New report asks, do land titles help poor farmers?

Companies and governments are pushing for the privatization of land around the world as a way to get at economically valuable resources, according to a recent report from the Oakland Institute, a policy think tank based in California.

But such moves can disenfranchise Indigenous and local communities, without regard for the support the land provides to their livelihoods, said Frederic Mousseau, the report’s lead author.

“[In] many places around the world, you have so many uses of land beyond the notion of economic value,” Mousseau, policy director at the Oakland Institute, said in an interview. Communally managed spaces provide wood, medicines, game and fish to these groups, he said.

“When [proponents of privatization] talk about unlocking the economic value of land,” Mousseau added, “they don’t talk about this value.”

The report examines case studies in six countries where politicians and agencies have pressed for individual land titles to “unlock the economic potential” of communally and customarily held lands. The authors include examples of what amounts to land grabbing by governments, such as the threats to Indigenous reserves from the highest office in Brazil.

“There is no [I]ndigenous territory where there aren’t minerals,” Brazilian President Jair Bolsonaro said, according to a report by Survival International cited by the Oakland Institute. “Gold, tin and magnesium are in these lands, especially in the Amazon, the richest area in the world. I’m not getting into this nonsense of defending land for Indians.”

“All those [Indigenous and conservation] reserves stymie our development,” Bolsonaro said in The New York Times.

Elsewhere, the authors describe a large-scale project in Zambia headed by a company called Medici Land Governance (MLG). The project uses blockchain, a technology used to record transactions involving cryptocurrencies such as Bitcoin, to register land ownership and establish titles as part of the country’s development plans. Mousseau and his colleagues link the worldwide wave of privatization with this effort, which generated 50,000 titles in a pilot in 2018. MLG aims to add another 250,000 through a subsequent project with the city council of Lusaka, Zambia’s capital.

The Oakland Institute report notes that the percentage of the country’s land that’s under customary ownership was 94% when the country gained independence from the U.K. in 1964. Now, that figure is less than 60%.

MLG is a “public benefit corporation,” according to its CEO, Ali El Husseini. It is also a subsidiary of the online retailer Overstock.com. Oakland Institute’s Mousseau and his colleagues say that comments by former Overstock CEO Patrick Byrne reveal the company’s true intentions.

“There are also trillions of dollars in value in global mineral reserves that cannot be accessed by the mining firms … which have difficulty conducting operations where land governance is not clearly established because of various laws and regulations that go back to the 1940s,” Byrne wrote in a letter to Overstock shareholders in 2019, according to the Oakland Institute. “We believe our work can unlock those values. In the process of unlocking such tremendous values, there should be a few shekels for us, and mountains of shekels that will come into the possession of the world’s poorest.”

In an email to Mongabay, Rania Elton, a spokesperson for MLG, rejected the idea that Overstock, through its subsidiary, is looking to tap into Zambia’s mineral wealth.

Husseini said that the report’s portrayal “[does] not characterize the scope and operational strategy of the work MLG is doing.”

“[We] have nothing to do with mineral rights whatsoever,” he said, adding that the work in Zambia is with the Ministry of Lands and Natural Resources, not the Ministry of Mines.

But Mousseau questioned the MLG’s use of blockchain to hand out private titles in Zambia.

“How is it going to work?” he said. “For this miracle solution to work, you need to move to have this system of private ownership, and you need a way to register all the land.”

Christoph Kubitza, a research fellow at Germany’s University of Göttingen who was not part of the Oakland Institute research, said that there are often benefits and drawbacks to using tools like blockchain in the context of land tenure.

“Using modern technologies is certainly helpful,” he said in an email, “but local agencies do often not have the means to use these technologies which could alienate them from the whole process.”

Kubitza studies land use in Indonesia, where, he said, most of the farmland is worked by individual farmers.

“The authors are right that private land titles alone will not lead to sustainable development in every context,” he said. “I agree with the authors that private land titles can, in certain circumstances, put local communities at risk. If the concept of land markets is not well understood, investors may take advantage of the situation.”

However, he pointed out that customary ownership isn’t always the same as communal ownership.

“Distinct customary systems of tenure have evolved in different regions of the world,” he said. “And communal tenure can be one form of customary tenure.”

Mousseau said that communal tenure has led to increases in dairy production in West Africa over the past few decades, as a result of herders and farmers sharing access to land.

“You can have economic development with doing just the opposite of what we are told countries should be doing,” he said.

Often, the justification for private land titles is to provide title holders with access to credit, buttressed by the theory of Peruvian economist Hernando de Soto. De Soto’s reasoning is that, with a formal title to privately held land, even some of the world’s most impoverished farmers have a tangible asset against which they can borrow money and potentially lift themselves out of poverty.

But in Mousseau’s view, putting land up as collateral also exposes smallholder farmers to the possibility of losing their land, for example, in the event of a severe drought.

“I agree with the authors that land titles, credit and land markets will not solve the problem of inequality,” Kubitza said. “Land reforms are necessary in many countries.”

But he also points out that customary tenure isn’t by itself the answer either. In the case of communally held land, he added, it might pave the way for outside interests to move in.

“I don’t think there is any evidence that customary tenure alone can save local communities from eviction — there are multiple examples where quite the opposite happened,” Kubitza said. “Customary tenure is often not well defined. With individual private titles companies have to negotiate with each single individual to obtain the land.” If the land is just registered with the community or the district government, “it could be actually easier to obtain the land in some instances,” he added.

In his own work in Indonesia, he has found that when farmers on the island of Sumatra have titles, they’re more likely to work their land more intensively. As a result, Kubitza reasons, they’re less likely to clear standing forest to expand their production.

In most cases in Indonesia, that’s meant private titles. Still, communal systems exist in Indonesia, and they don’t always conflict with private ownership, he said.

“Privately-owned agricultural land with secure land titles and community-owned forest or agricultural land is not a contradiction,” Kubitza said. “Both can coexist.”

Similarly, in Cameroon, Tchinda Kamdem Eric Joel’s research has shown that private titles increase agricultural productivity, precisely because it offers access to credit.

“[T]his dynamic is only valid in the presence of a credit market,” Tchinda Kamdem, an economist at the University of Dschang in Cameroon, told Mongabay in an email. “Indeed, it becomes useless to title land if there is no bank nearby to lend credit.”

Kubitza said that land titles are far from “a silver bullet,” but instead just one arrow in the quiver of strategies needed to help struggling farmers around the world.

“Major efforts are necessary to support smallholder farmers in low-income countries which are often among the poorest in many countries. Supporting them working on their own land instead [of] wage labor on large-scale estates has positive income effects, leading to better education and health,” he said.

“Providing them with secure land titles is one amongst many measures to help them.”

Banner image of a village in Zambia © Sandra Coburn courtesy of the Oakland Institute.

John Cannon is a staff features writer with Mongabay. Find him on Twitter: @johnccannon

Citation:

Kubitza, C., Krishna, V. V., Urban, K., Alamsyah, Z., & Qaim, M. (2018). Land property rights, agricultural intensification, and deforestation in Indonesia. Ecological Economics, 147, 312-321. doi:10.1016/j.ecolecon.2018.01.021

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