The Arab states invest their oil fortunes in the craziest things, from the proposed Mile-High Tower in Jiddah to the indoor ski resort in dry-as-dust Dubai. Perhaps the craziest idea yet is Saudi Arabian wheat. Some 30 years ago, the lake- and river-less kingdom decided it should be self-sufficient in wheat.
It worked. But the subsidies to farmers at times approached $1,000 (U.S.) a tonne. Last year, the Saudis finally concluded that desert wheat made no more sense than Nunavut pineapples. The farms will disappear within a few years, after which the country will be entirely dependent on imports. But from where?
Answer: from any nation willing to sell or lease vast tracts of its farmland and-here’s the kicker-allow the Saudis to export most or all of the food grown there back home, bypassing the international market. Such “offshore farms” are a quiet, though burgeoning, form of neo-colonialism. And they have the potential to unleash a new food crisis.
reportonbusiness.com: The farms race