Large-scale Acquisition of Land Rights for Agricultural or Natural Resource-based Use

CHALLENGE

Large-scale land acquisition and investments in agriculture attracted considerable interest in the wake of the 2007-08 commodity boom and the subsequent financial crisis. Some countries were concerned about their inability to provide food security from domestic resources. Other investors sought land as a hedge against inflation or for speculative gain. Agro-industrial investors had an incentive to increase the scale of their operations.

This global 'land rush' is unlikely to slow given volatile global commodity prices, demand for biofuels, rising incomes, urbanization and population increases. However, opinions about the social and environmental implications of this phenomenon are divided in the absence of solid empirical data. Some have saluted the rediscovery of agriculture by different investors as an opportunity for yield increases and rural development. Others focused on highly publicized cases where land acquisition by outsiders for speculative purposes at very low prices were detrimental to local welfare, trampled basic rights and resulted in irreversible environmental damage including water pollution and deforestation. 

MAIN FINDINGS

What emerged is a mixed picture.

• The projected increase in the demand for agricultural commodities over the next decade could be met by increasing productivity without expanding into forested areas. In particular, crop yields in the Sub-Saharan African countries which are of most interest to investors seldom exceed 30 percent of potential yields on currently cultivated areas.
• Some countries work with smallholders and use competitive bidding to foster investment deals that benefit locals. But many countries are ill-equipped to deal with large-scale land acquisition. For example, in many countries, lack of information and transparency make it difficult to exercise due diligence and responsibly manage a valuable asset. This information gap makes it easy to neglect local people’s rights and environmental impacts, opens the door to bad governance and corruption and jeopardizes investors’ tenure security. Furthermore, land transfers appeared mainly ad hoc based on investor demands rather than country development strategies.
• There is a large discrepancy between investments deals reported in the media and those actually finalized, and between deals signed and actual land area under cultivation. While some countries have transferred large areas to investors, the extent to which such land is actually used productively remains limited. For example, in South East Asia, in response to policies that aimed to foster development of the palm oil industry by giving away land (and the trees on it) for free, large areas with high biodiversity value have been deforested without ever having been planted to oil palm. In Mozambique, 2004-2009, 2.7 million has of land were acquired by investors, but a 2009 land audit found that some 50 percent of this land was unused or not fully used. Many projects in the biofuel sector experienced problems or were cancelled due to lower oil prices. Beyond economic and technical challenges, tensions with local communities have often stymied implementation.
• Case studies based on field visits show that investments can bring significant benefits under certain conditions but that the benefits are often outweighed by negative impacts borne disproportionately by vulnerable groups. Even projects that are not fully implemented can seriously undermine local livelihoods. Project proposals that were not implemented have often affected patterns of resource access and shifted the local balance of power. Expressions or expectations of outside interest in agricultural land can set in motion “land grabbing” by local elites that can have undesirable social impacts or deprive vulnerable people of their livelihoods.

 RESULTS

• Building upon this study’s initial results and consultations with governments and private sector investors, the Bank drafted seven principles for ensuring responsible agro-investments: Respecting land and resource rights; Ensuring food security; Ensuring transparency, good governance, and a proper enabling environment; Consultation and participation; Responsible agro-investing, Social sustainability; Environmental sustainability.
• A number of developing countries have approached the World Bank for technical assistance to improve the capacity of their legal and institutional environments to screen, monitor and enforce responsible agro-investments.

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Author : The report was prepared by a team led by Klaus Deininger, World Bank. Support was provided by PROFOR , the Swiss Agency for Cooperation and Development (SDC), the Trust Fund for Environmentally and Socially Sustainable Development (TF-ESSD), the Hewlett Foundation, the Bank Netherlands Partnership Program (BNPP) and the French Ministry of Foreign and European Affairs.
Last Updated : 06-16-2024

Impacts of China’s Forest Tenure Reform: Implications for Policy Makers

CHALLENGE 
In an effort to combine economic and ecological benefits, China’s forest tenure reforms aimed to provide farmers with stronger incentives to manage and protect forest lands, invest in them, and allow their transfer to better uses. To do so, they aimed to establish individual management on some 100 million hectares of forest which provides a livelihood for more than 400 million individuals. Given their size and far-reaching nature, these reforms have often been described as China’s ‘third revolution’ after collectivization and adoption of the household responsibility system. Indeed, a number of countries have shown great interest in emulating China’s experience, arguably one of the largest reforms in this respect globally.

A careful evaluation of the decade-old reforms could hold valuable lessons for China’s efforts to fine-tune its legal and regulatory environment to maximize potential gains from these reforms, and to guide other countries that want to improve the way in which state forests are managed.

APPROACH
PROFOR is supporting the analysis of information collected in two large-scale surveys conducted in 2006-2007 and 2011. It is expected to provide up-to-date and policy relevant analysis of key aspects of China’s forest tenure reform, in particular (i) the impact of reforms on households’ livelihood strategies and investments ; (ii) the extent to which reforms allowed emergence of transparent and well-functioning markets for forest land to attain efficiently sized operations rather than excessive fragmentation or concentration; (iii) the nature and impact of collective action at the village level to effectively manage forests and provide local public goods; and (iv) determinants of households’ labor allocation and the extent to which local labor and credit markets function and allow households in forest-dependent villages to make the best use of their endowments.

RESULTS
This activity is ongoing. Results from the analysis will be available on this website and disseminated via working papers, workshop and conference presentations, and a seminar with policy makers in Beijing.  You can follow us on twitter or join our mailing list for regular updates.

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Author : World Bank’s Research Department (Agricuture & Rural Development), under the auspices of the Department of Rural Forest Reform at the State Forestry Administration in China. 
Last Updated : 06-15-2024

Examining Land Management Policies in the Brazilian Amazon

CHALLENGE

There is enough land in the Amazon region to satisfy Brazilian society's demands for economic development, environmental management of a resource base of global importance and the challenges of agrarian reform. Yet Brazil has been unable to create a fully coherent and manageable land policy and administration system for the region which permits sustainable development goals to be achieved while reconciling special interests and uses. Instead, resource waste, private appropriation of the public domain and social conflict have characterized land relations in the region.

As the region becomes increasingly accessible for a variety of economic activities, and more central to Brazil's economy, the resolution of the land questions looms large as a foundational element for reconciling and ordering economic development, resource management and social priorities. A better understanding of the dynamics of land grabbing and land speculation as well as of the impact of current policies and of the institutions mandated to implement them could help to influence and design new policies to better manage the race for property rights in the Amazon.

APPROACH

Along with other donors, PROFOR helped finance a study focusing on land management policies in the Brazilian Amazon. The study was conducted by Malcolm Childress, Senior Land Administration Specialist at the World Bank.

FINDINGS

The study revealed that large-scale users, agrarian reformists, conservation interests, and others are racing to claim property rights in the Amazon. With illegal occupation, fraudulent and inconsistent land records, and flawed land laws, the resulting land administration is chaotic. Some actions have begun to bring more order to land administration. An effort to re-inspect and document land records, called recadastre, has uncovered illegal occupation, but is incomplete. Creation of new protected areas has slowed illegal occupation, however these areas still face threats of encroachment. And other factors contribute to the problem: the federal budget process gives land administration low priority and inconsistent support, with predictable results.

The study suggested the creation of a new social and political pact to reform land administration. The reformed system of administration would seek to reclaim illegally occupied lands, rationally identify and allocate lands suitable for agrarian reform, recognize and regularize rights of good-faith occupiers, and expand and consolidate protected areas. The pact would lead to local agreements among a broad range of interest groups and officials, backed by federal enforcement. The goal would be a fair, transparent, and workable allocation, recorded in a multipurpose land information system.

RESULTS

Some of the study's recommendations were reflected in a land regularization program which has brought more order in the Amazon.

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Author : Malcolm Childress, Senior Land Administration Specialist at the World Bank
Last Updated : 06-15-2024

Developing Forest Policy Analytical Capacity in China

Building basic models of forest supply

CHALLENGE

China's forestry sector is in the process of transformation. A pattern of forest depletion has been reversed in China and replaced by the world's largest afforestation process. Centralized command and control of the sector is yielding to various forms of private, localized and frequently highly autonomous management arrangements. China is increasingly integrated into the world wood economy, becoming in a period of less than 10 years one of the world's largest importers of wood and wood products and an increasingly important exporter (and re-exporter) of wood products including pulp, paper and furniture.

Managing forest policy for this increasingly complex, sophisticated and market-driven sector is placing new challenges on Government authorities, which are increasingly hard pressed to ensure that reforms continue and succeed in environmental, economic and social terms. In particular, capacity to conduct modern economic analysis of possible policy reforms and initiatives with China, and within the State Forestry Administration (SFA) is seriously limited. The sector has been judged to be seriously lagging behind other sectors in such critical economic reform areas as taxation, regulation, land tenure and enterprise reform. As a result, there is a risk that future reforms will not be based on well-reasoned analysis. The Forest Economics Development Research Center (FEDRC) recognizes that it is stretched beyond its ability to provide the SFA and others quality economic analysis and has identified supply analysis as an area of particular capacity building need.

APPROACH

Building on the skills and interests of FEDRC, PROFOR helped provide well-justified advice and perspective on the impacts of alternative policy reforms and initiatives on the supply of forest goods and services, and helped institutionalize a stronger, collaborative and modern policy analysis capacity within the sector and the SFA.

This knowledge activity explored timber and forest supply from major components of the Chinese forestry sector (e.g. geographic regions and management arrangements, such as small farmer, communes and state forest farms) in relation to alternative policy and institutional options. Particularly important policy questions included timber and enterprise taxation, land tenure and regulatory and transport policies. A series of reports, studies and workshops for national and international audiences resulted, with recommendations for Chinese forest policy reforms related to topics such as timber taxation, licensing and regulation and land tenure.

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Author : Forest Economics Development Research Center (FEDRC), China
Last Updated : 06-15-2024

Benefit Sharing and Customary Land Rights in Forest Areas for Indonesian Indigenous Peoples

CHALLENGE
In Indonesia, the question of forest and land ownership is legally complex.  Indonesia’s post-independence land legislation, based on colonial practices, has continued to assign rights and allocate forest and land resources in ways that exclude or marginalize local people, especially historically disadvantaged groups such as indigenous peoples and isolated communities.  Approximately 70% of Indonesia's land is classified as forest zone and thus claimed by the state. Although only about 11% of this total land area has been legally verified and gazetted as state forest land, in practice, it remains under state control, despite contested and competing claims from communities, indigenous peoples, forest concession holders, and even local governments.  Insecure land tenure has long been known as a factor that impedes proper natural resource management.  Conflicts over land, for example, have contributed to the incidence of fire, and are recognized as a barrier to Indonesia’s ability to attract investment for continued growth.

In addition, natural resources, such as land and water, are not only the sources of livelihoods for many indigenous peoples but also a source of their identity.  The indigenous peoples' close relationships with their surrounding ecosystem have resulted in complex traditional tenurial arrangements and management regimes that are often at odds with the formal legal structures of the Indonesian state. This situation of competing claims to rights and ownership over forest lands complicates discussions on how benefits will accrue from climate change responses such as REDD+.   

These issues go well beyond REDD+ and forest carbon/climate mitigation issues, but the institutional engagements and dialogue processes around REDD+ have recently created an opportunity for more concrete and open discussions with some real potential for progressive action.  A consortium of NGOs, led by Epistema Institute, as well as institutional partners and think tanks, has developed a Tenure Road Map for addressing land conflicts and improving land tenure. The Ministry of Forestry has now formed a working team for preparing a forestry macro tenurial plan including some of these organizations, together with the World Agroforestry Centre and some of the opinion leaders in this field.  At the same time, the indigenous peoples’ organization, AMAN, has developed a concept for a registry of ancestral domains (Badan Registrasi Wilayah Adat, BRWA). Parliament is also considering a draft law on indigenous rights as well as other legislation and regulations that would need to be assessed as part of the reform process.  

The ultimate resolution of these issues will be a process, not a declaration or a ruling.  After addressing basic legal issues, the unfolding process will continue to encounter difficult and costly implementation issues, such as the need for national scale mediation and adjudication processes, institutions, and legal aid organizations; the need to build capacity in the legal system to understand, address and defend new bundles of rights resting with previously marginalized stakeholders; and the need to build the capacity of the local communities themselves (and their civil society advocates, advisors and service providers) to articulate and defend their rights and claims. 

APPROACH
Access to potential REDD+ resources in the future is making it worthwhile for stakeholders to address and begin to resolve these thorny issues.  There is now an opportunity for a focused investment in continued dialogue and analysis that can contribute to consensus around some legal issues, practical tools, and ways forward. The activity drew on the existing work that civil society and indigenous organizations were developing (land tenure road map) in coordination with the Ministry of Forestry (MoFor) and the National REDD task force and combined this with analysis of successful experiences related to customary land rights recognition happening in Indonesia.

RESULTS

This activity developed knowledge products and supported consultative dialogue processes related to the inclusion of marginalized and indigenous communities in emerging forest, REDD+ and land tenure dialogue processes. Activities were closely coordinated with the Aliansi Masyarakat Adat Nusantara (AMAN), the National Forest Council, the civil society organizations (CSOs) working group on land tenure, MoFor, and other think tank institutions and stakeholders.

The analytical products, which were prepared through consultations, highlight the main issues and opportunities related to customary land rights recognition and benefit-sharing mechanisms in Indonesia. Findings present the case that the recognition of customary tenure rights has contributed to indigenous communities playing an increasingly important role in forest and biodiversity preservation, which enables the regulated use of forest resources and respect for customary and traditional practices and laws. Consequently, these communities have become major players and partners in the overall sustainable management of resources and nation building. Overall, the data suggests that forging the middle ground in administering indigenous land requires a mix of policy, regulation and support for grassroots change through community-based efforts. These changes should empower the weak and marginalized, enhance the quality of lives of millions of unsecured indigenous landholders through reforms, and increase public confidence in the land administration system.

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Last Updated : 06-15-2024

Balancing Mining Development and Forest Conservation in the Congo Basin

CHALLENGE

Deforestation in the Congo Basin is expected to increase significantly in the future as investment in productive sectors grows. Thus, it will be essential to assist Congo Basin countries in ensuring that forestland development is planned and implemented in such a way as to avoid, minimize and/or offset unnecessary economic losses and social hardship and to draw optimal benefits from sustainable forest resource use. In 2013, the World Bank published a study on “Deforestation Trends in the Congo Basin – Reconciling Economic Growth and Forest Protection,” with support from PROFOR. One of the sectors covered by the study was the mining sector.

Early planning for the development of mineral resources, including the associated infrastructure (roads, railroads and energy, in particular) may help to reduce future impact, create development benefits at the local level, and enhance the sustainability of mining-driven development. However, land-use planning and zoning exercises in the Congo Basin so far have been centered on the forestry sector and have had limited impact on development policies in other sectors.

APPROACH

The development objective of this activity is to come up with innovative cross-sectoral methodologies and stakeholder processes that inform the decision-making process on large mining and associated infrastructure developments, enabling decision makers to reduce forest loss and the resulting negative environmental and social impacts. Activities included:

1. Lessons learned from relevant initiatives; and
2. Participatory land-use planning. The team conducted a land-use planning and road map exercise, and developed sector-specific recommendations for the Republic of Congo (ROC).

RESULTS

This activity led to the development of an informed process – applicable at both the national and sub-national level -  for how the Government of ROC can move forward on land use planning. The activity stressed the significance of inclusive and participatory methods, as well a mechanism for settling disputes, and a process that works across sectors. The introduction of spatial analysis tools enabled government authorities to (i) develop a clearer understanding of how they can pull together information related to competing interests, such as economic development and social and environmental impacts; and (2) advance practices that can help harmonize development initiatives, even if it is not possible to resolve every conflict.

The ROC Ministry of Land Use Planning and Public Works led much of the exercise, which was also supported by the World Resources Institute. While there is still implementation work to be done, investments in the forest, agriculture and mining sectors have sought out how to incorporate the practices, tools and processes that were highlighted in this activity. There has also been greater coordination the different sectoral ministries. Results from this activity will also inform ongoing investments, including REDD+ activities under the Forest Investment Program (FIP), and were used in the preparation of the Congo Commercial Agriculture Development Project.

In addition, this activity helped to consolidate knowledge, best practices and tools on land use planning, and share them with multiple stakeholders in the Republic of Congo, including government ministries, NGOs, civil society organizations and indigenous peoples’ groups. Since participants from the Democratic Republic of Congo (DRC) are undergoing a similar process, they benefited from learning about the experience in ROC.  

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Author : World Bank Africa Region and World Bank Oil, Gas and Mining Policy Division (SEGOM).
Last Updated : 06-15-2024

Are Forest Tenure Rights Critical for Green Rural Development?

Although in the last 10 years, the forest area owned or controlled by indigenous peoples and communities has increased from 21% to 31%. However, in many cases the penetration and enforcement of reforms transferring forest rights to communities is still problematic. In Latin America, where forest ecosystems cover as much as 21% of the land (940 M ha), and include more than 50% of the world’s tropical forests, rates of land use change are also the highest. Even in those countries that are beginning to control deforestation (e.g., Brazil), forestlands continue to be significantly threatened by rapidly expanding agribusiness, oil and gas infrastructure, mining, illegal drug cultivation and logging. There is growing evidence that local communities managing forest ecosystems significantly contribute to the economy, conservation of biodiversity, low carbon emissions growth and other environmental services. Nelson and Chomitz (2011) found that multiple-use protected areas in Asia and Latin America limited fires more effectively than strictly protected areas, and indigenous territories were much more effective, with remoteness and environmental factors held constant. Viable tenure reforms that clarify and secure access of local communities to an array of forest rights will be vital in reducing deforestation and degradation of rural landscapes: in particular, the rights to access forest resources and exclude outsiders from their property, the authority to define or plan land use patterns and manage natural resources, and the duration and permanence of these rights over time are important elements of the land tenure systems of countries interested in designing and implementing green rural development policies and programs (e.g.  REDD+). Governments interested in combating forest ecosystem destruction and degradation will need to incorporate detailed legal analyses and include plans to address gaps and extend recognition of tenure rights and other reforms necessary to enable communities to manage and benefit from their lands, forests, and carbon.

APPROACH

This activity, based on a systematic comparative analysis of forest tenure regimes in six countries of Latin America, seeks to contribute to the discussion and analysis currently under way in many countries in Latin America regarding the key policy, legal, institutional and technical elements needed to strengthen, expand and enforce their forest tenure regimes. The six proposed countries (Argentina, Colombia, El Salvador, Honduras, Nicaragua and Peru) are currently designing or implementing REDD+ strategies with support from the Forest Carbon Partnership Facility (FCPF) or Forest Investment Program (FIP) funds, or work with the World Bank on land policy and administration issues.

RESULTS

Climate Focus International produced an Inception and Methodological Framework Report, which was the basis for initiating the forest tenure analysis at the desk level from five of the six participating countries (Honduras is still in preparation) that was completed in December 2013.

Land regularization and forestry experts from the Bank and other external partners — the Rights and Resources Initiative (RRI) and the Salvadoran Research Program on Development and Environment (PRISMA) — met in December 2013 and developed a set of detailed comments and recommendations, both general and country specific, on how to strengthen the expected project outputs, and to orient Climate Focus International on better ways to conduct the field phase of the project.

In-country field visits were carried out to interview key local technical experts, government agencies and primary stakeholders. The comparative analysis report was completed in July 2014, and the final draft of the strategic analytical report has been completed and is under revision by several bank teams. The final product will be published and disseminated before the end of FY15 Q4. 

Findings will continue to be shared on this page as they become available. Follow us on twitter or join our mailing list for regular updates.

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Author : Worldbank, Climate Focus International,
Last Updated : 06-15-2024