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A book by Frédéric Lemaître,
Editor-in-Chief, Le Monde
Frédéric Lemaître, Editor-in-Chief and Columnist of the French daily Le Monde, recently authored
“Tomorrow, Hunger!” a book we highly recommend for its sound analyses and the quality of its approach.
We asked the author why he got involved in such project at a time when agricultural issues were not “drawing a full house” in the French press.
“The triggering factor can be traced back to the 2008 Davos Forum. As I was talking with the head of a banking institution, the executive expressed his disappointment that the Forum was completely eschewing a major topic for the future: the agricultural and food issue. I then decided to improve on the topic.”
At the time, hunger riots were occurring more frequently, commodity prices were at their highest level and all experts in attendance were betting on a continued trend. Then, only a few months later, everything collapsed: the prices, the financial and economic crisis and now the agricultural crisis experienced by several countries in the world, all events that are shaking our beliefs, without ever really bringing our leaders to commit to trade regulation and liberalization as well as the implementation of agricultural policies that mitigate agricultural price volatility.
As pointed out by Frédéric Lemaître, we cannot too strongly make clear that “the advantage of a crisis is that is compels leaders to act.”
Let us hope that action will not be limited to conclusions or incantations. We need political leaders who do not let themselves be influenced by the “prophets of the impossible” and who are guided by the audacity to reform political action.
We a reproducing below several outstanding excerpts from the book, which has been nominated for the TerrEthique literary prize to be awarded during the 2010 Paris International Agricultural Show. Our best wishes for success!
by Dominique Lasserre, Advisor, momagri
Selected Excepts Introduction
“May 2045? India just declared war to Indonesia… And yet, relations between the world’s most populated country and the largest Muslim-majority nation had been satisfactory for a long time. In 2015, the two countries even entered into a spectacular deal: As it became powerless to feed its billon and a half people, India purchased from Indonesia the rights to farm land in Papua, a province almost as vast as France […] But for the past few years tensions arose between the two communities. Primarily because of soaring agricultural prices, the land––formerly swampy but now
highly productive––is worth a fortune. Consequently, Indonesia wants the land back, or at least benefit from a share of the crops, to which the Indian Government is totally opposed […] If we already witnessed some ‘thirst wars’, it is the first time that a ‘hunger war’, as the press calls it, opposes two nations.
Science fiction? Of course […]
Food security is back on the agenda and the value of land is again increasing. In the name of these imperatives, governments, sovereign wealth funds and multinational corporations are purchasing land and raising new questions with the international legal system. […] Hunger wars are thus not inevitable in the future. The 2008 riots are only a foretaste of what is ahead. […]”
A return to colonialism? (Chapter 7)
“A slight 19th century atmosphere is perceptible at the start of our 21st century. As in olden times, land in certain countries is highly coveted by non-residents. This is more evidence that leaders of the wealthy nations have only a very limited trust in the future of trade relations. Their rationale?
Since tomorrow’s return to protectionism can threaten food security for my fellow-citizens, why not purchase today the land that will protect me from depletion? The fact that public or private interests join forces with emerging countries to cultivate land together is not reprehensible in itself, if the resulting profits are shared.
But if we believe the snippets of information currently passed around––most of these agreements are confidential––this is not the case. According to The Chosun Ilbo, the Korean daily of record, Japan discreetly purchased 12 million hectares of land in Southeast Asia, in China and in South America to produce food products to be exported to its islands. The surface is impressive: close to three times that of the Japanese arable land. The NGO Grain indicates that for its part, the Libyan Government leased 200,000 hectares of agricultural land in Ukraine to meet its needs in food imports. And the United Arab Emirates bought approximately 400,000 hectares from Pakistan with Islamabad’s backing. […]
… Pergam Finance, an investment fund, has been investing in South American land since 2005. Olivier Combastet, its Chairman and CEO, explained his strategy in a July 2007 article in the French magazine L’Expansion. ‘Based on the observation that farmland will become an increasingly rare asset, we set up a very precise roadmap for our action. We search for poorly managed farms to improve their structure and value. The rule is to set a purchase price at around $2,000 per hectare. Today, we have surpassed our goals of returns and the value of our first investments has already risen by 30 percent. (…) Our target is to build up a diversified asset portfolio throughout Uruguay, Argentina and another country to better balance risks. We aim to make Campos Orientales the largest real estate fund listed on the French Bourse, both in terms of size and returns.
But you see, Latin America is becoming expensive. For some investment bankers, tomorrow’s Eldorado is to be found in Africa. There, only 210 million hectares are farmed, while it is estimated that there are at least 400 million hectares of very good soil and one billon hectares that can be farmed.’
[…] In spite of financial unrest, the daily Hedge Fund News (whose delectable masthead logo is ‘creative volatility’) wrote in its September 1, 2008 issue that Emergent raised more funds than expected––€2 billion––and hoped to raise a total of €3 billion. The minimal contribution was €500,000 for a private person and €5 million for an institutional investor. In these times of chaotic markets, Hedge Fund News added a fact that was not missed by its readers: the expected annual return is 25 percent.
After the subprime mortgages, is agriculture going to be the future financial bubble? In 2007 and for the first time in three decades, the price of agricultural land already increased more than housing prices in London or New York City.
In all likelihood, the phenomenon was reproduced in 2008. If the trend does not die down, what can happen? In the best-case scenario, private capital can bring financing to a sector that needs it and will need it more and more. Indeed, such is the players’ justification. But we are not sure that the farmers currently suffering from hunger are the ones more likely to gain. In this scenario, we would, in the upcoming decades, see farmers converted into employees of multinationals––even foreign nations––whose production might essentially be earmarked for export. […] Must we take that route to feed the world?
The situation is disturbing enough for the FAO Director-General to sound the alarm. In an article published in the September 24, 2008 issue of Le Monde, he states: ‘The use of natural resources with the sole goal of financial return […] might lead to the emergence of a neo-colonial pact to provide commodities without added-value in the producing countries and inacceptable working conditions for agricultural workers. It is therefore imperative to avoid the misapplication of a good idea.’”
Unfair trade (Chapter 10)
“Only because they consider that food security for their populations is not negotiable, the United States and the European Union massively subsidize their agricultural activities. Far from being reprehensible, such political vision is necessary. Can we imagine that, in the name of supply and demand, a share of the population cannot feed itself? Of course not. The right to food is fundamental. Henceforth, a question arises: must, or should, trade liberalization be applied to agriculture as it is to other trade goods?
There are really very few people who really think so, and the 2008 food crisis only strengthens the camp of disbelievers. For over half a century, the international community has assumed that trade liberalization is one of the requirements for economic growth. Facts seem to prove it right… with the exception of agriculture where it faces three major hurdles (please read page 116 of the book for details).
Therefore everyone agrees: agriculture is not a good similar to others, and liberalism in agriculture is a pipe dream for the time being. Would a truly liberal policy bring happiness to the impoverished? This is far from being obvious.
According to the World Bank, aid granted to farmers by prosperous countries boils down to reducing agricultural prices on international markets by five percent. Nothing important in that case. […] [The FAO] paradoxically considers that it would be the consumers in OECD member nations who would benefit the most from total liberalization, since they are now the ones suffering the most from import restrictions. As far as emerging countries, ‘those that are net importers of agricultural products and those who gain from preferential access to markets in OECD countries will not end up the winners of trade liberalization, even in the long term.’ Actually, since the European Union maintains agreements with 79 countries in Africa, the Caribbean and the Pacific basins (APC), which are often among the world’s poorer nations and which do assess duties on European imports, trade liberalization would in fact detrimental for them. To tell the truth, the main beneficiary of agricultural trade liberalization would be the emerging country capable to compete with the European Union and the United States: Brazil.”