In the history of Europe, including the Balkan, plenty of land grabbing went on. But nowadays there is a new form of land grab and it is made possible with EU subsidies.
Recently, a report was published by the Transnational Institute (a progressive international think tank) and Via Campesina (International Peasant’s Movement) about the land grab that is currently happening in Europe. Land grab is mostly associated with countries in the developing world but according this report it is now also happening in Europe. They blame the system of EU Common Agricultural Policy subsidies to facilitate this. The new CAP subsidies favour large landowners since the subsidies are no longer linked to production but to size of land (I wrote about that in a previous blog). As an example is mentioned that almost half of all the agricultural land in the EU is in the possession of only 3% of the agricultural businesses that are bigger than 100 hectares. A few big private business entities have gained control of ever-greater areas of European land while small farmers simply cannot survive.
Next to big European agri-businesses getting their hands on agricultural land, there is another phenomenon: Chinese companies; hedge funds and sovereign wealth funds from the Middle East; and Russian oligarchs laying their hands on land in Eastern and Southern Europe. Chinese companies are active in Bulgaria; Middle East countries are busy in Romania and recently the Arabs have also arrived in Serbia with much fanfare.
The report continues: “Land is being grabbed across Europe for multiple reasons: production of raw materials for the food industry dominated by transnational companies, extractive industry, bio-energy, green grabs such as vast solar greenhouses, urban sprawl, real estate interests, tourism enclaves, and other commercial undertakings such as commodity trading and market speculation”.
The result of the rapid privatization process in Serbia was not only that agricultural land ended up in the hands of a few big landowners, national and foreign, but also to some 500,000 redundancies and destroyed companies. Furthermore, of the 2,284 privatized companies between 2001 and 2012, about half went bankrupt. In 253 agri-businesses that were privatized, over 65,000 workers were made redundant and 50 sales contracts were terminated. Behind every worker laid off, there is a family. Behind many workers laid off there is a community.
Liberalization of sectors of the economy –including agriculture- promises improved quality of service and reduction of prices. There are however plenty of examples where quite the opposite happened. Not only that. There is also a danger of monopoly and the forming of cartels with political influence and influence on price determination. Real liberalization of land reform, distributes land equally and honestly. The role of the State is to guard that the playing field is and remains level so that no monopolies arise. Monopolies that not only control the land and the prices of it but also the prices of the commodities grown there are a danger to free trade. Don’t take my word for it; the granddaddy of liberalism Adam Smith already said so.