost taxpayers more than US$4 million, the largest budget for a policy drafting in the country’s 66-year history, despite its low quality.

Lamenting the policy is no use though. Therefore, it’s important for us to keep demanding the
speedy rescue of our forests, certainly by strictly implementing the moratorium on forest conversion for the sake of people’s welfare and security.

The moratorium should be implemented in the following ways. First, there will be no more new licenses issued to convert primary forests and peat land and a strategy to fulfill future timber demand will be drawn up.

The existing licenses are to be audited by independent third parties. Audit results are to be used
to annul questionable licenses, particularly those issued not in line with the law.

Second, the most endangered forests will be saved by registering forest areas through re-zoning and recalculating as well as estimating public timber needs at least for the next few years.

Movements to curb timber consumption in society should be encouraged, besides revitalizing the local community’s role in forest resources management and preparing the transfer of critical forest zones to local communities.

Third, social issues need solutions. Today, tree felling is only allowed on replanted forest estates or those that fall under community management, which are separately regulated and subjected to strict control.

Later, an incentive policy should be introduced for the development of downstream industries to produce valuable commodities as part of efforts to create jobs and generate added value.

The other aspect to be handed by the government in the moratorium process is the formulation of a policy concerning conflict resolution protocols as a future guide to the settlement of conflicts in the forestry sector.

In the course of the moratorium, the timber industry can continue operating by using raw materials from the existing timber estates or, if they are not yet sufficient, timber materials can be imported from other countries, because the use of materials from natural sources at home equally eliminates the benefit of the moratorium itself. To facilitate control, the types of wood imported should be different from those found in Indonesia.

The writer is head of the international relations and climate justice department at the Indonesian Environment Forum.
source:
http://www.thejakartapost.com/news/2011/06/20/presidential-order-vs-forest-conversion-moratorium.html

EU told to 'show leadership' on food security

By Martin Banks - 30th March 2011
Britain's top scientific advisor has urged the EU to "show global leadership" in tackling food security issues.

However, speaking in Brussels on Wednesday, Sir John Beddington refused to be drawn in on the row over cloned meat.

Campaigners for new controls, including MEPs, were defeated after 12 hours of talks on Monday between member states and parliament failed to agree a law to regulate the cloned meat industry.

The failure to reach agreement has sparked bitter recriminations but Beddington declined to get involved, telling this website, "I do not want to comment on this."

Beddington, who reports directly to UK prime minister David Cameron, was in Brussels to launch the UK government's report on the 'the future of food and farming.'

The report predicts that, with the global population set to increase from seven to eight billion by 2030, the food system will face "unprecedented" pressure.

In a keynote speech at a breakfast briefing, he said the planned reform of the Common Agricultural Policy should "deliver a competitive agricultural sector."

In drafting future framework programmes, the EU, he insisted, should also give "more priority" to R&D in the food system.

He said, "The main message I want to get across today is that we have urgently got to address the issue of food security. In other words, how we are going to feed nine billion people in a sustainable and equitable way.

"This has got to include everything from energy and water to food security. Clearly, this is going to be a major challenge."

The 207-page report, which includes contributions from 400 leading experts from 35 countries, was launched at the British chamber of commerce to Belgium.

It urges the EU to show "global leadership on subsidy and trade reform issues and strengthen the EU's presence in regional and international food security".

Beddington, one of only two national chief scientific advisors in the EU, said that the report "makes clear" that the global food system up to 2050 will face "enormous challenges, as great as any it has confronted in the past."

He added, "It carries a stark warning for both current and future decision-makers on the consequences of inaction. Food production and the food system must assume a much higher priority in the political agendas across the world.

"To address the unprecedented challenges that lie ahead the food system needs to change more radically in the coming decades than ever before, including the industrial revolution."

Beddington told an audience of business leaders and EU policymakers there were "grounds for optimism".

"It is now possible to anticipate a time when global population numbers cease to rise and there's a growing consensus that global poverty is unacceptable."

Beddington later took part in a high-level seminar, organised by the European commission's joint research centre.

Meanwhile, the confederation of food and drink industries of the EU said it "regrets" the failure to reach an agreement on novel foods, including the sale of meat from cloned animals.

Its president Jesús Serafín Pérez, said, "The CIAA regrets the failure to reach an agreement on the novel foods regulation. It would have encouraged innovation in the food and drink industry, engendering greater consumer choice and facilitating market access for novel foods.

"This impacts on Europe's 500 million consumers and Europe's largest manufacturing sector, made up of 288,000 companies, 99.1 per cent of which are small and medium-sized enterprises."
source:
http://www.theparliament.com/latest-news/article/newsarticle/eu-told-to-show-leadership-on-food-security/

EU urged to press for more 'sustainable' production of palm oil

By Martin Banks - 14th June 2011
The EU has been urged to help shift production of palm oil in a more "sustainable direction".

Speaking on Tuesday at an event jointly organised by the Parliament Magazine, Imke Lübbeke, of the WWF, said that the environmental impact of oil palm had "not been exaggerated".

Lübbeke, the organisation's EU bio-energy policy officer, said there was "increasing evidence" that oil palm production was directly responsible for a 12 per cent reduction in the "number, variety and abundance" of wildlife in Malaysia, the world's second biggest producer of palm oil.

She added, "WWF is not against palm oil which is a very valuable vegetable oil.

"It has unique characteristics that suit it to processed foods and other consumer goods like detergents and soaps.

"We support palm oil as long as it produced sustainably."

The lunchtime roundtable, jointly organised with the Malaysian Palm Oil Council, focused on the sustainability of palm oil production, currently a controversial issue among MEPs and policymakers.

It also heard from Danish Independent MEP Anna Rosbach that palm oil has been used in "many industries" for years and is a "healthy" oil.

She told the meeting, "This issue has two parallel sides: On the one hand we have the big international companies cutting down rainforests, draining and burning swamp forests and destroying biodiversity.

"On the other hand, we have all the beneficial sides of palm oil both for use in food, fuel and for its contribution to the economy."

Rosbach, an ECR member, said that Asian countries, such as Malaysia, should not be blamed for the "devastation" she said is often caused by palm oil production.

"If we look at Africa, we see that many European companies are behind the fast-growing plantations," she added.

"We should remember that many of the environmental concerns surrounding palm oil production are the same that we see with all kinds of large scale and intensive agricultural productions."

In a Q&A session, British Tory MEP and environment committee member Martin Callanan, who chaired the debate, asked whether deforestation was still taking place even though the Malaysian government had designated all its virgin rain forests as protected areas.

In reply, Nagendran Bala Sundra, a minister counsellor at the Malaysian EU embassy in Brussels, made a robust defence of his country's record when it comes to the environmental impact of palm oil production.

He said, "We recognised that our forests are not finite and a lot of effort has been invested into tackling this issue. This is something that has not always been recognised."

He also emphasised the importance of the palm oil industry to his country's economy.

He said the sector was "one of the most heavily regulated" industries in the world and that palm oil production contributes "significantly" to global food security.
source:
http://www.theparliament.com/latest-news/article/newsarticle/eu-urged-to-press-for-more-sustainable-production-of-palm-oil/

Palm Oil demand to rise as an Bio-Diesel input

By Jithendra Antonio

Watawala Plantaitons PLC Chairman, G. Sathasivam is of the view that future Palm Oil prices would rise as Palm Oil will have higher demand as an input for bio-diesel production.

“Spurred on by the world’s intensified search for alternate sources of energy, the Malaysian government for instance has now renewed focus on developing its palm oil industry for the production of bio-diesel,” Sathasivam outlines in his latest annual financial review adding that building of new bio diesel plants is being encouraged in response to demand for bio diesel from European countries.

While the contributions from the oil palm business of Watawala Plantations Group has been commendable during the year, Sathasivam anticipates that strong demand for bio diesel is also expected from countries such as South Korea, India, Colombia and Turkey.

“As palm oil has the lowest cost of production amongst edible oils, it seems likely to

make up a significant portion of that market,” he says adding that Oil palm planted on anthropogenic grassland could supply this requirement in 2050, thus addressing some of the environmental concerns related to the destruction of forest land.

He further notes that it is encouraging the Ministry of Plantation Industries has proposed to expand Sri Lanka’s Oil Palm cultivated land extent from the current 5,000 hectares to 25,000 hectares. “A public-private partnership would be a vital element to ensure the success of this programme” Sathasivam notes in his review.

He further goes in to explain that any wage revisions during next year, would need to be linked to productivity and continuous unproductive wage revision could be detrimental to the Plantation Industry as a whole. “There is a serious need for all stakeholders to take part in this issue than isolating the Plantation Companies,’ Sathasivam stresses in his review.
source:
http://print.dailymirror.lk/business/127-local/47301.html