Friday, April 09, 2010

Agriculture Outsourcing

India is eminent for Software Outsourcing, China is well-known for computer hardware and domestic products outsourcing. Mexico is the global leader in auto parts outsourcing. USA is a giant for high-tech goods like Aircrafts, Automobiles, Chemicals and Pharmaceuticals. Japan is famous for Electronics. So... what about outsourcing of agriculture? Lot of countries are importing food and agro products from other countries to satisfy their population needs. Governments and corporations are buying farmland in other countries to grow their own food to protect their food security. We can call it as outsourcing of agriculture. These countries are outsourcing the farming for various reasons: most of them are lack of natural resources and volatile climate conditions.
Take the instance of Middle East, they don’t have sufficient water resources to grow crops and taking care of the growing population. Saudi Arabia gives up the growing crops in the desert with exorbitant spending. They invested in Indonesia for 500,000 hectares of farmland and other animal production investments in abroad. United Arab Emirates has leased 375,000 hectares in northern Sudan, 325,000 hectares in Pakistan and 5,000 in Ethiopia. Kuwait arranged $546 million loan to Cambodia in exchange for a lease to a large area of rice lands. Qatar leased 100,000 hectares in the Philippines, Vietnam and Kenya. Some of the Asian countries also pursuing same deals, South Korean companies have arranged to lease 690,000 hectares in Sudan and Madagascar. China invested $800 millions in Mozambique agriculture. China bought a lot of farm land in Senegal for Sesame production. More than 300 Indian companies have invested around $4.0 billions in Ethiopia for Floriculture and agriculture. Lot of outsourcing investments in agriculture projects were made in Sub Saharan Africa and South East Asia.

Some of the Latin American countries are encouraging agriculture investments. Mercosul countries (Uruguay, Paraguay, Argentina, Venezuela and Brazil) are attracting the foreign investors with their land & investment policies and their abundance of natural resources. Many of US and Canadian Agribusiness corporations (Bunge Foods, Cargill, Unilever, and ADM) are cultivating and processing the food grains, soya, sugar and ethanol in South America.
We can assume that all these efforts are feeding the people, but one thing we can notice that the entire agriculture trade is going to the hands of the wealthy nations, retails giants and big food processing organizations. The developing and poor countries are unable to feed their people if the surplus food which will be produced will be shipped to abroad. So the investing countries or corporations shall take the consideration of local population food needs. Leasing and selling the land to foreign investors should be transparent and accountable, that revenue shall be used for the benefit of the local population. Please send your comments: