land grab sign board Nairobi - Juliana Flickr

Agricultural land acquisitions in developing countries have garnered much attention in recent years. While not completely new, there has been a recent surge in investment activity, spurred in part by the global financial, energy and food crises. Several countries with limited amounts of arable land and water per capita, especially in the Middle East and Asia, have essentially begun outsourcing the production of food and energy crops by investing directly in farmland abroad, especially in Africa. Private companies are also involved. Crops produced are primarily for export, usually to the investing country.

This practice is especially controversial in developing countries where national and household food security are not yet assured. Many commentators have raised concerns that poor villagers will be forced off their land and denied access to their normal water supplies. Downstream water users may also be affected. Agribusiness, it claimed, will marginalize family farming, thereby putting the livelihoods of poor farmers at risk. There are also fears that production on a more industrial scale will lead to environmental degradation.

Proponents claim that African agriculture has long been starved of investment and that foreign funds can help create jobs, increase export earnings and promote the use of more advanced technologies. They point to poor agricultural productivity growth in Africa, the lowest of any region in the world, and see the infusion of capital, advanced technology and know-how as what is needed to raise agricultural productivity, enhance food security and improve livelihoods through on-farm and off-farm employment. However, good governance is crucial. How these investments are planned and managed will dictate whether they deliver the promised benefits, and how those benefits are shared.