that investors become confident enough to bet on farming; it takes us to meetings of asset managers, where they give accounts to their investors and try to raise new capital; it takes us to the headquarters of pension funds and asset managers, where capital allocation and investment decisions are being made; it takes us to the agricultural assets themselves and the surrounding communities in frontier regions, such as Tanzania and Aotearoa New Zealand,3 where we will witness how agricultural ventures are restructured in such ways that they meet the models, calculations and requirements of the world of money management; and it takes us to the offices of various intermediaries, such as investment consultants, lawyers and market intelligence providers, who provide crucial business services to investors and asset managers alike, and who play an important role in consolidating “agriculture as an asset class”, as well as the state agencies in the frontiers of the finance-driven land rush, where investments are being facilitated. But it also leads us to sites of resistance, where finance-driven investments in agriculture are being criticized, and alternative visions of agriculture are being propagated (as an interesting side note: if time and resources permitted it, it would also take us to exotic places such as Luxembourg, Guernsey and the Cayman Islands, places that are crucial for optimizing the tax structure of some of the agri-investments discussed in this book).
Obviously, the socio-spatial complexity of agri-investment chains poses a challenge for regulators, as well as for political engagement and research. Yet, once investment chains and their underlying actor constellations have been identified and geographically grounded, different “pressure points” (Cotula & Blackmore 2014: 3) can be identified for regulation or activist engagement (see Figure 1.1). Such an endeavour must always keep in mind that it is “ultimately all of us” (Muniesa et al. 2017: 133) who are linked to global investment chains, and the production of institutional landscapes, via a giant “network of delegation” (ibid.).
Figure 1.1 The agri-investment chain and its share- and stakeholders
Source: Adapted from Cotula and Blackmore (2014: 2) (reprinted with permission).
A tale of two frontiers
Aotearoa New Zealand is regarded as one of the prime agricultural investment frontiers globally. Together with the United States, Brazil and Australia (Luyt et al. 2013), the country has accounted for most of the individual funds and other institutional equity structures invested in primary agriculture. This is at odds with the public and academic perception that most of the financialization of farming has taken place in countries of the Global South. The country adopted neoliberal agricultural policies in 1984, with successive governments supporting foreign investment into agriculture in an effort to recapitalize indebted farms, boost export volumes and enhance efficiency. The result of more than three decades of regulatory and rural restructuring has been an influx of investors, first in forestry from the early 1990s onwards, but later on increasingly in the agricultural sector more generally. Foreign direct investments (FDIs) into farmland have sharply increased since about 2010, with the entry of pension and private equity funds into the country’s dairy, beef, wine and deciduous fruits subsectors. The country’s strong agricultural potential, well-developed farmland markets, proximity to Asian markets, significant depth in farming expertise and effective legal and contracting processes make it an “institutional-grade” investment destination. Although the state-mediated efforts of granting foreign investors access to farmland and forestry have by no means been uncontested domestically, foreign investment is often normalized in a context in which overseas connections are part of the national history and rural imaginary.
The east African nation of Tanzania is interesting because it is considered to be one of the main “frontier markets” by financiers. Many would go as far as considering it “an ideal country for large-scale agricultural land investments due to its record of liberal economic reforms and high growth rates in the last two decades” (Bluwstein et al. 2018: 807). Despite the frenzy, frontier markets such as Tanzania are associated with particular risks that usually keep large Western institutional investors away, but they may attract more risk-taking factions of capital. Thus, the country has seen a number of private-equity-driven investments into large-scale farms over the past 15 years or so. Some of these investments have targeted former state farms from the socialist era, which have been promoted by Tanzanian state players as ready-made sites for investment. The bid to attract investors into farmland is driven by a larger agricultural transformation agenda that aims at modernizing the largely “peasant-based” agricultural sector of the country, which has, however, attracted considerable criticism from civil society organizations within and outside Tanzania. This conflict-ridden transition context makes Tanzania an ideal setting for studying the articulation of global agri-investment chains with local agrarian, economic and political-institutional settings.
Producing knowledge about institutional landscapes
The first part of the research informing this book included participant observation of agricultural investment conferences, the analysis of hundreds of industry intelligence and investment brochures, and interviews with key players in the agricultural investment scene. The second part followed specific investment chains into two main frontier regions of the finance-driven land rush, Aotearoa New Zealand and Tanzania. The grounding of particular investment chains in these distinct geographical contexts also allows us to place the contemporary drive of financial expansion into agriculture into a longer history of metropolitan financial expansion and place making in colonial and settler-colonial contexts. Moving back and forth between the macro and the micro, this book will ground agri-finance investment chains in specific sites, but seeks to “study up”4 their workings at the same time. Obviously, such a research strategy comes at a price. It not only tends to lose sight of those affected by the workings of the powerful (e.g. workers in farming ventures, adjacent communities, other farmers) but also encounters many challenges in practice owing to the secretive nature of the money management industry. Many of the players involved – especially private equity funds – are exempt from comprehensive reporting because of their private nature (unlike stock listed enterprises) or are bound to confidentiality agreements as a result of their fiduciary duties. These limits to knowledge production will become repeatedly visible in the narrative that follows. The words of an eminent scholar of modern financial markets, sociologist Donald MacKenzie, capture this problem well:
Those who conduct interviews to open black boxes may gain insight but may lose the capacity to condemn, while those who condemn, at the cost of insight, may end up condemning ineffectually, or condemning the wrong things. Certainly, though, the opening of black boxes is no panacea. It is a technique of research, and like all such techniques also a political act, one fraught with ambiguity and with compromise.
(MacKenzie 2005: 570)
This said, it has been surprisingly easy to gain access to many informants from the world of money management via a mixture of personal networks, unmediated e-mail contacts, physical contacts at investment conferences and (sometimes) straightforward farm visits. Many of the people interviewed for this book were happy to talk about their trade and were supportive of the research. None of them was the “typical investment banker” or interviewee one would have expected after
