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Foreign investments in agriculture have been taking place in the Southeast Asian region since the colonial period. In the past few years however, there has been a distinct rise in both the number and magnitude of such investments in the region and the world as a whole. While such investments have generally been warmly received and encouraged by host governments, the scale and pace by which they have been pursued and the fact that they involve the ceding of control over large tracts of land to foreigners have raised serious concerns over their longer-term impact. Some have even pejoratively labeled the development as a veritable "land grab" by rich countries and foreign investors. A major driver of the current overseas farmland investment phenomenon is the aggressive push of governments to secure their longer-term food security in reaction to the food crisis of 2008. This is particularly true for countries with limited production capabilities and related agro-climatic constraints. Additionally, foreign governments look at such investments as a strategy for energy security through biofuel and feedstock production and a means for pursuing their geo-political activities. Foreign ventures are also increasingly seen as a way to reduce reliance on immigrant labor, ensure food quality and safety of imported products, and secure carbon credits that can be used to comply with greenhouse gas emission commitments. Most of the investments are carried out by private firms, sometimes with indirect support from their governments. These private entities are generally profit-seeking enterprises which see business opportunities arising from rising population and food demand, the liberalization of trade in the region, and the looming scarcity of land, water and other natural resources. Investments in food production overseas have also become more popular as a hedge against inflation and a strategy for portfolio diversification, particularly following the recent collapse of securities markets.
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East Asia Rice Working Group |
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