The Oakland Institute has released a report titled (Mis)Investment in Agriculture: The Role of the International Finance Corporation in the Global Land Grab, which points out that more than 13 million Ethiopians are in need of food aid, “but paradoxically the government is offering at least 7.5 million acres of its most fertile land to rich countries and some of the world’s most wealthy individuals to export food back to their own countries.”
Below is the Case Study on Ethiopia
taken from the 59 pages Report
Ifc’s advisory services have been involved with Ethiopia for over a decade. FIas’s first diagnostic work in the country began in 1997 when it reviewed Ethiopia’s investment climate and its approval process for foreign direct investment. Then in 2000, fIas provided training to the Ethiopian Investment agency to help strengthen its capacity for investment promotion, and in 2001, fIas reviewed the country’s investment environment with a special emphasis on export-oriented fdI. Also, in fy07, fIas reported that its “SWAT team for Africa” had conducted an Investment policy and promotion project in Ethiopia, yet little public information exists on the details of this project.
In late 2008, Ifc’s focus also turned toward Ethiopia as it opened a new office in Addis Ababa in order to “increase activity to support Ethiopia’s economic development.” An Ifc news report stated, “Ifc’s strategy in Ethiopia focuses on proactively developing new investment projects, supporting public-private partnerships that promote economic growth, and mobilizing direct investments to key sectors of the economy, including agribusiness, financial services, health and education, infrastructure, manufacturing, and tourism.”
Ifc is also working to develop Ethiopia’s leasing sector through a joint investment and advisory services project that will help establish the country’s first leasing company. The new company will be the culmination of Ifc’s work with Ethiopia’s government to help draft a new legal framework for leasing in the country, which started almost a decade ago.
Predictably, the leasing of farmland has increased dramatically in Ethiopia the past three years. In what has been called Ethiopia’s great “land lease project”—in an effort to introduce large-scale commercial farming to the country—the government is offering up vast chunks of fertile farmland to local and foreign investors at almost giveaway rates. by 2013, three million hectares of idle land is expected to have been allotted, equivalent to more than one fifth of the current land under cultivation in the country.
In one land grab case, one journalist describes his experience in Ethiopia visiting an industrial farm along the main road to awassa:
‘The farm manager shows us millions of tomatoes, peppers and other vegetables being grown in 1,500 foot rows in computer controlled conditions. spanish engineers are building the steel structure, dutch technology minimizes water use from two bore-holes and 1,000 women pick and pack 50 tons of food a day. Within 24 hours, it has been driven 200 miles to Addis Ababa and flown 1,000 miles to the shops and restaurants of Dubai, Jeddah and elsewhere in the Middle east.
The 2,500 acres of land, which contains the Awassa greenhouses, are leased for 99 years to a saudi billionaire businessman, Ethiopian-born sheikh Mohammed al-amoudi, one of the 50 richest men in the world. his saudi star company plans to spend up to $2-billion acquiring and developing 1.25 million acres of land in Ethiopia in the next few years. So far, it has bought four farms and is already growing wheat, rice, vegetables and flowers for the saudi market. It expects eventually to employ more than 10,000 people.’
In another case, karuturi, a Bangalore based Indian company, has acquired more than 300,000 hectares (741,000 acres) of land in Gambella. It has a 90-year lease on this land. Karuturi has also leased land elsewhere in Ethiopia such as Bako. Under their agreement, karuturi does not have to pay a penny for the first six years for its holding in Gambella. Then it has to pay only 15 birr (equivalent to usd $1.13) per hectare per year for the remaining 84 years of its 90 years lease.
Nyikaw Ochalla, an indigenous anuak from the Gambella region of ethiopia told The Guardian on March 7, 2010:
“all the land round my family village of Illia has been taken over and is being cleared. People now have to work for an Indian company. Their land has been compulsorily taken and they have been given no compensation. People cannot believe what is happening. Thousands of people will be affected and people will go hungry.”
Ethiopia is one of the hungriest countries in the world with more than 13 million people in need of food aid, but paradoxically the government is offering at least 7.5 million acres of its most fertile land to rich countries and some of the world’s most wealthy individuals to export food back to their own countries.