LONDON (Reuters) - A race to grab land in developing
countries and exploit food supply fears and payments to conserve
forests could spark conflicts in areas of land disputes,
development and civil rights groups say.
Investors say higher land valuations are just what's needed
to settle claims which may have festered since colonial days.
But much marginal and forested land is common property,
which in the past has given poor local communities little
benefit from logging, mining and oil concessions.
"No-man's land and hinterland is suddenly valuable," said
Andy White, coordinator for the Washington-based Rights and
Resources Initiative, a development NGO.
"Communities had been told the land was theirs. Now it's
contested," he said, explaining that a community in Liberia had
told him that in one week they had separate visits from a mining
company, a logging company and a biofuel company. "They were
told by the government -- 'go out and prospect'."
Spiralling commodity prices have driven speculative interest
in farms and forests in emerging markets where productive land
can cost one 10th of the price in industrialised countries.
"There are still very good prospects," said George Lee,
manager of hedge fund firm Eclectica's agriculture fund, which
invests in companies which buy land, comparing grazing land
prices in Uruguay at $3,000 per hectare with $20,000 in Britain.
Benchmark wheat prices have dipped by a third since a peak
last September but remain 50 percent above a 2007 low.
Land and food prices are expected to remain high as a
growing, richer world demands more land for settlement and food,
while climate change threatens more droughts.
CONFLICT
Steps to fight climate change and secure energy supplies are
partly to blame for stoking land prices, by fuelling interest in
alternative energy including biofuels produced from food crops
such as palm oil, soy, sugar and grains.
Added to that, payments to preserve vast tracts of tropical
forests could be the next big environmental market, winning
broad support in U.N.-led climate talks as a way to lock up in
trees the greenhouse gas carbon dioxide.
Scrupulous investors say they follow ethical principles on
land purchases:
"You don't want to be a hostile element in the environment
... it's an investor choice, you see a lot of abuse," said
Kimberly Tara, chief executive of FourWinds Capital Management,
an investor in water, biofuels and farms.
"In places like Ghana you can do all sorts of things. You
can take a logging concession, you can strip the land and
destroy it, give nothing back to local communities."
In Ghana, the constitution details how to split rents for
logging concessions between government agencies and local
communities, but that is routinely flouted as the Forestry
Commission takes a 60 percent fee first, say NGOs.
"There's been very little effort to make sure that any of
that money actually gets down to communities as opposed to being
captured by local elites," said Kyeretwie Opoku, coordinator of
Ghana-based NGO, Civic Response.
The Rights and Resources Initiative cites research showing
ongoing foreign investments in biofuel production in Africa,
including a 3-million-hectare investment by a Chinese company in
the Democratic Republic of Congo.
CARBON
Now investors are circling a possible new market meant to
help preserve tropical forests.
Heavily forested, tropical nations are lobbying U.N. climate
talks to be allowed to sell lucrative carbon offsets in exchange
for protecting millions of hectares of rainforest.
Rich countries accept that they must bear the burden of
global targets to curb greenhouse gases, and some are keen to
achieve such targets by buying carbon offsets -- funding forest
conservation is considered a cheap way to do that.
Rights to forested lands can be hotly disputed between
indigenous peoples, local communities and central government,
raising doubts over who will get the carbon cash.
"Carbon markets could be the match that sets it all off,"
said Andy White of the Rights and Resources Initiative.
Without their involvement, local communities which depend on
the forests for their livelihood will collude in illegal logging
to make money another way, NGOs say.
Carbon market investors say the prospect of returns will
help disentangle conflicts.
"It will encourage the resolution of disputed land claims, a
lot of these are not being resolved simply out of inertia," said
Eric Bettelheim, executive chairman of UK-based Sustainable
Forestry Management (SFM).
"Even in the diamond business, consumers and producers found
out that people get angry, won't buy from conflict areas. The
oil and gas industry are dealing in commodities which are very
hard to trace ... by and large carbon offsets are much more
exposed to public scrutiny, subject of legislation."
SFM is paying authorities for a share of hoped-for avoided
deforestation carbon offsets on a 500,000-hectare tract of
rainforest in Peru and will share any profits with local people.
Rules for such investments in carbon sinks are not set yet,
under U.N. talks expected to agree a climate treaty next year.
"There's no point in blaming bankers wanting to make
profits," said Barry Gardiner, British Prime Minister Gordon
Brown's special envoy for forests.
"Our job as an international community is to make sure these
markets work effectively to deliver carbon sequestration,
protect indigenous people's rights and deliver ecosystem
services."
(link to source)
(link to source)