Land Policies for Resilient and Equitable Growth in Africa

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Policy Recommendations

The Land Policies for Resilient and Equitable Growth in Africa report highlights examples of policy reforms from Africa and beyond that can lay the foundations for Africa to better utilize its economic, human, and ecological potential. Five elements are particularly important:

To reduce urban informality and improve the functioning of land and mortgage markets, there is need for legal, regulatory, and institutional changes that (i) improve the quality and reduce the cost of land service delivery through adoption of fully digital workflows and integration of spatial and textual data, (ii) reduce or eliminate transfer taxes that drive transactions into informality, (iii) ensure full digital interoperability of the land registry with other key registries, (iv) put in place low-cost mechanisms for registration and enforcement of mortgages, and (v) revise planning regulations to be in line with ground realities and contribute to public goods.

Recurrent taxation of urban property (and large commercial farms) can improve ownrevenue, reduce speculation, strengthen the social contract, and reduce the tax burden on labor, capital, or consumption. In settings with high informality, it can also open a path to documented ownership. Implementing a tax fairly requires (i) a complete digital tax roll based on satellite imagery, (ii) use of computerized mass valuation of properties based on market prices with public availability of parcel-level valuations, (iv) effective enforcement of payment (for example, by not registering any subsequent transaction without a tax clearance certificate) and minimal exemptions. Future property tax revenue, complemented by levies or capital gains taxes to capture land value increases, can then be used to issue bonds to finance investment in public infrastructure such as roads or sewers.

Making existing legislation for recognition, demarcation, and registration of digital use rights to rural land operational can help improve rural resilience, factor market functioning, land-use efficiency, and welfare. This requires putting in place regulation for use rights management without mandatory conversion to title, clarifying (i) responsibility for documenting issuance and maintenance and digital interoperability with other registries, including farmer registries used to allocate agricultural support, (ii) mechanisms to transfer land internally or to outsiders, (iii) links and interactions with local government including responsibility for land-use planning and entitlement to a property taxes, (iv) ways to protect women’s rights; and (v) accessible avenues for conflict resolution.

To preserve public land and ensure it continues to provide services to future generations, there is a need to (i) demarcate, document, and register all public land and clarify ownership and management responsibilities, including the assignment of use rights; (ii) eliminate conflicts of interest that arise if the same institution owns, regulates, and disposes of public land; (iii) put in place transparent and competitive mechanisms (such as electronic auctions) to transfer rights to public land; (iv) ensure that contracts are public to facilitate third-party monitoring; and (v) regulate land-use planning and put in place oversight mechanisms to enforce proper land use (for example, based on remote sensing).

While the above looks like a daunting agenda, its implementation is made easier by capitalizing on digital interoperability, connectivity, and remotely sensed imagery. Interoperability and connectivity allow to (i) reduce the cost and increase the transparency of land rights documentation and registration via fully digital records and workflows that ensure officials’ accountability via e-signature, (ii) enhance the quality and currency of associated records via real time links to other digital registries (for example, personal IDs, firms, mortgages etc.), (iii) improve protection of third parties’ rights, including those by spouses, by gathering consent electronically; (iv) improving competitiveness of output or factor markets (including those for insurance) by reducing friction in acquiring information or transferring resources. Establishing real time links to remote sensing further allows to (i) enforce land-use restrictions quickly before implicit rights are created and (ii) contract on outcomes in terms of land use or conservation, including through new mechanisms such as parametric insurance or climate finance.

Main Messages

Land is one of Africa’s main resources. Enabling private owners, men, women, or groups, to invest in and use it effectively for productive purposes, human settlement, or environmental conservation and allowing it to be leveraged as collateral to develop domestic capital markets will be a key lever of economic and social development. Ensuring that public land is managed transparently for long-term benefit and that public infrastructure is planned well in advance to guide private development and providing local governments with the means to benefit from land appreciation caused by such development through property taxes are equally important.

 

Yet, data from a wide range of sources show that many African countries fail to capitalize on these opportunities. Accessing land institutions is difficult and costly, undermining trust in their reliability and impartiality. Lack of documented rights, even if only for land use, impedes structural transformation by making land rental and insurance difficult, impedes women’s ability to enforce their rights, and leads to a proliferation of conflict. Tax rolls are incomplete and collection minimal. Expansion of cultivated area is often on public land, associated with a loss of biodiversity, elevated risk of crop failure, and in ways that benefit influential individuals rather than the public at large.

 

The good news is that it is possible to address these issues by adjusting regulations and improving the performance of land institutions.

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