Grow My Food For Me!

I’ve latched on to the topic of food security v. self-sufficiency and discussed the value of conferences on food security and climate change here in the past.

So it is not surprising that following a Sultan Qaboos University Conference on Food Security in the Arab Countries, I’m itching to bring this up again. I only attended a few morning presentations yesterday, but I enjoyed the global and regional focus that opened the conference. Unfortunately – but not unexpectedly – it was an under-attended event, and someone rightly asked, why are there no university students here? Another quick comment before moving on to things of substance: Q&A sessions are meant for…you guessed it…questions and answers. I now approach Q&A sessions at conferences and symposiums in Oman with dread, because they are simply excuses for attendees to comment and deliver ill-prepared statements, usually only loosely tied to the speaker’s subject matter.

But on to greater things.

A major topic taken up at this event was the potential for GCC investment in foreign agricultural land, in a move to become food secure. We can be thankful that recent reports, articles, and conferences seem to have finally hammered the last nail in the coffin of “self-sufficiency,” and are now delving into the matter of guaranteeing enough food for populations, at a stable price.

Like many policy options, the idea of agro-investment abroad seems quite rational and perhaps even simple. In fact, a recent article from Emirates Business 24/7 fixates on this topic, boldly stating that: “Gulf oil producers have abandoned long-standing nationalistic policies of achieving food self-sufficiency and switched to a more realistic approach of using their strong financial muscle to invest in farm projects in fertile countries.” The truth is that many factors complicate an easy path to foreign, agricultural investment projects.

Focusing on a study published by Saudi’s NCB Capital, the article discusses

• the low contribution of agriculture to GDP
• Oman as a GCC countries more tied to agriculture in terms of employment
• Oman’s grain storage that gives the country a 3-4 month reserve capacity
• the 2008 food price shock
• population increase and the increasing demand for food, and specific types of food
• conflicts in fertile regions that make importers as well

The article, and the studies it chronicles, mirror the discussion at the recent Food Security Conference: If we need more food, and can’t grow it ourselves, what is the path to obtaining the most reliable, reasonably priced imports? Oman can develop domestic agriculture by focusing on produce particularly, optimizing water use. But water intensive items (grains), which are in high demand by consumers, must be brought in from water rich countries. Enter the topic of agro-investments abroad.

So our Emirates Business piece quotes a study carried out by the Federation of the GCC Chambers of Commerce and Industry that encourages greater coordination and cooperation between Gulf states in developing joint-farm projects in regional fertile countries (Sudan, Egypt and Yemen were mentioned). First, we have to question the quality of any study that encourages investment in a corrupt, conflict ridden state with little to no water reserves left (Yemen). But once we get past that confusion, it is important to examine the soundness of investing dwindling oil rents in regional/global agricultural land.

I learned the jargon of foreign agro-investments at the SQU Food Security Conference. What is talked about now is the need for a win/win solution for both the investing nation and the local stakeholders involved in deal making. As one presenter put it, there are three main limiting factors that will explain why Gulf countries have actually become more cautious about foreign investment in agriculture (while many have this in their strategic plans, we have yet to see thorough implementation). These factors are:

• Economic (water could be developed, if there was investment) v. Physical (there just could never be water there) water shortages
• Financial reasons (decline of oil prices, Sovereign Wealth Fund losses, increase in financial cost for GCC countries to invest in these projects)
• Political reasons (land rights issues, potential opposition by local stakeholders in target countries, instability in the invested region)

 So there are environmental, financial, political, and ethical barriers to a simple investment in Sudan to foster food security in Oman. As another presenter added, there are many trends to keep an eye on when considering how food secure the Gulf will become, and especially when considering foreign investment in agriculture, including

• Oil production, prices, economic diversification
• Future of food security = food for oil
• Democratic transitions in the Gulf?
• Local stakeholders entering a win/win situation?
• Improvement in transparency?
• Water saving domestic agriculture?
• Linked into international supply chain to contribute a specialization?

 One conference attendee with a question (actually, a comment with a broad, unanswerable question tacked on) asked: Wellllll, what is the best way for us to be food secure, the oil is running out!? The presenter answered rightly: Food security does not operate all by it’s lonesome. A plan to be food secure is intrinsically tied to economic diversification that will prepare the country for life without oil wealth.

Again, we come back to the theme that natural resource management does not operate in a vacuum. Only political-economic reforms will improve sustainability of water and land use, and lead to food security as well.