February 6, 2014
African countries seek new farmland investments
With deals they say are designed to avoid problems of the past, African countries that missed out on Gulf cash pouring into agricultural projects elsewhere on the continent are trying to entice Arab investors.
Domestic hostility or even unrest on some projects has aroused due to an earlier wave of foreign investment in African farmland, with opponents regarding them as land-grabs that eat into local people''s food needs. But Zambian and Ghanaian governments argue that everyone can benefit from such investment provided it is properly regulated.
They took their message this week to a global agricultural forum in the United Arab Emirates, offering land lease and production sharing deals which aim to raise money for helping their own small scale farmers and to feed local people.
In a multi-billion dollar search for food security, desert states of the Gulf - which rely on imports for around 80% to 90% of their food needs - started investing heavily in farmland overseas around 2008.
Bad weather in large food producing nations, growing use of land for biofuel crops and curbs on agricultural exports by some governments had sent grain futures prices soaring at that time, prompting the Gulf spending spree to secure access to large scale food production.
Sudan, Ethiopia and Namibia have benefited from investments which included land to grow crops like wheat, rice and corn, but other African nations have so far been left out.
Ghana offers tax-free arrangements for agricultural investments in the northern part of the country. In return, the farming projects would typically split their production, with part going to the domestic market for crops which are locally consumed and the investor exporting the rest.
Resources are badly needed to develop small scale farming in Africa. Zambia has only 500 commercial farmscompared with around 1.5 million small farmers, Zambian Agriculture Minister Robert Sichinga said. The country is farming only 14% of its 70 million hectares of arable land but is self-sufficient in most crops and exports food to neighbours. "Foreign direct investment would help us secure more export markets," Sichinga said.