Farmland buying may harm poor states - EU official

The European Union is concerned by the trend of foreign investors and countries acquiring large tracts of farmland in developing countries to guarantee their own food security, a senior EU official said on Wednesday.Although the EU had not reached a common position on the issue there were fears the trend might pose a risk to developing countries if it were not done properly, said Stefano Manservisi, director-general for aid and development at the European Commission - the EU executive.

Manservisi said his concerns did not mean such deals were bad, he said in an interview. But some were the result of negotiations that were very often untransparent, he added.

"We are very concerned because this is another way to exploit developing countries ... doing it thirty years ago, this would have been a perfect example of neo-colonialism," he said.

"The poorest countries are selling commodities, they are exporting migrants and now they are selling their land from which they will not take any kind of benefit in terms of food or whatever," Manservisi added.

Countries such as Saudi Arabia, the United Arab Emirates, China and South Korea are looking to buy farmland beyond their borders after sharp food price hikes in 2008 highlighted a need for greater food security.

Underexploited farmlands across Africa are particularly coveted by foreign investors, in a phenomenon known as "land-grabbing".

In March, Madagascar's army-backed leader cancelled a deal by South Korea's Daewoo Logistics to lease a million hectares of Madagascar - equivalent to the size of Qatar - to grow food.

"The paradox here was that as Madagascar was selling land ... people were still dying of hunger," Manservisi said.

A report in May, co-authored by international agencies estimated that nearly 2.5 million hectares (6.2 million acres) of farmland in five sub-Saharan African countries has been bought or leased since 2004: an investment of $919.98 million.

The report by the International Fund for Agricultural Development (IFAD) and UN Food and Agriculture Organization (FAO), and London-based International Institute for Environment and Development (IIED), said fears about food security and rising returns in agriculture mean the trend would continue.

Although some of the deals might bring benefits in terms of infrastructure and jobs, it also meant risks for recipient countries, local people and the investors, the agencies said. (Reuters)