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"A Search for Fair Returns"

Reuters' special report "In global land rush, a search for fair returns" (Jan 31, 2011) raises questions of governance, benefit-sharing, innovation and foreign investment that PROFOR has been asking as well in recent and ongoing studies. The story, reported from Illinois, Brazil, Sierra Leone and South Africa (plus London and Rome), mentions the World Bank study on large scale land acquisition which PROFOR supported:

The World Bank estimates that 45 million hectares worth of large-scale farmland deals were announced in 2009, more than 10 times the annual average expansion of agricultural land in the decade to 2008. "Demand for land acquisition continues and may even be increasing," the World Bank said in its report, which asked whether the rush for land can "yield sustainable and equitable benefits?"

It's a good question. When fast-growing countries in the Middle East and Asia began buying land in Africa four years ago, there were cries of land grab and exploitation. Now hedge funds, pension funds, multinational corporations, farmer cooperatives and other investors are piling in as well, bringing, in some cases, new ideas and more professional management.

But the land rush still poses plenty of dangers: for both the countries targeted for their rich, under-exploited land and for anyone sinking money into a farm halfway around the world. The World Bank calls the risks "immense...At the same time, these risks correspond to equally large opportunities."

Reuters' journalists interviewed both local farmers who felt cheated by unfair agreeements and people who were afraid foreign investment would pass them by if the land acquisition rules in their country became too restrictive:

Locals who have seen the benefits of foreign money are also worried. Ademar Moacir Cordeiro, a former mayor in Tunas do Parana, a mountain town some two hours southwest of Curitiba, says foreign investment in forestry has brought jobs that pay three times the minimum wage, and a booming local economy. "If there were no forestry industry we wouldn't be standing here today," he says, estimating that 200 log-laden 18-wheel trucks trundle through the town on a typical day. "We depend on the planting of the trees... The forestry industry is the future of the town and it's what we leave for future generations."

The story ends with an interesting insight on picky ethical eaters demanding to know where their food is grown -- they are driving a move toward "bar codes on trees" which requires more investment than your average farm.

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