from land grab to win-win
DESCRIPTION
Foreign acquisitions of farmland in Africa and elsewhere have become the focus of concern. Many observers consider them a new form of colonialism that threatens food security of the poor. David Hallam argues that investments could be good news if the objectives of land purchasers are reconciled with the investment needs of developing countries. For more information visit: http://www.fao.org/economic/es-policybriefsTRANSCRIPT
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
International Investments in Agricultural Production
David HallamDeputy Director, Trade and Markets
Division, FAO
Presentation at the international conference “Land Grab: The Race to the World’s Farmland”, Woodrow Wilson Center, Washington, DC, 5 May 2009
Washington, 5 May 2009 2International Investments in Agricultural Production
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
Outline
Trends and patterns of investments
Motivations for investments
Impacts of investments
Policy implications
Outstanding issues
Washington, 5 May 2009 3International Investments in Agricultural Production
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
Trends and patterns
Not a new development but increasing trend
Focus of investments: agricultural production
Investors: mostly private sector, but governments involved
Investing countries: Gulf States, China, Republic of Korea
Destinations of investments: Africa, also Latin America
Nature of investments: land acquisitions
Size of investments: large
Washington, 5 May 2009 4International Investments in Agricultural Production
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
Motivations – Investing countries
Differs between type of investor
Food security• Natural resource constraints – land and water• Waning trust in international food markets
Biofuel production
Portfolio diversification
Washington, 5 May 2009 5International Investments in Agricultural Production
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
Motivations – Host countries
Need for investment
Financial gains of asset transfers rather small...
...but broader developmental benefits
Washington, 5 May 2009 6International Investments in Agricultural Production
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
ODA to agriculture
0%
2%
4%
6%
8%
10%
12%
14%
1980 1985 1990 1995 2000 2005
Washington, 5 May 2009 7International Investments in Agricultural Production
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
Impacts of international investments
Economic, political, social and environmental impacts
Potential positive effects of investments • Technology transfers and employment creation• Food production and food security• Diversification and development of value-added production
Potential negative effects of investments• Social rights issues• Transparency, governance issues and sovereignty• Environmental issues
Overall mixed record on foreign direct investment in agriculture
Washington, 5 May 2009 8International Investments in Agricultural Production
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
How to achieve a win-win situation?
Onus mostly on host countries
Encourage inward investment
Create receptive domestic sector
Improve trade policy commitments
Increase consistency with food security strategies
Establish clear property rights
Limit adverse social and environmental impacts
Ensure land use rights and compensate stakeholders
Washington, 5 May 2009 9International Investments in Agricultural Production
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
Wider policy implications
International codes of conduct
Global corporate social responsibility
International investment agreements
Dispute settlement
WTO disciplines
Washington, 5 May 2009 10International Investments in Agricultural Production
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
Some outstanding issues
Investing country issues• Why direct land investments?
Host country issues• Policy and legal frameworks to minimize risks and
maximize benefits
International issues• Reconcile interest of investors with investment needs
of developing countries
Washington, 5 May 2009 11International Investments in Agricultural Production
FAO – Trade and Markets DivisionFood and Agriculture Organization of the United Nations
More information
For more information, please visit:
http://www.fao.org/economic/es-policybriefs