Rye Town Supervisor Joesph Carvin Snaps Up African Farmland
Joe Carvin's Altima Partners investment fund is buying up farmland in Africa and Latin to grow food for export -- a profitable business, with a growing global population and rapidly rising prices. The high-stakes game of real-life Monopoly is leading to a modern colonialism to which many poor countries in African and Latin American countries submit out of necessity.
Every crisis has its winners. A group of them are sitting in Joseph Edward Carvin's Altima Partners LLP's offices in New York.
Rye Town Supervisor Joe Carvin can give one hell of a snappy presentation. He has colorful graphs posted up and down on PowerPoint charts and bound reports. Some graphs are headed downward as the year 2050 approaches. They represent the farmland that is disappearing as a result of climate change, soil desolation, urbanization and the shortage of water.
The other lines, which point sharply upward, represent demand for meat and biofuel, food prices and population growth. There is a growing gap between these two sets of lines. It represents horrific world hunger and massive profit for Altima Partners and David Gray who is one of Joe Carvin's Partners and lives at 171 Rowayaton Woods Drive in Norwalk, CT .
According to most prognoses, there could be 9.1 billion people living on earth in 2050, about two billion more than today. In the coming 20 years alone, worldwide demand for food is expected to rise by 50 percent.
"These are pessimistic prospects," says one Altima Partner insiders.
For Rye Town Supervisor Joe Carvin, who lives at 55 Hillandale Road in Rye Brook, New York , this is all of this is good news and his mood is buoyant.
How could Carvin's mood be any different?
After all, hunger is Altima Partner's business. The combination of more people and less land makes food a safe investment, with annual returns of 20 to 30 percent, rare in the current economic climate.
Land is scarce and expensive in Europe and the United States.
Solving the problem means that hedge fund honcho Joe Carvin must exploit and develop new land, which is only available in Africa, Asia and South America. This combination of factors has triggered a high-stakes game of real-life Monopoly, in which Altima Partners, banks and governments are engaged in a race for access to the world's arable land.
One Of Joe Carvin's competitors is a Susan Payne, who heads a land fund in southern Africa, which currently includes 370,000 acres, mainly in South Africa, Zambia and Mozambique. This land fund has raised half a billion dollars from investors. The land fund talks about fighting hunger, but the headings on it's marketing materials are embellished with photos of soybean fields at sunset, tell a different story.
One investment presentation is called "Africa -- the last frontier for finding alpha." The word alpha signifies an investment for which the return is greater than the risk.
And Rye Town Supervisor Joe Carvin will tell you that Africa is alpha country.
That's because land, which is extremely fertile in some regions, is inexpensive on the impoverished continent.
It is rumored that Joe Carvin's land fund has paid less than $140 per acre in some of the poorest counties on earth. Carvin has less than 5% of the price of land in the United States.
For a small farmer in Africa, the average yield per hectare has remained unchanged in 40 years. With a little fertilizer and additional irrigation, yields could quadruple -- and so could Joe Carvin's profits.
In fact, there has been so much demand for this type of investment that Carvin has been considering establishing a new or sub-fund to rake in the all of the cash available.
A great deal of capital is currently available. It is the third year of the global economic crisis, and investors are seeking alpha investments.
Rye Town Supervisor Joe Carvin is applying the most basic formula in the world:
Man must eat.
US investment management company BlackRock, for example, has established a $200 million agriculture fund, and has earmarked $30 million for the acquisition of farmland. Renaissance Capital, a Russian investment company, has acquired more than 100,000 acres in Ukraine.
Joe Carvin's former employer Deutsche Bank has invested their money in pig breeding operations and chicken farms, investments that include the legal rights to farmland.
Food is becoming the new oil.
Worldwide grain reserves recently dropped to a historic lows.
This is just as the oil crisis did in the 1970s.
There were bread riots around the world, and 25 countries, including some of the biggest grain exporters, imposed restrictions on food exports.
Altima Partners is exploiting two fears -- the fear of hunger and the fear of uncertainty.
As these fears are exploited and converge, hedge fund honcho's like Carvin are triggering what some are already calling a second generation of colonialism.
What is different about this colonialism is that countries are readily allowing themselves to be conquered. The Ethiopian prime minister said that his government is "eager" to provide access to hundreds of thousands of acres of farmland.
The Turkish agriculture minister announced: "Choose and take what you want."
In the midst of a war against the Taliban, the Pakistani government staged a road show seeking to entice British investors with tax breaks and exemptions from labor laws.
It is not just bankers and speculators, but also governments that are acquiring land in other countries, seeking to reduce their dependence on the world market and imports. China is home to 20 percent of the world's population, but it has only 9 percent of the world's arable land.
But what happens in a globalized world when colonies arise once again? What if, for example, Saudi Arabia acquires parts of Pakistan's Punjab region or Russian investors buy up half of Ukraine? And what happens when famine strikes these countries? Will the wealthy foreigners install electric fences around their fields and will armed guards escort crop shipments out of the country? Pakistan has already announced plans to deploy 100,000 members of its security forces to protect foreign-owned fields.
Because of the political sensitivity of the modern-day land grab, it is often only the country's head of state who knows the details. In some cases, however, provincial governors have already auctioned off land to the highest bidder, as in the case of Laos and Cambodia, where even the governments no longer know how much of their territory they still own.
No one is sure exactly how much land is at stake. The number cited by the International Food Policy Research Institute (IFPRI) is 60 million acres and growing rapidly.
Even United Nations organizations has to resort to citing newspaper reports, while the World Bank is trying to convince countries to pay closer attention to the fine print on agreements from guys like Joe Carvin.
the World Bank, estimates that 10 to 30 percent of available arable land could be up for grabs, although only a fraction of the potential number of lease and sale agreements have been signed.
In Mozambique, the government has already allocated four million acres to investors like Altima Partners.
Some deals are not being made by private investors, like Rye Town Supervisor Joe Carvin.
The Sudanese government has leased 1.5 million acres of prime farmland to the Gulf States, Egypt and South Korea for 99 years. Paradoxically, Sudan is also the world's largest recipient of foreign aid, with 5.6 million of its citizens dependent on food deliveries.
Kuwait has leased 130,000 acres of rice fields in Cambodia.
Egypt plans to grow wheat and corn on 840,000 acres in Uganda.
The president of the Democratic Republic of Congo has offered to lease 10 million acres to the South Africans.
Saudi Arabia is one of the biggest and most aggressive buyers of land. This spring, the king attended a ceremony where he took delivery of the first export rice harvest, produced exclusively for the kingdom in hunger-stricken Ethiopia. Saudi Arabia spends $800 million a year promoting foreign companies that cultivate "strategic field crops" like rice, wheat, barley and corn, which it then imports.
Ironically, the country was the world's sixth-largest wheat exporter in the 1990s, the Saudi Kingdom finds it cheaper to exploit farmland in poorer countries.
An Investor Like Joe Carvin Needs a Weak State To Make Big Profits
Joe Carvin and Altima Partners is exchanging money, oil and infrastructure for food, water and animal feed. At first glance, this seems to present a solution for many problems.
The only country Africa currently producing a food surplus is South Africa.
But many of the countries where Joe Carvin is snapping up land are suffering from water shortages.
Most countries, on the other hand, are importers and, with rapidly growing populations, will likely be even more dependent on food imports in the future. Is it ethical for a guy like Joe Carvin to lease land cheaply in order to grow and export food as starving children look on?
The way Altima partner's agreements are structured they can harm the country and the farmers in the long term, robbing them of their most important asset - land.
Because the countries in Africa are competing for investors, they are undercutting each other.
Some contracts are barely three pages long -- for hundreds of thousands of acres of land. These types of agreements stipulate what products are to be cultivated, the location and the purchase or lease price, but they include no environmental standards. They also lack the necessary investment regulations and the stipulation that jobs must be created.
The benefits to the host governments and local farmers are often short-lived. In the long term, however, they must suffer the consequences of over-fertilizing, deforestation, over-consumption of water, reduction of ecological diversity and the loss of local species.
To boost harvests and achieve annual returns of over 20 percent or more, Joe Carvin and his Altima Partners fund must operate their farms on an industrial scale.
When the soil becomes depleted after a few years, many investors simply move on. Land is so cheap that they are not forced to value sustainable farming practices.
When food becomes scarce, the investor needs a weak state that does not force him to abide by any rules.
A state that permits grain exports despite famines at home, that is consumed by corruption or deeply in debt, ruled by a dictatorship, racked by civil war, or sends millions of workers abroad and is dependent on these workers receiving visas and jobs.
A new target is Africa's newest nation,South Sudan, which even isn't a month old yet. However Philippe Heilberg a Joe Carvin contemporary and and the founder of the investment firm Jarch Capital, is now the largest land leaseholder in South Sudan, where he leases 400,000 acres of prime farmland in Mayom County.
The mere mention of the words South Sudan conjures up images of civil war, refugees and famine, not of a place where one would consider growing tomatoes.
But Heilberg, like Carvin< raves that his project will be more beneficial to investors seeking large returns. Heilberg is adamant that Paulino Matip, from whom he has leased the land for 50 years, not be referred to as a warlord, but as a "former warlord" or "deputy army chief." Heilberg neglects to mention that the rebels led by Matip are suspected of having committed war crimes. Instead of buying stocks, the former banker is now speculating on the political future of South Sudan. Land acquisition is already a step further along in western Kenya, home to Erastas Dildo, 33, the kind of person that Joe Carvin's investment firm would probably characterize as a risk factor: a small farmer who owns three acres of land. It is fertile land, where the corn turns bright green and grows 6.5 feet tall, where the cattle are as fat as hippos and the tomato plants bend under the weight of their tomatoes. The nearby Yala River flows into Lake Victoria. There are three small brick houses on the property. Erastas harvests his corn twice a year, and vegetables and tomatoes grow year-round. One hectare produces $3,600 worth of corn a year, a lot of money by Kenyan standards.
They Drove Out 400 Families
But things changed when Erastas was contacted by Dominion Farms, a US agricultural producer that established a colony in the Yala delta, where it has leased 3,600 hectares of land for 45 years, at the ludicrous rate of $12,000 a year. Dominion, which plans to grow rice, vegetables and corn on the land, wants to include Erastas Dildo's three acres in its venture.
The Dominion representatives offered to pay him about 10 cents per square yard. Erastas turned them down, and now they are making life difficult for the farmer. Their most effective weapon is a dam they have built. When Erastas tried to harvest his corn last year, it was under water. "They are playing with the water level to get rid of us," he says. And when that doesn't work, says Erastas, Dominion sends in bulldozers, thugs and sometimes even the police.
Perhaps Erastas and his family will be forced to make way for the development soon, as is already happening in many other places. The World Bank estimates that only 2 to 10 percent of the land in Africa is formally owned or leased, and most of that is in cities. A family may have lived on or occupied a piece of land for decades, but it often has no proof of ownership.
The Hunt for Land Continues
Nevertheless, the land is almost never left unused. The poor, in particular, live off the land, where they collect fruits, herbs or firewood and graze their livestock. According to a joint study by several UN organizations, land grabs are often justified by defining the land as "fallow." As a result, according to the report, land grabs have the potential to dispossess farmers on a large scale. In many countries, there may be enough arable land available for everyone, but the quality is not uniform -- and the investors want the best land. That, as it happens, is the land where farmers usually live.
Because more than 50 percent of Africans and Latin Americans are small farmers, Altima Partners large-scale land acquisition could be disastrous for the population. Those who lose their fields lose everything. The fact that the large investors, like Joe Carvin can substantially improve harvests with their modern agricultural technology is of little use to Africans who, once they have lost their land and livelihoods, cannot afford to buy the new farms' products.
The World Bank and others are now developing a code of conduct for investors like Joe Carvin.
And so the hunt for land continues. Dominion has secured another 3,200 hectares, and Philippe Heilberg is in the process of leasing an additional 600,000 acres in South Sudan.
Back in Port Chester, New York, Rye Town Supervisor Joe Carvin is doing a jig up on the third floor at 10 Pearl Street as he is reciting numbers to illustrate how fast the global population is growing.
The world is growing by 154 people per minute, 9,240 per hour or 221,760 per day. And each one of them wants to eat.
Joe Carvin's investment strategy will be judged by his maker on the day of reckoning.
And these are not the only ethical issues that Joe Carvin will have to answer for some day. Most folks in town know that Carvin has always been a bit on the greedy side.
The problem for Port Chester and Rye Brook tax payers is that Joe Carvin is too occupied with African and Latin American land grabs, and can not properly run the town of Rye or manage the beach at Rye Town Park.
Joe Carvin is too busy trying to earn a double digit return on third world farm land as Rye Town Park lost a million dollars during one of the best beach seasons on record.
There is just too much mismanagement by the Carvin team at Rye Town Hall.
The taxpayers of Port Chester, Rye Brook, Rye City and Rye Neck must make up that million dollar loss at Rye Town Park as Supervisor Joe Carvin is out exploiting some of the poorest people on the planet.
Joe Carvin is not focused on the Town Of Rye and it is the taxpayers who must pay for his lack of attention.
But the Rye Town Supervisor has a pie in the sky plan to get reelected, in spite of his poor record and wasteful spending. And if that doesn't work Carvin is always ready, willing and able to use dirty tricks and slander.
But the Carvin brothers always have their hands in the pockets of Port Chester homeowners.
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