Land is the new gold


A few days ago, I found myself reading an article about Chilean avocados. As an avocado passionate lover (I grow my own little plants, hoping they survive the Lombardian winter!) I enjoy seeing these creamy tropical fruits on the grocery’s shelves. Nonetheless, the article left me with a sense of guiltiness, making me feel accessory to an unsustainable practice.

As an extremely water-intensive crop, indeed, avocados are literally drying entire areas of Chile. The already scarce freshwater reserves are driven away from households’ consumption and other agricultural activities, and devoted to this export-oriented monoculture aimed at satisfying  European appetite for  guacamole sauce.

The fact that small-scale farmers in the developing world dominate the production of many agricultural commodities but have difficulties in building their livelihoods from them, has always been a big question mark to me.

World population is expected to double by 2050, with most of the increase taking place in developing countries. States will have to feed and house growing populations and, in this context, agriculture-aimed large-scale land acquisitions by foreign actors represent a major policy challenge, as they drive huge amounts of resources away from this goal.

Nothing is new under the sun. Since the debt restructuring programs and trade liberalization policies of the World Bank and the International Monetary Fund in the global south during the 1980’s, land has become a commodity to undersell on the world market. Nonetheless, a wave of land grabs unprecedented in size occurred contemporaneous to the financial crises, fostered by concerns about projected scarcities of food, water, and energy, and speculation purposes.

Foreign investors usually belong to two groups. The first is governments, state enterprises or state funds from oil-rich countries with a lack of arable land, water scarcity and harsh climate conditions. The second group is composed of private companies from industrialized countries and emerging economies with large populations and rapid economic growth investing in agro-fuel projects.

In my Master’s thesis, I analyzed land deals for roughly 30Mha, equal to 42 million football fields and more than the size of Ecuador (data were taken from the Land Matrix database). These acquisitions have been most pronounced in Sub-Saharan Africa (Mozambique, Ethiopia and Tanzania), Southeast Asia (Cambodia, Indonesia and Laos) and Latin America (Argentina and Brazil). The land in question is secured to grow a particular set of crops for export –palm oil, jatropha, trees, rubber and sugarcane– that have uses as both food and biofuel/biomass.

When analyzing the determinants of a country’s attractiveness for land acquisitions, I found that land investments tend to target countries with large untapped freshwater reserves, a high grade of land tenure insecurity and a high forest cover rate.

In Indonesia, for instance, oil palm plantations fueled by transnational land acquisitions have been a main determinant of primary forest conversion into agricultural land. The slash-and-burn technique used to make room for new oil palm cultivations has made the country a top CO2 emitter globally.

What do Indonesian palm oil, Chilean avocados and Brazilian soybeans have in common? These countries are targeted  for growing agricultural commodities for export. Unfortunately, it is not the case that the outsourced agricultural production is motivated by higher yields or water-saving logics. As mentioned, other factors seem rather to drive land acquisitions.

One thing is certain: the impact on local social fabrics and natural ecosystems is huge. Entire communities are “expelled” from the acquired territories and denied customary rights to land and water. In other cases, they are forced to migrate as the production of a single type of crop makes land unproductive and depletes water resources.

For how long will this be sustainable, in view of the climatic and demographic challenges ahead?

Elena Dal Zotto

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s