The following is an excerpt from GRAIN’s article on the World Bank’s report on global land grabs. This process has been particularly forceful in Eastern Africa, and has been justified by Meles Zenawi, Prime Minister of Ethiopia. However, it is a strategy that is at odds with the focus on “food security,” because it leases land that could be used for local production, to foreign firms or corporations that will then export all products and repatriate the profits. When it comes to land, it essentially reinvents colonial processes of expropriation of resources. However, the World Bank’s report is insufficient in terms of data collection, and faulty in its conclusions, that the land grabs present “opportunities” along with their devastating social costs.
World Bank land grab report: Beyond smoke and mirrors
GRAIN 2010-09-23, Issue 497
Anyone who looks beyond the smoke and mirrors effect can see that the report is more significant for what it doesn’t say than what it does. Had the bank really wanted to shed light on this new investment trend it would have at least peeled back the curtain on the investors. Who are they? What are they after? How much of the investment flows are private and how much are public? Without this kind of information, you cannot analyse much. For example, we have heard companies say on numerous occasions that their investments have nothing to do with ‘food security’ – that this is business, pure and simple. Weighing up exactly who is involved and for what purpose, without the fantasies attached, would have been most useful. In fact, at the beginning of this year, the bank shared some data of this nature when it identified for the Global Donor Platform the top countries targeted by these land grab deals and the top countries of origin of the investors between 2008 and 2009 (see Table 1). But in its final report, the bank chose not to name names, forcing everyone to speculate why.
This is not all that the bank left out of the report. ‘The veil of secrecy that often surrounds these land deals must be lifted so poor people don’t ultimately pay the heavy price of losing their land,’ World Bank managing director, Ngozi Okonjo-Iweala, declared upon releasing the study. It’s true. And she could have started by making available to the public all of the contracts and investor-state agreements that the bank’s study team was able to access in the course of this research. Communities need to have access to the actual terms of these deals in order to judge them for themselves. Government and corporate propaganda will not do. Yet these documents are very difficult to get hold of. If the bank really wanted to lift the veil of secrecy it would start by putting these legal documents in the public domain. We would be glad to host them at farmlandgrab.org and help ensure their translation into local languages.
Another matter that the report is silent about is the World Bank’s own neck-deep involvement in these deals. For decades, the bank has been actively promoting market-based approaches to land management through its lending practices and policy advocacy. This means privatisation of land rights, both through the conversion of customary rights into marketable titles as well as the disengagement of the state, and legal reforms necessary for Western style land markets to function. If the bank now says that so many countries, especially in Africa, are ‘ill-equipped’ to deal with the ‘sudden influx of interest’ from farmland investors, then what good were the policy advisory services it performed over the last 30 years?
Even more directly, the bank’s commercial investment arm, the International Finance Corporation, is a major investor in numerous private equity firms that are buying up rights to farmland while its Multilateral Investment Guarantee Agency (MIGA) is providing land grab projects with political risk insurance (Table 2). MIGA has put up US$50 million, for example, as cover for Chayton Capital’s US$300 million business investments in Zambia and Botswana. For other firms, like British hedge fund SilverStreet Capital, MIGA’s role in protecting farmland investments is crucial. If problems arise, ‘you’ll have the World Bank on your side,’ Gary Vaughan-Smith, SilverStreet’s chief investment officer, puts it. MIGA, like IFC, is a for-profit agency, with a mission to promote profitable agribusiness investments in developing countries for its shareholders. Given these multiple levels of vested interest in farmland deals, it should come as no surprise that the bank promotes them despite dismal realities on the ground.