ARGENTINA: Farmers, Lawmakers Try to Curb Land Sales to Foreigners

By Marcela Valente Reprint | | Print |

Marcela Valente

BUENOS AIRES, Oct 17 2002 (IPS) - Small and medium-sized farmers and a group of lawmakers in Argentina have banded together to try to curb the sale of farmland to foreigners, who have been drawn by the plunge in the value of property in dollars caused by the crash of the peso.

”If you had 500,000 dollars in December, you could buy 1,500 hectares. But now with that money you can purchase 2,500 hectares, at a time when the prices of farm exports are much higher, also due to the devaluation,” the director of the Argentine Agrarian Federation, Miguel Quarleri, told IPS.

The new real estate opportunities began to appear immediately after the government of Eduardo Duhalde decided in January to scrap the ”convertibility” scheme that kept the peso at par with the dollar for over 10 years.

The value of the peso has now fallen to 3.70 to the dollar.

The shift in the conditions surrounding sales of rural real estate led the Agrarian Federation, which represents thousands of small and medium-sized farmers, to present a draft law that would create a unified national registry of rural property owners in each province, and put in place restrictions on selling land to foreigners.

The initiative was promptly backed by legislators of the centre- left Argentines for a Republic of Equals (ARI) party, led by parliamentary Deputy Elisa Carrió.

The popular lawmaker, who plans to stand in the early presidential elections slated for next March, said that if she is elected, she will set limits on sales of land to foreigners.

Meanwhile, a number of web sites have cropped up, many of them in English, offering farms and highly productive land for sale.

One web page offers millions of hectares in the wet pampas, a vast area in central and eastern Argentina which has some of the world’s most fertile soil and a perfect climate for agriculture.

”Argenfarms” asks ”Have you thought about buying land in Argentina?” It explains that due to the current economic crisis, innumerable farms have come up for sale at highly competitive prices.

Argentina, Latin America’s third largest economy, is in the grip of its worst crisis ever. After four years of recession, unemployment has soared to over 21 percent, while more than half of the population of 37 million has fallen into poverty.

The web site invites potential buyers to ”take advantage of the opportunity” to purchase farms, fields or estates in this Southern Cone country at ”incredible” prices.

The rural property companies catering to foreigners on the web site invite them to buy land in the pampas, ”the most productive region in the country, suitable for any kind of production, with excellent communications and roads, and not far from the port of Buenos Aires.”

But they also offer tracts of up to 100,000 hectares in Argentina’s southern mountain and lakes region, suitable for tourism ventures; in Mesopotamia, located in the eastern and northeastern provinces bordering Brazil, Paraguay and Uruguay; in the western region of Cuyo, which has land that is ideal for wine growing; and in the northwest, an area that draws large flows of tourists.

Some real estate companies admit that they have been doing business with foreigners, while others say the number of queries has increased, but that the deals often do not go through because potential investors are wary of the current economic and political instability.

”It isn’t true that business is booming, but it is true that property values have dropped 30 percent, and that we have received queries from people in Britain, France and the United States for rural properties consisting of thousands of hectares,” said Claudio Mazás, at the Emir Carrillo real estate company.

”Of the total number of queries we have received, 40 percent come from foreigners,” he said.

Carrió pointed out that no country allows unrestricted access to land by foreign investors. She also underlined that many of the foreigners purchasing property do not even have legal representation in Argentina.

In addition, she warned that the offers could draw a flood of investors ”interested in laundering money that comes from illegal activities.”

Quarleri, with the Agrarian Federation, stressed that the conditions under which the sales are taking place have not been freely chosen by farmers, an overwhelming majority of whom are up to their necks in debt, including large agribusiness concerns, as well as family farms.

”We estimate that out of 84 million hectares of arable land, nearly 30 percent is under mortgages that the owners are having difficulty paying off,” said Quarleri.

He added that although the peso has stopped depreciating in the last few weeks and farm commodity prices have improved somewhat, the interest rates paid by indebted farmers have continued to climb.

The prices of farm products – which account for over half of Argentina’s exports – have begun to rally in the past few months, especially in the case of soybeans, corn and wheat, the country’s main agricultural export products, bringing some hope to producers after 12 years of crisis.

However, many have already lost their farms, and there is a long way to go before the country will return to the bonanza of the past.

The Argentine Rural Society, which groups large landowners, says that out of a question of philosophy, it could not oppose the sale of land to foreigners.

However, the association concedes that under the current conditions, it would not be difficult for a foreign investor to buy up an entire province.

Small and medium-sized farmers want property sales to foreigners to be restricted by a law that would prevent a district or a province from eventually identifying itself with the flag of another country.

Farmers from Rafaela, in the eastern province of Santa Fe, observed in a column printed by the daily newspaper La Razón that Texas formed part of Mexico until the 19th century, but that people from the United States moved in en masse in search of cheap land and new frontiers, and in 1845 it became part of that country.

ARGENTINA: Farmers, Lawmakers Try to Curb Land Sales to Foreigners

By Marcela Valente Reprint | | Print |

Marcela Valente

BUENOS AIRES, Oct 17 2002 (IPS) - Small and medium-sized farmers and a group of lawmakers in Argentina have banded together to try to curb the sale of farmland to foreigners, who have been drawn by the plunge in the value of property in dollars caused by the crash of the peso.
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