The Why and the How of Land-Grabbing in Africa

Biofuels were then and continue to be in many respects hyped as an environmentally friendly alternative to oil-based transport fuels. The United States, the EU and other OECD (Organisation for Economic Co-operation and Development) countries initiated legislation to encourage its production. They also set mandatory targets. The EU set a binding target to replace 20 per cent of fossil fuels with biomass, hydro, wind and solar by 2020. Each member state is also required to replace 10 per cent of its transport fuel as well. It is this 10 per cent target that is a cause for concern and is partly conditioned on the commercial viability of second-generation biofuels. Second-generation biofuels are mainly made from lignocellulosic materials like wood and straw. First-generation biofuels are mainly ethanol from grains, sugar crops and biodiesel from oil seeds or from recycled cooking oil.[1]

Exporting biofuels or feedstocks from developing countries to the EU will push up food prices and hurt poor consumers. Studies and countless media reports link biofuel plantations with a number of destructive conditions that directly undermine their potential, not to mention ethics. For instance, the EU has a contractual obligation to import sugar from ACP (African, Caribbean and Pacific) states entering into an EPA (economic partnership agreement). But there are no clear legal mandates to determine the difference between ‘environmentally sound’ and ‘environmentally damaging’ imports.[3]

As such, European companies are scrambling for a slice of African soil. The financial incentives along with home policies drive the business fury and yet, according to a report by the European Parliament, only a tiny percentage of biofuel is imported from Africa because of high tariffs. The United Nations FAO (Food and Agricultural Organisation) along with the IIED (International Institute for Environment and Development) and the IFAD (International Fund for Agricultural Development) conducted a study that looks at the impact of land acquisition in Mali, Ghana, Sudan, Ethiopia and Madagascar. Since 2004, close to 2.5 million (ha) hectares of land – excluding land allocations below 1,000 ha – have been appropriated by foreign acquisition in these countries. Two-thirds of 3 billion people survive on around 500 million parcels of land less than two hectares in size. Most of the land claimed by foreign acquisition was already in use by local people. Women, who are the main food producers, were more easily driven out due to discrimination. In Tanzania, a sugarcane plantation for biofuel in the Wami basin displaced 1,000 farmers. The results are disheartening as people end up in over-populated urban centres and their outlying slums.

The promise of easy money in an environment without strong regulation and cheap land is a motivating factor for companies and the hosting government. Weak legislation means mechanisms that are supposed to protect local rights, interest, and welfare is disregarded.[4] Rich arable land used for commercial biofuel production has serious implications for a people who already spend 70 per cent of their incomes on food. Food and energy security concerns are supposed to be key drivers behind government-backed investments. However, the key driver behind these deals is investment opportunities. This is compounded by a global demand for non-food agricultural commodities and biofuels, which promise high rates of return. The buy-outs and speculation of African land is also driving up its value while policy measures in home and host countries encourage the scramble.[5] The incentives stemming from EU legislation on biofuels, for example, mean the acquisition of land for biofuel production will continue.

‘A lot of little start-up companies with financing are going to Africa. It’s like the conventional oil industry. It starts off small and if it works, they will be bought out by the large companies,’ Mr Bebb told Pambazuka News. Mr Bebb suspects most of these start-ups will fail within in two years.

In Ethiopia, arable land and wooded areas are being cleared without taking into consideration the loss to biodiversity. Environmental impact assessments are not required or are performed in an ad hoc manner. Access to rural land by investors is guaranteed by Article 4 of Ethiopia’s Rural Land Administration and Land Use Proclamation (456/2005) so long as priority is supposedly given to peasant farmers and pastoralists. Biomass fuels account for almost 94 per cent of total energy consumption while the remaining percentage comes from imported petroleum fuels. As a net importer of petroleum fuels, the country is particularly vulnerable to price hikes and the government is seeking to offset the risks by investing in alternative fuel sources.[6] Energy security is the official line. But at what cost? Two years ago there were around 50 registered developers for biodiesel and another six for bioethanol production in Ethiopia. Four of the bioethanol producers are government operated and sugar is their source crop.

‘Land acquisition is a political issue’, Alexander Muller, the assistant director at FAO, told a special committee at the European Parliament. ‘Deals seek access to resources, not to the market. Most of the investors are private but the government is also involved’, he said. Mr Muller then explained that it was in the interest of everyone to support small farmers and that local communities must be involved to defend vulnerable groups. These individuals are asked to produce legal documents to protect them from foreign acquisition. Traditional land rights are not considered binding so people are forced off the land.

Thousands of kilometres away in the capitals of Europe, ministers are slapping taxes on locally produced first-generation biofuels. In Germany, for instance, biofuels were entirely tax-free until 2006. A year later German biodiesel production capacity peaked and then bottomed out in 2008. Nearly 70 per cent of Germany-based biofuel companies went bankrupt. But the knock-on effect is that Germany is now importing more biofuel from abroad. As an added bonus, second-generation fuels will continue to enjoy complete tax exoneration until 2015.[8]

Recently in New York, the EU Commissioner for Development Karl de Gucht delivered a speech and proposed a monitoring mechanism under the conjoined efforts of the Global Partnership for Agriculture and Food Security and a reformed Food Security Committee hosted by the FAO. But it’s also back home in Europe where policies influenced by corporate interests should be fully disclosed. The backroom dealings and the lobbyists that roam the corridors of the European Parliament and the European Commission do their best to stay out of the public eye.

It is indeed a tragic enterprise where worthy conservation and sustainable energy initiatives become high-jacked by political and corporate interests. Strong regulation of EU companies seeking their fortunes in Africa is missing and as a result, reckless investments and the promise of quick returns are felling virgin forests and driving indigenous peoples off their land. When and if these companies fail, they will pull out and leave behind them a wasteland where elephants in the Babile Elephant Sanctuary once roamed, where entire families surviving on less than 2 hectares attempt to carve out a desperate living in an overcrowded slum, where carbon absorbing trees lie smouldering. In the meantime, Europe will meet its 10 per cent target and some, like Sweden, will even excel. Then the highbrow discourse will follow along with the press releases that praise Europe’s commitments to meeting its objectives. But in the far-flung places of the world’s least developed countries, the machinery will grind out the devastation if serious attempts at oversight, at regulation, at responsible government and sincere sustainable efforts are not met.