Hedge funds are behind "land grabs" in Africa to boost their profits in the food and biofuel sectors, a US think-tank says.
The Oakland Institute said hedge funds and other foreign firms had acquired large swathes of African land, often without proper contracts. It said the acquisitions had displaced millions of small farmers. Foreign firms farm the land to consolidate their hold over global food markets, the report said. They also use land to "make room" for export commodities such as biofuels and cut flowers.
It said hedge funds and other speculators had, in 2009 alone, bought or leased nearly 60m hectares of land in Africa - an area the size of France. It added that some firms obtained land after deals with gullible traditional leaders or corrupt government officials. The contracts gave investors a range of incentives, from unlimited water rights to tax waivers.
"The research exposed investors who said it is easy to make a deal - that they could usually get what they wanted in exchange for giving a poor tribal chief a bottle of Johnnie Walker whisky" said Anuradha Mittal, executive director of the Oakland Institute. "When these investors promise progress and jobs to local chiefs it sounds great, but they don't deliver.
"No-one should believe that these investors are there to feed starving Africans.These deals only lead to dollars in the pockets of corrupt leaders and foreign investors," said Obang Metho of Solidarity Movement for New Ethiopia, a non-governmental organisation in Addis Ababa.
In Ethiopia, a process of "villagisation" by the government is moving tens of thousands of people from traditional lands into new centres while big land deals are being struck with international companies.
The largest land deal in South Sudan, where as much as 9% of the land is said by Norwegian analysts to have been bought in the last few years, was negotiated between a Texas-based firm, Nile Trading and Development and a local co-operative run by absent chiefs. The 49-year lease of 400,000 hectares of central Equatoria for around $25,000 (£15,000) allows the company to exploit all natural resources including oil and timber. The company says it intends to apply for UN-backed carbon credits that could provide it with millions of pounds a year in revenues.
In Mozambique, where up to 7m hectares of land is potentially available for investors, western hedge funds are said in the report to be working with South Africans businesses to buy vast tracts of forest and farmland for investors in Europe and the US. The contracts show the government will waive taxes for up to 25 years, but few jobs will be created.
"The scale of the land deals being struck is shocking" said Mittal. "The conversion of African small farms and forests into a natural-asset-based, high-return investment strategy can drive up food prices and increase the risks of climate change."
This is what Marx described in Capital in 1867 as "primitive accumulation" and as he it: "The expropriation of the agricultural producer, of the peasant, from the soil, is the basis of the whole process." Deprived of their land, their homes, their traditional surroundings and the protection of the law, the expropriated African farmers are left to sell the one thing they possessed - their ability to work.
As Honore de Balzac, the French novelist wrote back in the 19th century, “Behind every great fortune lies a great theft.” !!