East Asia: Land Programs, Regional Challenges, and Ways for Moving Forward

1. East Asia: Land Programs, Regional Challenges, and Ways for Moving Forward Li Guo November 19, 2007 Washington DC

2. Purposes of the presentation:To provide audience a) an overview of EAP’s land programs; b) regional challenges; and c) preliminary thoughts on ways for moving forward…..

3. Part A: EAP’s land programs… Focusing on: Types of assistances; issues addressed; detailed activities; results….

4. Types of assistances…a) Lending services: From 1984 to present, Bank has financed 12 lending projects on land administration in Thailand, Indonesia, Philippines, Laos, Cambodia (total around $450 million). Some projects are under preparation (Vietnam, Cambodia).b) Policy Advisory Activities: From 1995 to present, Bank has supported land policy dialogues in many countries, such as Indonesia, Philippines, Laos, Cambodia, Vietnam, and China. Helping client countries address land related policy and legal issues.

5. Types of assistance…There is a linkage between policy advisory activities and lending services, i.e., after policy advisory activities help stakeholders reach consensus about the land policy and legal reforms, implementation of the consensus, including detailed policy formulation and legal revision work, becomes a part of lending activities.

6. Issues are addressed in land programs…a) Outdated and fragmented policy and legal framework;b) Inappropriate institutional arrangements and inadequate services provision; andc) Weak land administration and management capacity.

7. Issues: some examples…a) Outdated and fragmented policy and legal framework:A complex array of incidental laws, ministerial and other decrees, and ad-hoc regulations (Indonesia);Weak legal position of landholders in land acquisition negotiations with the state institutions on behalf of commercial enterprises (Indonesia, Vietnam);An increasing number of land disputes (Indonesia, Cambodia);

8. Issues: some examples…b) Inappropriate institutional arrangements and inadequate services provision:Responsibilities for land administration was split among several government agencies, without appropriate mechanisms for coordination (Philippines, Laos); Multiple and inconsistent land valuation systems; the absence of national land valuation standards, among other things, leads to long court battles over compensation (Philippines);High transaction risks, no efficient market, lack of rural finance deepening (collateral), social conflicts, distorted private investment (Indonesia, Cambodia).

9. Issues: some examples…c) Weak land administration and management capacity; Average Time Required to Transfer a Property in Selected East Asian Countries

10. Issues: some examples…c) Weak land administration and management capacity Weak local governments’ capacity to undertake their new mandates such as issuing location permit, land acquisition and compensation, land disputes settlement, land use planning, land reform etc. (Indonesia, as a result of decentralization)A national appraisal authority needs to be established to support an equitable property system and increase local government revenues from land-related taxes and fees. This is essential to support decentralization (Philippines).

11. Detailed activities…Development of land policy and regulatory framework; Institutional development, capacity building, and training;Implementation of an accelerated land titling program; Development of land information system; Capacity building support for local governments; and Property valuation…

12. Investment distributions…About 70%-80% project costs used for adjudication and registration activities;Other components accounted for the remaining 20%-30% project cost.

13. Results…. First, tenure security has been improved (e.g., 70% to 80% of respondents believed that they have greater tenure security, Indonesia);Second, land titles improved landholders’ access to credit from financial institutions (loan size is twice bigger than non-project area, Indonesia, Thailand) ;Third, land titles strengthen investment incentives of landholders (46% vs. 24%, Thailand).Fourth, land markets become more active and land prices were higher than those in non-project area.

14. Results…. High economic and financial rates of returns (ERR: 30%-40%; FRR: 20%-30%, quite consistent across different countries).Reduction of land conflicts… Strengthened landholders’ negotiation position in the process of land acquisition by government etc.

15. Part B: Challenges… (or lessons learned…) Challenge 1: Very diversified land tenure arrangements in the region…. Therefore, there is no one-size-fits-all solution.

16. Part B: Challenges… (or lessons learned…) Challenge 2: A strong and high level of government commitment to the land program is needed to address issues such as inconsistency of laws and regulations, land grabbing, corruption, civil conflicts…Challenges 3: Land policy should be viewed as an integral element of a broader policy dialogue rather as a string of narrowly land-oriented technical interventions…

17. Part B: Challenges… (or lessons learned…) Challenge 4: Land titling should also fit within broader strategies of urban and rural development. Otherwise, imperfections in other factor markets may undermine or even eliminate the advantages from possession of title. Challenge 5: Value of traditional land rights arrangements… In some areas, compared with freehold titles, traditional tenure arrangements may be more cost-effective in increasing tenure security and even provide a (limited) basis for land transaction.

18. Part B: Challenges… (or lessons learned…) Challenge 6: Active and adequate participations from stakeholders… Experience shows that active participation of all stakeholders during policy formulation, demarcation of boundaries, and systematic adjudication is critical to the success of the program.Challenge 7: Single land agency model should be promoted, i.e., mapping side of land and legal side of land (rights registration) should be unified.

19. Part B: Challenges… (or lessons learned…) Challenge 8: Involvement of private sectors in surveying and other technical tasks can substantially speed up the process of titling… but it is challenging to promoting private sectors’ participation… Challenge 9: State land management and state land registration…

20. Part C: Ways of Moving Forward…A. Tailor project design to country circumstances through in-depth examining related issues at the preparation stage, project restructuring, as well as enhancing SPN efforts during the project implementation;B. Build effective approaches for improving governance through supply and demand side approaches for improved service delivery and better mechanisms to address systematic corruption at sectoral as well as project levels.

21. Part C: Ways of Moving Forward… C. Better design and implement a monitoring and evaluation system (will be discussed later by my colleague).d. Capitalize new opportunities emerging with decentralization as well as technology advances, such as SDI and ICT in support of e-governance, improving transparency and service delivery. e. Highlight linkages between land programs and broader urban and rural development strategies for more integrated and effective interventions.

22. Part C: Ways of Moving Forward… f. Promote participations from the stakeholders as well as private sectors in land programs. g. Promote a single agency model… (mapping and rights registration) in our client countries.h. Introduce new initiatives, such as FIG regional forums, dialogue with PCGIAP, to create a land forum across Asian-pacific region for more efficient and effective interventions.

23. Thank you. Gli1@worldbank.org