For investors seeking to purchase, lease or access large areas of land in developing countries, understanding the complex land tenure realities – who has what rights or claims to which pieces of land – can be the difference between a failed investment and a successful, responsible one. Failing to account for or adequately compensate individuals or communities with claims to land that is slated for investment can lead to displacements or loss of livelihoods for local people and communities, and can create significant financial or reputational risks for the investor as well. For investors, conducting proper due diligence and structuring responsible land-based investments to account for all stakeholders can be extremely complex in situations where rights to land are unclear, undocumented, overlapping, or poorly enforced – which is often the case in developing countries.
For these reasons, a group of development organizations, under the leadership of Grow Africa and the New Alliance for Food Security and Nutrition, have released a new tool to help investors better understand risks related to land-based investments and manage them responsibly: the Analytical Framework for Investors Under the New Alliance. The Analytical Framework is designed to help investors identify practical steps to align their policies and actions with global best practices and relevant international guidelines, such as the Voluntary Guidelines on the Responsible Governance of Tenure (VGGT) and the UN Guiding Principles on Business and Human Rights (also known as the Ruggie Principles), and the African Union’s Guiding Principles on Large-Scale Land Based Investments.
Along with a range of other bilateral and multilateral development partners, USAID played a key role in developing the Analytical Framework through a collaborative multi-stakeholder process. USAID’s Operational Guidelines for Responsible Land-Based Investment form the basis of many of the recommendations in the Analytical Framework.
As a next step, Grow Africa is seeking interested companies to pilot the framework in actual investments projects in Africa to determine their effectiveness. Please contact Grow Africa at info@growafrica.com if your firm is interested in participating in this pilot.