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The blog of the Wilson Center's Environmental Change and Security Program
  • Food, Water, Energy, Timber, Population: Do Madagascar’s Forests Stand a Chance?

    April 22, 2009 By Kayly Ober
    A graphic published recently in Le Monde reveals that companies from South Korea, China, Saudi Arabia, and the United Arab Emirates (UAE) are the top purchasers of foreign farmland. These corporations from water-strapped, land-starved, and/or densely populated countries often make bargain-basement deals with unsavory African and Asian governments—or even warlords—to increase their own profits and their home nations’ food security.

    A case in point: The International Criminal Court’s indictment of Sudanese President Omar al-Bashir for human-rights abuses has not deterred Saudi Arabia’s Hail Agricultural Development Co. from developing 9,200 hectares of land in Sudan or the UAE from investing in agricultural projects in several Sudanese provinces, including a 17,000-hectare farm for wheat and corn.

    As previous New Security Beat posts have pointed out, allowing foreign governments to purchase land could threaten food security within the host country, and around the world. The heads of the Food and Agriculture Organization and the International Fund for Agricultural Development raised eyebrows last weekend when they suggested that these deals could be “win-win” situations, if done right.

    These business ventures can also have serious political consequences: Several months ago, seeing an opportunity to capitalize on increasing population growth and limited arable land in its homeland, South Korean conglomerate Daewoo signed a deal to buy more than half of the arable land in Madagascar to grow grain and palm oil. Widespread anger at the terms of the deal—from which the island’s people would gain little—contributed to then-President Marc Ravalomanana’s unpopularity. After weeks of riots, Ravalomanana was ousted by Andry Rajoelina, who immediately axed the deal. “In the constitution, it is stipulated that Madagascar’s land is neither for sale nor for rent, so the agreement with Daewoo is cancelled,” Rajoelina told BBC News.

    Yet although Rajoelina’s actions may seem to have preserved Madagascar’s land for its people, the coup he launched has spurred unprecedented destruction of this land, in the form of deforestation. The breakdown of authority that accompanied the coup spread into Madagascar’s protected areas, where groups of thugs have been illegally felling valuable trees at a rapid rate since the coup. This environmental destruction is particularly tragic for a country like Madagascar, which possesses some of the richest biodiversity on the planet and relies heavily on ecotourism for jobs and economic growth.

    Next month, a Wilson Center event will explore some of the motivations, patterns, and implications of this rush for farmland. Five Wilson Center programs are co-sponsoring this event—demonstrating the global, cross-sectoral implications of this issue.

    Photo: Deforestation in Madagascar. Courtesy of Flickr user World Resources Institute Staff and Jonathan Talbot.
    Topics: Africa, Asia, conflict, food security, forests
    • http://www.blogger.com/profile/12411270631913617686 Daniel

      This is an interesting article.

    • NickLW

      You can look at examples from only a few years ago to see how foreign investment in Africa used to be viewed as veritably neocolonial in nature. However, looking at this example now in Madagascar of what happens when you block that foreign investment versus what can happen in a place like Sierra Leone, where foreign investment (as opposed to foreign aid) combined with privatization of certain industries is welcomed, you can really start to wonder if it is actually impossible for many African states to work out their problems without outside interest. This help, by the way, can also be a fairly attractive option for foreign investors themselves – a possible win-win?

    • http://www.blogger.com/profile/12130944527257315651 Kayly Ober

      The potential for a win-win situation, as you and International Fund for Agricultural Development (IFAD) President Kanayo F. Nwanze call it, is foreseeable if a few requirements are met.

      While foreign land investment may prove to be a positive source of technology transfer, employment opportunities, and economic and infrastructural development; it seems unlikely that developing states would be able to barter deals that are jointly beneficial. At a recent event at the Wilson Center, scholars agreed that good governance and transparency is needed to benefit investor and host country alike. With these prerequisites in place, investors can rest assured that renegade governments won’t renege on the deal; and host countries can push for fair terms, and even a share of the harvest. However, in countries like Sierre Leone, as you mentioned, these prerequisites are often lacking or non-existent. Indeed, Sierra Leone is often cited as a country with a history of land and natural resource abuse because of rampant corruption and weak rule of law. In a case like this, no matter the terms of the agreement or the investor’s intentions, deals can and will be abused.

      Recently, The International Food Policy Research Institute (IFPRI) called for an international code of conduct to be drawn up, modeled on international business laws to prevent corrupt practices in the context of foreign direct investment. This, I believe, may be the first step in ensuring that just deals be made in the future for both investors and developing countries.

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