It Had to Come to This

One thing the free traders never raised with us was the day when other countries would try to lock up our farmland. It's called "food security" and, while you haven't given it much thought, it's been weighing heavily on their minds.

We haven't paid much attention to it because so far it's been going on mainly in the Third World. Foreign companies show up, get their hooks into the best farmland available, and begin exporting agricultural production to their home markets.

The countries that were the easiest pickings were those that never had any proper land titles system. A farmer might have worked land that had supported his ancestors for generations but, without some registered title, he was little more than a squatter easily tossed off his ancestral lands by often corrupt government officials who sold him out. Wait a sec, that sounds like the Highland Clearances.

What makes this especially egregious is that these land dispossessions are often happening in poor countries that already have a food insecurity problem. These include nations that endure periodic famine to which the world community responds with food relief.

It's not just the handiwork of China. It's all sorts of countries that are cash rich but land/food poor. The Middle East for example. Britain grows a lot of its off-season delicacies in food insecure Kenya.

But now, predictably, they're coming for us. They're using a more sophisticated approach, one that's far more subtle. Instead of buying the land directly, openly, alarmingly, they simply take over the Agri-business giant that already owns the land*. It's not all that much different than how they got us to offshore our industrial base only the factory stays here.

Fortunately, while the Canadian government snoozes in its free-trade blanket, the Americans are sitting up and taking notice, sort of.

In November 2015, China National Chemical Corp (ChemChina) entered talks to buy the Swiss-based Syngenta for $41.7 billion. Subsequently, ChemChina increased its offer to more than $43 billion. This is the largest overseas acquisition by a Chinese company to date.

In February 2016, Syngenta agreed to the offer from ChemChina. The deal still needs the support of Syngenta’s shareholders and regulatory approval, especially from the U.S. government, given Syngenta’s large presence in the U.S. market. 

While there are already security concerns in the U.S., particularly among agricultural officials, about the deal, it is quite unlikely that the U.S. will block the deal. The Committee on Foreign Investment in the United States (CFIUS) has never before blocked a deal on food security grounds. For instance, CFIUS approved Shuanghui’s takeover of Smithfield Foods, despite concerns in the U.S about the implications for America’s food safety and security.

The Sygenta case is about China gaining access to the latest GMO technology, ostensibly to overcome some of its agricultural problems at home. But China has other plans.

* Recently a Chinese firm tried to buy up a large tract of ranchland in Argentina. The government responded with restrictions prohibiting foreign ownership of Argentinean agricultural land. China then responded by simply acquiring a controlling majority of the shares in a major Argentinian cattle company. Problem solved - for now.

It's time that Canada woke up and looked ahead to what our world could be like in 2050 and beyond. We need to treat our resources - our water, farmland, agricultural production - as strategic assets to be protected against the worst impacts of globalization. The time to get that underway is now.

Could this be next? It's not only Argentina's ranch land that's in peril. China is now sending its fishing fleet into Argentinian waters. This led to a confrontation between the Chinese fleet and Argentinian coast guard vessels that ended in the sinking of one Chinese trawler. The Argentinians rescued four of the Chinese crew, the rest boarded another Chinese fishing boat.