“The African continent is going to be the golden continent of the period,” raves a business leader at the 2011 World Economic Forum in Davos.
This sentiment is shared by economists, investors and world leaders around the globe, who are singing the praises of Africa’s economic potential. And at long-last this optimism about Africa’s economy may be warranted. Eight of the world’s top 20 fastest-growing economies are African Countries. And the financial news and investing website The Street recently declared Africa to be the “hot new continent for trade and investment.”
In some ways, the transition is already happening. Genetic research is finally delivering higher-yielding, more resilient so-called African crops, like sorghum and cassava, says to The Economist. And the BBC reported on a recently published book that suggests the continent could “feed itself in a generation” if top politicians genuinely commit to developing infrastructure, modernizing agriculture and implementing the use of genetically modified crops.
But alongside the excited buzz welcoming Africa’s new dawn, there are fears that a land rush could be more exploitative than beneficial. The New York Times article cites concerns that the scramble for African land threatens to become a series of “neocolonial land grabs that destroy villages, uproot tens of thousands of farmers and create a volatile mass of landless poor.”
There are clear reasons for the urgency and location of the rush. Arable soil is a limited commodity in many parts of the world. Fears about food security and the cultivation of biofuels are ramping up demand for the earth’s last remaining stretches of fertile land — most of which are in Africa.
The World Bank estimates that up to 115 million acres of farmland are already being leased to foreign investors across the globe, reports the Christian Science Monitor. “As much as 90 percent of Africa is under customary tenure, which means it’s held by the state on behalf of the community, who are then given the customary right to the land.” In short, land can be seized at the whim of those in power.
The particular circumstances of these types of deals are unique, but the context in which they are negotiated is often similar. The landlord country is poor with a high rate of unemployment and underdeveloped infrastructure. But it has an abundance of productive farmland. Huge zones are leased to a corporation or government of a wealthier nation. The latter pays the former. The investor brings in state-of-the-art technologies and skills to develop infrastructure and ideally employ citizens of the landlord country. But what happens next is key, explains the Christian Science Monitor article. In many of these deals, most or all of the product is exported to the foreign investing country. Land and labor are exploited and neither domestic food security, nor growth are improved.
Africa certainly can’t afford this fate. In sub-Saharan Africa, nearly two-thirds of the population lives on less than $1.25 a day, and more than one-fourth is considered undernourished (pdf), according to the most recent U.N. Millennium Development Goals report.
If this is to be the continent’s long-awaited golden era, foreign investment and involvement will be essential. But the motives of the architects of these deals must be clear and the management carefully crafted. The New York Times quotes former U.N. security-general, Kofi Annan, who stresses the need to focus on food security in Africa, but also calls for sensitivity to Africa’s colonial legacy.The food security of the country concerned must be first and foremost in everybody’s mind … Otherwise it is straightforward exploitation and it won’t work. We have seen a scramble for Africa before. I don’t think we want to see a second scramble of that kind.
At first glance, Africa’s prospects look good. But it would be a tragic lost opportunity if the continent’s bounty is exported, leaving its breadbasket empty.