Assessing the contractual arrangements for large scale land acquisitions in Mali with special attention to water rights

Transcription

1 Assessing the contractual arrangements for large scale land acquisitions in Mali with special attention to water rights J. Baumgart April 2010 Division "Agriculture, Fisheries and Food" Page 1

2 Structure of the presentation 1. Potential for irrigated agriculture 1.1 Demand for land 1.2 Demand for water 2. Key features of contracts 3. Contracting process and its elements 3.1 Land titles, lease conditions and fees 3.2 Water rights 3.3 Joint ventures 3.4 Risks and benefits for local residents 3.5 Product destination 4. Questions and conclusion Division "Agriculture, Fisheries and Food" Page 2

3 1. Potential for irrigated agriculture Potential for irrigated agriculture up to 2.2 Mio. ha? ha already under irrigation mostly by smallholders in different types of schemes ha within the Office du Niger (ON) zone Potential mainly in Niger river valley interior Delta Investors target ON Zone, which claims to have 2.45 Mio. ha, some infrastructure available Area outside irrigation fields mostly used by extensive livestock and rain fed agriculture. Division "Agriculture, Fisheries and Food" Page 3

4 Map of the Office du Niger Source: Division "Agriculture, Fisheries and Food" Page 4

5 1.1 Demand for land Office du Niger plans to extend irrigation land by ha until 2020 Request for land by private investors ha (until 2009), abrogated (2010) Actual attribution ha Signed contracts for ha (maybe ha more) Analysed contracts cover ha (all projects started) Inversion of the degree of small hold usage by 2020 with current investment trends. Division "Agriculture, Fisheries and Food" Page 5

6 Map of investment projects Source: A. Sangaré: Etude rélative à l établissement d un bilan des ressources en eau Division "Agriculture, Fisheries and Food" Page 6

7 1.2 Demand for water Sufficient water available in June to December period even for big land extensions January to Mai water deficiency for irrigated cultures already at present Change in cropping patterns (irrigation all year through) exceed water availability in dry season Critical mark for down stream users, smallholders and ecosystems (40m³/s) regularly exceeded in past years (Especially sugar cane and double rice crop) Mobilisation of reserves through (i) more water use efficiency (difficult to convince users) and (ii) upgrading of upstream water storage capacity (very investment intensive). Division "Agriculture, Fisheries and Food" Page 7

8 Interior Niger Delta in rainy and dry season Division "Agriculture, Fisheries and Food" Page 8

9 2. Key features of contracts (1) Division "Agriculture, Fisheries and Food" Page 9

10 2. Key features of contracts (2) Source: L. Cotula: Land deals in Africa Own investigations Division "Agriculture, Fisheries and Food" Page 10

11 3. Contracting process & its elements No involvement of local residents in contracting process Objectives of GvM: Introduction of modern innovative technology, investment funding for food production and export Acceptance of heavy burdens concerning land resettlement Non respect of customary land use rights Multitude of departments without clear coordination Guarantee of investor security sometimes excessive Division "Agriculture, Fisheries and Food" Page 11

12 3.1 Land titles, lease conditions and fees Mostly long term leases ( 50 years renewable) Development agency selling the developed land & titles Only one contract with lease fees (very low) Cooperative models only sought in timid manner Risks in land market distortion and discouragement of cooperative land use models Options for extension and permission to lease parts of land have speculative character Division "Agriculture, Fisheries and Food" Page 12

13 Weir on Niger River at Markala Division "Agriculture, Fisheries and Food" Page 13

14 3.2 Water rights Only 2 contracts make provision for water rights Two investors require more than half of the dry season critical reserve and exclusivity of service in emergency situation Other contracts take water rights for granted! Situation of serious water shortage can be foreseen Payment of water fees is not standard. Water fees per ha and not consumption Risk for GvM: Primary infrastructure cannot be maintained Undue subsidising of water for large scale investors. Division "Agriculture, Fisheries and Food" Page 14

15 3.3 Joint ventures between GvM and investors Joint ventures in 2 contracts. Mostly investment burdens to be accepted Set up with separate production and processing companies allows for shift of benefit in disfavor of GvM GvM guarantees that all government units be bound by the clauses of this contract. GvM guarantees that no law will entail the nullity of this contract or any of its clauses. Binding clauses limit GvM s reaction range in the long term especially in the case of continuous water shortage. Division "Agriculture, Fisheries and Food" Page 15

16 3.4 Risks for local residents Local residents left out of negotiating processes Have become aware of their fate only when the bulldozers arrive Loss of residence and land use ( agriculture, animal tracks, herding, natural resource use) Unclear resettlement conditions. Some contracts stipulate the land to be free of any juridical restraints and individual property rights. Lack of irrigation water in shortage times. Insecure job availability Division "Agriculture, Fisheries and Food" Page 16

17 3.4 Benefits for the local residents/country Some investors make clear statements concerning jobs for local people One investor sets clear production targets Contract farming and /or land titles for production in two cases possible Provision of local infrastructure by one private investor Contribution to food/energy security? Division "Agriculture, Fisheries and Food" Page 17

18 3.5 Where does the product go? Destination of product precise in one case In two cases the entire production may go abroad One contract sets up a set of rules for sugar market regulation to protect the investors economic position against price variation The signing of contracts for sugar cane production will eventually lead to huge overproduction In the best case it can favour export and import substitution Unclear if local residents benefit from the production on site. Division "Agriculture, Fisheries and Food" Page 18

19 4. Questions Can government guarantee the conditions of contracts specially the advantages given? Is it clear that joint ventures give a better return on investment for government? How will government react to civil unrest due to evictions? What is the effect of the preferential long term leases to the ordinary farming society? How will the water shortage be managed, as the new investment into barrages will happen only in 10 years? Division "Agriculture, Fisheries and Food" Page 19

20 4. Conclusions GvM should install one authority for dealing with investment contracts, develop standard procedures and fine-tune its economic instruments. M&E of the processes and results to be made. More research on water efficiency and the effects of water management on the ecosystems in the Delta needs to be made Large scale investments introducing innovative technologies can be a good thing if they are socially and environmentally compatible Future contracts should be discussed with the affected people also in the sake of investor security. Division "Agriculture, Fisheries and Food" Page 20

21 Thank you for your attention Division "Agriculture, Fisheries and Food" Page 21