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Not a lot of sympathy for Posco.

They’re paying money to the government to forcibly take people’s land and hand it over to them. And the people getting the shaft are resisting.

I, too, would be upset if (say) China Holdings Ltd. paid the state of Texas a billion dollars to exercise imminent domain on my land and my neighbors’ land and hand it to the foreigners.

There was a good article in Financial Times not long ago about the abuse of government takings in third world countries, with emphasis on India. The system is rife with corruption, as you might imagine. And who decides what it’s worth?

Not a lot of sympathy for Posco. They’re paying money to the government to forcibly take people’s land and hand it over to them. And the people getting the shaft are resisting. I, too, would be upset if (say) China Holdings Ltd. paid the state of Texas a billion dollars to exercise imminent domain on my land and my neighbors’ land and hand it to the foreigners.

They paid $4.5m per acre of land for rural land in India. In comparison, land in the Galveston area costs less than $10K an acre. And this is for land near a bustling port at the center of a major oil and gas boom vs farmland in India. Something doesn't smell right. The interest alone on 10-Year Treasury Notes on $4.5m is $100K per year. I can't believe that Indian farmland yields $100K per year per acre. Heck, if US farmland, which is acknowledged to be generally superior to much of the world's stock, yielded that much, it wouldn't be selling for thousands of dollars per acre.

Re Chinese eminent domain, the system is generally pretty generous, which is why you get these isolated instances where large demonstrations occur - these are the exceptional cases in which the tenants got gypped. And almost like clockwork, the officials at the center of the dispute get fired and in many cases, prosecuted. Through Chinese contacts, I’ve heard that a lot of land is basically leased out to manufacturers, with the rents being distributed to the former tenants. It’s when the officials involved try to grab the lion’s share of the proceeds that the tenants get riled up. Note that in many cases, the tenants literally have only squatters’ rights to the land - much of it was confiscated by the Communist Party from rich landowners (many of whom were executed, along with their families, with the cooperation or even assistance of the tenants). Since the rightful owners of the land are in many cases dead, thanks to the Party and the tenants who helped kill the landlords, it’s probably not unreasonable that the tenants don’t get all the rewards that a rightful owner would from land development.