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Agriculture

World Bank sees opportunities

by Cathrine Schweikardt

In brief

A rose plantation in Addis Ababa: international “land grabbing” in Africa has come under criticism, but the World Bank sees opportunities under certain conditions

A rose plantation in Addis Ababa: international “land grabbing” in Africa has come under criticism, but the World Bank sees opportunities under certain conditions

Ever more foreign investors are buying or leasing agrarian land in developing countries. The World Bank considers the trend an opportunity to promote development – under certain conditions.

After the food crisis and the boom in biofuels, investments in agriculture seem to be a safe bet. Farmland promises reliable profits in the future (see D+C/E+Z 9/2009, p. 349). The World Bank says demand for land continues to rise after, in 2009 alone, the amount of land sold to foreign investors increased tenfold to 45 million hectares. Seventy percent of it was in Africa.

So far, experts struggle to assess the consequences of this recent “land grabbing” movement because of a lack of data and experience. A recent World Bank report entitled "Rising Global Interest in Farmland – Can It Yield Sustainable and Equitable ­Bene­­fits?" provides some new insights. It is based on data from 14 countries in the years 2004 to 2009.

The World Bank sees investments in agriculture as an opportunity to step up local development – for instance, by expanding infrastructure, creating new jobs, generating additional tax revenue and providing market access and technology to local cultivators. But theory and practice do not ne­­­cessarily match. The World Bank states that governments and investors are not always living up to their promises, though due to a dearth of information relating to ownership rights the Bank does not make a conclusive assessment. According to the report, moreover, weak governance and unrealistic development strategies add to implementation problems. The Bank also notes that local people often suffer detrimental consequences such as expulsion.

The World Bank hopes to contribute to improving matters by sharing information with all stakeholders: governments, investors, civil society and international organisations. Its web-based Knowledge Exchange Platform for Responsible Agro-­Investment is a start. The World Bank suggests seven principles:
– respect for land rights and ownership,
– ensuring food security,
– transparency, good governance and environmental safeguards,
– consultation and participation,
– responsible agro-enterprise investments,
– social sustainability and
– environmental sustainability.

According to the World Bank report, only 30 % of Africa's potential harvest is actually produced. The agricultural sector therefore not only needs more investments, but production capacity on current farmland also has to increase, the document states. The authors point out that greater agricultural productivity will bring people closer to achieving the most important Millennium Development Goal, the one of cutting in half the number (more than one billion) of those who do not have enough to eat.

Cathrine Schweikardt