Friends of the Earth slams food speculation and land grabs | World Development Movement

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Friends of the Earth slams food speculation and land grabs

By David Dominic, 13 March 2012

This week I read a recent report by Friends of the Earth Europe. ‘Farming Money: How European banks and private finance profit from food speculation and land grabs’ is an interesting read for anyone concerned about poverty and social justice issues. 

The report looks at two major topics: food speculation and land grabs. Anyone who has been following the work of the World Development Movement over the last couple of years will be familiar with food speculation, and WDM in fact contributed to a section in the report about food speculation by British banks. 

In order to address the speculation problem, Friends of the Earth recommends two solutions. The first reform it advocates is increased transparency in food markets, with trade of futures contracts taking place on public exchanges rather than in secret - how the current ‘over the counter’ market operates, The second is ‘position limits’, meaning that there should be limits to how much of food markets can be controlled by speculators. 

Hopefully, the combined pressure of FoE and WDM in making these demands will force a change in the UK negotiating stance within the EU, where the UK has been blocking such legislation.  

Friends of the Earth also adds a new angle to the debate by linking the problem of food speculation to land grabs – an increasing problem in the global south over recent years.  The report explains that “Driven by high food prices and increasing demand for agrofuels and raw materials, the number of large-scale acquisitions of farmland in developing countries is soaring”.  It adds that:  

Such land deals often lack [local communities and land users’] free prior informed consent, violate or disrespect customary land rights, result in loss of access to natural resources, fail to deliver on employment and development, drive landlessness, and can involve violence and intimidation.

The report includes some shocking examples. In Ethiopia in 2010, 150,000 people in the Eastern Somali region were relocated following land deals with foreign companies and in Uganda 20,00 people were forcibly evicted to make way for timber investments by the London-based New Forest Company. According to FoE, major financial institutions are never far away from the deals, with large percentages of their investments in land acquisition.  

To stop land grabbing, FoE makes two main suggestions to European policymakers.  The first is to “Introduce specific regulation on investments, in order to curb land grabs driven by investors and speculators”.  The second is to “Strengthen liability rules for investors and financial service providers, with respect to their potential role in agricultural commodity markets and financing land deals”.  

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