Facilitating land access and agricultural investment: the role of international institutions

Excellencies,
Ministers,
Colleagues,
Ladies and gentlemen,

Introduction
First, I should like to thank the World Bank for inviting me to speak at today’s opening session of this Annual Conference on land policy and administration.

Land is fundamental to the lives of poor rural people. It is a source of food, shelter, income and social identity. Secure access to land reduces vulnerability to hunger and poverty.

Land tenure systems have a major impact on the success of development projects.

That is why access to land and productive resources is a key strategic objective for IFAD.

Growing pressure on land
But competition for land has never been greater.

A growing world population, climate change, declining soil fertility and the ever-present need for global food and fuel security are placing increasing pressure on our planet’s natural resources.

This is particularly the case for land.

 Today, public and private corporations, investment banks and hedge funds are buying millions of hectares of land in Africa, Asia and Latin America to produce food or biofuels. Even the value of less-fertile land – unsuitable for food crops – is rising, as countries and businesses recognise the potential to grow biofuel crops on marginal land.

Poor rural communities in developing countries, not least indigenous peoples are the hardest hit by this growing pressure on our land resources.

Land and poor rural people
There are some 1.4 billion extremely poor people in the world today, struggling to survive on less than US$1.25 a day. Seventy-five per cent of these men, women and children live in the rural areas of developing countries.

Land is fundamental to their lives. Even communal or marginal lands provide a vital base for the livelihoods of poor people, especially women, who may use it for crop farming, herding or collecting fuel wood or medicines.

Secure access to land is also critical to improving wider food security. For smallholders to help improve food security on a global scale, they need secure access to land.

There are some 500 million smallholder farms worldwide supporting around 2 billion people. In many developing countries, smallholder farmers produce most of the food consumed.

Smallholder farmers are often extremely efficient producers per hectare and can contribute to a country’s economic growth and food security. For example, Viet Nam has gone from being a food-deficit country to being the second largest rice exporter in the world. It achieved this largely through developing its smallholder farming sector. In 2007 the poverty rate fell below 15 per cent from 58 per cent in 1979, demonstrating the fact that GDP growth generated by agriculture is at least twice as effective in reducing poverty as growth in other sectors.

Secure access to land is important not only for agricultural production. Tenure security also allows poor people to diversify their livelihoods by using their land as collateral – renting it out or realizing its value through sale.

It is also vital for political stability. Lack of secure land tenure has contributed to social instability and conflict in many parts of the world.

Yet many of the world’s extremely poor people in developing countries have weak or unprotected tenure rights.  

Women are particularly vulnerable. Their land rights are often obtained through relationships with men. So if the male link is severed for whatever reason, women can lose those rights.

What should be done?
So what should be done?

At IFAD we believe that secure land rights and equitable access to land – especially for smallholders – are essential for economic growth and poverty reduction.

But securing land rights is a complicated business. Land tenure systems are diverse and complex. They can be formal or informal, statutory or customary, permanent or temporary. Some are legally recognized, others not. Some involve private ownership, while others are based on common property.

There is no single land issue. And there is no single solution.

Over the past three decades, IFAD has integrated support for land tenure security into the full range of our rural poverty reduction programmes. Through IFAD-funded programmes and projects, we support land policy formulation, redistribution programmes, securing of collective and individual customary rights, strengthening of links between land tenure security and sustainable land management, and improving and securing women’s access to land.

Our partners in this endeavour include governments, civil society organizations, development institutions and other UN agencies – in particular the FAO. And – of course – we are also a founding member of the International Land Coalition and host its secretariat.

A common thread to our support is the recognition that it’s often better to develop local, customary-based administrative systems rather than establish new, formal systems of land ownership. This is particularly true of communal and common-property lands.

And we also recognize the importance of securing indigenous peoples’ rights to their lands – without which their cultural survival is at risk.

The case for investment
Sustained agricultural investment is essential to support land tenure security.

Farming is primarily a private or family business. So the first investors in agriculture must be the farmers themselves. Smallholders must invest in their land. They must invest in their irrigation facilities, their livestock and their farm equipment. Only that way will they be able to boost their productivity, enhance their resilience to effects of climate change and, ultimately, increase their incomes and wellbeing.

Governments and multilateral institutions, such as IFAD and the World Bank, also have a role to play. We can enable smallholders to invest more by improving their access to rural financial services, appropriate technology and remunerable markets.

And agricultural production in developing countries is attracting other potential investors – both domestic and foreign. Of course, establishing win-win partnerships between these investors and local smallholder farmers presents a challenge. But it can also provide important opportunities. For example, one form of investment that we, at IFAD, have found to be particularly beneficial is community-investor partnerships.

Such partnerships can be long-term land lease agreements by an outside investor.

Or they can be purchase agreements, whereby an entity agrees to buy a certain amount of the farmer’s harvest, which may entitle them to tax breaks.

Or the partnerships can involve contract farming, whereby an outside investor agrees to buy the harvest from farmers at pre-arranged quantities and prices, in return for which they may provide credit, inputs and technical advice.

Or they can be joint equity ventures, where an outside investor and the farmers have joint share-holdings in a company.

In other words, such partnerships often don’t require large-scale transfer of land rights. What is important is that they should be long-term. That they should balance profit with social responsibility. And they should be supported by governments, civil society organizations and the private sector, to ensure they are mutually beneficial.

India – the West Garo Tea Factory
One good example of a successful public-private-community partnership is the West Garo Hills Tea Factory in India.

The IFAD-supported North Eastern Region Community Resource Management Project for Upland Areas helped the Tea Farmers Federation of West Garo Hills of Meghalaya to start a tea factory. The establishment of the factory received support from the Government’s District Rural Development Agency, which provided the majority of funds for the tea-processing machinery. 

Further support – in the form of machinery, factory design, and training – was provided by TNI Ltd, a private sector company.

And the local communities of West Garo Hills contributed 2.5 hectares of land, as well as bricks and labour.

Half of the green leaf is being bought by the Assam Supreme Tea Estate Private Limited Company, for processing in their own factory. The other half is being processed in the tea factory itself. 

Bolivia – Sustainable Development Project by Beni Indigenous People
IFAD has also assisted initiatives aimed at facilitating indigenous peoples’ access to land and forests. For example, in Bolivia, IFAD supported the self-development of indigenous peoples in Beni to benefit from land reform.

The project collaborated with indigenous organizations at the local and regional levels and facilitated legal recognition of indigenous communities. Working with the Agrarian Reform Institute and indigenous brigades, we were able to take forward the land titling process, including identification and demarcation of land and negotiation with current occupants of that land. As a consequence, the project benefited 157 indigenous communities representing more than 7,000 women and more than 8,000 men. And about 1 million hectares of indigenous peoples’ land were rehabilitated in the process.

Rwanda - Kirehe Community-Based Watershed Management Project
And finally, IFAD recognises that women are often severely disadvantaged when it comes to land titles. That is why, as part of the Kirehe Community-Based Watershed Management Project in Rwanda, we have provided support for the registration of about 100,000 smallholder land holdings in the names of both spouses. The Project is also supporting equitable access by poorer and vulnerable members of the community to government-managed productive wetland areas.

Land policy guidelines
This is all well and good. But cooperation and partnership need to be supported by the right policies.

That is why, in 2008, IFAD’s Executive Board endorsed a new policy on access to land and tenure security. In collaboration with the FAO, World Bank, UN Habitat and others we have also supported the African Union Commission, the UN Economic Commission for Africa and the African Development Bank, in the drafting of pan-African land policy guidelines, which were endorsed by the Summit of the African Union Heads of State and Government last year.

And we are also collaborating with FAO and others to formulate global voluntary guidelines for good land governance.

Conclusion
In conclusion, it is clear that with sustained investment and with the protection provided by the right policy guidelines – much can be achieved to ensure poor rural people have access to, and can profit from, the land. And wider food security can therefore also be realized.

International institutions have an important role to play. And we – at IFAD – take ours very seriously. But, as the India, Bolivia and Rwanda examples demonstrate, there are important roles also to be played by governments, the private sector, civil society and local organizations.

Partnership is key. Let’s remember that as we rise to the challenge of protecting, sharing and profiting from our land resources.

Thank you.

26 April 2010, Washington D.C., United States of America