Frédéric Mousseau, a French economist, is policy director of the Oakland Institute, a progressive economic observatory, for which he coordinates research on land, agriculture and food security. A former consultant for NGOs such as Medecins sans Frontieres and Oxfam, he works in particular on agricultural investments, price volatility and the global food crisis.
You have called the rise of multinationals in Ukraine’s agricultural sector “unprecedented.”
For recent history, I would say yes, especially the push for privatization and land reform. There is no precedent for a push of this magnitude by Western countries and institutions to force a similar level of privatization.
One of your reports compares Ukraine’s relationship with the West to that of countries like Zambia, Myanmar, Brazil. A classic example of post-colonial neoliberalism?
That report shows that international institutions, governments and Western private interests have promoted privatization in a number of countries around the world. Ukraine is a prime example of the use of economic assistance as a wedge to impose desirable reforms. But Ukraine is also a unique case because of its proximity to Europe and the amount of land previously collectivized by the Soviet system, and thus available for privatization.
Did agribusiness interests play an important role in the conflict being described as a clash between democracy and authoritarian corruption?
Not only them. It was clear that equally important interests in natural and mineral resources were at stake, and a similar push to privatize the banking and pension sectors. In any case, the large Western conglomerates were highly motivated to acquire stakes in these domestic economic sectors.
These interests were already in motion in the 1990s.
The International Monetary Fund’s push for privatization of public lands began as soon as Ukraine gained its independence in the early 1990s. The large financial institutions offered the first Ukrainian government’s “assistance” in producing deeds and titles to the land. And it was equally evident how the privatization processes benefited specific and narrow oligarchies rather than the Ukrainian people. This is the reason why a moratorium on land acquisition was imposed at the time, which remained in place until last year.
And two projects of economic influence, defined by opposing plans of assistance from Russia and the West, are already emerging.
It has been like that. In 2014 two competing offers of economic assistance were put together; two “envelopes,” one Russian and one Western. After the Maidan uprising, the Western package prevailed.
You document how the IMF and the European Bank for Reconstruction and Development have waged an intense campaign to privatize land.
From the beginning, the promise of aid from the European side contained determined conditions, first of all the end of the moratorium (on the sale of land to foreigners, n.ed.), a demand that has accompanied every offer of assistance from the beginning. It was a necessary precondition.
What will the practical effect be now that the moratorium has been lifted?
There are still limits to the amount of land that can be acquired by foreigners, but this is an important step towards privatization and consolidation of land ownership. The law imposes limits on foreign ownership but at the same time allows international banks to become shareholders in Ukrainian companies or invest in local companies, a mechanism that allows anyone to invest in the sector. The door is open for large American investment funds, e.g. BlackRock or the like, to invest in emerging agribusiness through Ukrainian companies so that it does not officially show up as foreign ownership. The country represents an opportunity for enormous returns on investment. The reform is also designed to favor large landowners and industrial agriculture, increasingly squeezing out less-productive small farmers, a dynamic explicitly advocated by the IMF.
Is it true, therefore, that there are American multinationals with major controlling stakes in Ukrainian land?
Yes, but focusing solely on land ownership can be misleading. Companies like Monsanto, Cargill, Archer Daniels Midland and Dupont do not need to own land. Their model focuses on operating breeding facilities, fertilizer plants, commercial infrastructure, export terminals. They benefit from the industrialization of the agricultural sector and the liberalization of trade (in addition to silos and threshers, Archer Daniels Midland, for example, operates a grain terminal at the port of Odessa, n.ed.).
Are you aware of similar dynamics at play in other post-Soviet republics?
We have no specific data on other countries. However, given the size of Ukraine and the quality of its infrastructure, I would certainly say that this country represents (apart from perhaps Russia itself) the largest potential field of conquest for private agribusiness.
Is it safe to assume that one purpose of Russian aggression is to counter this dynamic?
I don’t feel comfortable making assumptions about Russian goals. Our reports merely offer proof that a struggle has been going on for years for control of Ukraine’s resources. Of course, the official versions emphasize democracy or, conversely, Ukraine’s historical cultural links with Russia, but it is clear that there are enormous economic interests. Nor does it appear that the war has changed Western strategy in this regard.
At present, it is the blockade of Black Sea ports that is worrying because of the possible effects on markets and a global food crisis.
We will publish a report on this topic shortly. The FAO said in early May that world grain stocks are relatively stable. The World Bank confirms that cereal stocks are close to historic records and that three quarters of the Russian and Ukrainian harvests had already been delivered before the start of the war. We can say that there isn’t any imminent shortage, but rather heavy speculation on the futures markets betting on higher prices and future famines to maximize gains. For example, there has been much talk of India’s decision to halt wheat exports, much criticized by the U.S. for the resulting pressure on global prices. But if we look closely, India accounts for just 2% of global exports (10 million tons expected by 2022/23).
In comparison, the U.S. currently moves 160 million tons of grain per year, or 35% of global trade. The criticism of India has less to do with an actual food crisis than with maintaining the same global market that is in the interest of the agribusiness giants and their investors. Clearly there is a food crisis, with millions or hundreds of millions of people in the world in a state of insecurity, without access to adequate food or dependent on welfare networks, but this exists regardless of the war. There is a food crisis, but it is a crisis without actual food shortages.
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