Ethiopia is the world champion of “land grabbing” – the practice of renting out vast expanses of farmland to local and, in particular, foreign investors. In 2011, 3.5 million hectares were allocated, while the projected figure for 2015 is 7 million hectares, an area twice the size of Belgium.[i] By way of comparison, 12 million hectares are farmed by the same number of smallholders, who make up four-fifths of the Ethiopian workforce. It is not hard, then, to imagine the anticipated leap forward in agricultural output, especially given that the productivity of these new mechanised farms should be much greater than that of traditional peasant farmers. As a first approximation, medium sized yields and export of just half of their production should, in the medium term, bring in about US$ 10 billion in foreign currencies, at a time when the deficit in the balance of payments is the Achilles heel of the Ethiopian economy and its GDP currently stands at US$ 30 billion.
“They gave the land to us and we took it… This is green gold!” exclaimed one of the largest investors.[ii] The rents are “ridiculously low by any standard” (theoretically starting at US$ 8 dollars per hectare per year), the leases are for up to 99 years, finance facilities and tax breaks are increasingly generous as the share of exported produce goes up. Some are calling it “the deal of the century”.[iii] The authorities, who are solely responsible for this operation, because land is public property, [iv] challenge the term “land grabbing” and retort that these are “win win arrangements.” They say that only “abandoned” or “unutilized” land is open to the investors “on the basis of clearly set out lease arrangements… to make sure everybody will benefit from this exercise.”[v]
But the indictment of journalists and researchers, who have only recently been able to peek beneath the of this operation shrouded in secrecy, seems irrefutable.
“The government of one of the most vulnerable countries in the world is handing over vast land and water resources to foreign investors to help the food security efforts of their home countries, or to gain profits for their companies, without making adequate safeguards and without taking into account the food security needs of its own people.” The mechanism that they set up can be summarised as follows: Ethiopia rents out land to investors so that they can export their produce, and then import the same produce, grown somewhere else, to feed its own people. In the end, “the damage done… outweighs the benefits gained.”
The Ethiopian regime is anything but impulsive. It has obviously weighed up the pros and cons of land grabbing, especially since, for the large part, these were known in beforehand.[vi] So why did they throw themselves headlong into it?
