Global land deals suck rivers dry

Beth Walker, China Dialogue March 22, 2012

The current surge in land acquisitions by foreign countries and private companies could lead to regional tensions over water rights, warns a new report by the Stockholm International Water Institute published last week.

Land acquisitions in Africa, south-east Asia and South America have sharply increased since 2008, driven by food security concerns, growing demand for biofuels, and financial speculation. The World Bank estimates that nearly 60 million hectares of land in Africa were leased in 2009 – and over 200 million hectares leased in developing countries overall in the past 10 years.

“Land investment is a water investment”, the report argues. “Water is often presumed to be included without explicitly being mentioned in land lease agreements”. Governments are signing away water rights for decades to large investors, with little regard for how this will impact users at a national level – from fishermen to pastoralists whose livelihoods depend on customary access to water – but also at the international level for countries that share river basins. And since the details of these agreements are not publically available, according to the SIWI report, it is hard to gauge the long-term implications.

And many of the largest land leasing countries are located in trans-boundary water basins, such as the Mekong, Nile and Niger River Basins, and so these deals will have implications for shared water resources, and regional relations. For example, the Ethiopian government has leased 10% of its agricultural land to foreign investors, and South Sudan and Sudan are quickly following suit, setting off alarm bells in downstream Egypt. In the Mekong River Basin, 41% of agricultural land in Laos, and 8% in Cambodia have been leased. And unlike the controversial case of the Xayaburi dam in Laos, now put on hold, the water used by foreign land concessions in Cambodia and Laos has not been a topic in regional dialogues at the Mekong River Commission.

India and China are both major players in these land acquisitions. Facing water shortages and increasing food demands at home, both countries are investing in land to gain access to water resources which is scarce at home. Other big actors are some of the water-short countries in the Middle East, but even European and US companies are making investments.

The rise of large-scale land acquisitions has received much attention from media and researchers. But less attention has been paid to water. Water allocation for irrigation or other use on land leased by foreign parties will have lasting implications for water resources at an international level; and this issue will need to feature in the discussions over water-sharing and river basin management going forward.

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