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Large-Scale Land Based Investments, Globally and in Africa Ward Anseeuw Cirad / University of Pretoria AFMA conference Cape Town 19/11/2014 PP&G PP&G
Large-Scale Land Based Investments, Globally and in Africa
Ward Anseeuw Cirad / University of Pretoria
AFMA conference Cape Town 19/11/2014
PP&GPP&G
Outline
1) Large-scale land based investments
globally and in Africa – State and features Quantitative, based on the Land Matrix and other available data
2) Implications, trends, practices…
Qualitative, based on the main literature
Large-scale land based investments,
globally and in Africa – State and features
LSLBI globally
Oral agreement 66 3.7 1.1
Contract signed 804 50.8 30.6
concluded deals 870 54.5 31.8
Expression of interest 42 5.5 n.a.
Under negotiation 144 9.1 n.a.
Intended deals 186 14.6 n.a.
Negotiations failed 50 5.3 n.a.
Contract cancelled 24 1.6 1.5
Failed deals 74 6.9 1.5
# deals ha intended ha under contract
LSLBI globally
Oral agreement 66 3.7 1.1
Contract signed 804 50.8 30.6
concluded deals 870 54.5 31.8
Expression of interest 42 5.5 n.a.
Under negotiation 144 9.1 n.a.
Intended deals 186 14.6 n.a.
Negotiations failed 50 5.3 n.a.
Contract cancelled 24 1.6 1.5
Failed deals 74 6.9 1.5
# deals ha intended ha under contract
LSLBI globally
Oral agreement 66 3.7 1.1
Contract signed 804 50.8 30.6
concluded deals 870 54.5 31.8
Expression of interest 42 5.5 n.a.
Under negotiation 144 9.1 n.a.
Intended deals 186 14.6 n.a.
Negotiations failed 50 5.3 n.a.
Contract cancelled 24 1.6 1.5
Failed deals 74 6.9 1.5
# deals ha intended ha under contract
African countries are among the most focused on in the world
0
100
200
300
400
500
600
700
0
5 000 000
10 000 000
15 000 000
20 000 000
25 000 000
30 000 000
35 000 000
40 000 000
Africa Asia Latin Oceania Europe
size (ha)
# deals
0
50
100
150
200
250
300
350
400
-
5 000 000
10 000 000
15 000 000
20 000 000
25 000 000
Africa Asia Oceania Latin Europe
Conluded
All
• Important concentration – top 20 countries, 74% deals, 80% size
• Top 20 – 9 African countries
African countries are among the most focused on
0
1000000
2000000
3000000
4000000
5000000
6000000
7000000
0
20
40
60
80
100
120
# cases
Size (ha)
African countries – in particular east African ones - are among the most focused on
0
20
40
60
80
100
120
0
500000
1000000
1500000
2000000
2500000
3000000
3500000
4000000
4500000
5000000 Operational cases in Africa - top 20
Project not started Startup phase (no production) In operation (production)
Project abandoned Unknown # cases
Concentration of LSLBI
Western countries are still the main investors in Africa, Emerging and Middle
Eastern countries are upcoming
0
10
20
30
40
50
60
0
1000000
2000000
3000000
4000000
5000000
6000000
Size
# Cases
North West Central East Southern Saudi Arabia UK USA Egypt South Korea
UAE India Malaysia UAE South Africa South Africa Italy Canada USA UK
Japan Liberia Singapore Jordan Brazil - France Belgium Saudi Arabia India
AFRICA
The rush for land is triggered by a wide range of drivers, food becoming a main
driver
0
50
100
150
200
250
300
350
0
2 000
4 000
6 000
8 000
10 000
Concluded deals (In 1000 ha) Concluded deals (# of deals)
GLOBAL
The rush for land is triggered by a wide range of drivers, food becoming a main
driver
Jatropha hype for pure and mixed biofuel deals - Data as of 1 November, 2013
GLOBAL
The rush for land is triggered by a wide range of drivers, food becoming a main
driver
0
2000000
4000000
6000000
8000000
10000000
12000000
14000000
16000000
East West Southern Central North
Unknown
Tourism
Renewable Energy
Livestock
Industry
Forestry
Conservation
Agriculture
AFRICA
Little effective production
0
20
40
60
80
100
120
140
160
180
200
Central East North South West
Unknown
Project abandoned
In operation (production)
Project not started
Startup phase (no production)
11%
20%
50%
17% Failed
Intended
Concluded not operational
Concluded operational, no producing yet
Concluded, operational, producing
1.7%
AFRICA
Slowing down overall, but evidence of long-term trend of growing commercial
interest in land Reasons: Credit crunch, high failures, less media focus,
civil awareness, countries are getting better preapred
0
10
20
30
40
50
60
70
80
90
100
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
North
West
Central
East
Southern
Total Africa
LSLBI trends
Oral agreement 66 3.7 1.1
Contract signed 804 50.8 30.6
concluded deals 870 54.5 31.8
Expression of interest 42 5.5 n.a.
Under negotiation 144 9.1 n.a.
Intended deals 186 14.6 n.a.
Negotiations failed 50 5.3 n.a.
Contract cancelled 24 1.6 1.5
Failed deals 74 6.9 1.5
# deals ha intended ha under contract
+115
+41
+24
Implications, investment models and agrarian change – Towards
new opportunities for Africa?
Different LSLBI with different outcomes
Independent farmer model
Associative farmer model
Cooperative farmer model
Speculative 1000-day
model
Asset management
and Investment
funds model
Nucleus estate model
Agribusiness Estate model
Different LSLBI with different outcomes
o Uncertain institutional environments and the difficulty of doing business
o Technicality of the projects o The lack of markets o Lack of financial services o High settling and transaction costs
Independent farmer model
Associative farmer model
Cooperative farmer model
Speculative 1000-day model
Asset management and Investment funds model
Nucleus estate model
Agribusiness Estate model
High failures
New strategies 1
o To overcome high risks related to settlement in less developed agrarian economies
o Focus on core business
Independent farmer model
Associative farmer model
Cooperative farmer model
Speculative 1000-day model
Asset management and Investment funds model
Nucleus estate model
Agribusiness Estate model
High failures
Increased integration
Few inclusive models
New strategies 2
Independent farmer model
Associative farmer model
Cooperative farmer model
Speculative 1000-day model
Asset management and Investment funds model
Nucleus estate model
Agribusiness Estate model
High failures
Less risky activities - Increased focus on stable countries, with well-developed
property rights - Other investment strategies (equity)
Less visible but at least as important in terms of volume and impact on agrarian structures in host countries
New strategies 3
Independent farmer model
Associative farmer model
Cooperative farmer model
Speculative 1000-day model
Asset management and Investment funds model
Nucleus estate model
Agribusiness Estate model
High failures
A more organised second generation of investments - Going beyond individual settlements - More coherent/structured support
- Private sector (service providers, …) - Governments (one stop shops, …) - International community (VGs, RAIs, F&Gs)
- Broader agricultural environments are developing
Concluding thoughts • A need for investment in African agriculture • Agrarian change in Africa?
o Yes - but slow o Very little # - With very few ‘positive’ results
• For farmers/investors • For local populations/host countries
o Far-going integration and closed value-chains • Corporization of agriculture • Concentration and dualization within the agricultural sector
• Change not always there where expected/announced, by the promotors of LSLBI o Lack of LT reflection on development trajectories o Need for more Inclusive Development
Thank you
Ward ANSEEUW CIRAD Researcher
Post Graduate School of Agriculture and Rural Development University of Pretoria
Pretoria 0002 South Africa
Email: [email protected]
