The new African dispossession

JUBA, SUDAN---We turned off the main road to Awassa, talked our way past
security guards and drove a mile across empty land before we found what
will soon be Ethiopia's largest greenhouse. Nestling below an escarpment
of the Rift Valley, the development is far from finished, but the
plastic and steel structure already stretches over 20 hectares - the
size of 20 football pitches.

The farm manager shows us millions of tomatoes, peppers and
other vegetables being grown in 500m rows in computer controlled
conditions. Spanish engineers are building the steel structure, Dutch
technology minimises water use from two bore-holes and 1,000 women pick
and pack 50 tonnes of food a day. Within 24 hours, it has been driven
200 miles to Addis Ababa and flown 1,000 miles to the shops and
restaurants of Dubai, Jeddah and elsewhere in the Middle East.

Ethiopia is one of the hungriest countries in the world with
more than 13 million people needing food aid, but paradoxically the
government is offering at least 3m hectares of its most fertile land to
rich countries and some of the world's most wealthy individuals to
export food for their own populations.

The 1,000 hectares of land which contain the Awassa greenhouses
are leased for 99 years to a Saudi billionaire businessman,
Ethiopian-born Sheikh Mohammed al-Amoudi, one of the 50 richest men in
the world. His Saudi Star company plans to spend up to $2bn acquiring
and developing 500,000 hectares of land in Ethiopia in the next few
years. So far, it has bought four farms and is already growing wheat,
rice, vegetables and flowers for the Saudi market. It expects eventually
to employ more than 10,000 people.

But Ethiopia is only one of 20 or more African countries where
land is being bought or leased for intensive agriculture on an immense
scale in what may be the greatest change of ownership since the colonial
era.

An Observer investigation estimates that up to 50m hectares of
land - an area more than double the size of the UK - has been acquired
in the last few years or is in the process of being negotiated by
governments and wealthy investors working with state subsidies. The data
used was collected by Grain, the International Institute for Environment
and Development, the International Land Coalition, ActionAid and other
non-governmental groups.

The land rush, which is still accelerating, has been triggered
by the worldwide food shortages which followed the sharp oil price rises
in 2008, growing water shortages and the European Union's insistence
that 10% of all transport fuel must come from plant-based biofuels by 2015.

In many areas the deals have led to evictions, civil unrest and
complaints of "land grabbing".

The experience of Nyikaw Ochalla, an indigenous Anuak from the
Gambella region of Ethiopia now living in Britain but who is in regular
contact with farmers in his region, is typical. He said: "All of the
land in the Gambella region is utilised. Each community has and looks
after its own territory and the rivers and farmlands within it. It is a
myth propagated by the government and investors to say that there is
waste land or land that is not utilised in Gambella.

"The foreign companies are arriving in large numbers, depriving
people of land they have used for centuries. There is no consultation
with the indigenous population. The deals are done secretly. The only
thing the local people see is people coming with lots of tractors to
invade their lands.

"All the land round my family village of Illia has been taken
over and is being cleared. People now have to work for an Indian
company. Their land has been compulsorily taken and they have been given
no compensation. People cannot believe what is happening. Thousands of
people will be affected and people will go hungry."

It is not known if the acquisitions will improve or worsen food
security in Africa, or if they will stimulate separatist conflicts, but
a major World Bank report due to be published this month is expected to
warn of both the potential benefits and the immense dangers they
represent to people and nature.

Leading the rush are international agribusinesses, investment
banks, hedge funds, commodity traders, sovereign wealth funds as well as
UK pension funds, foundations and individuals attracted by some of the
world's cheapest land.

Together they are scouring Sudan, Kenya, Nigeria, Tanzania,
Malawi, Ethiopia, Congo, Zambia, Uganda, Madagascar, Zimbabwe, Mali,
Sierra Leone, Ghana and elsewhere. Ethiopia alone has approved 815
foreign-financed agricultural projects since 2007. Any land there, which
investors have not been able to buy, is being leased for approximately
$1 per year per hectare.

Saudi Arabia, along with other Middle Eastern emirate states
such as Qatar, Kuwait and Abu Dhabi, is thought to be the biggest buyer.
In 2008 the Saudi government, which was one of the Middle East's largest
wheat-growers, announced it was to reduce its domestic cereal production
by 12% a year to conserve its water. It earmarked $5bn to provide loans
at preferential rates to Saudi companies which wanted to invest in
countries with strong agricultural potential .

Meanwhile, the Saudi investment company Foras, backed by the
Islamic Development Bank and wealthy Saudi investors, plans to spend
$1bn buying land and growing 7m tonnes of rice for the Saudi market
within seven years. The company says it is investigating buying land in
Mali, Senegal, Sudan and Uganda. By turning to Africa to grow its staple
crops, Saudi Arabia is not just acquiring Africa's land but is securing
itself the equivalent of hundreds of millions of gallons of scarce water
a year. Water, says the UN, will be the defining resource of the next
100 years.

Since 2008 Saudi investors have bought heavily in Sudan, Egypt,
Ethiopia and Kenya. Last year the first sacks of wheat grown in Ethiopia
for the Saudi market were presented by al-Amoudi to King Abdullah.

Some of the African deals lined up are eye-wateringly large:
China has signed a contract with the Democratic Republic of Congo to
grow 2.8m hectares of palm oil for biofuels. Before it fell apart after
riots, a proposed 1.2m hectares deal between Madagascar and the South
Korean company Daewoo would have included nearly half of the country's
arable land.

Land to grow biofuel crops is also in demand. "European biofuel
companies have acquired or requested about 3.9m hectares in Africa. This
has led to displacement of people, lack of consultation and
compensation, broken promises about wages and job opportunities," said
Tim Rice, author of an ActionAid report which estimates that the EU
needs to grow crops on 17.5m hectares, well over half the size of Italy,
if it is to meet its 10% biofuel target by 2015.

"The biofuel land grab in Africa is already displacing farmers
and food production. The number of people going hungry will increase,"
he said. British firms have secured tracts of land in Angola, Ethiopia,
Mozambique, Nigeria and Tanzania to grow flowers and vegetables.

Indian companies, backed by government loans, have bought or
leased hundreds of thousands of hectares in Ethiopia, Kenya, Madagascar,
Senegal and Mozambique, where they are growing rice, sugar cane, maize
and lentils to feed their domestic market.

Nowhere is now out of bounds. Sudan, emerging from civil war and
mostly bereft of development for a generation, is one of the new hot
spots. South Korean companies last year bought 700,000 hectares of
northern Sudan for wheat cultivation; the United Arab Emirates have
acquired 750,000 hectares and Saudi Arabia last month concluded a
42,000-hectare deal in Nile province.

The government of southern Sudan says many companies are now
trying to acquire land. "We have had many requests from many developers.
Negotiations are going on," said Peter Chooli, director of water
resources and irrigation, in Juba last week. "A Danish group is in
discussions with the state and another wants to use land near the Nile."

In one of the most extraordinary deals, buccaneering New York
investment firm Jarch Capital, run by a former commodities trader,
Philip Heilberg, has leased 800,000 hectares in southern Sudan near
Darfur. Heilberg has promised not only to create jobs but also to put
10% or more of his profits back into the local community. But he has
been accused by Sudanese of "grabbing" communal land and leading an
American attempt to fragment Sudan and exploit its resources.

Devlin Kuyek, a Montreal-based researcher with Grain, said
investing in Africa was now seen as a new food supply strategy by many
governments. "Rich countries are eyeing Africa not just for a healthy
return on capital, but also as an insurance policy. Food shortages and
riots in 28 countries in 2008, declining water supplies, climate change
and huge population growth have together made land attractive. Africa
has the most land and, compared with other continents, is cheap," he said.

"Farmland in sub-Saharan Africa is giving 25% returns a year and
new technology can treble crop yields in short time frames," said Susan
Payne, chief executive of Emergent Asset Management, a UK investment
fund seeking to spend $50m on African land, which, she said, was
attracting governments, corporations, multinationals and other
investors. "Agricultural development is not only sustainable, it is our
future. If we do not pay great care and attention now to increase food
production by over 50% before 2050, we will face serious food shortages
globally," she said.

But many of the deals are widely condemned by both western
non-government groups and nationals as "new colonialism", driving people
off the land and taking scarce resources away from people.

We met Tegenu Morku, a land agent, in a roadside cafe on his way
to the region of Oromia in Ethiopia to find 500 hectares of land for a
group of Egyptian investors. They planned to fatten cattle, grow cereals
and spices and export as much as possible to Egypt. There had to be
water available and he expected the price to be about 15 birr (75p) per
hectare per year - less than a quarter of the cost of land in Egypt and
a tenth of the price of land in Asia.

"The land and labour is cheap and the climate is good here.
Everyone - Saudis, Turks, Chinese, Egyptians - is looking. The farmers
do not like it because they get displaced, but they can find land
elsewhere and, besides, they get compensation, equivalent to about 10
years' crop yield," he said.

Oromia is one of the centres of the African land rush. Haile
Hirpa, president of the Oromia studies' association, said last week in a
letter of protest to UN secretary-general Ban Ki-moon that India had
acquired 1m hectares, Djibouti 10,000 hectares, Saudi Arabia 100,000
hectares, and that Egyptian, South Korean, Chinese, Nigerian and other
Arab investors were all active in the state.

"This is the new, 21st-century colonisation. The Saudis are
enjoying the rice harvest, while the Oromos are dying from man-made
famine as we speak," he said.

The Ethiopian government denied the deals were causing hunger
and said that the land deals were attracting hundreds of millions of
dollars of foreign investments and tens of thousands of jobs. A
spokesman said: "Ethiopia has 74m hectares of fertile land, of which
only 15% is currently in use - mainly by subsistence farmers. Of the
remaining land, only a small percentage - 3 to 4% - is offered to
foreign investors. Investors are never given land that belongs to
Ethiopian farmers. The government also encourages Ethiopians in the
diaspora to invest in their homeland. They bring badly needed
technology, they offer jobs and training to Ethiopians, they operate in
areas where there is suitable land and access to water."

The reality on the ground is different, according to Michael
Taylor, a policy specialist at the International Land Coalition. "If
land in Africa hasn't been planted, it's probably for a reason. Maybe
it's used to graze livestock or deliberately left fallow to prevent
nutrient depletion and erosion. Anybody who has seen these areas
identified as unused understands that there is no land in Ethiopia that
has no owners and users."

Development experts are divided on the benefits of large-scale,
intensive farming. Indian ecologist Vandana Shiva said in London last
week that large-scale industrial agriculture not only threw people off
the land but also required chemicals, pesticides, herbicides,
fertilisers, intensive water use, and large-scale transport, storage and
distribution which together turned landscapes into enormous
mono-cultural plantations.

"We are seeing dispossession on a massive scale. It means less
food is available and local people will have less. There will be more
conflict and political instability and cultures will be uprooted. The
small farmers of Africa are the basis of food security. The food
availability of the planet will decline," she says. But Rodney Cooke,
director at the UN's International Fund for Agricultural Development,
sees potential benefits. "I would avoid the blanket term
'land-grabbing'. Done the right way, these deals can bring benefits for
all parties and be a tool for development."

Lorenzo Cotula, senior researcher with the International
Institute for Environment and Development, who co-authored a report on
African land exchanges with the UN fund last year, found that
well-structured deals could guarantee employment, better infrastructures
and better crop yields. But badly handled they could cause great harm,
especially if local people were excluded from decisions about allocating
land and if their land rights were not protected.

Water is also controversial. Local government officers in
Ethiopia told the Observer that foreign companies that set up flower
farms and other large intensive farms were not being charged for water.
"We would like to, but the deal is made by central government," said
one. In Awassa, the al-Amouni farm uses as much water a year as 100,000
Ethiopians.