Securing Property and Resource Rights Through Tenure Reform

Addressing the need for greater tenure security so that the poor can tap ecosystems and invest in their good stewardship is a top priority. It requires reform of the formal tenure regimes that currently make it hard for the poor to exercise property rights over land and resources. Interest in tenure reform has grown significantly in recent years as acceptance of the central role of tenure security in poverty reduction has spread. When well thought-out and appropriately implemented, tenure reform can produce considerable benefits for the poor. The most important is an acknowledgement by the state that traditional tenure arrangements, including communal tenure, are legitimate and legally enforceable.
(See Box 4.1.)

Recognition of Traditional Rights

Untitled, customary tenure remains the predominant form of tenure in many rural areas of the developing world. The persistence of untitled occupancy—the situation of many poor families who live on land they do not hold formal title to—is a common challenge for tenure-reform efforts. Experience shows that recog-nizing and integrating such customary tenure into formal state tenure regimes is a key feature of successful reform. This may require greater flexibility about what is considered legitimate proof of “ownership” so that oral as well as written records of occupation or access to communal lands are accepted. (See Table 4.1.)

In Mozambique, Tanzania, and Uganda, new tenure laws simply recognize land held under customary tenure as fully legally tenured “as is.” This includes using certification processes based on verbal endorsements (Mozambique), as well as using community-administered land recording and titling processes (Tanzania). In Eritrea, customary tenure has been recognized in the form of lifetime-use agreements, although they cannot be passed down to family members (Alden Wily and Mbaya 2001:15-18).

Other countries are slowly bridging between communal tenure and more individualized land rights .(See Box 4.1.)The key is that new individualized rights must be compatible with customary practices, so that they do not create or perpetuate a parallel tenure system that can give rise to conflicting claims later on. Simple and unambiguous procedures for recording land sales and transfers can also help avoid tenure disputes as customary systems interface with modern land markets and land uses (Deininger 2003:52-54).

Traditional rights to resources also extend beyond land rights per se into water rights, the use of fisheries, and pastoral rights. These too can be made more secure through formal recognition and delineation by the state. For example, the government of Fiji formally recognizes “customary fishing rights areas” where villagers have traditionally fished and collected shellfish. These nearshore zones, known locally as qoliqolis, have been surveyed and accurately mapped, with the records maintained by the nation’s Native Fisheries Commission. Based on these designations, the state Fisheries Department has begun granting local communities the right to draw up their own management plans for qoliqolis with the aim of restoring these fisheries as a community asset.

It is important to recognize that increasing security of tenure for the poor does not always require gaining full title or private ownership of land or resources (Deininger 2003:39). In the case of common-property resources like state forests or fisheries, increased tenure security often takes the form of the legally sanctioned use of these resources, including the right to exclude others and manage the resource for optimum benefit. As in the Fiji example above, the key to increased security is that the physical extent of the land or resource, the exact limits of the use, the permissible forms of management, and the limits on the state’s ability to modify or terminate the arrangement are specified and agreed to in a legally binding agreement. This kind of unambiguous and enforceable use-right is often a central feature of successful community-based natural resource management projects meant to extend ecosystem access to the poor.

Reduced Transaction Costs and Other Benefits

High transaction costs—the costs of doing business, both in money and time—have traditionally been an important obstacle to the poor in acquiring or disposing of land. Effective legal and land information systems typically form the core of successful tenure reform, thereby lowering property transaction costs, whether these be sales or leases of resources and use rights. This can help the poor access and manage land and resources as more flexible assets.

Other benefits can come from successful tenure reform as well. One is a decentralization of the bureaucracy that administers tenure and resolves resource and land disputes. When the government machinery for administering tenure rights moves closer to the small rural landowner, it increases the landowner’s access to land registration and taxing authorities, as well as legal proceedings involving land disputes. Decentralization of tenure administration has been particularly dramatic in Tanzania and Uganda, with community-based mechanisms for resolving property rights-related disputes appearing in these countries, as well as Mozambique (Alden Wily and Mbaya 2001:14 -18, 46).

Improved security of tenure has also, in many instances, fueled the development of more dynamic land markets in poorer communities. In such cases, poorer households can benefit through greater access to productive land if they have sufficient access to capital. Evidence from Mexico, for example, indicates that policy reforms of the early 1990s that opened up both land and credit markets enhanced access to land among poorer households with adequate access to capital, but not poorer families in general (Carter 2003:52).

Higher Rural Incomes

Greater security of tenure, especially when coupled with access to credit, can help poor farmers in developing countries invest more in their land, thereby improving agricultural productivity and raising farm income. In Thailand, evaluation of a 20-year initiative begun in 1987 to provide the country’s rural populations with access to modern land registration and credit institutions revealed that midway through the effort, rural incomes, major investments, and use of formal credit is much higher among farmers with titled land than for those yet to be included in the program (Riddell 2000:10). In China, experimental land policy reforms granting clear ownership rights to village-based cooperatives for communal management of mountainous forest lands enabled villagers in Jiangsu and other provinces to create large, successful orchards (Bruce et al. 1995). In general, successful tenure reform creates both the perception of greater security and the reality of more enforceable rights—both important elements in the willingness and ability of the poor to invest their time and resources in expanding their environmental income. (See Figure 4.3.)

The Dangers of Ineffective Tenure Reform

Reforming something as central to wealth creation as a nation’s tenure system is by no means easy. Even though modern tenure-reform efforts rarely attempt major land redistribution, they are still politically perilous, with vested interests often reluctant to change the status quo. Unfortunately, when changes to tenure systems are incomplete or poorly executed, the poor can end up worse off rather than better. Therefore, in designing tenure reforms, policymakers must be careful to avoid the following:

Failure to recognize important land uses and users. Poorly designed attempts to increase security of tenure for some can end up reducing the security of others. For example, land titling and registration projects may overlook rights to important land uses, such as the right to gather nontimber forest products or to obtain water. These uses are most often exercised by women and the poor. If these rights are not legally recognized as part of the land registration process, they may be effectively destroyed (FAO 2002a:20)

Land grabs by urban elites. In some instances, city-based government and business elites have made dramatic attempts at land grabbing through the process of shifting land out of customary tenure systems and into statutory tenure systems. This can take the form of governmentgranted concessions on indigenously held land over which the state claims ownership. Or it may simply be land purchases by the elite from those who hold land under customary tenure arrangements. Some countries, such as Cameroon, have initiated policies that appear to encourage land speculation, favoring privileged individuals with access to knowledge, influence, and money (Elbow et al. 1998:5).

Exclusion of women. Women make up the majority of the world’s agricultural producers, but they are usually the last to be included in land and tenure reform efforts. Traditionally, women in Africa and other parts of the developing world have only had access to land tenure through their husbands, fathers, or other male relatives. Registration of land in the name of male relatives precludes women from obtaining property rights at a time when women’s access to land for cultivation is becoming increasingly important for AIDS widows and other female heads of households (Carter 2003:49).

Inadequate procedures for documenting communal rights. The lack of appropriate procedures for expeditious, cost-effective documentation of untitled communal property rights can compromise the effectiveness of tenure reform. For instance, the government of Bolivia enacted legislation recognizing indigenous land rights in 1996; because of complicated and costly documentation procedures, however, by 1999 only 10 percent of eligible territories had received titles (White and Martin 2002:16).

Conditionality and other constraints to land markets. Many new tenure laws do nothing to remove constraints and limitations that have long hampered land markets in developing countries. For example, none of the recent spate of African tenure legislation removes long-standing requirements to occupy and use agricultural land in order to maintain tenure (Alden Wily and Mbaya 2001:14 ). Agricultural use may not always be the best use of ecosystems, either economically or ecologically. For example, conversion to wildlife habitat may be a better use of some lands with high tourist potential, or conversion to other commercial purposes. Flexibility in land use may increase the value of the land assets of the poor, while conditions on use reduce the economic potential of the land.

(See Box 4.1.)