ABU DHABI – Gulf Arab states are changing tack in their search for food security. With their farming projects in some of the poorest African nations sometimes arousing local hostility, Arab investors are turning to those developed countries that comfortably produce more food than they consume. United Arab Emirates-based agricultural firm Al Dahra has chose this path in March, buying eight agricultural companies for $400 million in Serbia, a major food exporter where public attitudes to foreign-owned farming may be less sensitive. Projects in Europe, North America and Australasia tend to be more expensive and offer less scope to build vast estates like in Africa. But they also present fewer political problems and less risk for the UAE, Saudi Arabia, Qatar and Kuwait which all need to feed growing populations. For years the Gulf states, dependent on imports for 80 to 90 percent of their food, bought tens of thousands of hectares of farmland and other agricultural assets in the developing world, mainly Africa. They hoped these investments would give them direct access to big food production bases, insulating them from global swings in food prices. But the reality has proved difficult. Some of the African projects have drawn accusations that Arab investors are grabbing land that should be used to feed local people. Bad security and weak infrastructure have plagued some ventures. Although Gulf companies announced plans to spend billions of dollars, the problems mean many of the projects have not gone ahead, at least not to the point of largescale food production, said Eckart Woertz, senior research fellow at the Barcelona Center for International Affairs. The Gulf states began investing heavily in farmland overseas around 2008, after bad weather in big food producing nations, growing use of biofuels and curbs on farm exports by some governments sent grain futures markets soaring. Saudi Arabia began to scale back a domestic wheat-growing program in 2008, planning to rely completely on imports by 2016. So the Gulf states encouraged their companies to buy arable land in the developing world. Al Dahra is typical of that drive; it is a private firm, owned mainly by Abu Dhabi investors, but its mission statement pledges to “partner with the UAE government in realizing the strategic food security program.” Abu Dhabi investment firm Jenaan has since 2007 accumulated about 160,000 feddans (67,200 hectares) of arable land in Egypt, which is a big importer of wheat. The company originally planned to grow fodder to feed the UAE's livestock. But Jenaan was hit by a 300 Egyptian pound ($43) a tonne export tax, and faced other problems such as labor strikes and shortages of diesel to power machinery. This has forced Jenaan to grow wheat instead of fodder, all for consumption within Egypt, said company chairman Mohammad Al-Otaiba. – Reuters
