understanding land investment deals in africa - Oakland Institute

“The Ministry of Investment and the Ministryof Commerce and Industry are leading thedevelopment and implementation of actions toaddress key constraints to rapid private sectordevelopment. A One-Stop Investment Shop isbeing established, key laws already drafted …will be enacted and implementation systemsestablished.” 67Streamlined investment procedures such as theseoften ignore the risks posed by rapid economicdevelopment in post-conflict states. A primary objectivefor transitional states like South Sudan is to reestablishtrust with their citizenry. In these circumstances,robust regulation of the private sector is necessary toensure that companies invest in a way that strengthenslocal economies and maximizes employment creation,rather than simply maximizing profits for the investors.International Financial Institutions (IFIs)and Donor CountriesIn March 2011, Rachel Kyte, the vice-presidentfor advisory services at the International FinanceCorporation (IFC), visited Juba in order to announcean ambitious new program to promote private sectordevelopment in South Sudan. A central component of theprogram concerns the restructuring of the “investmentclimate” in order to attract new businesses. 68 As seenelsewhere in the continent, guidance from the WorldBank and the IFC often results in countries adopting a“hands-off” approach to private sector development.This minimalist approach turns a blind eye to successstories elsewhere in the world, where robust stateregulation of the private sector translated into rapidand sustainable economic growth. For example, mostobservers attribute the high growth rates of the AsianTigers—including Hong Kong, Singapore, SouthKorea, and Taiwan—to the active role that those statestook in regulating their economies. Even in the West,countries like the US and France have developedtheir agricultural sectors and become food exportersthrough substantial public intervention.Donor countries are also actively promoting the myththat industrial farming is the key to improved foodsecurity in South Sudan. The United States Agency forInternational Development (USAID), for example, isworking with Citibank, the IFC, the Corporate Councilon Africa, and others to help the country market itsresources and attract private capital in key sectors,such as agriculture. In partnership with the WorldBank, African Development Bank, European Union(EU), and Japan, USAID is also working to organizesector-specific private investor conferences, includingone on agriculture. 69 With little attention paid to therisks that an unrestrained private sector poses in afragile post-conflict environment, initiatives such asthese threaten to undermine peacebuilding efforts byelevating the interests of foreign investors over thoseof rural populations.The Oakland Institute understanding land investment deals in africa: south sudan | 18