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African Agriculture and Tongue Twisting Financial Mumbo Jumbo

Touch the Soil News #237

Not too long ago I heard a successful entrepreneur explain how you get wealthy – you need to own the company! Venture capitalists understand this. In the least, venture capital understands it needs to control enough of the company to siphon off “exciting” levels of return on investment. As significant portions of “exciting” profits are withdrawn, how much is left for the entrepreneur, working people, suppliers and the community?

Rice Farming in Africa. African agricultural assets are being viewed as key to global investor profits.

Africa is hungry for capital – borrowed or from investors – it’s all the same. To package the language so it comes out like a win for everyone all kinds of verbal acrobatics are used. Following is a classic example used to convince Africans that the interests of African entrepreneurs, employees and communities are best served by not owning the company, but as servants to capital. A private capital fund called “One Thousand & One Voices” explains it this way:

“The experienced and knowledgeable investment team of One Thousand & One Voices™, coupled with the Three-Dimensional Capital™ of the family offices invested, create powerful resources for portfolio companies.”

For the lay person, what does this mean?

Recently, this investment firm made it known that it was including agricultural assets in Africa to its portfolio. “Investors Monthly” quoted Hendrik Jordaan, the CEO of One Thousand & One Voices, as follows: “Global food demand is rising. … that’s undeniable. Africa has 60 percent of the world’s uncultivated arable land.”

Mr. Jordaan explains their money is different from others in that they are in it for the long haul. “Instead of selling out after a few years, we can hold our investments for up to 20 years. We are in the fortunate position of being able to leverage off our investors’ intellectual, relational and patient capital.”

In short, capital comes in, takes out “exciting” profits and the completely pulls out later on.

The investment dollars from One Thousand & One Voices are certainly not worse than other investment dollars and, in the big picture, are but small players. But they illustrate the dilemma of Africa. Monies for the fund which One Thousand & One Voices will use in Africa comes mainly from owners of Coors Beer and the Belk family which owns Belk upscale department stores.

Is the real agenda of investors to use African agricultural assets to exploit global hunger – forcing Africans to compete for food from Africa with wealthy nations from around the globe?

Can Africans develop their own capital and keep the wealth (capital) of Africa in the hands of Africans?  Or would that take too long for nations in a hurry to Westernize? The following video illustrates how Africa is hungry for want of capital.

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