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Current Affairs
The land concessions Boon or curse for Africa?
Few issues over the past couple of years have generated as much controversy and emotion as the current trend towards granting concessions of large parcels of African land to foreign interests.
The debate has been furious – with critics claiming that this is a new and insidious form of neocolonialism while others argue that foreign interests, armed with modern methods of production, could prove to be Africa’s salvation in terms of food security. Who is right? In this month’s cover story, we examine this thorny subject from several angles.
The South Africa–Congo concession: Exploitation or salvation? Against the backdrop of some highly publicised land concession deals, one set of agreements, between the Republic of Congo (Brazzaville) and a group of white South African farmers, has generated intense speculation. Khadija Sharife talks to the principal players to find out what is involved in this deal and the real reason for this new ‘trek’.
It has been called ‘neocolonialism’ by the Director General of the United Nations Food and Agriculture Organisation (FAO), an ‘asset as good as gold, only better’ by hedge fund specialists, and the ‘new Great Trek’ by South Africans who remember their history. Presently, over 30m hectares in almost 30 African countries have been auctioned to a host of corporations and governments, from China – housing one fifth of the world’s population on 8% of the world’s arable land – to oil-rich, water-poor Gulf nations.
The deals involving these concessions are often cloaked in secrecy but African Business has learnt that they are usually characterised by allowing free access to water, repatriation of profits, tax exemptions and the ability for investors to acquire land at no cost whatsoever, with little or no restriction on the volume of food exported or its intended use, in return for a loose promise to develop infrastructure and markets. However, the terms of the concessions vary from country to country and deal from deal – in some instances, the host country drives a hard bargain and in other cases, the investors call the shots.
As the debate over the whole question continues to rage on, the much-discussed Congo land-lease, granting 200,000 hectares to South African farmers with a further 10m hectares in the balance, appears to mark a departure from the usual terms underpinning foreign acquisition of fertile land by multi-nationals. Not only has commercial agriculture on these concessions chiefly been earmarked for domestic use, thus generating food security, but good crop yields possess the potential to reduce outstanding debt in the Congo from 70% to 40% of GDP within a year. Describing the South African farmers, an official from ABSA AgriBusiness, a leader in the financing of the agricultural sector, stated, “They are capable of farming without government support, can compete against the best in the world and even with our scarce resources, they produce profitably.”
“There are three main reasons we are in the Congo,” stated Andre Botha, president of Agri Gauteng, a division of Agri SA. “The first is, of course, to diversify our businesses; the second is to assist local farmers to commercially develop their own land; the third reason is to assist the government of South Africa to fulfil the expectations of the world in stabilising the African continent through the exchange of skills and technology.” Agri SA, a commercial farmers’ association, was initially contacted by the Congolese government in January 2009, with the latter seeking a strategic non-governmental organisation in the form of a professional farmers’ union, rather than a political state-controlled entity. The union, a federal organisation formed in 1904, is composed of 70,000 large and small-scale commercial farmers in South Africa. It actively assists members in farm development, corporate liaison, information technology
development and transfer, trade, industry, water, land, economic and environmental affairs, as well as labour and training.
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