HomeNewsMaking Chisumbanje Agro-Investments in Sugar-Cane Sweet

Making Chisumbanje Agro-Investments in Sugar-Cane Sweet

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Research on the Chisumbanje ethanol project indicate that the agro-fuel investment is a big challenge for the communities because it is destroying their land based livelihoods.

By Dr Phillan Zamchiya

The lived realities of displaced rural farmers offer important insights into the need for the Zimbabwean government to craft a fairer land deal that caters for competing community, private and state interests.

This is in line with the 2009 framework and guidelines on land policy in Africa (continental framework and guidelines) that seeks to promote macro-economic growth from agro-investments without destroying the livelihoods of the indigent populations. The Zimbabwe government is therefore required to make sure that the Chisumbanje agro-investment in bio-fuel production does not destroy the livelihoods of the marginalized rural farmers. As Kachika argues, in the context of agro-investments, ‘African governments should avoid impeding access by local communities to vital and scarce land related resources …as has been the case in Ethiopia, Mali, Mozambique and Tanzania’.[1]

Key findings

For the majority of the small-scale farmers the land grabbing is giving rise to major concerns.

The displaced farmers were not adequately consulted as the investor consulted only the local elite. There was no compensation for some displaced farmers.

Where the company provided compensation, the displaced communities have decried the paltry amounts such as US$3 per hectare, which does not match the permanent loss of their livelihoods.

Promises of employment benefits have not been fully realized by the displaced as only a few workers employed by the company were from the displaced communities and labour relations are bad.

In addition, the sugarcane out grower scheme initiated by the company, has worsened the farmers’ livelihoods significantly.

With little experience in negotiating with skilled private negotiators, farmers agreed to US$4 a tone of sugarcane and now owe debts to investors of about $20 000 per family.

Evidence also shows that the company privatized scarce water resources to the detriment of small-scale farmers.

The company’s private security guards and some members of the state security also used disproportionate violence against members of the community. This has been exacerbated by the fact that government ordered the dissolution of a local committee established to resolve disputes and the limited participation of civil society to represent the marginalized rural communities.

In addition, the Chisumbanje land deal has created tenure uncertainty among the affected communities with competing narratives on the property system on how land should be held from the private investor and the local community members. Land grabbing has affected food self-sufficiency, household income, education of children and health.

The impact of land grabbing is complicated by the government’s romanticisation of the envisaged macro economic benefits at the expense of rural dwellers’ losses. These include production of 350 000 litres of ethanol every month, 22 megawatts of electricity enough to service the whole of Manicaland province, carbonated drinks for export.

The Zimbabwe government also dreams that the land deal will create employment for 6, 000 people, save Zimbabwe an import bill of 1,5 million and 2,5 million litres of fuel which will translate into $2 million dollars every month and result in the reduction of fuel prices. On the other hand, the investor is blinded by the need to make huge profits.

This has resulted in mandatory blending and overpricing of ethanol fuel on the market to the detriment of the consumers.

Recommendations

There is therefore need to mitigate the land grabbing related risks that are threatening the marginalized rural dwellers of Chisumbanje.

This needs to be balanced with the government and private sector interests for a sustainable solution. I therefore make the following recommendations.

Tenure

The systems of property under which land is held and used in Chisumbanje need clarification. This is in line with the continental framework and guidelines. Even though land in Zimbabwe is owned by the state, customary laws co-exist with the state laws. Clear tenure rights are important for communal farmers who rely on communal tenure, especially women. As enshrined in the continental framework and guidelines ‘land policies should recognize the role of local and community based administration and management institutions and structures along with those of the state’.[2] In addition, the Zimbabwe constitution section 71 stipulates that no person should be compulsorily deprived of their property except in the interests of defence, public safety, public order, public morality, public health or town and country planning’.[3] However, section 71 (c) (ii) of the constitution requires the state to ‘pay fair and adequate compensation for the acquisition before acquiring the property’.[4] In the next section I discuss compensation.

Consultations and compensation

The company must cease agricultural operation on land it seized from communities without adequate consultation and compensation. The company must retreat to the 5 112 hectares of leasehold land it was offered by ARDA.

There is no contestation over this land. Adequate consultation and compensation should precede encroachment of land and investment on the land. Once the investor starts operating, the incentive to bring significant livelihood benefits to the displaced might not be there. As Schutter argues, ‘later may be too late’.[5] One of the principles of responsible agro-investment is that ‘all those materially affected are consulted and the agreements from consultations are recorded and enforced’ before operation.[6] In addition, government must set up an independent team of technocrats that will do a pre-consultation comprehensive asset audit for each household affected, as a basis for defining adequate compensation. The variables of the audit should include land, livestock, crops, properties, incurred business loss, social capital, health and water rights.

Defective contracts

The company must repeal the out grower contract signed by the investor with unsuspecting small-scale sugar-cane growers. The government must provide skilled negotiators, with experience of negotiating with the private sector, to negotiate on behalf of the out growers. The price of sugarcane should be revised from the paltry $4 a tonne to the market price which is no less than $70 a tonne. The out growers who had offer letters from government must be compensated for loss of land user rights. Sugarcane that has been delivered to the company, to date, must be paid for at market value. The debt that has accrued to farmers must be suspended until the current contract has been revised with full understanding of all actors involved.

Human and Labour Rights

The use of violence on members of the community by the company’s private security and state security agents must be investigated by the National Prosecuting Authority (NPA) in line with the new constitution. This was a violation of human rights and those liable must face justice and victims must be rehabilitated and compensated in full.

In addition, workers who faced unfair labour practices as confirmed by some court rulings must be reinstated or compensated. The investor must adhere to the country’s labour practices and respect human rights as enshrined in the constitution.

Civil society representation

In line with the continental guidelines and framework, representation from civil society groups is important. Civil society groups can help to support the poor rural farmers.

The experiences of the Platform for Youth Development (PYD) in Chisumbanje show that civil society can effectively support the poor rural communities. In addition, civil society groups should promote transparency in land deals through holding the government accountable.

They should be allowed to review the agro-investment deals and make inputs to the process from the start.

As an immediate step, there is need for government to revoke the decision to dissolve a local democratic committee called the District Ethanol project Joint Implementation Committee (DEPIC). DEPIC was an important platform for dispute resolution and building consensus on problematic issues. The committee must include the elected Member of Parliament (MP), local councilors, company representatives, and representatives of traditional leaders, relevant local government departments, workers’ representatives and elected community representatives from affected communities.

Mandatory blending

There is no need for government underwritten mandatory blending if the investor adopts a fair pricing system of ethanol. Blending should be voluntary and the blends from Green Fuel, or any other company, should remain voluntary or optional for users.

According to a Zimbabwe government study based on the cost build up involved in producing a litre of ethanol in Zimbabwe and landed cost build up of landed fossil fuel (unleaded petrol), the actual price of ethanol should be 0.62 cents a litre.

According to the calculations the following table suggests what would constitute fair pricing with reasonable profits.

However, E20 is being sold at $1.55 which is far above the reasonable price above. This costing is meant to make the investor get exorbitant profits. It is clear that fair pricing in line with international ethanol prices will drive consumers to buy and use ethanol blends without government enforcing mandatory blending. Even for compromise’s sake, the government can only adopt 5% mandatory blending because car manufacturers, sellers and buyers have no complaints about its compatibility. There are complaints from E10 onwards.

Even though, most Zimbabwean citizens are averse to ethanol blends and some factual education might help on the pros and cons.

Conclusion

Once the company encroachment into communal land is stopped, adequate consultations are done, fair compensation is set, ripping small-scale sugar cane out growers is stopped, human and labour rights are respected, tenure systems are clarified, democratic local representation is instituted and predatory mandatory blending is reversed then it will be the right time for the government, investor and community to explore opportunities for benefits upstream and downstream of the agro-fuel investment.

These may include power generation, fuel, carbonated drinks for export and other interdependent projects that can stimulate the local and national economy. In seeking policy solutions, the principle, in line with the continental guidelines and framework, is to ensure that the marginalized communities in Chisumbanje are not neglected or sacrificed for quick private profit and government’s envisaged macro-economic benefits.

PHILLAN ZAMCHIYA is an academic and researcher. He has a PhD in international development from Oxford University

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