Monday, May 30, 2011

On "Land grabbing in Ethiopia"

Land grabbing has become a important topic in Africa. It seems that big foreign investors from India or Saudi Arabia are can rent land for one dollar a year per hectare in Ethiopia and start commercial farming. Is it good or bad? I guess there is no clear answer to that. A good overview is given by this week's Ethiopian reporter :

I guess there are two crucial issues that are not mentioned in the article. Firstly, how much of the produced food stays on the local Ethiopian market? Secondly, to what extend are the natural resources over used?

My recent field trip to the Rift Valley gave me the chance to visit some commercial farms (around Mojo). The first farm was an horticulture farm owned by a rich Saudi Arabian and produces mainly salad, cabbage and other vegetables. About 60% of the production goes to the middle east. Viable or not? It depends, if the small holders cultivating the land before was less than the 40% of the food that is kept on Ethiopian market, then yes otherwise no!

The second farm was a rose producing farm delivering the flower auction in the Netherlands. It is owned by 12 Ethiopian investors. This farm makes use of ground water, accessed by a very productive well. Given the current stage of development of the whole basin, it is likely that the water use of the whole
region is below the recharge level. So no threat for the ground water yet. But what will it be when the whole region will be developed? Viable or not? It will strongly depend on the Ethiopian government to truly implement its ground water policy and truly monitor water extraction.

Roses are not food, and therefore do not contribute to food security in a country where 2.8 million people depend on food aid. But it creates employment. Employees from both the horticulture farm and from the rose farm earn 15 birrs a day, that is less than a dollar a day. I bough a pack of strawberry from a strawberry farm in the same area for 20 birrs...

So here again, is foreign investment viable in the area? If the smallholders in the area earn more than a dollar a day, then it is not viable. As the area is pretty fertile with access to ground water, it is likely that smart smallholders earn more... but this year, the onion price collapse... so the smallholders that planted only onions are likely to have very little income...

So before saying if "land grabbing" is good or bad, one needs to look at the specific situation of each area!