SPECIAL REPORTS AND PROJECTS
International Finance Corporation Should Stop Bankrolling Destructive Agribusiness
Published
10 months agoon

In late June, the World Bank’s private sector arm, the International Finance Corporation (IFC), approved a US$200M loan to agribusiness giant Louis Dreyfus Company (LDC). Under the guise of “sustainable development,” the loan will be used to purchase soy and corn—mostly destined for factory farms—grown on industrial mega-farms in Brazil’s heavily threatened Cerrado.
A biodiversity hotspot that is home to 5 percent of the world’s animals and plants and 216 Indigenous territories, the Cerrado has already lost half its native vegetation to cattle ranches and mechanized soy and corn mega-farms. LDC is just one of many agribusinesses, including Cargill, Bunge, JBS, and Marfrig, whose beef and animal feed operations are threatening to drive this ecosystem towards total destruction by 2030.
While IFC claims that its loan to LDC will “address higher demand and escalating food prices in an environmentally sustainable and socially inclusive way,” in reality, this investment will drive further environmental destruction and disenfranchisement of local and indigenous communities while enriching one of the world’s wealthiest and most powerful industrial agribusinesses. In 2020, LDC generated US$49 billion in revenue and has US$3.5 billion in public and private financing available. With limited public investment in sustainable agriculture, one must ask why taxpayer funds are being used to support this well-resourced mega-corporation that has contributed to Cerrado ecosystem destruction over the past decade.
Since late May, Friends of the Earth, members of the Stop Financing Factory Farming (SFFF) Campaign and 230+ civil society organizations (CSOs) from around the world have fought to block the investment. In numerous letters to the IFC and its government shareholders, groups documented how this investment is at odds with the bank’s own environmental policies and its commitment to align lending with the Paris Agreement and United Nations Sustainable Development Goals (SDGs).
Supporting industrial animal feed production does not advance the UN Sustainable Development Goals
The IFC justified its US$200 million loan by claiming that the funds would help to reduce deforestation through “support [for] a portfolio of eligible soy and corn farmers in Brazil that are committed to zero deforestation and conversion of native vegetation.” But these “eligible farmers” are multi-thousand-acre industrial operations located in the states of Goiás, Mato Grosso, and Minas Gerais, which are already largely deforested. Even if incentives set up under the loan could prevent future land conversions, deforestation is only one of the many environmental and social impacts that should be addressed by public financing for a company like LDC.
Completely ignored in IFC’s loan analysis are the additional negative impacts of industrial farms’ use of pesticides and fertilizers on climate and air, soil and water resources. Also ignored were harmful social impacts of these operations, including pesticide-related illness and death, including among children, as well as the potential for land-grabbing, local community conflicts and the displacement of smallholder farmers.
Failure to address these serious issues undermines the IFC’s stated commitment to help achieve the Sustainable Development Goals. A 2019 German government report documents how large-scale soy operations in the Cerrado and elsewhere “are associated with social injustice and…environmental degradation that hinders the achievement of the UN Sustainable Development Goals (SDGs).” According to this report, agribusiness operations in the region threaten at least 8 of the 17 SDGs, including: 1: No Poverty, 2: Zero Hunger, 3: Good Health and Well-Being, 12: Responsible Consumption and Production and 13: Climate Action.
A coherent strategy to make LDC’s soy and corn operations more “sustainable” would have required a shift in agricultural practices that reduce fossil fuel, pesticide and synthetic fertilizer use, as CSOs explained. A more “inclusive” and food security-centered strategy would ensure at least some support for smallholder, lower-carbon, regenerative crop systems and increased land access for traditional communities.
Diverting resources to feed animals instead of humans also threatens to aggravate the current global hunger crisis. As the crisis intensifies, the world’s 800 million+ hungry people would be better served by public development banks using taxpayer funds to support the production of diversified, truly sustainable and nutritious food rather than feed for factory farms that churn out cheap meat and dairy products for consumption in higher-income countries.
Paris Agreement misalignment: LDC is a major laggard on climate
The IFC’s support for a company that has failed to set sufficient GHG reduction targets is at odds with the bank’s commitment to aligning its investments with the Paris Agreement.
Unlike some of its peers, LDC has yet to set Paris-aligned reduction targets for its GHG emissions. The company has committed to only meager 1 percent reductions in its Scope 1 and 2 emissions (those generated by the operations or activities the company controls). Even more important, LDC has yet to calculate its Scope 3 emissions (those generated by operations or activities a company does not control, including soy production), which likely make up more than 90 percent of the company total. At a minimum, the IFC and other public development banks should require any company benefiting from its preferential financing to set Paris-aligned GHG reduction targets.
Now that the LDC loan has been approved, IFC must be held accountable for its impacts
Together with global allies and partners on the ground in Brazil, the Stop Financing Factory Farming Campaign will continue to track LDC’s activities and demand accountability from the IFC for the harmful impacts of its lending. In a letter responding to the loan approval, more than 100 organizations have asked that the IFC disclose the names and locations of the industrial operations its funds will support so that groups on the ground can monitor the impacts of its investment. We have also asked that the IFC urge LDC to cut ties with suppliers known to be involved in illegal deforestation, land grabbing and/or other human rights violations.
The campaign will also continue to urge the IFC and its government shareholders to shift lending away from industrial livestock and monoculture feed production and toward smallholder, lower-carbon regenerative mixed crop systems. Such a shift would square with the World Bank’s own guidance concerning development banks’ role in encouraging capital investments that “incentivize more sustainable practices—properly valuing ecosystem services and mobilizing resources, knowledge and technology for smallholders, indigenous peoples and other producers to support a more equitable way of producing and consuming food.”
Source: FoodTank
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SPECIAL REPORTS AND PROJECTS
Will more sovereign wealth funds mean less food sovereignty?
Published
2 months agoon
April 13, 2023
- 45% of Louis Dreyfus Company, with its massive land holdings in Latin America, growing sugarcane, citrus, rice and coffee;
- a majority stake in Unifrutti, with 15,000 ha of fruit farms in Chile, Ecuador, Argentina, Philippines, Spain, Italy and South Africa; and
- Al Dahra, a large agribusiness conglomerate controlling and cultivating 118,315 ha of farmland in Romania, Spain, Serbia, Morocco, Egypt, Namibia and the US.
Sovereign wealth funds invested in farmland/food/agriculture (2023)
|
|||
Country
|
Fund
|
Est.
|
AUM (US$bn)
|
China
|
CIC
|
2007
|
1351
|
Norway
|
NBIM
|
1997
|
1145
|
UAE – Abu Dhabi
|
ADIA
|
1967
|
993
|
Kuwait
|
KIA
|
1953
|
769
|
Saudi Arabia
|
PIF
|
1971
|
620
|
China
|
NSSF
|
2000
|
474
|
Qatar
|
QIA
|
2005
|
450
|
UAE – Dubai
|
ICD
|
2006
|
300
|
Singapore
|
Temasek
|
1974
|
298
|
UAE – Abu Dhabi
|
Mubadala
|
2002
|
284
|
UAE – Abu Dhabi
|
ADQ
|
2018
|
157
|
Australia
|
Future Fund
|
2006
|
157
|
Iran
|
NDFI
|
2011
|
139
|
UAE
|
EIA
|
2007
|
91
|
USA – AK
|
Alaska PFC
|
1976
|
73
|
Australia – QLD
|
QIC
|
1991
|
67
|
USA – TX
|
UTIMCO
|
1876
|
64
|
USA – TX
|
Texas PSF
|
1854
|
56
|
Brunei
|
BIA
|
1983
|
55
|
France
|
Bpifrance
|
2008
|
50
|
UAE – Dubai
|
Dubai World
|
2005
|
42
|
Oman
|
OIA
|
2020
|
42
|
USA – NM
|
New Mexico SIC
|
1958
|
37
|
Malaysia
|
Khazanah
|
1993
|
31
|
Russia
|
RDIF
|
2011
|
28
|
Turkey
|
TVF
|
2017
|
22
|
Bahrain
|
Mumtalakat
|
2006
|
19
|
Ireland
|
ISIF
|
2014
|
16
|
Canada – SK
|
SK CIC
|
1947
|
16
|
Italy
|
CDP Equity
|
2011
|
13
|
China
|
CADF
|
2007
|
10
|
Indonesia
|
INA
|
2020
|
6
|
India
|
NIIF
|
2015
|
4
|
Spain
|
COFIDES
|
1988
|
4
|
Nigeria
|
NSIA
|
2011
|
3
|
Angola
|
FSDEA
|
2012
|
3
|
Egypt
|
TSFE
|
2018
|
2
|
Vietnam
|
SCIC
|
2006
|
2
|
Gabon
|
FGIS
|
2012
|
2
|
Morocco
|
Ithmar Capital
|
2011
|
2
|
Palestine
|
PIF
|
2003
|
1
|
Bolivia
|
FINPRO
|
2015
|
0,4
|
AUM (assets under management) figures from Global SWF, January 2023
|
|||
Engagement in food/farmland/agriculture assessed by GRAIN
|
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SPECIAL REPORTS AND PROJECTS
Farmland values hit record highs, pricing out farmers
Published
7 months agoon
November 21, 2022
SPECIAL REPORTS AND PROJECTS
Ugandan communities battle to benefit from mining on their land
Published
10 months agoon
August 26, 2022
Communities in Karamoja face an uphill task organising to beat international capital and authoritarian politics.
Rupa, Uganda – A handful of artisanal miners stand shirtless in an open pit, breaking boulders that glint white in the sun. Nearby, soldiers stand sullenly at the gate of the Sunbelt Marble Mine and Factory, owned by Chinese businessmen who have sunk $13m into the project.
These are the two faces of the mining rush in the Karamoja region of northeast Uganda: small-scale freelance miners, toiling with basic equipment for scant reward, and a mix of wealthy foreign and local investors protected by the state.
Here in Rupa, a sub-county of Moroto district, the locals have seen companies come and go, buying up land and dividing communities. So in 2017, when they got wind that a Chinese company was coming, they were determined to do things differently: this time, they were going to organise.
It was a pioneering attempt to ensure that local people benefitted from mining, building on customary ownership and exploiting little-used provisions of Ugandan land law.
But the story of how it worked – and how it did not – shows just how hard it is for communities to organise in the face of international capital and authoritarian politics.
Mining rush
Many of the 1.2 million people in Karamoja are cattle-keepers, driving their herds across grasslands managed by clan and custom. The rains are fickle, so negotiating access to pasture involves an element of give-and-take.
But the mining companies that are exploring the region want something solid and immovable: the minerals that lie beneath the soil, including marble, limestone, copper and gold.
In the early 2000s, the army forcefully disarmed the gun-wielding cattle-raiders who once roamed the plains, and speculators rushed in during the ensuing peace.
“The first businesspeople who came were taking over the land,” says Simon Nangiro, chairman of the Karamoja Miners Association, which represents small-scale miners in the region. “Companies come with military accompaniments … [They’re] negotiating behind the scenes with people who are vulnerable.”
According to the mining cadastre, the government has granted full mining leases in Karamoja to four companies – Sunbelt, Tororo Cement, DAO Marble and Mechanized Agro – across 79 square km (31 square miles) of land.
It has also issued licences for exploration to dozens of other local and foreign companies on roughly 4,000 square km (1,544 square miles) and is considering applications on nearly 5,000 square km (1,931 square miles) more.
Documents like leases, licences and land titles are how the modern state speaks – but it is a language foreign to Karamoja, where ownership is rarely written down and only a quarter of people can read.
“Here in Karamoja we have a customary land tenure system,” explains John Bosco Logwee, an elder in Rupa and one of the leaders of organising efforts there. “As a result, people [from outside] looked at the land and thought it does not belong to anybody.”
In Uganda as a whole, an estimated 80 percent of the land is held customarily although exact figures are hard to come by. The problem of proving who owns what worries everyone from activists, who warn of land grabs, to the World Bank, which wants to spur rural property markets.
Under the 1998 Land Act, communities can create “communal land associations” (CLAs) to defend their collective land rights. More than 600 have been incorporated nationwide, often with World Bank support.
Some of the first to be established were in Karamoja, where 52 were set up in 2012-2013 by a non-governmental organisation, the Uganda Land Alliance. According to Edmond Owor, its former executive director, the CLAs had some early successes in fending off fraudulent investors. But in 2016, the Alliance itself collapsed due to internal governance problems, leaving the fledgling CLAs on their own.
“The creation of a CLA is a very easy process, and that’s where the easy work ends,” says Simon Longoli, executive director of the Karamoja Development Forum (KDF), a civil society group based in Moroto. “We find it very difficult to trust a piece of paper to ensure the rights of the community over a piece of land.”
What people really needed, he thought, was organising and capacity building to assert the rights they had on paper. In short, they needed power.

Community organising
Communities in Rupa had been at the forefront of Karamoja’s mining rush. A 2014 report by Human Rights Watch described how two foreign-owned companies had come to the area and started exploration without the consent of the locals.
“International capital has come into Karamoja, it has allied itself with powerful political and military elites at the centre, facilitated by influence peddlers,” says David Pulkol, a Rupa indigene who formerly served as a member of parliament, government minister and head of Uganda’s external intelligence agency. “Those three are in the same bed, dispossessing the ordinary people of their livelihoods.”
So in 2017, the three clans of Rupa sub-county joined their CLAs together to form the Rupa Community Development Trust (RUCODET), taking out the formal title to the land on behalf of 35,000 people.
Longoli and his KDF colleagues arranged training for the trust’s leaders in negotiation and other skills. No other community in Karamoja had organised on such a scale to take on mining companies.
The arrival of the Sunbelt mine would give RUCODET its first major test. Under Ugandan law, all minerals belong to the government. But landowners have “surface rights” to the land itself, which have often been trampled by mining companies.
Now, thanks to RUCODET, the Chinese investors would have to negotiate with the community. “It was tough,” says Logwee, the elder. “We had no experience before of that kind of thing.”
Sunbelt had strong backing from Operation Wealth Creation, a sprawling Ugandan military programme that started out giving seeds to farmers and was now helping build fruit factories, disburse credit and develop the minerals sector.
The programme is led by Salim Saleh, Ugandan President Yoweri Museveni’s ubiquitous brother, whom many consider the second-most powerful man in the country. He is a feared general with extensive business interests, who has been accused by UN experts of grabbing resources during the 1998-2003 Congo war – an allegation he has always denied.
As part of the negotiations, a team from RUCODET travelled 400km to Kapeeka, where a Chinese-owned industrial park has been constructed close to Saleh’s personal residence. Longoli of KDF says that some leaders in RUCODET and in local government were taking calls from Saleh himself to get an agreement signed.
Major Kiconco Tabaro, a spokesman for Operation Wealth Creation, claims that it was not directly involved in the negotiations but has “a strategic working relationship with all ministries, departments and agencies of government” to “help bring about socioeconomic transformation”.
It was hard to say no to a man like Saleh, and the leaders of RUCODET did not. In 2018, they signed away surface rights to 3.3 square km of land to Sunbelt for 21 years, receiving compensation of 1.8 billion shillings ($500,000), they say.
By one yardstick, that was a lot of money. Small-scale miners in Rupa say they get just 100,000 shillings ($28) from traders for filling a 7-tonne truck with stone, a task which takes four people at least a week.
But Sunbelt expects gross revenues of $30m a year, according to the 2021 manifesto of the ruling National Resistance Movement – making the payout to RUCODET equivalent to one week’s turnover. A spokesman for Sunbelt declined an interview request for this story.
The leaders of RUCODET used 100 million shillings ($28,000) to set up 94 educational scholarships for schoolchildren and university students. Some of the rest was handed out as cash to community members.
But there was protest from those who felt left out and mutterings that money was misused or even stolen – allegations which Logwee dismisses as “speculation”. Three people familiar with the matter told Al Jazeera that the lawyer who advised RUCODET charged 400 million shillings ($110,000) for his services, which included the cost of surveying and titling the land.
Then tragedy struck. The leader of RUCODET was a man called Marjory Dan Apollo Loyomo, a brother of the former spy chief Pulkol. “He was very strong, he was very charismatic, he was very committed,” recalls Longoli. He was also the elected chairman of Rupa sub-county, which meant he had to represent his people in disputes.
In 2019, after a decade of peace, the armed cattle-raiders started to make a comeback. Loyomo had disagreed with aspects of the army’s handling of the issue.
On December 17 that year, according to the UN Human Rights office, the army called him to a military detach in Rupa. It had impounded cattle after a raid; local people were angry. Loyomo, as sub-county chairman, tried to deliberate with the officers. A soldier shot him dead.
The regional army commander was transferred soon afterwards. His successor, Brigadier General Joseph Balikudembe, says that he cannot comment on the incident due to ongoing proceedings against the soldiers involved.
Nobody that Al Jazeera spoke to wanted to speculate on the reasons for Loyomo’s killing, but everyone agreed that it was a devastating setback.
“The loss of a torchbearer, the founder chairman, has been a very big loss for RUCODET,” says Logwee, who has succeeded him to the role.
“He was fighting really for his people,” argues Joyce Nayor, an activist and Rupa resident who is critical of the trust’s current leadership. “Since he died, RUCODET has also died a natural death.”
Hardly any local people got jobs in the Sunbelt mine, Al Jazeera heard on two visits to the area with local activists. Some small-scale miners have been allowed to remain in a corner of the land that was allocated to the company, where they break boulders for sale.
They complain that Sunbelt tried to push them into an ever-smaller area and take away the traders who would buy their stone – and that RUCODET has done little to help.
“RUCODET is there in name only,” says Isaiah Aleu, a miner.

Choppy waters
Land trusts and CLAs are promising tools for communities to defend their rights, say land campaigners. But there is no consensus about how they should navigate turbulent political waters.
Pulkol is now helping build RUCODET’s capacity through the Africa Leadership Institute, a non-governmental organisation he leads. He thinks the best hope for Karamoja is to work with investors and government for shared benefits, rather than to block them altogether.
Longoli, the activist, is not so sure. Often when it comes to minerals, “the best deal is just no deal”, he says. “RUCODET, because of pressure from above or pressure from within the institution, was in a hurry to close deals.”
Yet he remains hopeful that organisations like RUCODET can be the basis for something better. “These are not perfect but they give a bridge somewhere,” he says.
The next test is coming soon.
In Loyoro sub-county of Kaabong district, 100km (62 miles) to the north, a new company called Moroto Ateker Cement is exploring for limestone. Pulkol, representing the local government of Moroto, sits on its board.
The state-owned Uganda Development Corporation has a 45 percent stake in the project. The seven clans of Loyoro have started the process of forming a trust, after the RUCODET model.
Meanwhile, in the bush, surrounded by soldiers and tsetse flies, exploratory drilling machines bore down into their land.
Source: Al Jazeera
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