Is Africa selling out its farmers?

BAKO, Ethiopia/JOHANNESBURG Wed Nov 11, 2009 9:24pm EST

1 of 6. Ethiopian farmers Mandefro Tesfaye (L) and Maru Sisay walk in their wheat field in Abay, north of Addis Ababa, October 21, 2009.

Credit: Reuters/Barry Malone

BAKO, Ethiopia/JOHANNESBURG (Reuters) - For centuries, farmers like Berhanu Gudina have eked out a living in Ethiopia's central lowlands, tending tiny plots of maize, wheat or barley amid the vastness of the lush green plains.

Now, they find themselves working cheek by jowl with high-tech commercial farms stretching over thousands of hectares tilled by state-of-the-art tractors -- and owned and operated by foreigners.

With memories of Ethiopia's devastating 1984 famine still fresh in the minds of its leaders, the government has been enticing well-heeled foreigners to invest in the nation's underperforming agriculture sector. It is part of an economic development push they say will help the Horn of Africa nation ensure it has enough food for its 80 million people.

Many small Ethopian farmers do not share their leaders' enthusiasm for the policy, eyeing the outsiders with a suspicion that has crept across Africa as millions of hectares have been placed, with varying degrees of transparency, in foreign hands.

"Now we see Indians coming, Chinese coming. Before, we were just Ethiopian," 54-year-old Gudina said in Bako, a small farming town 280 km (170 miles) west of Addis Ababa. "What do they want here? The same as the British in Kenya? To steal everything? Our government is selling our country to the Asians so they can make money for themselves."

Xenophobia aside, a number of organizations -- including the foundation started by Microsoft billionaire Bill Gates -- argue that Africa should support its own farmers.

"Instead of African countries giving away their best lands, they should invest in their own farmers," said Akin Adesina, vice president of the Nairobi-based Alliance for a Green Revolution in Africa (AGRA). "What's needed is a small-holder, farmer-based revolution. African land should not be up for garage sale."

FOOD FOR THOUGHT

Both sides of the debate agree on this much: a stark reality -- underlined by last year's food price crisis -- looms large over Ethiopia and beyond. The world is in danger of running out of food.

By 2050, when its population is likely to be more than 9 billion, up from 6 billion now, the world's food production needs to increase by 70 percent, according to the United Nations Food and Agriculture Organization.

In Africa, which for a variety of reasons was bypassed by the Green Revolution that transformed India and China in the 1960s and 1970s, the numbers are even more bleak. The continent's population is set to double from 1 billion now.

In all, the FAO says, feeding those extra mouths is going to take $83 billion in investment every year for the next four decades, increasing both the amount of cultivated land and how much it produces. The estimated investment for Africa alone is $11 billion a year.

For deeply impoverished Ethiopia, sub-Saharan Africa's second-most populous nation after Nigeria, even a fraction of those sums is unthinkable.

Yet with 111 million hectares -- nearly twice the area of Texas -- within its borders, the answer, in the government's eyes, is simple: Lease 'spare' land to wealthy outsiders to get them to grow the food. One unfortunate consequence of that thinking is Gudina and his little plot of maize are painted as part of the problem, rather than a potential solution.

"The small-scale farmers are not producing the quality they should, because they don't have the technology," said Esayas Kebede, head of the Agricultural Investment Agency, a body founded only in February but already talking about offering foreign farmers 3 million hectares in the next two years.

"There are 12 million households in Ethiopia. We can't afford to give new technology to all of them," he said, sitting in an office adorned with maps showing possible sites for commercial farms.

Indian agro-conglomerate Karuturi Global, whose involvement in Ethiopia so far has been exporting cut-flowers to Europe, has taken the hint, branching out into food production with a sprawling maize farm in Bako. Unlike with similar land deals elsewhere in Africa, the company insists crops will be exported only after demand is met in Ethiopia -- where 6.2 million people are said to be in need of emergency food aid because of poor seasonal rains.

"Our main aim is to feed the Ethiopian people," Karuturi's Ethiopia general manager, Hanumatha Rao, told Reuters, sitting under an awning at the Bako farm as hundreds of laborers harvested maize in the fields stretching up nearby hillsides. "Whatever we produce will go to the stomachs of the Ethiopian people before it goes to the international market."

ANOTHER AFRICAN REVOLUTION

While many governments have been busy courting foreigners, in most cases from Asia or the Middle East, to increase Africa's food output, small farmers like Gudina are not totally without friends.

An initiative backed by the Melinda and Bill Gates and Rockefeller foundations is aiming to kick-start an African Green Revolution, carefully avoiding the pitfalls that had engulfed previous such attempts.

In particular, Africa boasts a dazzling array of soil types, climates and crops that have defied the one-size-fits-all solution of better seed, fertilizer and irrigation that worked in Asia half a century ago.

Its perennial tendency to corruption and official incompetence has also played its part in keeping average grain yields on the continent at just 1.2 tons per hectare, compared with 3.5 tons in Europe and 5.5 tons in the United States.

AGRA's Adesina says sub-Saharan governments are slowly realizing the importance of small farmers, who account for 70 percent of the region's population and 60 percent of its agricultural output. But he urges governments to make good on a pledge six years ago to raise farm spending to 10 percent of their national budgets.

For its part, AGRA is pouring money into research institutes from Burkina Faso in the west to Tanzania in the east to breed higher yielding and more drought- and pest-resistant strains of everything from maize and cassava to sorghum and sweet potato. Keywords: FOOD/AFRICA

"We've been studying African agriculture for several decades and the message we keep getting back from farmers is: 'It's the seeds, stupid,'" said Joseph DeVries, director of AGRA's seed improvement division. "What you're planting is what you're harvesting."

As yet, the work -- carefully packaged as "Africans working for an African solution" -- involves only conventional breeding techniques, such as cross-pollination and hybridization, as genetically modified seeds remain prohibitively expensive for farmers subsisting on one or two dollars a day.

However, AGRA does not rule out a future role for GM food crops, a stance that has stoked fears it will inadvertently pave the way for U.S. seed companies into the continent beyond South Africa, the only country that allows widespread commercial use. It also accepts a need for chemical soil additives -- a source of concern to environmentalists -- although it stresses the importance of "judicious and efficient use of fertilizer and more intensive use of organic matter."

After 10 years of research, DeVries said, AGRA has developed, among other things, a cassava variety with double its previous yield and a hybrid sorghum strain that is producing 3 to 3.5 tons per hectare, compared with 1 ton before. It is also giving grants to rural shop-keepers to try to create seed distribution networks in countries that remain too small or inaccessible to attract interest from established commercial suppliers.

"There's huge demand for these new varieties, but there's just not nearly enough investment. It's logistics, and it's also capital," DeVries said.

CASH FOR CROPS

As ever in Africa, money -- or, rather, a lack of it -- is a major problem. According to AGRA's Adesina, only 1 percent of private capital on the continent is made available to farming, due to banks' concerns about loan collateral and a reluctance to deal with farmers who in many cases are barely literate.

However, the Green Revolution push has begun to attract some serious financial players.

With AGRA providing $10 million in loan guarantees, South Africa's Standard Bank, the continent's biggest bank, has earmarked $100 million over three years for small farmers in Ghana, Mozambique, Tanzania and Uganda. The pilot scheme suggests the bank is buying an argument slowly gaining traction: That Africa, a continent more renowned for war, famine and disasters, could and should evolve into the breadbasket of the world.

With less than 25 percent of Africa's potential arable land under cultivation, according to many estimates, and its current levels of yield at rock-bottom, it is a compelling, if distant, vision.

"The first step is improving the efficiency of small farmers in Africa," said Jacques Taylor, head of Standard Bank's agricultural banking arm in Johannesburg, seat of the gold on which most of South Africa's wealth has so far been based. "Can we get them to increase their yields from just over 1 ton to 3 tons to 5 tons? That's possible. It's not a dream. It's a reality."

LAND-GRABS AND GM'S TROJAN HORSE?

Even though Standard Bank says it is keen to expand the funding, if all goes well, there is a very long way to go before such financing makes a dent in the $11 billion the FAO says has to be invested in Africa each year.

"Do we need more of this? For sure. $100 million is really a drop in the ocean when you look at the funding needs," Taylor said. "But we'd like to think this is a step in the right direction."

As such, it seems inevitable Africa will have to adopt a dual-track approach to its looming food crisis -- rolling out the red carpet for more Karuturis, but also making life easier for Berhanu Gudina and his colleagues in central Ethiopia.

While it is hard to fault the thinking behind either strategy, critics of both abound.

Across the continent, foreign deals have been condemned as "land-grabs" negotiated between barely accountable administrations and outside companies or governments who care little about poverty or development.

In one notable case, in Madagascar, a little-reported million-hectare deal with South Korean conglomerate Daewoo contributed heavily to a successful popular uprising in March against President Marc Ravalomanana.

Elsewhere, from Sudan and its numerous Gulf farmer-investors, to Republic of Congo and a group of white South African commercial farmers, to Ethiopia and its Indians, land has become a hot political potato.

The prevailing view outside governments is that the little guys are being forced to make way for the mega-deal.

"It cannot just descend on them from the sky. It has to be done in consultation with the people who occupy the land," Ethiopian opposition leader Bulcha Demeksa told Reuters. "But the government is not doing that. It is just going ahead and signing agreement after agreement with the foreigners."

Similarly, AGRA's detractors look to unintended consequences of India's Green Revolution -- particularly the environmental damage caused by widespread fertilizer use and drying up of water tables -- to argue Africa should look before it leaps.

Furthermore, says Mariam Myatt of the Johannesburg-based African Center for Biosafety, if India's experience is anything to go by, a Green Revolution would leave Africa's farmers as dependent on banks and seed and fertilizer companies as they are now on seasonal rains.

"The Green Revolution, under the guise of solving hunger in Africa, is nothing more than a push for a parasitic corporate-controlled chemical system of agriculture," she said.

With Bill Gates also pumping funding into biotech research at bodies such as the African Agriculture Technology Foundation, Myatt said, AGRA might end up as the unwitting Trojan horse that eases GM crops -- and Western corporate interests -- into Africa.

"It will go a long way toward laying the groundwork for the entry of private fertilizer and agrochemical companies and seed companies and, more particularly, GM seed companies."

For a graphic to go with this story see: here

(Writing by Ed Cropley; Editing by Jim Impoco and Walter Bagley)

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