Sweden’s AP2 responds to NGO’s “land grab” comments

Swedish state investor Andra AP-fonden (AP2) has responded to comments by non-governmental organisation GRAIN linking it with the grabbing of agricultural land in the developing world.

Although he made no specific allegations against the fund, GRAIN coordinator Henk Hobbelink pointed to AP2’s recent move into agricultural land as an example of the damaging flow of international capital into agricultural land.

“We call on everyone to do whatever is possible to stop the international flow of money for the global acquisition of farmland,” Hobbelink said in a speech accepting the prestigious Right Livelihood Award prize in the Swedish Parliament earlier this week.

“Here in Sweden,” he said, “people can start by taking on companies, like Black Earth Farming, which have bought or leased farmland overseas.” He also called for a campaign against state-owned development finance institution Swedfund over its involvement in an ethanol production facility in Sierra Leone. And he called for Swedish development aid projects to be scrutinised. He added: “The Swedish pension fund AP2 is also going into global farmland acquisitions as a new strategy to supposedly protect the retirement savings of working Swedes.”

AP2 announced in May that it was teaming up with US-based TIAA–CREF to form a joint venture to invest in agricultural real estate in the US, Australia and Brazil.AP2 would invest about $250m into the new company.
In a detailed response to Responsible Investor, AP2 said it invests in farmland in countries where there are stable and transparent land governance framework and legal system of property rights in land.

“Sustainability issues are an important factor when we take an investment decision and something we follow up and evaluate,” said spokeswoman Ulrika Danielson.
“We don’t invest in land in the Amazon. The agricultural sector in Brazil doesn’t need forest land in order to expand. There is enough pasture land that can be converted.

“Our managers always check that agricultural land that we invest in is converted according to Brazilian law. This is done by checking historical satellite images. Our managers can daily get satellite images over the lands we invested in.”

She said that, in Brazil, the fund invests in farms owned by large companies. “We don’t buy farmland from small family farms,” she added. “For us it is very important that the sustainability aspects are included in the evaluation of new agricultural land and that land is farmed in a sustainable manner.”

She also pointed to the fact that AP2 is part of a global group of institutional investors that has developed the Principles for Responsible Investment in Farmland guidelines.