Is South Sudan's Largest Land Deal a Land Grab?

A new study alleges that a land deal threatens local people in Central Equatoria, South Sudan.

By Michaela Rhode | Think Africa Press | September 7, 2011

50 million hectares of land, an area twice the size of the UK, have been acquired by foreign companies or governments in Africa over the last few years. From Brazil to China to Saudi Arabia, demand is widespread and this trend was recently continued in South Sudan. With almost  10% of the country already in foreign hands, a report by The Oakland Institute (OI) published details of its largest and potentially most divisive land deal to date, the  2008 agreement between Nile Trading and Development and the Mukaya Payam Cooperative.

Good intentions? – A question of perspective

How prominently did the needs of the local community feature in this deal? Think Africa Press spoke to two experts, Anuradha Mittal, founder of the Oakland Institute, an American think tank specialising in the exposure of land grabs, and Howard Douglas, head of Kinyeti Development, partners with Nile Trading and Development, to uncover the ramifications of this deal. Ms. Mittal is an expert on trade, development, human rights and agriculture and the author of numerous books on the subject. In 2008, Nation magazine named her ‘Most Valuable Progressive Thinker’ of the year. Howard Douglas is a former US ambassador and US Coordinator for Refugee affairs. He has worked extensively with the US government and with the Episcopalian Church in post conflict countries.

Earlier this year, The Oakland Institute reproduced a copy of the  lease agreement along with a  report identifying the worrying aspects of the deal. Both sides attest that the needs of the community are a priority. Mr.Douglas dismissed the report as “a piece of trash”, accusing the OI and NGOs of scandal-seeking and headline grabbing. Ms.Mittal was equally scathing, branding Mr.Douglas a “thief”.

The agreement in question is for a 49-year lease of 600,000 hectares of land with a possibility of another 400,000 hectares and full rights to exploit all natural resources of the land. The OI report draws attention to the astonishingly low price paid for the lease of the land; 75,000 Sudanese pounds ($25,000) which works out to $16 a hectare. Mr.Douglas argued that this figure was not the price paid for the land but a fee levied by the government. The figure in the lease is indeed attributed to a “land charge” and he asserts that the agreed price was for Nile Trading and Development to organise and finance the development of the land in return for a percentage of the profits. This would involve spending high, unspecified sums on infrastructure such as roads and schools for the community. However, this promise is not stipulated in the lease agreement and has failed to materialise in the past three years. The document published by OI provides no legal imperative for Nile Trading and Development to give anything back to the community in terms of infrastructure.

The report also points to another worrying aspect of this deal. It draws attention to the claims made by Sudan’s Agency of Independent Media that the Mukaya Payam Cooperative is a “fictitious cooperative” comprised of, “a group of influential natives from Mukaya Payam and the neighbouring payams…The influential natives leased out the land behind the backs of the entire community.” Ms.Mittal identifies the Cooperative as three individuals living in Juba who are totally disconnected from the people of Mukaya Payam. She affirms that, “the people did not even know about the deal until the OI report came out this year.” This is an allegation that Mr.Douglas vehemently denies. If true, then it would mean that land which has been used by the same communities for generations has been given away without their consent and the compensation they are supposed to receive for this put in the hands of an elusive entity. It would not then be surprising that the people are, as Ms.Mittal claims, “very very angry”.

The Mukaya Payam Cooperative is an elusive entity with only one name attached to it, the lease agreement being signed by Magistrate James Yosia Ramdalla, the Paramount Chief of the Cooperative. Although four other “payams” (communities) were involved in the deal, there is only one signature on the lease.

According to the terms of the agreement, “any profits generated by Nile Trading and Development in respect of the leased land shall initially and through 2012 be divided 60% to the company and 40% to the Mukaya Payam Cooperative.” Whether the cooperative, whoever they may be, will distribute the rents amongst the other payams and how they will do so is uncertain. Mr.Douglas claims that, “the intention was that every man, woman and child who was associated with the Mukaya Payam would be the beneficiaries of the agreement.” He claims that they intend to set up a Mukaya Payam Trust to administer the funds to the community members. However, intentions are not legally binding and there are no stipulations in the lease agreement concerning distribution of funds.

What remains unclear is how NTD plans to develop this land. Mr.Douglas claims that large scale agriculture is the long-term goal. He speaks of creating “agricultural cooperatives” with schools, clinics and facilities to produce enough food for export, giving farmers a disposable income and political security. This vision is one which, according to Ms. Mittal, is to be taken with a pinch of salt. She points to the fact that nothing in the lease agreement indicates that agriculture is on NTD’s agenda. The real detail in the document is afforded to exploration rights.

Plans for the future

Investment in South Sudan ought to be seen as a great opportunity. These companies should provide jobs and contribute to the development of the country. According to Jonathan Brooks of the OECD, an estimated $18 billion a year needs to be invested in agriculture in order for the world to be able to feed itself by 2050. Developing all available land is a necessary step for the world to take and Africa will not be able to meet this level of investment on its own.

Ms. Mittal makes it clear that OI is pro-investment in South Sudan. However, she adds that, “to assume that foreign investors coming in will lead to better job security or food security is a myth”. She claims that unscrupulous investors are jumping on the bandwagon of agricultural investment, to disguise an attempt to control resources. She points to the fact that there is no legal framework in place in South Sudan to protect the people leaving them with only, “the empty words and empty promises of these investors”.

It is important to look beyond the disagreement on both sides. As Ms. Mittal says, “in regard to Mr. Douglas and his lease in South Sudan it is really not about his word against OI’s word. It is about his word against the word of the community and more important their own documents such as the contract; they speak the truth.”

Some representatives of the community have spoken. A  petition signed on the 23 July this year has been handed to the state governor in Juba. It states that, “we the chiefs, elders, religious leaders and the youth of Mukaya Payam, unanimously, with strong terms condemn, disavow and deny the land lease agreement reached on 11 March 2008 between the two parties.” The petition states that the lease agreement was reached without the knowledge of the community and that it is illegal. It is signed by seven chiefs, a reverend, two elders and two others. The President of South Sudan, H.E Salva Kiir, has subsequently given his support to the community stating, “you are the government and you have the powers”. The government must act quickly and decisively to produce stringent guidelines for investors in order to ensure that the rights of its people are protected. If done correctly, foreign investment could flourish. However, until those rights are guaranteed in law, land deals remain dangerous territory.

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