Sept. 29, 2011— As the demand for food, fuel, urbanization and other uses drive up the pressure on land resources across the globe, governments around the world are finding it vital to strengthen land governance.
Indeed, better land governance encourages investment, steers rural and urban growth, and improves social welfare. It also helps countries overcome a legacy of inequality, dispossession and conflict, and ensures that new land investments offer benefits shared by the public.
The issue is important because many countries were caught unprepared by the sudden increase in demand for land. Many are grappling with how to prevent deals that would harm local people and sow the seeds of conflict.
In recent meetings, including the Annual Bank Conference on Land and Poverty organized by the World Bank’s Development Economics Vice Presidency earlier this year, stakeholders from governments, civil society and the private sector discussed how to work together to ensure that investments are transparent and provide local benefits.
“A consensus has emerged among stakeholders that improving land governance for the poor should be the top priority,” says Klaus Deininger, author of a recent widely-cited land report and lead economist at the World Bank’s Development Research Group. “Securing land tenure is essential to attract investments that would boost land productivity. And the need for adequate legal and regulatory frameworks applies to investors large and small.”
In fact, several countries have already begun some very promising and potentially far-reaching steps in this direction:
Brazil is implementing a national program to recognize land tenure in rural, as well as, urban areas of the Amazon. The program uses advanced technology and a transparent Web-based process. The goal is to regulate land use, boost productivity and reduce deforestation.
The Indian state of Karnataka, which already digitized 20 million titles for rural areas — a step that dramatically cut down corruption — has developed an online system to transfer land rights. The database is accessible to banks and significantly reduces the number of disputes. The government is now drawing on the private sector to expand the approach into urban areas.
Rwanda’s government initiated a nationwide program to register all of the country’s land, at a rate of some 500,000 parcels a month, which helped empower women and boost investment. Similarly, Ethiopia, which already conducted one of the world’s largest rural land-certification programs, is working to make the results sustainable and expand into urban areas.
In pilots that could have a far-reaching impact on urban development, a few cities in China are piloting approaches to taxing urban land and urban expansion. That method, which is initiated by local governments, causes fewer conflicts. It will likely be more sustainable than traditional ones.
At stake is the global effort to fight rural poverty. Already, rising prices of food staples, such as corn and cereal, have taken a toll on the world’s poor population. About 44 million people were forced into poverty during the food crisis from June to December last year, according to World Bank estimates. A 10 percent increase in food prices could drive an additional 10 million people into poverty.
“Preventing similar crises in the future will require work on several fronts,” says World Bank Senior Vice President and Chief Economist Justin Lin. “The private sector will have to play an important role in fostering agricultural development in the future and overcome decades of underinvestment in the sector.”
Insecure land tenure affects both small farmers and large investors, according to the Bank’s research, especially the ground-breaking report, Rising Global Interest in Farmland. “Failure to recognize land rights greatly increase investment risks and makes it more difficult for investors to generate local benefits,” Lin says. “Weak land systems make it difficult to liquidate non-performing enterprises or to tax land, creating a danger that large amounts of land will be locked up unproductively for speculative purpose.”
The right land policy, however, can help countries attract the right investors and put agriculture development on the right track. For that purpose, it’s important to support agriculture and, in particular, monitor land governance at country level in a structured and systematic way, Deininger says.