Many of the Persian Gulf countries have ample money but are dependent on other countries for their food requirement. Rising prices of food items and scarcity are turning into uncomfortable issues. Some of the richest countries in the region, including Saudi Arabia, are handicapped by a dry, unforgiving climate and a shortage of farmland. These countries import more than 60 per cent of their annual food supply. Existing water stores are expected to exhaust over the next quarter of a century and food demand is growing fast. Population growth in the region is more than double the world average, the prices of some staples are up more than 30 per cent this year, and civil unrest is mounting.
This is a daunting situation and conventional response does not offer a sustainable solution. Relying for food on other countries is considered by many government leaders not only risky but also shortsighted in an era of tight trade restrictions and projections of even higher prices. Therefore, the policy planners have started preparing the groundwork for a new approach: buying or renting farmland in other countries-sometimes thousands of miles away.
In recent weeks, officials and businessmen from Saudi Arabia have met with representatives of Thailand and South Africa and discussed farmland purchase. The United Arab Emirates is exploring land in Sudan, Egypt, and Yemen and is working out multi-billion dollar deals in Pakistan with several private companies to build large corporate farms for growing rice, wheat, sugar cane, and fruits. Reportedly, Abu Dhabi has already signed a deal with Sudan to develop 70,000 acres there.
Having petro-dollar at their disposal the Persian Gulf states have been the most aggressive in such pursuits, but they are not alone. In April, the president of South Korea, Lee Myung-Bak, expressed interest in renting farmland in eastern Russia or Southeast Asia. Chinese firms, many with close government ties, have recently pursued deals in the Philippines and Africa and are also eyeing land in Australia.
Even individual farmers from the United States and Australia have started eyeing overseas farmland, particularly in South America. Investors consider land as the root of all commodities and a valuable investment. The bona fide farmers are looking at expanding their operations in other parts of the world.
Globally, farmland is disappearing at an alarming rate. According to estimates, approximately 50 million acres vanish every year to urbanisation, population growth, and economic and industrial development. In Iraq, where the Tigris and Euphrates rivers have nourished riverbanks since the start of civilisation, farmland is expected to shrink substantially because of upriver damming in Turkey. Vietnam lost 1.2 million acres of farmland due to construction of golf courses alone over the last six years.
A few developing countries have tried to slow or halt the turnover. China, after seeing its farmland dwindle by tens of millions of acres in the first part of the decade, has imposed tight restrictions on land conversions and, in January, began prosecuting thousands of alleged offenders. But trying to stop the conversion of land is the exception rather than the rule.
From a historical perspective, land grabs are nothing new. Imperialism and colonialism were defined to a large extent by efforts to acquire power through land.
These campaigns, however, were characterised not by diplomacy or money but by violence and force. What's happening now is different, although it raises old questions about sovereignty and workers' rights.
Though the terms of the deals vary-some involve land purchases, others, large investments in existing farms and which would obviously result in new employment opportunities for local workers and require negotiations. However, the key issue is where the food will go after harvest. In Sudan, for instance, where food riots are common, officials would not like to create the impression of helping others at the cost of their own people.
Some observers see the potential for large and enduring benefits on both sides. The reported sellers of underdeveloped farmland from Pakistan and Sudan are poor and lack the resources to make their own land productive. Foreign investment may help the host countries in improving roads and irrigation system but the potential threat of inviting too many East India Companies and loosing their
Sovereignty is something that stakeholders must think seriously.