The United Nations declared 2014 the International Year of Family Farming (IYFF) to highlight the importance of family and smallholder farmers. Food Tank is partnering with the U.N. Food and Agriculture Organization (FAO) to commemorate IYFF, and will feature weekly posts and other media highlighting the innovations that family farmers are using to alleviate hunger, poverty, and environmental degradation along with the campaigns and policies that support them.
Recent reports and studies from several international research organizations are calling for more comprehensive and responsible investment in agriculture – particularly with regard to farmland. According to a recent policy paper by Oxfam, “massive investment in agriculture is desperately needed to help fix the broken food system. Private sector investment can play a vital role…if it adheres to some key principles.”
Many disagree on whether private land investment will have positive or negative outcomes for increasing food security and improving livelihoods. Global Ag Investing, a consulting firm specializing in agricultural investments points out the following: “Given the small scale of the average farm globally and the challenges for such businesses in accessing capital, the scope and need for institutional capital to be deployed in agriculture in order to improve efficiencies and generate higher returns may be significant.”
A working paper from the U.N. Development Program on private investment in land in Africa cites “increasing… foreign exchange reserves…increased liquidity in rural areas and investments in…roads, schools and health posts” as well as “the potential to create employment, facilitate technical transfers and modernize the agriculture sector to improve its productivity and increase its production” as potential benefits to private investment.
A recent report from the Oakland Institute provides an overview of fund profiles for some of the major agricultural investing firms. When asked about the potential social upheaval caused by his fund’s investments in African land, Mark Keegan, CEO of Farm Lands of Guinea, Ltd. said, “I am also aware that success will bring social upheaval. I never stop pointing this out to African governments so that they can plan whilst they have time to think about it.”
Notably, the report also points out that traditional investment portfolios are moving toward private funds, and that private funds are increasingly investing in agriculture. This means that traditionally large investors – large financial intermediaries, pension funds, university endowments, and government agencies – all have a stake, and are contributing to the impacts of these investments.
Oxfam has a petition available to sign asking the World Bank to stop funding land grabs. Landesa released an issue brief advising investors and governments on how best to protect local communities while purchasing land, and the International Fund for Agricultural Development (IFAD) released an extensive report exploring business models that promote the inclusion of farmers in decision-making processes. They evaluate the models based on how ownership, voice in influencing business decisions, risks, and profits are shared between companies, farmers, and any other stakeholders.
Investigations into responsible and socially conscious ways of investing offer promise for a positive-sum strategy for both investors and local communities.
