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Africa Land-Rush for multinational Agribusinesses

If you have lands with no water,

If you have water and no fertile land,

If you have accumulated enough in your Sovereign Fund…

The way to go for States is to invest in foreign fertile lands for agricultural “self-sufficiency”, which means import food at much lower prices. 

Japan, South Korea, China, India, and Saudi Arabia are leading these kinds of joint ventures. For example:

South Korea has acquired a total of 3 millions hectares (three times the superficies of the State of Lebanon); it is growing fields in Russia (500,000 ha), Sudan (700,000 ha), Madagascar (1.3 million ha), Mongolia (300,000 ha), Philippines (100,000 ha), and Indonesia (25, 000 ha).  The Korean agency for international cooperation (State owned) is creating private and public enterprises to invest into agribusinesses by loans or direct governmental investments. Leases of fertile lands are for 60 years and an extension of another 40 years. In return, Korea will extend technologies and development planning.  It appears that South Korea is projecting unification with North Korea and the flooding of North Korean refugees soon.

China has invested for a total of 2 millions hectares.  It has 1.25 millions in South East Asia (Thailand, Malaysia, Cambodia, and Laos), in Mozambique (800,000 ha), in Russia (80,000 ha), in Australia (45,000), and in Cuba (5,000 ha).

Japan has acquired a total of one million hectares in Philippines (600,000 ha), USA (225,000 ha), and Brazil (100,000 ha).

India has acquired a total of 1.7 millions hectares in Argentina (600,000 ha), Ethiopia (370,000 ha), Malaysia (300,000 ha), Madagascar (250,000 ha), Indonesia (70,000 ha), and in Laos (50,000 ha). 

The Indian government has extended loans to 80 agribusinesses to purchase 350,000 ha in Africa.  Ramakrishna Karuturi (the king of rose production in 4 millions hectares) is leasing the hectare for two dollars a year in Ethiopia!

Saudi Arabia has invested in Indonesia (one million ha), Senegal (500,000 ha), and in Mali (200,000 ha). 

The Arab Gulf Emirates has invested in Pakistan (325,000 ha), and in Sudan (400,000 ha).

Egypt has invested in Uganda (850,000 ha). 

Libya has invested in Ukraine (250,000 ha), and Liberia (5,000 ha). 

Qatar invested in the Philippines (100,000 ha).

Africa is the remaining poorest continent with vast fertile lands and plenty of manpower to exploit for agribusiness enterprises. Africa is targeted to be exclusively the world’s food basket in this century.

Contrary to the talking points of President Obama and the other leaders of the G8 nations, the problem of feeding the world isn’t about the need to produce more food.

The main catastrophe is how to stop wealthy countries from:

1.  Subsidizing their richest farmers,

2. Grabbing up the best land in Africa for speculating on food commodities in their financial markets,

3. Wasting food,

4. Diverting crop production to livestock feed and biofuels,

5. and ratcheting up the costs of farming by encouraging the use of expensive and unsustainable GMO seeds, pesticides and fertilizers.”


We hope that the world community will pressure these investors to grow food slowly and not ruin the remaining land with fertilizers and pesticides.

We hope that the African can enjoy what the lands are producing for their daily staples…

We hope the African people get first cut at the distribution of food produced and receive first priority to ward off recurring famine…

Don The Porsche drives a yellow Porsche to work and wears cotton shirts double knitted; he is a super trader at a multinational bank and is in demand speaking to schools and universities.  Don is now enjoying big bonuses from the billion in profit that the bank is generating by buying and selling financial papers (such as forms of credit derivatives, Treasury Bills, short-term contracts…) through million of financial transactions a day; kind of making profit on high rate of turnover for small profit as in supermarkets.  Multinational banks take advantage of opportunities in the financial market, an  “incoherent” market with frequent fluctuations in interest rates through million of financial transaction a day.

Don The Porsche has climbed the ranks of this “drug cartel” kind of structure by learning the rules of the game:  Total loyalty to the institution that pays for your Porsche and standard of living, in return for damping your moral values and ethical conducts.  Don has learned to make a clean blackboard on previously acquired values. Don is now in the middle of the food chain, between the shark and the hyena.

The bank trades by shuffling “financial products” from one debtor State to another debtor State, as political programs and plans are announced by governments for stated goals to satisfying States’ economies.  Actually, all 192 States in the UN are debtor nations with “sovereign debts” to creditors, private or other governments.  The difference is that powerful nations pay lower interests on loans than the poorer nations, and thus, the strong nations loan to poorer nation for profit on difference in interest rates.  How that mechanism works?

The previous G8 of the developed nations (initially the previous colonial powers) have created rating companies such as Standard & Poors, Moody’s, and Fitch; they control and supervise these “private” rating companies that are assigned the task of attributing rating of financial and economical viabilities of State governments for paying off interests on loans and the principal on due dates.

The rating companies are politically motivated and obey the G8 of the Western powers political decisions for rating less harshly governments that follow their political lines (in the UN) and programs.  The rating companies punish “rogue governments” that dared contradict the “consensus politics” with very bad ratings, thus, pressuring rogue States paying high interest rates on badly needed loans.  Consequently, the biggest debtor nations get credits at low interest rates and in return their multinational financial institutions and International institutions (World Bank and Monetary Fund…) loans to developing nations at high interest rates.  Consequently, the former “colonies” that got their physical “independence” 50 years ago are still controlled financially “soft control” and subjugated to remaining in a developing conditions.

An individual asks Don this pertinent question: “The more a State is in difficulty, the more it needs to borrow, the poorer its financial rating, the costlier the loans, and the deeper in trouble the State is plunged in.”  Don’s reaction is a ready placating answer such as: “You cannot comprehend the complex world of finance.  If it was that simple a logic then, how could financial institutions transact 5 trillion dollars in every single day?” Don is very much aware of the simple logic empowering developed nations to impoverishing developing nations; but Don has learned not to get sentimental and accumulating “headaches for other people problems”:  He has to purchase a newer more powerful versions of Porsche and is awaiting an even bigger bonus.

Like most “successful” traders, Don earned a university degree in the finance field.  He probably was initiated in the university at producing statistical analysis from various updated mathematical models that compute trends in the financial market.  It is not difficult a job since data are instantly produced and displayed:  The computer is automatically programmed to run the math models at the click of key on the keyboard.  Don learned to look at the graphs and analyzing trends.  Don was initially hired to be in the background consultant for the “in-the-field” traders in the “Hall market”.

Basically, Don’s initial job position is for “arbitrating rate products”; he uses a set of techniques to generating profits due to market incoherences; he keeps an eye on opportunities created on the screen of his monitor.  (The financial field applies advanced mathematics in probability, statistics, numerical analysis, signal treatment, genetics laws, fluid mechanics and dynamics laws and all kinds of natural and human behavior laws that seem applicable to market finance.  Most of these models and techniques can be applied to irrigation network, fighting diseases, reducing environmental pollution, safeguarding biodiversity, retaining virgin forests…but most of the bright minds are attracted to financial institutions with wages four times higher than in other engineering fields.)

After a few years as a low-paid financial consultant, Don is promoted as assistant to a trader who by now, has forgotten how to use statistical modeling or has no time for this task, and rely of the freshly hired consultants.   Don was again gratified to the rank of supporting trader and then to full fledged trader working in the “Hall of trading”.  Don is set to earning large bonuses after doing his penitence in the background, envying traders and yearning for years to earning big bucks.

Now Don sits behind a 1.2 meter desk studded with a computer, a monitor, a keyboard, a mouse… Don is sitting in a supermarket of lined desks, raws after raws.  He is clicking on two important keys or icons “buy” or “sell”.  The more successful Don is, the more confident are his clients in his ability for maintaining his “fiduciary” duty of acting on their behalf (for their best interest).

Note 1:  Paul Krugman, another Nobel laureate for economics, wrote: “The ratio of financial profit to the GNP jumped from 4% to 8% in the last two decades but it resulted in no economic real growth.  The economy was rendered less stable and less performing due to financial deregulation.”  All indicates that even Europe has not experienced any real growth in that period.

Note 2:  This story was inspired by the French book “Foul Express” written by Marwan Muhammad.  He was an “engineer in financial mathematical modeling” and worked for a French multinational bank and resigned after learning the immoral and unethical procedures for generating profit at the expense of suffering and humiliation of the poorer nations.

Note 3:  How developing nations remain poor?  The rich developed States subsidize their agriculture and dump the foodstuff products on the open market of the poorer nations at lower prices that local peasants can compete with.  Consequently, the unsubsidized peasants of the poor nations leave their fields and transfer to urban centers lacking running water, electricity, and opportunities for work.  They end up living in the poorest quarters and shantytowns and are used and abused as menial workers.  They join the lower classes, kept at 20% of the population, in order to maintaining and up keeping the daily running economy.

Once the sovereign debt of a developing State is high enough requiring 50% of the budget to be earmarked for servicing the interests on loans then, the powerful nations instruct their multinational agribusinesses to purchase fertile lands (or renting for 99 years) at ridiculous low prices in the former colonial countries.  Fertile lands are transformed to harvesting products for “green” alternative sources of energy like sugar cane …  The natives lack the ingredients for their staple daily meals and famine is frequently rampant (blamed on environmental conditions by the western States).  You may read detailed cases in my category “Africa/Agriculture”




September 2021

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