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“Land Grabs” in Africa

by Tad Bardenwerper
August 2012

The Issue

Over the last decade, the amount of land purchased by foreign investors in developing countries has increased dramatically. By some estimates, nearly 35 million hectares of land in 66 countries have been purchased by foreign investors since 2006.1 Many commentators have labeled such investments “land grabs,” drawing attention to the potential negative impact such purchases might have on host nations.

Generally, experts suggest three causes for this increase in investment: global demand for food, global demand for biofuels, and the investment community’s growing interest in soft commodities in general.2 Some commentators worry that this new wave of “land grabs” could result in a form of “neo-colonialism,” with deals of unprecedented size, involving hundreds of thousands of hectares of land, leaving poorer states producing food for richer states while local populations struggle to meet their basic needs.3

Other observers see a different dynamic, and argue that the impact of foreign investment in land could be positive for less-developed nations. They argue that under the right circumstances, foreign investment in land can lead to sorely needed development in regions lacking basic infrastructure or access to outside resources. In addition, this investment has the potential to provide sustainable jobs for members of local communities, while giving those communities access to new, more efficiently produced sources of food.4

Ensuring that host nations and local communities benefit from foreign investment in land hinges on transparency among investors, communities and governments. This transparency must be embodied through negotiations that put the well-being of local populations first.

Africa and “Land Grabbing”

A 2012 report on “land grabs” cataloguing 416 large-scale foreign investments targeted at food production concluded that the most seriously affected nations were located in Africa.5 While food production was the driving force behind a majority of these deals, increased demand for biofuels, such as ethanol, has led to an increase in investment for the production of corn and jatropha (a possible source of biofuel).6 Not to be overlooked, critical to both food and biofuel production is water, and therefore land with reliable access to water is in high demand.7 Although most investors in the transactions included in the report were in the agribusiness industry, some were financial institutions or sovereign wealth funds, with roughly 2/3 of the deals headed by European or Asian investors.

Foreign acquisition of land in Africa seems to be increasing, in both the number and size of deals.8 Based on the number of deals made during this period, some of the most frequently targeted nations for land acquisition transactions are Ethiopia, Ghana, Mali, Mozambique and Sierra Leone.9 Based on the amount of land controlled by foreign investors in relation to a state’s agricultural area, a different study found the countries most affected by most affected by foreign investment to be Democratic Republic of Congo, Mozambique, Uganda, Zambia, and Ethiopia.10

So far, significant foreign investment in agriculture in Africa has done little to improve the continent’s agricultural production. According to the Economist, “Farming has done worst of all in Africa, where most of the largest land deals are taking place. There, agricultural output per farmworker was the lowest in the world during 1980-2004, growing by less than 1% a year, compared with over 3% a year in East Asia and the Middle East.”11

Main Concerns

Substantial land acquisitions by foreign investors raise serious legal and ethical questions. Specifically, such deals should be subject to close oversight by host governments and local communities.12 Unfortunately, such deals are often consummated with little transparency and a high risk of corruption.

Of primary concern are the rights of those who live on land that is sold to foreign investors. Often land is handed from a host nation to a foreign investor without any input from those who will be displaced as a result of the transaction.13 Not only are local communities harmed as a result of such practices, but these practices do not bode well for an investment’s long-term success: There are many historical examples of political unrest resulting from the unwelcome arrival of large-scale agribusiness from overseas, especially when local residents and employees face subsequent mistreatment at the hands of the foreign company.14

Finally, there are other concerns beyond the rights of affected community members. With regard to biofuels, many land deals claim to intend to increase biofuel supply domestically. However, many host nations do not yet utilize such fuels, so the proclaimed benefits to the host state never materialize.15 As for the environment, serious problems can arise when states hand over control of land to foreign entities with little stake in the region’s environmental wellbeing.16

Recommendations

Foreign investment in land can have a significant impact on a host country – either positively or negatively. Therefore it is up to the parties to a transaction to ensure a mutually beneficial result. In order to accomplish such an outcome, the concerns of affected communities must be respected, and the implementation of clear negotiation guidelines for host countries and investors can help make sure that those communities are treated fairly. Specifically, the most effective guidelines will focus on transparency, early engagement, inclusivity of all concerned groups, and negotiations grounded in good faith and legally binding commitments.17


Tad Bardenwerper is a third year law student at St. John’s University School of Law and a member of the St. John’s Law Review.


1. GRAIN, GRAIN releases data set with over 400 global land grab (Feb. 23, 2012), available at http://www.grain.org/fr/article/entries/4479-grain-releases-data-set-with-over-400-global-land-grabs (“GRAIN is a small international non-profit organisation that works to support small farmers and social movements in their struggles for community-controlled and biodiversity-based food systems.”).

2. See Shepard Daniel with Anuradha Mittl, The Great Land Grab: Rush for World’s Farmland Threatens Food Security for the Poor, THE OAKLAND INSTITUTE (2009), at 2–5, available at http://www.oaklandinstitute.org/sites/oaklandinstitute.org/files/LandGrab_final_web.pdf. Soft commodities generally refer to commodities that are grown, as opposed to hard commodities, such as oil and gas, which are mined and not renewable.

3. Julian Borger, Rich countries launch great land grab to safeguard food supply, GUARDIAN (U.K.), Nov. 21, 2008, available at http://www.guardian.co.uk/environment/2008/nov/22/food-biofuels-land-grab. See also John Vidal, Oxfam warns of spiralling land grab in developing countries: Many of world’s poorest ‘being left worse off by unprecedented land deals’, despite claims by governments and speculators, GUARDIAN (U.K.), Sept. 22, 2011, available at http://www.guardian.co.uk/environment/2011/sep/22/oxfam-land-grab-developing-countries. It should be noted that large-scale investment by “domestic elites” can swallow up large amounts of land as well, often at the bidding of foreign interests that might wish to evade restrictions on foreign investment. See High Level Panel of Experts (“HLPE”) on Food Security and Nutrition of the Committee on World Food Security, Land tenure and international investments in agriculture: A report by the High Level Panel of Experts on Food Security and Nutrition of the Committee on World Food Security (2011), at 17, available at http://www.fao.org/fileadmin/user_upload/hlpe/hlpe_documents/HLPE-Land-tenure-and-international-investments-in-agriculture-2011.pdf.

4. See HLPE, supra note 3, at 30, 34; David K. Deng, Handbook on Community Engagement: A ‘good practice’ guide to negotiating lease agreements with landowning communities in South Sudan, SOUTH SUDAN LAW SOCIETY, at 5 (April 2012), available at http://www.mokoro.co.uk/files/13/file/lria/1985-SSLS-Handbook-on-Community- Engagement.pdf.

5. See GRAIN, supra note 1 (“It confirms that Africa is the primary target of the land grabs, but it also underlines the importance of Latin America, Asia and Eastern Europe, demonstrating that this is a global phenomenon.”). See also HLPE, supra note 3, at 15.

6. See HLPE, supra note 3, at 9. Growing crops intended solely to produce energy (such as jatropha) can also be a risky investment, as the costs and benefits of such crops are not yet completely understood, and the market for such crops can be unpredictable. See Daniel, supra note 2, at 14. See generally, Friends of the Earth, Jatropha: wonder crop? Experience from Swaziland (May 2009), available at http://www.foe.co.uk/resource/reports/jatropha _wonder_crop.pdf.

7. Buying farmland abroad: Outsourcing’s Third Wave, ECONOMIST, May 21, 2009, available at http://www.economist.com/node/13692889.

8. Lorenzo Cotula et al., Land grab or development opportunity? Agricultural investment and international land deals in Africa (2009), at 4, available at http://pubs.iied.org/pdfs/12561IIED.pdf.

9. See GRAIN, supra note 1.

10. Lorenzo Cotula, Analysis: Land grab or investment opportunity, BBC (Feb. 21, 2012), http://www.bbc.co.uk/news/ world-africa-17099348 (chart courtesy of FAOSTAT). The full list, with percentages, follows: DR Congo: 48.8% Mozambique: 21.1% Uganda: 14.6% Zambia: 8.8% Ethiopia: 8.2% Madagascar: 6.7% Malawi: 6.2% Mali: 6.1% Senegal: 5.9% Tanzania: 5% Sudan: 2.3% Nigeria: 1% Ghana: 0.6% Id.

11. ECONOMIST, supra note 7.

12. Joseph Otoo & Laith Najjar, A4ID Report: The Right to Land (June 2011), Annex I, available at http://www.a4id.org/sites/default/files/user/Right%20to%20Land%20-%20A4ID%20Guide.pdf (including a list of relevant international law provisions).

13. See Deng, supra note 4; Tinyade Kachika, Land Grabbing in Africa: A Review of the Impacts and the Possible Policy Responses, OXFAM INTERNATIONAL (2010), at 31–32, available at http://www.oxfamblogs.org/eastafrica/wpcontent/uploads/2010/11/Land-Grabbing-in-Africa.-Final.pdf.

14. See Daniel, supra note 2, at 11. Some of these problems were evident in the early 20th century when fruit companies made major investments in Central and South America. Id. More recently, deals in Madagascar and Zambia have had major political ramifications. See ECONOMIST, supra note 7.

15. See Kachika, supra note 13, at 9.

16. See Deng, supra note 4, section 2.3.

17. See generally Deng, supra note 4 (outlining best practices for negotiations between foreign investors, host countries, and local communities). See also Salil Tripathi & Wambui Kimathi, What should companies do when states offer prime land on a platter?, GUARDIAN (U.K.), Mar. 6, 2012, available at http://www.guardian.co.uk/global-development/poverty-matters/2012/mar/06/companies-guidelines-land-investing-africa.