Oct. 4 (Bloomberg) -- The World Bank rejected a call by aid group Oxfam International to freeze the lender’s investment in land-intensive agricultural projects, saying such a move would not help prevent abusive practices in the purchase of acreage.
Oxfam, in a report released yesterday, urged the Washington-based bank to declare a moratorium on its agricultural investments in land to “create space to develop policy and institutional protections to ensure that no bank-supported project resulted in land grabbing.” According to the report, there have been 21 formal complaints since 2008 by communities from Asia to Africa saying projects funded by the bank violated their land rights.
A global rush to buy farmland triggered by the 2007-2008 spike in food prices has continued, with international investors focusing on the poorest countries with weak land-rights security for deals, a report by the Land Matrix research group said in April. According to Oxfam’s report released yesterday, an area of land the size of London is sold to foreign buyers every six days in poor countries.
The World Bank said in a written rebuttal it “does not support speculative land investments or acquisitions which take advantage of weak institutions in developing countries or which disregard principles of responsible agricultural investment.”
A moratorium “would do nothing to help reduce the instances of abusive practices and would likely deter responsible investors willing to apply our high standards,” it said.
Still, making sure projects meet such standards “is challenging,” it said.
The World Bank itself in a 2010 study said foreign purchases of land posed risks to the livelihoods of farmers in some countries. At the same time, the bank, whose mission is to eradicate poverty, estimates that the world will need a 70 percent increase in global food production by 2050 to feed the additional 2 billion inhabitants on the planet.
The worst U.S. drought since the 1950s sparked a 10 percent gain in the bank’s Food Price Index in July, it said Aug. 30, adding that further weather disruptions or rising energy expenses could increase grain costs already at a record.
Oxfam said the bank plays a pivotal role in land acquisitions through direct financial support for investment in land, policy advice to governments and as a standard setter for other investors. With a freeze, the lender could review its advice and craft tougher policies to stop land grabs, Oxfam said.
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