FARMLAND INVESTMENT STRATEGIES AND RISK IN ROMANIA

Transcription

1 FARMLAND INVESTMENT STRATEGIES AND RISK IN ROMANIA Photo: own archive Anna Hajdu, Oane Visser International Institute of Social Studies (ISS) of Erasmus University Rotterdam Utrecht University, LANDac 30 June 1 July 2016

2 WHY ROMANIA? The status-quo related to farmland investments Highest proportion of population working in agriculture Fragmentation, subsistence farming Land abandonment, farmland sales Highest number of foreigners owning farmland

3 RESEARCH PURPOSE Diversity of investment strategies and farm categories Understand new insights into dynamics of farmland investment and the interplay of factors that make (or unmake) a land rush

4 LAND RUSH Heated debate around farmland purchases and impacts Dubbed as land grabbing in the Global South and Europe Romania By increased foreign propertyship, it is argued, small-scale farming which ensures food security and resilience in face of socio-economic and climate risks, is threatened

5 METHODS - Stakeholder-oriented approach Perceptions on farmland investments in Romania Subsistence farming as weakness Subsistence farming as basis for sustainable development of rural areas farmer s group activists online media government officials Country strategy based on small-scale farming Donor organisations

6 PRELIMINARY RESULTS OF RESEARCH ACTORS IN FOREIGN FARMLAND INVESTMENT Land is owned, rented and leased Family office High net worth individual Equity fund Hedge fund Pension fund capital returns Farm management expert Financial expert Investment analyst Fund Manager Cadastre expert Farming expert Real estate expert transactions Tax consultants Established network Individual consultants Consultancies Embassies Government officials & authorities Land brokers Landscouts Individual lawyers Lawyers Trade chambers Notaries Farmland

7 RESEARCH QUESTION (FOR PRESENTATION) 1. In face of climate risks which property structures of farmland are more resilient?

8 BACKGROUND OF FARMLAND INVESTMENTS Investments since late 1990s, mainly Italian investors Purchase of small, highly fragmented parcels German, Middle East countries, Austrian, Spanish, Danish, Dutch, etc. Abandoned land Potential for development

9 TYPES OF FARMERS 71% million holdings under 1 ha -> 35% of agricultural area-5mill ha 27% ha = semi-subsistence farms-> 21.2% mill ha 1.6% ( farms) ha > 10% mill ha 0.3% - ( farms) 100 ha -> 34%

10 Preliminary results Sima et al showed that different types of farmers in the Southern plain of Romania would choose different climate adaptation strategies: 1. Irrigation systems and plantation of forest belts; lack of financial resources prevents them from investing in these Irrigation systems are a method foreign investors search to invest in. Some investments failed because of too high costs or because poor water quality at the depth allowed to dig wells. Where land is leased such an investment is risky 2. Cultivation of climate-resistant plants grain cereals (wheat, rye, corn) and oilseed plants (sunflower, rape) 3. Small-scale farmers choose the use of drought-resistant Romanian varieties of seeds-higher yield in years of drought; in years of normal precipitation foreign varieties seem to be more productive (Sima et al. 2015)

11 PRELIMINARY RESULTS Coming back to the research question: 1. We cannot look at property structures in isolation when looking at climate risk (large-scale versus small-scale) but at the type of farming that is undertaken, what the costs and benefits are 2. Foreign farmland property structure (own, rent, lease) may pose risks to the level of investment possibilities in irrigation infrastructure 3. Different categories of farmers adopt different climate-risk adaptation strategies 4. Further results are needed in terms of future impact on agriculture and Romanian farmers through foreign farmland ownership

12 THANK YOU!