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Cablegate: Brazil Criticizes China Over "Land Grabs" in Africa

VZCZCXRO4482
RR RUEHRN
DE RUEHGV #0152 0571623
ZNR UUUUU ZZH
R 261621Z FEB 10
FM USMISSION GENEVA
TO RUEHC/SECSTATE WASHDC 0428
INFO RUEHFR/USMISSION OECD PARIS 0001
RUEHGV/USMISSION GENEVA
RUEHRC/USDA FAS WASHDC
RUEHRN/USMISSION UN ROME 0001

UNCLAS GENEVA 000152

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: UNCTAD ECON
SUBJECT: BRAZIL CRITICIZES CHINA OVER "LAND GRABS" IN AFRICA

SENSITIVE BUT UNCLASSIFIED

1. (SBU) Summary: At an UNCTAD meeting on investment
in agriculture on February 3, China became the central focus of
criticism amid a chorus of concerns about the economic, food
security, environmental and social impact of large foreign
purchases of agricultural lands in developing countries. Of
particular note, a Brazilian Ministry of Agriculture official
publicly put China on the side of "land grabbing" in developing
countries. A number of countries indicated that they found China's
defense unconvincing. According to other member states, discussion
of FDI in agriculture may surface again at the OECD Investment
Committee meeting from March 22 to 26 and the UNCTAD Investment
Commission meeting from April 26-30. End Summary.

BRAZIL BLASTS CHINA

2. (SBU) In addressing delegates from approximately 50
countries, a Ghanaian agricultural trade unionist pointed to an
"ongoing land grabbing spree in Ghana and some 10 or so African
countries for biofuel production activities." In turn, a Chinese
Ministry of Commerce official asserted that contract farming and
foreign investments in agricultural lands are based on an equal
partnership between host governments and foreign investors and that
large farming operations achieve economies of scale and increase
agricultural productivity. The Chinese official's remarks prompted
Brazil's delegate to chide China for endorsing "land grabbing."

3. (SBU) Privately, the Brazilian Ministry's Advisor on
Foreign Investment equated China's acquisition of land and
resources in Africa to "neo-colonialism" and told EconOff, "I do
not want this in my country." The French delegate told EconOff
that China's comments indicated no sympathy for small farmers and
implied that China saw large communist-style farms at the approach
for all developing nations.

RESPONSIBLE INVESTMENT IN AGRICULTURE

4. (SBU) In response to a backlash against its own
investors' overseas land purchases, Japan is promoting an effort by
multilateral institutions to draft principles for responsible
investment in agriculture. While Japan's Ambassador in Geneva held
the chair for the meeting, the Japanese Economic Counselor confided
that his country declined to take a more vocal "pro-business"
stance in the discussion because China's remarks had stirred up so
much acrimony. At the conclusion of the meeting on February 5, the
Japanese Economic Counselor told the forum that the discussion had
been a useful "intellectual building block" that would further
multilateral discussion on how to address concerns about large
investments in agricultural lands.

5. (SBU) Many countries continue to approach this
discussion with caution. German and French delegates both told
EconOff that they have not had significant complaints about the
activity of their investors and do not yet have a clear sense of
how multilateral guidelines could affect their interests. The
Indonesian delegation notably remained silent throughout the
meeting. A Thai delegate said privately that her government is
reluctant to take a public stance on the issue until it uncovers
the identities of investors behind large land purchases in
Thailand.

6. (SBU) Comment: Some emerging markets and developing
nations are reacting sharply to foreign investors' land purchases.
U.S. investors, however, were never the subject of criticism at
this meeting. Japan took extra care to manage the discussion and
instead saw criticism focus on China. Brazil may see an
opportunity for its leadership in addressing the concerns of
African nations. End Comment.
KING

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