US universities in Africa 'land grab'

Thu Jun 9 11:53:38 BST 2011

US universities in Africa 'land grab'

http://www.guardian.co.uk/world/2011/jun/08/us-universities-africa-land-grab
Institutions including Harvard and Vanderbilt 
reportedly use hedge funds to buy land in deals that may force farmers out
    * 
<http://www.guardian.co.uk/profile/johnvidal>John 
Vidal and <http://www.guardian.co.uk/profile/claire-provost>Claire Provost
    * <http://www.guardian.co.uk>guardian.co.uk, 
Wednesday 8 June 2011 20.18 BST

Farmers work in thhe Sahara desert

US universities are reportedly using endowment 
funds to make deals that may force thousands from 
their land in Africa. Photograph: Boston Globe via Getty Images

Harvard and other major American universities are 
working through British 
<http://www.guardian.co.uk/business/hedge-funds>hedge 
funds and European financial speculators to buy 
or lease vast areas of African farmland in deals, 
some of which may force many thousands of people 
off their land, according to a new study.

Researchers say foreign investors are profiting 
from "land grabs" that often fail to deliver the 
promised benefits of jobs and economic 
development, and can lead to environmental and 
social problems in the poorest countries in the world.

The new report on land acquisitions in seven 
African countries suggests that Harvard, 
Vanderbilt and many other US colleges with large 
endowment funds have invested heavily in African 
land in the past few years. Much of the money is 
said to be channelled through London-based 
Emergent asset management, which runs one of 
<http://www.guardian.co.uk/world/africa>Africa's 
largest land acquisition funds, run by former JP 
Morgan and Goldman Sachs currency dealers.

Researchers at the California-based Oakland 
Institute think that Emergent's clients in the US 
may have invested up to $500m in some of the most 
fertile land in the expectation of making 25% returns.

Emergent said the deals were handled responsibly. 
"Yes, university endowment funds and pension 
funds are long-term investors," a spokesman said. 
"We are 
<http://www.guardian.co.uk/business/investing>investing 
in African agriculture and setting up businesses 
and employing people. We are doing it in a 
responsible way 
 The amounts are large. They can 
be hundreds of millions of dollars. This is not 
landgrabbing. We want to make the land more 
valuable. Being big makes an impact, economies of 
scale can be more productive."

Chinese and Middle Eastern firms have previously 
been identified as "grabbing" large tracts of 
land in developing countries to grow cheap 
<http://www.guardian.co.uk/environment/food>food 
for home populations, but western funds are 
behind many of the biggest deals, says the 
Oakland institute, an advocacy research group.

The company that manages Harvard's investment 
funds declined to comment. "It is Harvard 
management company policy not to discuss 
investments or investment strategy and therefore 
I cannot confirm the report," said a spokesman. 
Vanderbilt also declined to comment.

Oakland said investors overstated the benefits of 
the deals for the communities involved. 
"Companies have been able to create complex 
layers of companies and subsidiaries to avert the 
gaze of weak regulatory authorities. Analysis of 
the contracts reveal that many of the deals will 
provide few jobs and will force many thousands of 
people off the land," said Anuradha Mittal, Oakland's director.

In Tanzania, the memorandum of understanding 
between the local government and US-based farm 
development corporation AgriSol Energy, which is 
working with Iowa University, stipulates that the 
two main locations  Katumba and Mishamo  for 
their project are refugee settlements holding as 
many as 162,000 people that will have to be 
closed before the $700m project can start. The 
refugees have been 
<http://www.guardian.co.uk/environment/farming>farming this land for 40 years.

In Ethiopia, a process of "villagisation" by the 
government is moving tens of thousands of people 
from traditional lands into new centres while big 
land deals are being struck with international companies.

The largest land deal in South Sudan, where as 
much as 9% of the land is said by Norwegian 
analysts to have been bought in the last few 
years, was negotiated between a Texas-based firm, 
Nile Trading and Development and a local 
co-operative run by absent chiefs. The 49-year 
lease of 400,000 hectares of central Equatoria 
for around $25,000 (£15,000) allows the company 
to exploit all natural resources including oil 
and timber. The company, headed by former US 
Ambassador Howard Eugene Douglas, says it intends 
to apply for UN-backed carbon credits that could 
provide it with millions of pounds a year in revenues.

In Mozambique, where up to 7m hectares of land is 
potentially available for investors, western 
hedge funds are said in the report to be working 
with South Africans businesses to buy vast tracts 
of forest and farmland for investors in Europe 
and the US. The contracts show the government 
will waive taxes for up to 25 years, but few jobs will be created.

"No one should believe that these investors are 
there to feed starving Africans, create jobs or 
improve 
<http://www.guardian.co.uk/global-development/food-security>food 
security," said Obang Metho of Solidarity 
Movement for New Ethiopia. "These agreements  
many of which could be in place for 99 years  do 
not mean progress for local people and will not 
lead to food in their stomachs. These deals lead 
only to dollars in the pockets of corrupt leaders and foreign investors."

"The scale of the land deals being struck is 
shocking", said Mittal. "The conversion of 
African small farms and forests into a 
natural-asset-based, high-return investment 
strategy can drive up food prices and increase the risks of climate change.

Research by the World Bank and others suggests 
that nearly 60m hectares  an area the size of 
France  has been bought or leased by foreign 
companies in Africa in the past three years.

"Most of these deals are characterised by a lack 
of transparency, despite the profound 
implications posed by the consolidation of 
control over global food markets and agricultural 
resources by financial firms," says the report.

"We have seen cases of speculators taking over 
agricultural land while small farmers, viewed as 
squatters, are forcibly removed with no 
compensation," said Frederic Mousseau, policy 
director at Oakland, said: "This is creating 
insecurity in the global food system that could 
be a much bigger threat to global security than 
terrorism. More than one billion people around 
the world are living with hunger. The majority of 
the world's poor still depend on small farms for 
their livelihoods, and speculators are taking 
these away while promising progress that never happens."

http://www.newworldorderreport.com/News/tabid/266/ID/7999/Harvard-Vanderbilt-other-major-American-universities-buying-African-farmland-in-deals-some-of-which-may-force-thousands-of-people-off-their-land.aspx

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