What is happening and what can we do? What is happening and what can we do?

World Bank team (ARD, DEC, LEG, SDV)

Presentation by

Klaus Deininger, Land Tenure Adviser

Daewoo to cultivate Madagascar land for freeBy Song Jung-a and Christian Oliver in Seoul and Tom Burgis in Johannesburg 11/2008

A major opportunity? Or a huge risk?

By Song Jung a and Christian Oliver in Seoul, and Tom Burgis in Johannesburg. 11/2008

Much needed investment in rural areas Asset stripping; short-term speculation

Export & market development Spatial and inter temporal externalitiesExport & market development Spatial and inter-temporal externalities

Technology transfer Resource extraction & degradationTechnology transfer Resource extraction & degradation

Improved living standards Neglect of existing land users

Employment generation Displacement of labor with capital

New products (biofuels, horticulture) Corruption & rent seeking

Identify key drivers and aggregate trends Identify key drivers and aggregate trendsGlobal demand, agro-ecological potential, land valuesAggregate investment determinantsAggregate investment determinants

Assess country level evidence in 2 ways I Q tifi ti & C t t I: Quantification & Context Inventory based on official data Policy, legal, institutional framework

Benin, DRC , Ethiopia, Liberia, Mozambique, Nigeria, Sudan, Tanzania, ZambiaCambodia, Indonesia, Laos, Pakistan, Ukraine Argentina Brazil Mexico Paraguay Peru

II (subset): Actual implementation Social, environmental impact assessments

Argentina, Brazil, Mexico, Paraguay, Peru

Help address the phenomenonCountry level: Link to Bank analytical & operational workGlobal community: Standards & principles

A closer look at the fundamentals A closer look at the fundamentals What’s happening: Extent and determinants What can governments do? Help address the phenomenonp p

Favor Investment in Africa, Latin America and RUK

50

60

70 % available water utilized

30

40

50

rcen

t(%

)

10

20Per

-Sub

SaharanAfrica

SouthAsia

East Asia MiddleEast

Europe &Central

Asia

LatinAmerica

Africa Asia

G i h f l b l k t Growing share of global markets Brazil half of world sugar mkt, top soybean exporter, Uruguay/Brazil

major exporters of pulp Uruguay growing share of rice marketmajor exporters of pulp, Uruguay growing share of rice market…

Expansion of the frontier—Cerrado from 0 to 20 M ha of soy in 25 yrs

Intensification of production—pastures to crops, double cropping in p p p , pp gPampa

Emergence of very large farming companies mostly national (El Tejar Los Grobos Adecoagro Cosan Fibria)Tejar, Los Grobos, Adecoagro, Cosan, Fibria)

Many lease land, contract machinery, tech services, finance

But they are largeBut they are large Arg: Top 30 companies total 2.4 m ha. 75% farms in MGrosso > 1000ha

Invest across countries of the region to diversify risks Invest across countries of the region to diversify risks

Access international capital markets (e.g., Altima)

I t t j i d il d t (60 M t) Importer to a major grain and oilseed exporter (60 M t) 30 M ha taken out of production

H i l i d i i Huge potential to improve productivity

Farm size a legacy of Soviet era E h l d f ll f l d ld t l Even where land reform, small farms soon leased or sold to large

operational units (machinery, logistics etc set up for large farms)

Russia allows land sales, Ukraine leases up to 50 yearsp y

Emergence of “superfarms” (> 100,000 ha; 5000 empl) Ukraine: Top 40 companies with 4.5 mn ha; Russia: Top 30 w. 6.7 mn

ha

Vertically integrated to processing and markets

Foreign investment in Ukraine agric > $1 billion/yr

High potential; little use• 700 mn ha (>3 times Cerrado)• Medium to high potential• But only 0.5 mn ha cropped

Growth of regional markets Growth of regional markets• Still imports of 25 mn t cereals

Past attempts at large-scale food farms failed• Public and then private

Hi h t d t i bl• High cost and unsustainable

Commodity Rationale ∆ mn. ha, Operational Scaley ,1990-2007

p

Soybean Huge area expansion 25.3 Most LS

Plantation forests

Huge area expansion, deforestation

22.1 LS

Maize Food security and feed 11 6 SS and LSMaize Food security and feed 11.6 SS and LS Oil palm Rapid expansion in areas of

tropical forests 5.1 LS + outgrower

Ri M j f d it 5 1 SS (+ LS)Rice Major food security crop 5.1 SS (+ LS)

Sugarcane Rapid area expansion for sugar and ethanol

4.5 LS + contract sugar and ethanol

Rubber Deforestation, small scale 2 LS → SS

Jatropha High hopes in Africa 1 LS and SS Beef cattle Deforestation LS and SS

Outlook for stronger markets

Demand—biofuels: Supply—water,, energy prices, yield growth, CC

Production shifts to land-abundant regions (USA, RUK, LAC, SSA?)

L ti A i & RUK i i l b l k t h Latin America & RUK gaining global market share Soybeans—Brazil, Argentina

Wheat—RUK, Argentina

Rice—Asia (smallholders), Uruguay (large mechanized)

Major opportunities for expansion Major opportunities for expansion LAC—double cropping and conversion of pastures (and forests?)

RUK mostly productivity improvement RUK—mostly productivity improvement

20.0 Projected Crop Area Change without Climate Change, 2005-2025

10.0

15.0

Developed

0 0

5.0

M h

a

p

Land-scarce developing

-5.0

0.0Rice-wheat Other cereals Oilseeds

M

Land-abundant developing

-15 0

-10.0

15.0

350

400

Figure 6: Comparative Production Costs, Soybean, 2007-08

140

160

Figure 7 : Comparative Production Costs, Maize, 2007-09

250

300

350

$/t) 100

120

140

/t)

150

200

Cos

t (U

S$

Other

Inputs60

80

Cos

t (U

S$/

Inputs

Other

0

50

100 Land

0

20

40 Land

0

Thailand, 2005 Uruguay, 2010

Farm size (ha) 4 340

Irrigation Rainfed Irrigated

Yield 2.2 8.3

Farm price (US$/t) 161 230Farm price (US$/t) 161 230

Cost (US$/ha) 252 1,238

Cost (US$/t) 127 150Cost (US$/t) 127 150

% costs of inputs 26 26

% costs of labor 62 12% costs of labor 62 12

% cost of machinery 2 35

% costs of land and water 3 26

2Competitiveness in Maize (< 1 competitive)

2

1

Import Comp

0Export Comp

-> Not competitive in export markets

Technology Size(ha)

Crop Variable cost ($/ha)

Fixed cost ($/ha)

Yield(t/ha)

Cost($/t)

Existingg

Company 8000 Sorghum 67 70 0.5 277

Large farm 400 Sorghum 58 137 0.4 495

Smallholder 20 Sorghum 74 27 0.5 204

Potential

Z till & L f 400 S h 353 142 4 0 125Zero tillage, & fertilizer

Large farm 400 Sorghum 353 142 4.0 125

Medium 20 Soybean 280 142 3.0 143

Source: Min of Agriculture, 2009

Little appr. technologyLow productivity

Mechanized rainfed system, Sudan(4.5 M ha, some farms > 100K ha)

High costsSoil mining

0 60

0.70

0.80

a)

Lack of human capital Private sector interest

-1.25% pa

0.76% pa

0 20

0.30

0.40

0.50

0.60

Yie

ld (t

on

s p

er H

a

Infrastr. investment Strong global markets 0.00

0.10

0.20Y

Sorghum Sesame

With best management sorghumWith best management sorghumyields should be > 4 t/ha)

Efficient markets Risk management Financial services Potential for IT to

improve performance

Projected expansion 3.4 M ha/year Timber and pulp products (China), shift to tropics, p p p ( ), p ,

pressure on natural forests, Carbon services? Competitive advantage in (sub) tropicsp g ( ) p m3 /ha/yr—40+ in Brazil, 15 in USA, 5 in Finland

Pulp plantations v large > 250 000 ha for one Pulp plantations v. large > 250,000 ha for one mill, $2 billion investment T t t f l l l t ti Transport costs favor large-scale plantations

Issues: Deforestation, subsidies, contract farming

100%

Figure 5: Ownership by region and planted forest category

70%

80%

90%

40%

50%

60%

Other

Smallholder

C

10%

20%

30%Corporate

Public

0%

1990

2000

2005

1990

2000

2005

1990

2000

2005

1990

2000

2005

E and S Africa

E and S Africa

E and S Africa

E Asia E Asia E Asia S and SE Asia

S and SE Asia

S and SE Asia

S America S America S AmericaAfrica Africa Africa Asia Asia Asia

Country Years to 1st harvest Productivity (m3/ha/yr)Country Years to 1 harvest Productivity (m /ha/yr)Brazil 7 45 – 50 Indonesia 7 20 – 25 Australia 7 20 – 25 Argentina 7 – 12 25Chil 10 12 20Chile 10 – 12 20Spain 12 – 15 10-12United States 25 10United States 25 10Canada 45 7Sweden 35 – 40 5.5Finland 35 – 40 4

PINUS TAEDA PRDN COST US COS($/M3) LAND COSTS

35 Actual costs

253035 Actual costs

• USA -- $3000/ha• Brazil--$2500/ha

101520 • Mozambique--$1/ha

• Indonesia– negative (timber)L d t ti l

05

Land expectation values• Brazil--$5-8,000/ha• Uruguay--$2500Uruguay $2500• South Africa-$2900• USA--$170/ha

One of fastest growing crops 16 Expansion of Oil Palm One of fastest growing cropsDriven by veg. oils for foodMost efficient feedstock for

14

16 Expansion of Oil Palm

biodieselAll veg oils substitutes

Shifts in SE Asia (e g Idn) 10

12

a Shifts in SE Asia (e.g. Idn)NPV of $3,900-$9,600 per ha

Up to 3 mn. Jobs6

8

Mill

ions

h Latin America

SE Asia

Social & environmental impact highly disputed

Governance issues4

6 Africa

Governance issues Large comp’s (>500,000 ha)

Moving back to Africa -

2

1 1 1 1 1 1 1 1 2 2

SS: 200 k ha & $1 bn in LiberiaDifferent production models

1961

1966

1971

1976

1981

1986

1991

1996

2001

2006

Source: IIASA, 2009

Uryu, et al. 2008

Uryu, et al. 2008

Source: Butler and Laurance, 2009

7,000,000

Indonesia--Area sown to oil palm by type of producer (ha)

5,000,000

6,000,000

3,000,000

4,000,000Private State Owned

2,000,000Small Holders

0

1,000,000

1980 1985 1990 1995 2000 20051980 1985 1990 1995 2000 2005

E i llh ld titi Ensuring smallholder competitiveness Technology (extension, planting material): Yields much lower than estates Credit for establishment (or ability to get loans)C ed t o estab s e t (o ab ty to get oa s) Sorting out of land tenure (only use rights on forest lands; weak bargaining)

Ensuring environmental sustainability Peatland development attractive economically but high emissions of CO2

.. but also costly & need for management expertise – danger of degradation GHG emissions from LUC (1.7 mn Gt/a); use of degraded land feasible (WWF)( ) g ( ) There are alternatives but permits have already been allocated

Can REDD help? 10 20 h f d d d l d it bl f il l 7 9 h d d b 2020 10-20 mn ha of degraded land suitable for oil palm; 7-9 mn ha needed by 2020 Economics of directing oil palm development to degraded lands look feasible But requires sorting out land tenure issues & who will get funds Essentially a governance issue: RSPO & other mechanisms to support

Drivers—growth in sugar demand (3.5% in SSA) Bio-ethanol now major driver—Brazil to add 7 M ha by 2018 by

converting pastures

Sources of competitivenes Brazil—rainfed, cogeneration, milling %

Africa-trade preferences (AGOA, EBA)

Large-scale--20,000 ha per mill BR-Cosan, Copersucar 600-800 K ha

Sudan-Kenana—40 k ha

Issues—smallholder competitiveness,h i ti tmechanization, water use

Mozambique BrazilMozambique Irrigated

BrazilRainfed

US cents/l US cents/l O bi th lUS cents/l US cents/l

Yield sugarcane(t/ha)

128 (projected) 85

Labor 17 4 6 5

One bio-ethanol facility just closed. Second needs capitalLabor 17.4 6.5

Mechanization 7.8Material inputs 17.4 8.3

capital.

Land* 0 6.7Water supply 0.9 0Maint /mgmt 8 1Maint./mgmt 8.1Cost of capital 16.3 1.6Depreciation 2.4 4.3Cost of prd’n 54.4 44.1

Rubber Rubber FDI from China et al to Laos, Cambodia, Liberia, DRC Started as large estates now 80%+ small scale in Asia Started as large-estates, now 80%+ small-scale in Asia.

Why large-scale in Africa? Jatropha Jatropha High risk venture—depends on R&D and fuel prices Ideal for small scale large scale schemes folding Ideal for small-scale—large-scale schemes folding

Cattle (Amazon)Major cause of deforestation, both small/large farms Indirect effects from soy, sugarcane? Land speculation?

Commodity Jobs/1000 ha Invest $/ha Invest $per job

Sugar-ethanol manual-, Brz 700 $14,000 $20,000

Sugar-ethanol mech, Brz 150 $14,400 $96,000

Jatropha, Tanzania 600 $600 $1,000

Oil palm, Indonesia 350 $4,000 $11,400

Plantation forestry Uruguay 20 $7,000 $360,000

Sorghum Sudan semi-mech 53 $900 $17,000

Wheat/soybean irr, Zambia 16 $6,000 $375,000

Soy—fully mechanized, Brz 18 $3,600 $200,000

Grains fully mech., Ukraine 10 $450 $45,000

Implications for technology etcImplications for technology etc.

Factors in large production Innovations

Z till

Models with smallholders Outgrower schemes

I iti l b idi f llh ld Zero tillage ICT/satellite basedRisk diversification

Initial subsidies for smallholdersMay not involve contracts

Contract farmingRisk diversificationNew areas & crops

Adoption curve

Contract farmingSugarcane, soybeanContract prices and inputs

CSugarcane, soybeanContract prices and inputs

Often exacerbated by

Cooperatives, share in estatesMalaysia Zambia Often exacerbated by

Policy distortions (capital) Land mkt., labor regulations

Malaysia, Zambia Independent growers

Rubber in SE Asia, JatrophaSubsidized landStandards & tracubg

p

F h Pi l (10 k 2)For each Pixel (10 km2) Identify ‘yield gap’

Biophysical potential-Biophysical potential-actual use

Attribute to sources Infrastr., technology , etc.

-> Economic land rent Run global scenarios Run global scenarios

Climate change Carbon pricingRoad construction

-> Land rent implications Detailed analysis in pilot

Source: Vera-Diaz et al, 2008

Detailed analysis in pilot countries

B k d Background• 1997 law recognizes community

rights – good legal basisg g g• Huge potential: 34 mn. ha arable

land; only 3.7 mn. ha cropped

Want to attract investors Want to attract investors• New applications for 13 mn. ha in

18 months• Land audit: > 50% of existing

awards of land use rights (DUATs) un- or underutilized

… then backtracking• Moratorium in 2008

f f• Identify available land first

Overlaps:1.4 m ha; 418 cases

Private awards of user rights (DUATs) 8 900 2 900 l8,900 cases, 2,900 overlaps

Some hype has evaporated (or never been justified) Some hype has evaporated (or never been justified)Some investors lost big with negative social consequencesGovernments realized the dangers, tightened requirements T i 4 4 h t d 1 5 % d bi d b t Tanzania: 4.4 mn. ha requested, < 1.5 % approved; big debatesSome (e.g. Pakistan) is wishful thinking

.. .but there is still a lot going ong gNeed for regional data (Ethiopia: > 1 mn ha since 2005; 363 projects )Amh (7%) Gb (7%) Or (14%) S (15%) Bshg (56%) avg 2,800 haOften by-passing official channelsy p g

Official figures are highly unreliableQuality issues in Mozambique minor Undocumented expansion in Sudan (est’s 60%)Undocumented expansion in Sudan (est s 60%)Even countries with weak governance now asking for help

Region Projs Ctries # Biofuels Food crops Livestock Forestry/

Cons. NA

Af i 46 3 32 19 0 13 1 0 5 6 7 6 9Africa 46.3 32 19.0 13.1 0.5 6.7 6.9LAC 11.8 12 5.4 1.3 0.8 2.6 1.8SAS 4 4 4 0 5 1 5 0 5 1 5 0 3SAS 4.4 4 0.5 1.5 0.5 1.5 0.3ECA 12.3 10 3.3 5.7 2.1 0.8 0.5MENA 4 6 9 0 5 2 6 0 3 0 3 1 0MENA 4.6 9 0.5 2.6 0.3 0.3 1.0EAP 20.6 13 6.4 8.2 0.8 3.4 1.8World 100 80 35 2 32 4 4 9 15 1 12 3(n=389) 100 80 35.2 32.4 4.9 15.1 12.3

Region Agbiz Industry Fund NAAf i 8 0 16 2 9 5 12 6Africa 8.0 16.2 9.5 12.6LAC 2.3 2.3 4.9 2.3SAS 0 0 0 8 1 5 2 1SAS 0.0 0.8 1.5 2.1ECA 2.6 2.6 5.1 2.1MENA 0 5 1 0 1 8 1 3MENA 0.5 1.0 1.8 1.3EAP 3.1 5.4 6.9 5.1W ld 16 5 28 2 29 8 25 4World 16.5 28.2 29.8 25.4

Region Proposal Initiation Full productionp

Africa 13.9 27.3 2.8LAC 2 6 6 4 2 8LAC 2.6 6.4 2.8SAS 1.8 2.1 0.5ECA 4 6 6 2 1 5ECA 4.6 6.2 1.5MENA 1.5 2.3 0.8EAP 5.4 12.6 1.3World 29.8 56.9 9.8World 29.8 56.9 9.8

Top 3 Destination countries by region Origin

Af i L ti A i EAPAfrica Latin America EAP

Country Total Country Total Country Total Country Total

Sudan 6.4 Brazil 3.6 Indonesia 3.6 China 10.5

Ghana 4.1 Argentina 2.6 Philippines 3.1 UK 10.5

Madagascar 4.1 Paraguay 0.8 Australia 2.8 S. Arabia 9.8Madagascar 4.1 Paraguay 0.8 Australia 2.8 S. Arabia 9.8

PROBABILITY OF BEING A DESTINATION COUNTRY CONDUCIVE FACTORS

Variable Coeff. Robust Std Error

Land availability potentialL h i tiStd. Error

Land available for agriculture

0.358*** 0.118

GDP per capita 0 163 0 214

Less mechanization• Contradicts Lucas paradox

No role of GDP per capitaGDP per capita 0.163 0.214

Tractors/1000 ha -0.013* 0.006

Agricultural exports as % total exports

-0.008 0.008

No export dynamics Good governance not a factor

• Contrary to standard literaturetotal exports

Country’s exports as % global exports

0.092 0.132

Recognition of rural -0 375* 0 203

Weak land governance• Less protection of rural rights• Disappears for productionRecognition of rural

property rights10.375 0.203

Number of observations 88

R2 0.347

Disappears for production• Need for monitoring through civil

society & origin ctriesR 0.347

1 Protection of rural land rights.>0.***Significant at 1%, ** at 5%, * at 10%

1: Respecting land and resource rights1: Respecting land and resource rights

2: Improving food securityp g y

3: Ensuring transparency, good governance, and enabling environmentenabling environment4: Consultation and participation

5: Economic viability & responsible agro-enterprise investing6: Social sustainability

7: Environmental sustainability7: Environmental sustainability

I Individual/collective land rights recognized & demarcatedI. Individual/collective land rights recognized & demarcateda) Recognition & demarcation: e.g. Mexico, Peru (mostly) b) Recognition but little demarcation: e.g. Mozambique, Ethiopia c) Limited recognition: e.g. Sudan, Liberia, Indonesia, Cambodia

II. Modalities to transfer rights clear with proper representationa) Regulations for representation clear: Mexico Tnz (limits)a) Regulations for representation clear: Mexico, Tnz. (limits)b) Clear transfer mech., not representation: Moz., Zmb., Indn., Nig.

III. Affordable options to record, delimit & upgrade group tenurea) Accessible, clear & affordable: Mexicob) Exist but difficult to access: e.g. Moz., Zmb., Tzn.

IV Expropriation is a last resort limited to strict public goodsIV. Expropriation is a last resort, limited to strict public goodsa) Extremely circumscribed: Perub) Acquisition needs to go through Government with expropriation:

Z b Eth T Lib MZmb., Eth., Tzn, Lib., Moz.,V. Loss of property, use & secondary rights, whether registered or

not, is compensated promptly to maintain livelihoodsp p p ya) Only registered rights compensated: Ukr., Mex. b) Some secondary compensated: e.g. Peru, Moz., Zmb., Nig., (Tzn.)c) No/inadequate compensation: e g Sudan Tnz (practice)c) No/inadequate compensation: e.g. Sudan, Tnz. (practice)

I. Inventory on state land availability and potential is availablea) State land availability: e.g. Mex., Peru, (Uganda)b) Limited/no info. avail.: Moz., Brz., Eth.

II Subsidies for investors justified & implemented transparentlyII. Subsidies for investors justified & implemented transparentlya) Extremely well defined & implemented for ag. Land in Perub) Well defined, but not implemented transp’ly: Zmb., Nig., Liberiac) Little/no transparency: e.g. Indn., Sdn., Ukr., Brz., Pak.

III. Info. on key aspects of contractual arrangements is publica) Some contractual data & lease payments collected: Peru Liberiaa) Some contractual data & lease payments collected: Peru, Liberiab) Some information collected, not public: Moz., Eth., Sdn., Cmb.c) Not public: Ukr., Brz., Indn., Nig., Pak., Mex.

IV. Contracts are enforceda) Government monitoring: e.g. Peru, Mex., Brz.b) Contracts renegotiated/revoked: e g DRC Lib Cmb (int’l press)b) Contracts renegotiated/revoked: e.g. DRC, Lib., Cmb. (int l press)c) Limited/no monitoring: e.g. Sdn., Indn., Nig., Moz

I Investments guided by national ag development strategyI. Investments guided by national ag. development strategya) Importance recognized but not explicit: e.g. Moz., Tnz., Eth., Sdn

II. Mechanisms to ensure projects’ financial & economic viabilitya) Viability assessed, though haphazard in Moz.,, Lib.b) Little/no assessment: e.g. Sudan, Eth., Zmb., Nig.

III Risk is taken into accountIII. Risk is taken into accounta) Contracts conditional on undertaking investmentb) Application procedure tiered by aggregate area

IV. Vulnerability & distributional impacts assessed, taken into account in select’na) Land use changes consider food security: e g Chinaa) Land use changes consider food security: e.g. China

I. Investments consistent with local visions & potentially affected est e ts co s ste t t oca s o s & pote t a y a ectedare aware of their rights and ways to exercise thema) Local gov’ts involved in negotiation: Ukr., Moz. (parts)b) Campaigns based on need with NGO supportb) Campaigns based on need with NGO support c) Limited awareness: e.g. Tnz., Lib., Moz.

II. Agreements are based on consultation with all those affecteda) Promote partnerships with primary users: e.g. Ukr., Tnz., Mex.b) Limited/no consultation: e.g. Moz., Indn., Nig., Sdn., Eth.

III Mechanisms for legal representation of contracting parties areIII. Mechanisms for legal representation of contracting parties are available & clear to everyonea) Clear legal representation of individuals/groups: e.g. Mex., Ukr.b) Limited/no represent. of rights holders: e.g. Moz., Lib., Zmb., Nig.

IV. Those indirectly affected are compensated for losses a) Nonea) None

I EIA is in place to ensure key elements of environmentalI. EIA is in place to ensure key elements of environmental sustainability taken into accounta) EIAs mandated: e.g. Mex., Brz., Ukr., Eth., Lib. (forestry)b) EIA d t d t f d M Ni T Z b I db) EIAs mandated, not enforced: e.g. Moz., Nig., Tnz., Zmb., Indn.c) No EIA required: e.g. DRC, Sdn.

II. Implementation of environmental plans is monitoredII. Implementation of environmental plans is monitoreda) Monitored by Gov’t & civil society: e.g. Brz., Mex. (class action)b) Limited/no monitoring: e.g. Zmb., Lib., Sdn., Nig.St d d t t ti ill b d j t itIII. Standards to prevent negative spillovers beyond project sitea) None (e.g. Brz. deforestation)

L ll t bli h d d S Bi f l t l iLegally established procedure Sun Biofuel actual experience• Investor shall approach TIC and sublease land from Land Bank

• Investor approached villagers directly

Compensation shall be:• based on loss from land alienation• included in project agreement

• Villagers compensated for crops onely• Market price of land not factored

• Land users shall be recognized as shareholders • Their contribution to the company shall

• Two Tanzanian shareholders hold 1% of shares each•Neither of them are affected villagersTheir contribution to the company shall

be the land they give upNeither of them are affected villagers.

• Land to be allocated to investor shall be published in the Government Gazette

• Allocated land was published in the Gazette after the President’s assentpublished in the Government Gazette

before the President’s assent to allow for contestation

Gazette after the President s assent• Contestation is against an already taken presidential decision.

• EIA required prior to land acquisition by • No evidence that an EIA was conducted.q p q yinvestor• Villagers shall be informed of the value of their land and of the consequences of

• Informed consent seems to have been the case

giving it upSource: Land Rights Research and Resources Institute (LARRRI) & Joint Oxfam Livelihood Initiative for Tanzania (JOLIT), March 2008 . The Agrofuel Industry in Tanzania: A Critical Enquiry into Challenges and Opportunities.

Country Key issues CommoditiesD.R.Congo •Post-conflict (displacement, elite capture)

Hi h l i l t ti l•Oil palmV t bl / i•High agro-ecological potential

•Ecosystem vulnerable to land use change•Vegetables/maize •Carbon

Liberia •Re-negotiating concessions post-conflict•Legislated concession process including

•Rubber •Timber•Legislated concession process, including

community-negotiated social contracts•Timber •Rice

Mexico •Ejido reform community land rights•Communities negotiate w/investor directly

•Rubber •Vegetables/maize•Communities negotiate w/investor directly

•Gov’t services (attorney, register of projects)•Vegetables/maize •Rice

Mozambique •Gov’t solicited private investment•Unanticipated rush of applications (biofuels)

•Sugar for ethanol •Sugar for ethanol•Unanticipated rush of applications (biofuels)

•New land law (‘97); community consultation•Sugar for ethanol •Plantation forest

Tanzania •Agricultural encroachment on pastoral areas•Loss of biodiversity water catchment services

•Eco-charcoal•Teak•Loss of biodiversity, water catchment services •Teak

Ukraine •Unfinished land reform; no agric. land sales•Local govt supports comm.-investor nego’tns

•Mixed grains & oilseeds

Z bi G ’t f bl d l i d l / ll l F d/ hZambia •Gov’t farm bloc model: mixed lg/small-scale•Biofuels rush; also large Zimbabwean farmers•2 % of land rental proceeds to community

•Food/cash crops •Wheat/soya•Sugar

Clear land rights seem to be a precondition for positive results Displacement is more likely without clear rights. Compensation is also

lacking especially compensation for loss of livelihoodslacking – especially compensation for loss of livelihoods. Governments lack capacity to enforce agreements/implement

policies.

There are few mechanisms in place to ensure that companies keep their promises. Mandatory consultation mechanisms are also inadequatealso inadequate

If where companies are profitable, communities benefit more: more jobs are created and there is more technology transferj gy

Best results seen where communities keep a stake in the investments.

Given the sizeable areas concerned, direct impacts could include Land conversion and biodiversity loss

Unsustainable use of scarce water

Impacts on air, soil, and water qualityN d t i di t ff t i ti t ( ) Need to manage indirect effects on existing nat. resource use(r)s

Dislocation of resource users (e.g. pastoralists, forest users)

E h d l t d d d f i l l dEnhanced employment may reduce demand for marginal land REDD may provide a sustainable rural income source

Still need to ensure consultation and benefit sharing with localsStill need to ensure consultation and benefit sharing with locals Few countries enforce existing EIA requirements

None have adopted nationwide SEAs to consider strategic issuesNone have adopted nationwide SEAs to consider strategic issues

I Fundamentals are critical and often underemphasizedI. Fundamentals are critical and often underemphasizeda) If projects make no money, everybody losesb) Defining demand & market critical; gov’t contributionc) Wide range of arrangements (LS/SS) feasible even within a cropc) Wide range of arrangements (LS/SS) feasible even within a cropd) Secular trends imply higher land values & pressure for LS acquisition

II Countries targeted need assistance in many respectsII. Countries targeted need assistance in many respectsa) Transparency & monitoring where government is weak (incl. civil society)b) Knowing what’s going on & link between responsible ministries/bodies

I i i l l l l d h b ic) Institutional arrangements to apply rules transparently on an ad hoc basisd) Providing supporting public goods to support investment strategically e) Clarifying property rights & protecting them in long term

III. The international community can helpa) Agreement on a common set of principlesb) Help to implement thesec) Monitoring & enforcement by source countries