Main findings
FAO research shows that much more agricultural investment, including foreign direct investment, is needed to eradicate hunger and poverty and promote rural development. Agricultural investment by domestic and foreign investors can generate a wide range of benefits such as higher productivity, increased food availability, employment creation, poverty reduction, technology transfer and access to capital and markets.
However, these benefits cannot be expected to arise automatically. Investments that involve local farmers as equal business partners, do not involve transfer of land ownership and build on intensive consultations, can have positive and sustainable effects on local economies and social development. Conversely, other forms of investment, notably large-scale land acquisitions, carry risks for local communities, host countries and investors.
While investors have a key role to play in ensuring that investments are responsible, good governance at the national and local levels is crucial for positive outcomes and reduction of risks. However, laws and policies may not always be consistent and institutional capacities may be low.
