The year is 2007 and world food prices see a sharp increase, hedge funds speculate with food commodities, oil prices have gone up and so has the demand for biofuels. These factors combine to leave the world at risk of becoming more food insecure.
Fast-forward to 2021 – a world changed forever by the Covid-19 pandemic – and more than 2,890 transnational, large-scale land acquisition deals have been recorded since the early 2000s. Make that 4,600 if domestic deals are included. The food price crisis led to an expansion of large-scale land acquisitions, a highly controversial practice that can have an impact on both food security and the environment.
According to data from the UN’s Food and Agriculture Organisation, 8.9% of the world’s population was undernourished in 2019, and that is projected to increase to 9.8% by 2030. That equates to 841.4 million people without access to proper nutrition.
Large-scale land acquisitions target ‘hungry’ countries
The Land Matrix Initiative (LMI) is an independent global land monitoring initiative made up of global and regional partners that collects large-scale land acquisition data. It is updated constantly and shows the location of deals as well as the extension of them. Based both on extension and number of deals, Africa is the most targeted continent, followed by Latin America and eastern Europe. Peru is the country with the largest extension of large-scale land acquisition deals reported.
If FDI does not involve the local community, but rather pushes these people out and takes their way of living from them, food security is threatened even more.
Out of the top 20 countries based on the amount of land involved in deals, 13 are ranked in the Global Hunger Index as in a moderate to alarming situation. Some countries were excluded due to lack of data, although high levels of land-grabbing take place in these locations. They are the Democratic Republic of the Congo, South Sudan, Central African Republic, Laos and Zambia.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData
The chart shows the countries with the largest area of land involved in large-scale land acquisitions, according to the Land Matrix database, positioned with their Hunger Index score along with the percentage of their GDP that came from agriculture, forestry and fishing in 2019.
The LMI’s International Land Deals for Agriculture, Fresh Insights from the Land Matrix: Analytical Report II highlights the divide seen on the graph between two types of targeted countries: those with a high reliance on agriculture and high levels of malnourishment; and a second formed by countries that take a small percentage of their GDP from agricultural activities and rank lower on the Hunger Index score.
Does FDI make the land-grabbing situation worse?
Foreign direct investment (FDI) in the agricultural sector has long been seen as a way of fighting poverty and hunger in developing economies, especially those where agriculture accounts for a large proportion of their GDP. However, if this FDI does not involve the local community, but rather pushes these people out and takes their way of living from them, the opposite takes place and food security is threatened even more. This is one of the many dangers of land-grabbing.
Most food-insecure countries also have a long history of colonialism, which only causes more resentment when foreign companies from developed countries return to these locations as if they are no man’s land, where they can barge in with bundles of money and suffer zero consequences for any problems caused by their actions, other than walking away with a fat profit.
The LMI report also shows that the food security of smallholder farmers is affected by large-scale land acquisitions when there is a loss of cropland, as some of these acquisitions are intended for non-food or export-oriented crops. These practices can also bring a loss of forest land, a loss of biodiversity, and carbon sequestration, which can have a negative impact on not only the local area but on the whole planet.
The Covid-19 pandemic has compounded many of these issues. The non-profit Conservation International released a briefing on the impact of Covid-19 on nature that challenges the widespread belief that the pandemic has given the Earth a pause to breathe.
“There is a misperception that nature is ‘getting a break’ from humans during the Covid-19 pandemic,” says the briefing. “Instead, many rural areas in the tropics are facing increased pressure from land-grabbing, deforestation, illegal mining and wildlife poaching.”
A report by the BBC’s Future Planet series showed that in Brazil – one of the most heavily targeted countries for land-grabbing – rainforest destruction increased by 64% in April 2020 compared with the previous year. It added that most of this deforestation took place through land-grabbing of public property, which destroys the way of life of the indigenous people and other communities that live in these lands.
FDI can be part of the solution when it comes to meeting the UN’s second Sustainable Development Goal – no hunger by 2030 – if multinationals and governments adhere to business models that include local communities and make research and development part of their international expansion plans, thereby increasing standards instead of lowering them.
Land-grabbing is a complex issue, and it takes place in all corners of the globe. It is not always carried out by companies hailing from developed economies venturing into developing countries in the global south. It happens domestically, between developing economies and in developed economies as well, but it is always those who are already struggling that pay the price.
Home page photo of deforestation in Brazil by Florian Plaucheur/AFP via Getty Images.