In many parts of Africa, local farmers, herders and gatherers only have usufruct rights to the land and water resources they use. These rights are not recognized under the formal legal system, but are recognized under customary law.
Most have no written documents for their land, or for water access. Much land and water is legally owned by the state, which can allocate it to outside investors even against local wishes. But this situation varies from country to country. In Ghana, for instance, 80% of the land is owned and held under customary tenure by Chiefs and land-owning families. Nearly all of the recently acquired lands by foreign investors were acquired through Chiefs without the stateâ€™s involvement and this creates another set of problems. Even when investors come with the best of intentions, this means local groups are exposed to the risk of dispossession and investors to disputes and potentially unrest.
Technology transfer and livelihoods
The perception that large plantations are needed to “modernise” agriculture in poorer countries is widespread in many government and international agency circles.
But the introduction of new technologies is a complex and risky business. Small holder farmers are not always able to take advantage of new technology, as they may not have the skills and resources to effectively use and maintain it. Furthermore they may not be able to access credit that will enable them to invest in technology. The lack of legal entitlement to land means that often, even if they could, they are not willing to invest. Fieldâ€“level evidence on tenure insecurity as a constraint to investment is inconclusive, however. It depends on the type of technology investment in question.
Family farmers have long provided the backbone of African agriculture – and, when given a chance, they have been able to compete on global markets.
In Ghana, for example, a co-operative of 60,000 cocoa farmers has run a successful business for nearly 20 years and owns 45% of a UK company that manufactures and distributes chocolate.
Many companies successfully source agricultural produce from family farmers, and have invested in other activities along the production line – in ways that secure their supplies and improve local livelihoods.
Co-operatives or intermediaries can reduce the costs linked to working with large numbers of farmers. Public policy plays a key role in promoting fairer investment models.
A central challenge for African government will be how to manage and monitor new investments in the agricultural sector. Foreign money may swell state coffers, but unless it is handled with transparency and fairness, it will benefit only the privileged few and, worse, may deprive many others of opportunities. New thinking is needed to develop the institutions and policies that can deal effectively with foreign investment.