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FAO advocates for proper direction of agric investment in Africa

by Business News Report

The Food and Agricultural Organisation (FAO) has warned that the noticeable increase in foreign investments in Africa’s agriculture should be properly directed to avoid harming the sector. The agency made the submission in a report titled: “Trends and Impacts of Foreign Investment in Developing Country Agriculture’’ .
The report, made available to newsmen in Lagos on Wednesday, indicated that foreign investment in agricultural land in developing countries, “has increased markedly over the past decade’’. It stated that land acquisition tended to be among the best available with good soil quality and irrigation. The organisation advised that laws and institutions governing agricultural investment and land tenure should be made attractive for such investments to have positive effects.
“The challenge for policy makers, development agencies and local communities is to maximise the benefits of foreign agricultural investment while minimising its risks. While studies document the negative impacts of large-scale land acquisition in developing countries, there is much less evidence of its benefits to the host country, especially in the short-term and at local level,’’ it said. According to the report, the investments involving large-scale land acquisition in countries where land rights are unclear and insecure, have disadvantages that often outweigh the benefits to the local community.
“In several projects, the number of jobs is lower than what is initially announced and in some projects, even jobs requiring low-skilled workers are mainly taken up by non-locals,’’ FAO stated. Drawing a comparism, it said noted that although Foreign Direct Investment had risen significantly, especially in Asia and Latin America over the past decade, “only a small share goes to agriculture and less than five per cent in sub-Saharan Africa’’. It said that the increased investment represented an opportunity, given the high potential for growth, particularly in the light of currently high international food prices.

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