Global Challenges: Climate Change and Food Security

Yale Universitys Summer Institute

New Haven, Connecticut
China, Africa and Food Security
David H. Shinn
8 July 2015

Introduction
China and Africa together constitute more than a third of the worlds population. China is
Africas largest trading partner and an important source of investment and aid. As a result, the
China-Africa relationship has significant implications for global food security. Neither China,
with 1.4 billion people, nor the 54 countries of Africa collectively, with 1.1 billion people, are
food self-sufficient. Although they both export food, they have become net food importers.
The 2015 Global Food Security Index ranked 109 countries on the basis of food
affordability, availability, and quality and safety. China ranked 42 on this index. Of the 32
African countries ranked, only South Africa scored higher (number 41) than China and 31
countries scored lower, most of them near the bottom of the ranking. This index suggests there is
considerable room for both China and Africa to improve food security. Climate change will
make even more difficult the ability of China and Africa to contribute positively to global food
security.
I need to underscore one note of caution in this analysis. Some of the statistics used refer
to agriculture generally and do not distinguish between food crops and cash crops such as cotton,
sisal, and tobacco.
Challenges for China
China has done a good job of maximizing food production in view of its large
population, about 20 percent of the worlds total, and limited farmland, about 9 percent of the
worlds total. The number of undernourished people in China decreased from 254 million in
1990-1992 to 158 million in 2010-2012. Agriculture accounts for 43 percent of the workforce in
China. But China is approaching, if it has not already exceeded, the maximum production of
food that it can obtain from its land. Total arable land and permanent cropland actually fell
between 1991 and 2009. A growing population, continuing urbanization, and the effects of
negative environmental practices on farmland are making it increasingly difficult for China to

meet its need for food. As incomes rise in China, per capita consumption of food products also
increases.
Challenges for Africa
Africa has the potential to increase significantly its food production. Agriculture
(including non-food items) constitutes 40 percent of Africas exports and 70-80 percent of
employment. Yet African agriculture is in decline; its food production per capita decreased by 15
percent from 1960 to 2005. Africa went from being a net exporter of food in the early 1960s to a
net importer in the 2000s. The number of undernourished people in Sub-Saharan Africa
increased from 170 million in 1990-1992 to 234 million in 2010-2012.
Theoretically, Africa could improve its food production with better technology,
infrastructure, training, and agricultural inputs. For example, only 4 percent of Africas
cultivated land is currently irrigated. Most important, Africa is the location of an estimated 60
percent of the worlds uncultivated land. But Africa must overcome many challenges before it
can become a net food exporter.
Sub-Saharan Africa has the fastest growing population in the world and the most rapid
rate of urbanization. Each year these demographic facts complicate Africas ability to achieve
food self-sufficiency, not to mention a food export capacity. Most African countries have serious
land tenure issues that have stymied the development of agricultural projects. Many African
countries must improve their agricultural policies, eliminate trade barriers among African
countries, reduce corruption, and/or end conflict before they can reasonably expect to increase
food production. Due to the absence of adequate water sources, irrigation is not an option in
many areas; it is also expensive and comes with environmental downsides.
Even Africas large tracts of uncultivated land need to be considered with great care. By
cultivating these lands, will forested carbon sinks be eliminated? Is the soil truly productive or
largely worn out? Does it receive reliable rainfall? By farming these virgin lands will farmers
face serious diseases? Will people have to be forcefully removed from the land before it can be
farmed efficiently? Is the uncultivated land located in a conflict zone? Having 60 percent of the
worlds uncultivated land is not as meaningful upon closer examination.
Climate Change
And then there is the wild card of climate change facing both China and Africa (and the
rest of the agriculturally productive world). I will focus on climate change in Africa, which I
know better. The experts say that the impact of climate change on Africa will be greater than on
most other global regions and it will be more negative than positive.
In most of Africa, temperatures are already close to, and sometimes exceed, the optimum
with regard to crop growth and yield. Global warming has occurred across Africa and it is
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certain that temperatures will continue to rise, posing increasing constraints on agricultural
production and creating a variety of other challenges. Near-term increases in annual mean
temperatures are expected to be higher in the tropics and sub-tropics of Africa than in the midlatitudes. By the 2030s, Africa will experience a temperature increase of 1.5 degrees Celsius
above pre-industrial levels. This is expected to result in a higher risk of drought in Southern,
Central, and West Africa but a decreased risk in East Africa. Between 2030 and 2050, crop
yields in North Africa may decrease by up to 30 percent and there will be severe implications for
farmers livelihoods and regional food security.
By the 2030s, crop growing in mixed rain-fed, arid-semiarid regions will experience
failure about one in four years as compared to about one in five years today. Some crops will
experience no yield decrease while others such as sorghum face significant negative impacts in
the western Sahel and Southern Africa. By 2050, a drying trend in Southern Africa will
accompany increased frequency and severity of severe storms, drought, and flooding. Increasing
temperatures will result in reduced yields of all major food crops and a loss of area that is
currently suitable for growing these crops.
Greater variability in rainfall is expected, which will increase the risks for dry land
farming. In fact, increased rainfall variability may be the biggest challenge farmers confront as
they tend not to be risk takers and are reluctant to invest their meager capital in a crop that has
little predictability. The intensity of storms and poor water infiltration will result in the inability
of soils in many areas to absorb extreme rainfall. There will be poor groundwater recharge in
areas where rainfall decreases or becomes more variable. Farming systems will move
progressively towards the margins. Semiarid croplands may become rangelands and semiarid
zones may turn into deserts. Fish stocks will seek colder water. Pastoralists will move livestock
to greener pastures. By 2050, climate change will result in higher food prices for all staple crops
such as maize, rice, and wheat. Higher prices may diminish the demand for food, hence resulting
in lower caloric intake.
Some studies have already found a correlation in Africa between warmer temperatures
and increase in conflict, although this factor is less important than many other social and
economic conditions. The Intergovernmental Panel on Climate Change concluded with medium
confidence in 2014 that climate change can indirectly increase risks of violent conflicts in the
form of civil war and inter-group violence by amplifying well-documented drivers of these
conflicts such as poverty and economic shocks. Early agricultural adaptation policies by
governments and the private sector could, however, do much to mitigate the downsides of
climate change.
China and Africa would not seem to have much in common in efforts to combat global
warming and climate change. China is heavily industrialized and now accounts for about 30
percent of global CO2 emissions, the highest percentage for any country. Africas 54 countries
are mostly agricultural and account for less than 4 percent of global CO2 emissions; it tends to
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function as a carbon sink. In spite of these differences, the United Nations Environment
Programme, China, and Africa created in 2008 a cooperative effort to enhance the capacity of
African countries to address environmental challenges in the context of climate change through
technology transfer, demonstration projects, and capacity building programs. It is in Chinas
interest to align its climate change policy with developing countries; the question is whether
China and Africa share the same climate change policies.
China-Africa Agricultural Relationship
The China-Africa agricultural relationship includes both food and non-food products;
Chinas interests seem to be about equally divided between the two categories. The engagement
takes place in the form of Chinas agricultural aid projects in Africa, Chinese investment in
agricultural enterprises that are intended to make a profit, and China-Africa trade in agricultural
products. Chinas policy message to Africa is that Chinese agriculture has been successful
through a combination of market reforms, trade, and foreign direct investment. China believes it
has useful lessons for Africa and if these lessons can be applied in African countries, there will
be an increase in food production that will benefit the global community, including China.
Most of the experts who have looked at this relationship have concluded that so far China
is not making a special effort to obtain long-term leases on large tracts of land in Africa, the socalled land grab accusation. The signals from China on this controversial issue have not,
however, always been consistent. In 2007, the head of Chinas Export Import Bank declared that
his institution would be prepared to provide financial assistance to Chinese farmers to settle in
Africa. Although the government of China quickly distanced itself from this assertion, other
Chinese officials subsequently alluded to this possibility. Because of objections from Africans to
the concept of huge foreign controlled agricultural projects, especially those with large numbers
of non-African farmers, Chinas official policy continues to steer away from this idea.
Chinas Agricultural Aid to Africa
Agriculture has been a mainstay of the China-Africa aid relationship. Between 1960 and
2010, China completed 220 agricultural aid projects in Africa. In the 1950s, China relied heavily
on the development of agricultural cooperatives that emphasized new techniques and better
agricultural inputs. Large state farms were also a common feature of Chinas program. Chinas
projects were not always successful and often lacked an adequate understanding of African
agricultural conditions and traditions.
At the end of the 1970s, China began to rely on a contract system that used Chinese
companies to manage its agricultural projects. This market-oriented aid system subsequently led
to agricultural investment projects in Africa by Chinese companies.
In the 21st century, China launched a multi-faceted program that included agricultural
demonstration centers, sending of agricultural technicians and experts, holding of training
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courses, and participation in the Food and Agriculture Organizations action programs on food
security. The technology demonstration center has become the dominant feature of Chinas
agricultural aid program to Africa, combined with the sending of experts. Since 2006, China has
set up 15 centers and plans to establish another 7. While it is too soon to assess the contribution
of the centers, the initial reports are mixed. A study of the centers in Mozambique and Benin
found that the research and training offered did not respond to the demand in the host country but
more to the strategy of the Chinese companies in charge of the center. In addition, the centers
did not work in an integrated way with the national agricultural research efforts of the two
countries.
Current Chinese agricultural aid includes infrastructure construction, food production,
livestock breeding, technology exchange, scholarships, and the storage and transport of
agricultural products. Chinese banks also finance agricultural development projects. From 2010
to 2012, 52 percent of Chinas global foreign assistance went to Africa, but only 2 percent was
devoted to agricultural projects. It is impossible to measure the overall success of these aid
projects, but China has improved its agricultural aid programs as it learns from its successes and
failures.
Chinese Agricultural Investment in Africa
Direct investment in agriculture has not yet become an important part of Chinas strategy
in Africa. Many of the media reports on Chinese land leases in Africa are exaggerated or
inaccurate; on the other hand, China has been more active in agricultural investment in Asia and
Latin America. As of 2013, China approved almost 2,400 large and medium-sized investments
in Africa for Chinese companies. Only 86 of these investments in 27 African countries were
specifically related to farming. They included food crops, cash crops, and animal husbandry but
not all of these proposals materialized.
While Chinas direct investment in African agriculture grew from $30 million in 2009 to
$84 million in 2012, it constituted only about 3 percent of Chinas total direct investment in
Africa. On those occasions when Chinese companies obtained leases for food production in
Africa, there is little evidence that the goal is to grow food for export to China. Most of the food
production meets local and regional demand. Some of the smaller land leases, especially
vegetable gardens, are designed to supply a component of the Chinese community in Africa.
Solid field work on Chinese land leases in Ethiopia, the Democratic Republic of the
Congo, and Mozambique offers useful insights on this controversial subject. Since 2008, the
Ethiopian government has licensed 32 Chinese agricultural investments, of which 18 are small
vegetable farms. Four are edible oil and processing operations, three sugar cane production and
processing, three pig farms, two poultry farms, one mushroom farm, and one rubber plantation.
Most of the vegetable, pig, and poultry farms are designed to supply local Chinese and
international restaurants/hotels. The only large proposal among the 32 licensed by Ethiopia is a
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33,000 hectare palm oil plantation and a 30,000 hectare rubber plantation. There is no indication
that either of these large projects has moved forward. There are more licensed agricultural
investments in Ethiopia by companies from the United States, Ethiopian diaspora, Europe, Israel,
or Saudi Arabia than from China.
The Democratic Republic of Congo offers some of the most discussed Chinese land
grabs in Africa. In 2007, ZTE Agribusiness signed an agreement with the government of the
DRC to develop 100,000 hectares for a palm oil plantation. This announcement led to numerous
press reports of a much exaggerated project. Poor road infrastructure forced ZTE to scale back
the 100,000 hectare project to several smaller ones. As a result, it now has a 200 hectare oil palm
plant nursery and two additional farms of 246 hectares and 600 hectares. The China Overseas
Engineering Group Company applied for 100,000 hectares of farmland in the DRC. In 2009,
after failing to get approval from the DRCs Ministry of Agriculture, it abandoned the proposal.
The Hubei Dadi International Corporation also encountered land problems as it tried to
implement a project. It eventually abandoned a 300 hectare farm and a much smaller vegetable
and pig farm due to land disputes. The Hubei Dadi International Corporation changed its
business model from farming to agro-processing and trading of agricultural machinery.
Finally, reports of Chinese land leases in Mozambique have resulted in confusion,
misinformation, and legitimate concerns. China Grain and Oil Group agreed to invest $12
million in a soybean farm. The company brought seedlings and machinery from China that were
not suitable for local conditions and had to abandon the project. ACE Agriculture and
Aquaculture has a 600 hectare rice farm that has been plagued by an inadequate irrigation
system. China-Africa Cotton Mozambique adopted a business model that provides inputs and
training to local farmers in return for the purchase of raw cotton. In this manner, it avoids the
problems of leasing land.
The largest and most controversial project is being implemented by Wanbao Africa
Agriculture Development Limited, a private Chinese company, which received a concession for
20,000 hectares of farmland. As of 2014, the company was growing rice on about 6,000 hectares
and maize on 1,000 hectares. Wanbao provides the agricultural inputs and trains Mozambican
farmers in Chinese techniques. It also subcontracts its land to four Chinese state-owned
agribusiness companies. In 2013, the managers of the project faced a protest by about 400
Mozambican farmers who claimed they had been deprived of their land. Wanbao has plans for
significant additional agricultural investments. Chinese investments in Mozambiques
agricultural sector are increasing and diversifying.
China-Africa Trade in Agricultural Products
While China has been Africas largest trading partner since 2009, agricultural products
have not been a significant part of the trade in either direction. From 2009 to 2012, Chinas
agricultural exports to Africa grew from $1.6 billion to $2.5 billion. During the same time,
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Chinas agricultural imports from Africa grew from $1.2 billion to $2.9 billion. Chinas
agricultural imports from Africa constitute about 2.5 percent of Chinas total agricultural imports
and only about 1.5 percent of its total food imports, the single most important item being sesame
from Ethiopia. Africas agricultural exports to China constitute about 3 percent of Africas total
agricultural exports and have the lowest compound annual growth rate of any trade category with
China.
Chinas average most-favored-nation tariffs on agricultural goods are a relatively high
22.5 percent, which discourages imports, although China allows some agricultural products from
Africas poorest countries to enter duty free. China is increasing its food imports from Africa,
but most of the agricultural imports remain cash crops such as cotton and tobacco. Most of
Chinas agricultural exports to Africa are food products. In fact, China exports more food to
Africa than it imports from Africa.
China imports most of its agricultural products from the United States, Brazil, Australia,
Canada, New Zealand, and Argentina. Chinas agricultural exports go primarily to Japan, Hong
Kong, the United States, South Korea, Vietnam, and Malaysia. Africa is not currently a
significant source of food for China or recipient of food from China.
The Future of China-Africa Agricultural Relations
The fact that China does not now depend on Africa in any meaningful way for food does
not mean this will continue to be the case. China increasingly will require more food imports as
land is lost to development, water shortages become more severe, arable land quality deteriorates
for environmental reasons and due to climate change, and more Chinese move into the middle
class. Chinese leaders are not optimistic the country will be able to achieve additional growth in
the agricultural sector.
Chinas $650 billion sovereign wealth fund, the China Investment Corporation (CIC), is
already shifting its focus to invest in agriculture and global food supplies in a strategic move that
reflects the priorities of the countrys new leadership. The head of CIC announced in 2014 that
the fund will pay particular attention to agricultural sectors such as irrigation, land
transformation, and animal feed production that have been neglected by large institutional
investors.
If Africa becomes a more efficient producer of food and Chinas food demands continue
to outstrip domestic supply, China can be expected to turn increasingly to Africa to meet its
demand just as any other food deficit nation would do. If Africa becomes food self-sufficient
and develops an export capacity, Africans control the farmland, and African farmers raise the
crops, food exports to China should not raise any concerns. Chinese capital investment in such
circumstances could make a positive contribution to global food supply and, at the same time,
directly benefit Chinese consumers.
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If, however, Africa remains a food deficit region, exporting significant quantities of food
to China grown on Chinese-financed investment projects will raise serious questions. This will
be the case even if Africa earns foreign exchange from the projects that it could use to purchase
food. Likewise, if China sends significant numbers of Chinese farmers to Africa to operate its
investments for growing food or cash crops, the African reaction will likely be highly negative.
Both China and Africa face important agricultural policy choices.