Lets talk development blog by Klaus Deininger

Land and property lie at the center of many of today’s pressing development challenges. Consider that at most 10% of land in rural Africa is reliably registered. At this week‘s annual Land and Poverty Conference here at the World Bank, we will hear how this vast gap in documentation of land gap blunts access to opportunities and key services for millions of the world’s poorest people, contributes to gender inequality, and undermines environmental sustainability.

More encouragingly, there also will be many cases on display of how countries, cities, or communities have addressed this challenge in innovative ways. New data sources and technology options greatly enhance the scope for improving land tenure and linking it to land use. They imply that it is now often policy and regulatory constraints that prevent recognition of poor people’s land rights. Removing these constraints and careful piloting of systematic low-cost approaches can allow to quickly expand coverage with legally recognized documentation– with potentially far-reaching benefits for development

The benefits to securing and clearly defining rights to land are broad, especially for women and other disadvantaged groups. First, security of rights provides incentives for people to invest in improving the quality and productivity of their land and to discourage environmentally unsustainable practices (e.g. soil mining). In Malawi, 22 percent of small farmers are afraid their land will be taken away from them, a perception that lowers productivity especially for women, costing the national economy millions of dollars in lost output.

Land is usually a family’s main asset and its ownership determines equality of opportunity, including women’s bargaining power, the ability of parents to invest in their children’s physical and economic wellbeing, and to withstand sudden illness, financial crises, and other adverse shocks. In many settings, a woman’s ability to independently own, transfer, or inherit land is greatly limited, cutting her off economic opportunities, and subjecting her to inheritance-related land disputes.

In India, legal reforms to put women’s inheritance land rights on an equal footing with those of men, increased ownership of assets, autonomy (e.g. having a bank account of their own), and resulted in higher spending on education (and less on alcohol or tobacco) with virtuous knock-on effects on girls’ attendance and performance in school, and getting married later in life.

Finally, clearly documented land rights make market transactions, especially in leasing land, much easier.   Land rental is particularly important again for women, youth and to consolidate operational holdings. A national program to certify community land rights in Mexico provided a basis for long-term rental, increasing agricultural productivity and improving household incomes. In Rwanda, regularizing land tenure increased activity in rural land rental markets, improving the efficient use of land and providing collateral for USD 3 billion in mortgage-backed loans.

Broader challenges from unclear land rights
Documented land rights contribute to public goods and efficient land use. In many developing countries, peri-urban land prices have skyrocketed over the last decades. Weak or non-existent tax maps make it difficult to ensure that, via property taxes, part of these gains would accrue to (local) government to provide services and infrastructure instead of contributing to speculation and unplanned urban sprawl.

Satellite imagery that is available freely and in near-real time can vastly improve monitoring of land use and taking action against violations. Although not free, higher resolution imagery, together with data on transactions, allows generation of rather precise low-cost tax maps at city level can generate millions of dollars (e.g. quadrupling local revenue in Kigali). Building local capacity to use drones can further enhance these options, provided the regulatory framework is appropriate.

Unless public land is available, land for infrastructure and public spaces will need to be acquired by the state. Failure to plan infrastructure ahead, weak records, and outdated valuations make expropriation a conflictive and expensive process. Threats of expropriation threats without proper compensation may imply that peri-urban land is not used to the extent possible for high value agriculture. If low quality or limited coverage of land administration systems makes it impossible to use existing records as evidence of rights, private investors will want to acquire land via expropriation to ensure any unregistered claims are extinguished, as for example in India.

Land providing amenities such as wetlands, forests, parks, road reserves, or schools should be held by the state. Failure to identify and publicize boundaries of public land, monitor encroachment, quickly act on it, and dispose of public land in ways that are transparent can foster corruption and create enormous losses for the public, and affect climate mitigation.

Improving and monitoring performance

Institutional arrangements in many developing countries fail to harness the sector’s potential as a catalyst for transparency and change in the dynamics of gender relations, decentralization, and urbanization. This is typically due to gaps between often very progressive legal provisions and their actual implementation.

Recent improvements in access and reduction of service costs to data processing capacity, connectivity, and remote sensing have potential to close this gap. First, by reducing the cost of efforts to secure land rights by an order of magnitude. An intervention in Rwanda’s use of para-surveyors and high resolution imagery brought down the costs to about US$ 5 per parcel and resulted in a positive impact on land access of legally married women and investment in soil conservation.

Second, benefits from land registries can enhance synergies synchronizing land information with other data sources (banks, courts, taxation). This in turn will improve efficiency of government services and may enhance access to finance.

Finally, technology can improve accountability and transparency by objectively monitoring progress with countries’ land policies, strategies, and programs. At a global level, the ‘Land Administration Quality Index’ (LAQI), part of the World Bank’s Doing Business (DB) indicators since 2015, illustrates this. Data for 189 countries show large implementation gaps (see table). Laws are well developed everywhere – 90 percent of countries require registration of transfers, 96 percent check documents, and 78 percent have a state guarantee. But limited record coverage renders this ineffective: all the country’s (main city’s) private plots are registered in 22 percent (42%) of countries overall; 3 percent (16%) in Latin America, 4 percent (15%) in Sub-Saharan Africa (SSA), compared to 68 percent (90%) in the OECD.

Quality of the infrastructure to record textual and spatial elements of land rights varies widely: 39 percent of countries (75 % for South Asia to 4 % in Eastern Europe & Central Asia) rely on paper records only. Paper maps which make land use planning difficult are still almost exclusively relied on in rapidly urbanizing regions such as South Asia (88 %) or SSA (81%).

The ability of African countries such as Rwanda to achieve scores well above the OECD average highlights the scope for leapfrogging while reforms initiated by many countries to improve their ranking illustrate the usefulness of performance monitoring using a comparable set of data.

Schemes that link administrative data across different domains, e.g. property and personal identification, can improve transparency and enhance the value of land records. Regular reporting of data, e.g. on prices, and frequency of transactions is essential for banks and private sector decision-making, e.g. on areas with good land governance where investment will face less risk. Analysis of such data by local think tanks can enhance transparency, comparison across sub-national units, and provide the basis for an informed dialogue with all stakeholders on how to improve land governance in a way that is suited to each country’s specific conditions and history

This post is the first in a series of blogs we will post throughout the week to highlight the main themes, presentations and discussions at the World Bank’s 2017 Land and Poverty conference.
Visit: http://www.worldbank.org/en/events/2016/08/22/land-and-poverty-conference-2017-responsible-land-governance-towards-an-evidence-based-approach