LAND TO INVESTORS: Large-Scale Land Transfers in Ethiopia by Dessalegn Rahmato

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Introduction

The catch-phrase, “global land grab”, refers to the rush for commercial land in Africa and
elsewhere by private and sovereign investors for the production and export of food crops as well
as bio-fuels, in which the land deals involved stand to benefit the investors at the expense of host
countries and their populations. The phenomenon has attracted international activist
organizations and the world media since much of the land transferred is in poor and food
insecure countries that have long been dependent on Western financed food aid and other support
programs. Global land grabbing has spread quite rapidly following the international food crisis of
the second half of the 2000s which was accompanied by exceptionally high commodity prices
and severe supply shortages in the world market. The crisis aggravated sharply vulnerabilities in
many poor countries, but also raised the specter of food insecurity among those which hitherto
had relied on and felt secure with the global food market. It thus placed the quest for national
food security as an important policy agenda not only in poor countries but also in those which
were capital-rich but had limited agricultural endowments. According to international media
reports, many market analysts are of the opinion that volatility in the world food trade will
continue to drive up commodity prices and to cause periodic global shortages for many years to
come. There is thus a strong food security element in the on-going global land grab phenomenon.
At the same time, the rush for land in Africa by investors from the Gulf countries, India, China
and South Korea, has also been driven by the assumption that land is abundant in the continent,
land rents and labor costs are low, and there are few regulatory roadblocks restricting production
and export. As of the end of 2009, more than a dozen countries in Africa, including Ethiopia, had
given out millions of hectares of farm land to investors in the belief that large-scale investments
will provide opportunities for rapid agrarian development and serve as an important instrument
for tackling persistent rural poverty (see Cotula et al 2009, IFPRI 2009, World Bank 2010). Since the end of the 1990s, the Ethiopian government has given out huge tracts of land to
domestic and foreign investors on terms that are highly favorable to both but particularly so to
the latter, and under circumstances that its critics believe do not inspire confidence in the transfer
process nor in the benefits said to accrue to the populations concerned. Critical reports on the
“bonanza” reaped by foreign capital have appeared in the world media and the websites of
international activist organizations, and while some of these are based on questionable evidence,
the global attention they have drawn may well be deserved given the image of the country as a
land of poverty and hunger.

Ethiopia is one of the poorest countries in the world, and since the decades of the 1960s has
suffered severe food shortages and famines on numerous occasions. As recently as 2002/03,
there was widespread starvation in many parts of the country affecting more than 13 million rural
people, and it required large inflows of international food aid to avert a tragedy on the scale of
the famine of 1985/86 when hundreds of thousands of peasants and pastoralists perished in the
worst tragedy in the country’s history. Malnutrition is endemic in the countryside as well as in
the urban areas, and diseases associated with poor nutrition and scarcity of clean water are common. In 2009, over 22 percent of the rural population was dependent on a combination of
emergency food aid and safety net programs financed by Western donor countries and
international agencies. While the number of people seeking emergence food assistance has
decreased since then, nearly eight million rural people continue to be supported by safety net
programs. On the other hand, there has been a fairly high rate of economic growth in the last ten
years and improvements in health services have been registered, nevertheless this has not made a
significant impact on rural poverty nor has it helped

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