business development environment

For sale: one river, hardly used

Following Africa’s land deals, and Indonesia’s bid to privatise its coastline, how about this as a new form of leasing? Madagascar was, until recently, planning to export a share of one of its rivers to Saudi Arabia.

Under the scheme, 1% of the flow of the Faraony river was to be shipped to the desert state, presumably in tankers, in quantities of 260,000 cubic metres per day. It would have earned Madagascar $60,000 a day, if an outcry from the newly formed Malagasy green party and others had not put an end to the idea. Hardly surprising, since this is a country that saw the government overthrown because of an ill-advised land deal with South Korea.

Madagascar is not short of water. It has four times the Sub-Saharan average surface run-off at its disposal, and some 175 times more than Saudi Arabia. And exporting fresh water is nothing new either. Barcelona was forced to import water from France in a recent drought, and bottled waters of exotic provenance are available in every grocery store. But only 14% of Malagasy people have access to clean water. Should Saudi Arabia be ahead of the queue? On the one hand, water is a resource that Madagascar should be free to exploit. On the other, the handing over of not just resources, but control the land itself, is surely fraught with political and social dangers.

This particular deal has not come to anything, but there are many other leasing deals negotiating all across Africa. It’s a new generation of foreign involvement, and it’s still very hard to tell whether or not it’s a fair deal for Africa.

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