Corporate interest in agricultural investment is up, but a new report shows that policies are skewed against inclusive investments. We need to reshape them so investments meet local people's needs and aspirations.
Earlier this week, agribusiness companies, financiers, commodity traders and consultancy firms gathered in central London for the latest in a series of corporate events on global agricultural investment. If corporate ‘bashes’ are a good indicator of private sector interest, then interest in farming is clearly growing fast. After years of neglect, commercial investments in developing country agriculture are on the rise.
This renewed interest is a positive development, but not all investment is good. As companies set up large plantations there are real concerns that the deals will dispossess farmers, herders and foragers, marginalise small-scale producers and deliver few economic benefits. It is a particular risk where governance is weak and local residents don’t have much say. This week’s conference in London rekindled civil society mobilisation against 'land grabbing'.
Problems with policy
In many African countries, for example, centralised government control over land facilitates large-scale land acquisitions and undermines local rights. Many governments do not charge much for the land, and that fuels speculative acquisitions. Measures designed to promote agricultural investment — including investment protection, facilitation and incentives — are mainly designed for large-scale commercial operators. That’s despite the fact that small-scale farmers account for the bulk of agricultural investment many in low income countries.
Good intentions but poor implementation
There are policy innovations that work to include local farmers and communities. Strengthening local control over land and natural resources, for example through legal requirements for free, prior, and informed consent; regulating commercial investments effectively; and government action that promotes the equitable inclusion of small-scale producers in value chains can all drive more inclusive investment in agriculture. Equally, public investment in infrastructure and capacity building can improve smallholders' 'investment-readiness' and promote business models that support small-scale producers.
Yet there is typically a big gap between good policy intentions and what happens on the ground. It is not enough to design well-meaning policy — you also need to invest in implementing it. And vibrant local-to-global organisations that represent the interests of rural producers are indispensable. They can help rebalance power relations that might otherwise constrain implementation.
Put people first
For host countries and communities, promoting investment should not be an end in itself, but a means to an end — improving people’s livelihoods. So people should be at the centre of investment processes. The main question should move beyond how best to tweak prevailing investment paradigms so as to ensure that local people participate in the benefits, and ask instead how investment can be oriented so that it responds to the needs and aspirations of those people — as well as producing a financial return for the investor. Reshaping the policies that regulate land and investment is an important part of promoting this change.