Czech agricultural chamber complains of foreign land grab

A worldwide grab for land is underway by rich and populous countries like Saudi Arabia and China. In the Czech Republic, agricultural land is also being snapped up. Whereas buyers used to be mainly Dutch and German farmers, now Western investment companies are also getting in on the act.

“Buy land because they are not making it any more.” That was the advice of American writer Mark Twain more than a century ago and many, it seems, have taken his advice. The Czech Agricultural Chamber estimates that at least a third of farmland in the West of the country is now owned by foreigners. Jan Záhorka is president of the agricultural chamber.

“That is a local estimate. Local experts estimate that this land has been bought or that it is being rented out so that later when it is legally in order it will be possible to buy it”

Mr Záhorka says Czech land still represents a bargain that makes it worthwhile for foreigners going to the trouble of circumventing the temporary and not very stringent restrictions on land purchases imposed after EU entry.

“In all the border areas land is cheaper. In Moravia for example and some of these really fertile areas it is approaching the price of other Western countries. It is the case that in some countries, like Austria and Germany, only a minimum amount of land comes up for sale and when it does it is really expensive.”

Simon Wolk is a German lawyer who works for a company advising German individuals and companies on buying land in Central and Eastern Europe. He says Czech farmland is now the focus of a new institutional wave of investment.

“A lot of institutional investors or normal investors who do not have any farming background and they just want to invest in farmland because they are afraid of inflation at the moment. They want to get some secure assets and in Germany at the moment it is really, really hard to get farmland. I guess that is why people are moving from Germany and focusing on the closest countries, states, to Germany.”

Mr Wolk says the Czech Republic and Poland are the main focus for this attention even though there are much better bargains now on offer in Romania and Bulgaria.

At the Czech Agricultural Chamber, Mr Záhorka sees no real solution to the foreign land grab. All he can call for is an extension of the current legal limits on foreign purchases so that some sort of brake is at least in place.