The controversial issue of large-scale acquisition of land in the Global South by national or international investors is the focus of increasing attention within development policy discourse and from the general public. Advocates hope that the growing interest of private investors will provide important growth and employment impetus for the target countries. Critics, on the other hand, complain about the lack of transparency in the acquisition of agricultural land and fear that the livelihoods of local land users will be put at risk and the environment destroyed in the long run.
The current issue of Development in Brief provides an overview of the discourse and discusses the opportunities and risks of large-scale land acquisition for the population in the target countries.
The Global Alliance for Climate-Smart Agriculture (GACSA), a platform of the FAO, was founded two years ago with the stated goal of improving food security by integrating climate-friendly approaches in agriculture. However, the concept of climate-adapted agriculture is not without controversy. Germany, for example, has not joined the alliance – not least because of ongoing protests against the concept within civil society.
The latest issue of Development in Brief gives a quick introduction to the concept of climate-adapted agriculture, setting out the positions advocated by the proponents as well as the critics’ fears. It shows that, in spite of all the differences, there is a large overlap of feasible solutions.
A major reason for the reluctance of banks to extend credit to farmers is the broad range of risks that affect agricultural production and that reduce farmers' ability to repay loans. Against this backdrop, agricultural insurance presents one promising option to lower the financial impact from risks that the farmers face and hence to increase their creditworthiness. However, classical indemnity-based insurance products face the typical adverse selection and moral hazard problems, which are especially difficult to mitigate in countries with high transaction costs and weak judicial systems. In order to tackle this problem, index-based insurance products have been developed, linking payouts to an index such as rainfall, temperature or area yields rather than actual losses.
PDF for download: