The Politics of Agrofuels and Mega-land and Water deals

Insights from the ProCana case, Mozambique
29 June 2011

The Procana Bioethanol project in Mozambique is a clear example of how agrofuel investments contribute rather than mitigate climate change, and are often accompanied by dispossession and impoverishment caused by landgrabbing.

This paper examines the politics of large-scale commercial biofuels production and mega-land–water deals, with special reference to the dynamics of changes in land/ water use and property rights and how these impact on the lives and livelihoods of the socio-economically marginalised rural sectors in the countryside. The main argument is that the assumption about existing, available marginal lands is fundamentally flawed. It is demonstrated by examining the ProCana sugar cane ethanol plantation in Gaza province in Mozambique.

The ProCana case is exactly what Li has warned us about: a large-scale land-expropriating and labour-expelling investment.


Key drivers of biofuels from the transnational corporate world (oil, car, biotechnology, agro-industrial sectors, among others), international development agencies and national governments have claimed a ‘three-win’ scenario out of the biofuels initiative: helping to address pressing environmental problems via greenhouse gas savings, attaining energy security in order to maintain the current pattern of economic production and consumption in the North, while instigating economic growth and development in the global South. The principal targets to host biofuel production are land abundant countries, such as Mozambique.

The emerging literature on this theme suggests that these assumptions and projects are too optimistic and are fundamentally flawed. First, evidence suggests that greenhouse gas savings are not going to be achieved, and, in fact, greenhouse gas emissions are going to increase, with corporate clearing of forests to pave the way for industrial and monocrop biofuel plantations. In some biofuel feedstocks the energy balance is such that their cultivation may also be increasing greenhouse gas emissions.

Second, the fundamental starting point of the mainstream key drivers of biofuels is how to maintain the current patterns of economic production and consumption in the world, especially in the North. This includes the ever increasing use of cars. This is a problem, since simply looking for ways to fuel the current pattern of economic production and consumption without critically re-examining the very nature and character of the same economic production and consumption will not lead to any resolution of the environmental and energy problem.

Finally, while in aggregate terms economic investments and development may register in some locations in developing  countries, it is unlikely that it will contribute in any significant way to solving the problems of poverty, inequality and socio-political exclusion of the rural poor. Many of these land investments are in the form of large-scale industrial monocrop plantations that require more land and water and less labour. Hence, under certain conditions, promoting biofuels in places marked by poverty, inequality and socio-political exclusion might contribute to increasing the same social, economic and political problems.

The ProCana ethanol project in Mozambique displayed the actual and potential problems raised above. First, clearing the second-growth forest in the ProCana land allocation, and replacing it with industrial-monocrop sugarcane plantation (with the
probable later use of labour-intensive, cane-burning techniques) will not lead to greenhouse gas savings, but to greater net greenhouse gas emissions. Second, the planned ethanol production geared for export feeds into and strengthens the dominant model of economic production and consumption. Finally, between the massive dislocation, or even dispossession, of thousands of people in and around the ProCana land allocation and the employment promised to some, the net impact on the lives and livelihoods of the local population, on balance, is likely to be negative for the local communities.

A broader view on this question will include the cost of lost opportunity for the local villagers. For example, the government would redirect a major portion of its farm irrigation water allocation from the Massingir dam from its commitment to small-scale farmers and cattle herders to ProCana – in effect financially subsidising ProCana sugarcane production.

This begs the question: what if the government uses the same enormous farm irrigation water to service farmers and pastoralists directly in and around the area? The latter is likely to have a greater multiplier effect in terms of socio-economic livelihood impact than redirecting the dam water to a corporate industrial monocrop sugarcane plantation that will produce ethanol for export. The current water use (re)allocation in effect would render the full use of the Massingir dam as geared for outside Mozambique, while 93% of the rural poor Mozambicans remain ‘power-less’ and majority of farmers and pastoralists have no access to irrigation water.

Relocated, and faced with further threats of dispossession and their livelihoods disrupted, many of the rural Mozambicans affected by the ProCana sugarcane ethanol project risked the loss of their autonomy and capacity to produce their own crops for subsistence and for the market. These had come under severe pressure historically – especially in the context of colonial agricultural production system, the recent war, the earlier attempts at large-scale state farmlands – and were even further undermined by the ProCana plans. Investment in agriculture in Mozambique is, without doubt, urgent and necessary largely because as Cramer and Pontara (1998, p. 110) explain: ‘poverty in rural Mozambique is associated with market-isolation and the lack of off-farm income sources’ (also Wuyts 2001).

But the ProCana case is exactly what Li has warned us about: a large-scale land-expropriating and labour-expelling investment.
Thus, from a longer view we ask: then, what kind of development is this, and for whom? UNAC’s Diamantino Nhampossa was categorical about their position: ‘No to agrofuels for export. Yes to agrofuels for domestic consumption as long as its production
does not undermine food sovereignty.’ But in the end, ordinary people are not interested whether their products are used as food, or feeds, or fuel, as long as their fundamental interests as people and farmers are protected – as clearly stated by the man we interviewed inside the ProCana land allocation quoted at the beginning of this concluding section.

In October 2009, the main investor in ProCana, the London-based CAMEC, announced that it would not continue to invest in biofuel projects, as it planned to focus on its main investment portfolio, which is mining. This announcement was followed two months later by the statement issued by the Mozambican government that it was stopping and closing the operation of ProCana, and is now seeking new investors that can develop the same 30,000 ha of land. But regardless of how the biofuel project (ProCana-led or not) unfolds in the future, the socio-political processes that have already unfolded to date have provided us with key insights about the politics of biofuels, land and the rural poor.

These will be relevant insights for the rural poor in the Massingir district of the Gaza province in Mozambique, in Mozambique in general – and elsewhere with similar socio-political and economic agrarian conditions.

Published in Review of African Political Economy Vol. 38, No. 128, June 2011, 215–234