Why are Land Acquisitions not Development focused (Part 1)?

A note before we begin, I am not arguing that land acquisitions cannot in any way be positive or yield any good, and nor am I arguing that there is no form of land acquisition that is pro-development. What is being discussed are land acquisitions up to this point, which have been dominated by state actors and major corporations.

To begin this two-part post I'll first discuss development. As has already been brought up in the blog, the question of development is itself a complex one. There is no single model for development, with the path of the United Kingdom being distinct from the Four Asian Tigers (Taiwan, Singapore, South Korea and Hong Kong) and those paths being distinct from the superpowers-in-waiting: China and India. Further, the actual end point of development can also be contested. If the lifestyles of countries such as the US and the UK are unsustainable, and racked with increasing inequality and poorer wage outlooks, can we hold them up as goals to work towards?

These are important questions with serious ramifications for African countries and their paths for the years to come. It would, however, be impractical to attempt a definitive answer to these questions, even if the entire blog was devoted to it! For the purposes of this post, I'll broadly define development as a move towards reducing inequalities (of income, education, health etc.), growing sustainable industries and increasing standards of living. Even these definitions generate serious questions (is any industry within a capitalist system sustainable?), but there must be a starting point, and I believe these definitions are sufficient to interrogate land acquisitions and reasonably uncontroversial (see Figure 1 for the relationship between human development and inequalities).

Fig. 1 More human development is associated with less inequality

Transnational Corporations (or TNCs) have previously been mentioned. These corporations have a significant stake in land acquisitions across Africa, with a focus on agri-industrial developments. These acquisitions use the water of the African country to produce crops, principally food, and largely for export. So why would TNCs serve to entrench inequalities, as opposed to break them down in pro-poor development? Each individual case will undoubtedly vary, and there are certainly many case studies to explore if one is interested in a particular incident. But I'd argue that, on a fundamental level, TNCs entrench inequalities because they function in an unequal system with the ever-present requirement to grow. Companies have a duty to their shareholders, on whom they are reliant. That duty involves maximising the returns to their shareholders, if they (or, crucially, their competitors) can reduce their costs, they must do so. Owing to the power relations between a TNC and farmers in Africa, the relationship will always be to the detriment of the farmer.

TNCs however are not the only foreign direct investors on African land. State actors are also heavily involved, with particular interest from the Gulf States, Asian states and Western investors (Woertz, 2013). The Gulf countries have been securing international land for the strategic purpose of food security, with Africa identified as a continent with considerable opportunity for agricultural growth. In effect, these investments secure access to water that is in short supply in the Gulf, which is then used to cultivate the land and export that food back to the investor. These countries are attempting to reduce the risk of food shortages in any future crises, after several scares in the previous decades where money was not enough to secure sufficient food. Again, the aim of the investment is not geared towards development.

Next week I will continue to explore these inherently unequal land acquisitions, looking at what macroeconomic trends suggest about the relationships.

An African Green Revolution

Whilst looking further into the question of land grabs, agriculture and water, I stumbled upon this video about a Green Revolution in Africa, a movement that I mentioned in an earlier post.

It's produced by the Institute for Security Studies (ISS) - they are an African organisation (and I think the fact that they themselves are African is important) who typically focus on issues such as arms control and criminal justice. But it was interesting to see them include research carried out into food - showing just how important a topic this is considered. 

The video provides some interesting figures (I'm sure there are plenty of caveats and rebuttals but it still gets you thinking!) and ultimately decides on a development-focused plan for the future. Whether water is or is not given as much significance as food in their modelling is also quite telling; I haven't yet had the chance to look into this myself.

Regardless of what you think about their vision, ISS Africa is a major NGO, founded, and always on the ground, in Africa. Their opinion is influential, and their approach to development is likely to affect water management strategies.

Definitely food for thought!

Water Security and Foreign Investment

When writing my last post I was reminded of the recent discussions surrounding foreign investment in critical infrastructure, specifically Chinese investment in the UK's Hinkley Point C project and Australia's energy grid. The UK is now making moves to change its approach to investment in these key areas (Clifford Chance, 2016).

Land deals in Africa, and foreign investment in general, may introduce another layer of water insecurity to the already complex picture. Control, or at the very least intimate knowledge, of a country's agricultural systems and water infrastructure could present serious concerns for African governments.

Land Deals - the good, the bad and the necessary?

The variegated nature of land deals in Africa means land grabbing is too broad a term. There are considerable differences between the land, the people and the terms of the deals in question (Hall, 2011). I will thus refrain from using the phrase 'grabbing', as I believe it hinders a more thorough exploration of land acquisition deals and what they mean for water management.

Water cannot be viewed in isolation. The wider economic and societal implications of land acquisitions must be understood in order to inform a holistic (and realistic) water management scheme.

Quoting research by Rulli and D'Odorico, Pearce (2014) states that on the total global area of land acquired or in the process of being acquired, 300-550 million people could be fed through the use of modern farming techniques, compared to 190-370 million through traditional techniques. Whilst this is a crude figure - there are serious concerns about the sustainability of modern techniques in all these areas, the destination of the food grown, the use of that land for produce other than food - it is important to keep in mind throughout this post the potential of that land. There are many questions to be asked about land acquisition, and a distinct lack of answers. Studies in hindsight will undoubtedly establish "frameworks" and "best practise" guidelines, but for the decisions being made now, the issues of practicalities and principles are legion.

Even the phrase "land acquisition" implies purchasing of land, when in fact the trend is for land to be leased (Cotula et al., 2009 - see Figure 1). Furthermore, these land deals introduce expertise and technology alongside capital. This naturally carries the risk of local knowledge being lost, however, ignoring proven advances in agriculture equally carries risk. Encouraging/enforcing sharing of local knowledge could help ensure investor practises on the land have a lower risk of compromising water availability. There is considerable opportunity for technologies and expertise to develop within individual nations as a result of this investment, contributing to the development of water use infrastructure elsewhere in the country. Land and labour would therefore be traded for capital, technology and expertise.

Fig 1 Type of land rights transferred - "Other" in Mali and Madagascar refers to projects involving contract farming or land distribution arrangements.

Land deals also carry with them opportunity costs (Schutter, 2011), as land is not developed with the aim of poverty-reduction or responsible consumption. Further, the reduction of land to commodity-status could also negatively affect the culture of those that use it. Land can and does hold intrinsic value. Indeed, buildings and areas of land are protected in the UK under all manner of listings. It is not an overly romanticised view of the land, but a recognition of the importance of culture, and a people's relationship to their surroundings. Large-scale land deals also massively reduce the freedom of individuals whose livelihood is linked to that land. Their choices are restricted and shaped by the opportunities investors choose to create.

In response to calls for a Code of Conduct to shape land deals, Borras and Franco argue that:

any effort to link high standards of business practice with ethical behaviour in (trans)national land deals is unlikely to produce truly pro-poor outcomes if the primary aim of the land transfer is not categorically to protect and advance the land-access and property interests of working poor people. (2010: 510)

The argument follows that the root causes of poverty issues are not linked to economic development, but a 'TNC-controlled global system' (ibid). It may be argued therefore that a departure from this system is necessary to allow responsible water management decisions to be made. So long as profit is driving decisions within a global, capitalist system, it is not possible to have inclusive decision-making that includes all stakeholders. The power relations of our current political standard do not allow for environmental and societal protections, but rather the finances of an elite. 

Transnational corporations are not natural vehicles for poverty reduction. And the wholesale leasing of land for large-scale agri-industrial projects is unlikely to be the ideal development strategy - especially for the development of water access and security. Corporations - or rather, the pursuit of profit and power - does not have a good track record with equitable development. However, some deals may indeed increase standards of living and create water management solutions that are better suited to the growing populations of many African countries.  Even in developed countries, the struggle of keeping corporations in check is ever-present. Over the 20th century, when industrial jobs were exported and the UK's economy shifted to be far more financialised, there were considerable losses. To this day we struggle to control the excesses and transgressions of the current economy. I argue however that few, if any, would wish education standards, health services and infrastructure to revert to that of the 20th century. Is there an example of such development, water security and food security without the move from traditional, low-output agriculture? 

Africa's a vastly varied continent, and there may be instances within it where the pro-poor development opportunities that Borras and Franco call for may be possible, isolated from the wider capitalist hegemony. But it is not plausible for the African continent to insulate itself from international influence or reliance. If the inequalities and inequities of the world are accepted, and water management strategies are drawn up within this reality, then land deals are likely to be necessary and inevitable. The water and food security that we enjoy in the UK and in other developed countries has required compromise. Surely then it is not right to deny or discourage similar development in other countries because of our uncompromising stance.

The issue of land deals is not therefore just one of transnational corporations vs the people. I contend that it is far more difficult and nuanced. It requires choosing between different visions of development - each with the aim of serving the people.