Land Affairs

Agriculture, Inequality and Economic Growth

The market place coming to a town near you.

I am not an economist. Still, I find the discussions about economic growth in Africa interesting, not least because my field of study, land, is rife with theories about how land can and can not contribute to economic growth.

A very dominant theory among decision makers in Tanzania is the one about large-scale farming, which they see as a shortcut to economic growth. I am not able to tell if they are right or not. But I am quite sure that they should start focusing on Tanzania’s small-scale farmers, if they also aim at distributing the benefits of growth equally.

I write this, because I have just read a book published by the World Bank, Yes Africa Can: Success Stories from a Dynamic Continent. It analyses the policies behind a number of development successes in Africa. Tanzania is such a success case because of macroeconomic stability. Tanzania’s economy has grown 6% on average since 1996. That is a number that would make most politicians in the rich world jealous. But Tanzania’s growth is not reducing poverty significantly.

The poverty rate in Tanzania was 38.6% in 1991, 35.6% in 2001 and 33.4% in 2007 according to this Twaweza publication. That is a very poor performance. It is hard to understand why the development has been that slow. But then, in the World Bank book one can read that Tanzania’s growth is driven mainly by services and industry. Agriculture did not contribute to growth. That is a problem, according to the authors, since most people in the country depend on agriculture: The limited contribution of agriculture - in a country whereabout three-quarters of the population resides in rural areas, where poverty is concentrated - is a concern (pp. 26-27). In other words, unless the Tanzanian politicians start focusing on improving the conditions of small-scale farmers, they are unlikely to reduce poverty levels significantly.

The book describes a couple of success cases where agriculture has contributed to economic growth. Malawi is one and Kenya the other. Their stories are quite different.

In 2005 the Malawian government, in response to severe food security difficulties, launched an input subsidy program. It provided vouchers for maize fertilizers to more than half of Malawi’s farm households and also distributed improved maize seeds and tobacco fertilizers. Subsequently, maize production is estimated to have increased by 26–60 percent, while food availability has improved and wages in the agricultural sector have increased.

The Kenyan story goes like this: around 1990, the Kenyan government liberalised the fertiliser market and donations by donors were phased out. The use of fertiliser, subsequently, doubled between 1992 and 2007. Much of the increased use was among smallholder farmers. Largely as a result of the increase in fertilizer usage, maize yields in Kenya increased 18 percent over 1997–2007.

Obviously, it must have been cheaper for the Kenyan government than for the Malawian to achieve the increase in production. That is part of the reason why the book’s authors like the Kenyan story better. Another reason is the more market-based Kenyan intervention (it is, after all, a World Bank publication).
What I find interesting about the Kenyan story is that fertiliser became much more accessible for most farmers after liberalisation. In some regions the average distance from the farm to the fertiliser seller was reduced from 15 kilometres in 1997 to around 4 kilometres in 2007. To me, the examples point to the importance of improving ordinary, small-scale farmers’ access: access to improved seeds, access to fertiliser, access to markets, etc.

It is possible, in other words, to improve agricultural growth without a narrow focus on large-scale agriculture. The measures described here are small, practical improvements, not the grand schemes, the distribution of tractors, and the focus on large-scale farming that Tanzanian decision makers tend to prefer (read a previous blog post about it here).

A Crash Course in Tanzanian Politics, Please!

Some days, I find reports on my desk which are so thick that I’m about to give up before opening them. In particular, scholars and activists working within the land grab business tend to produce this type of reports. It is as if they believe that the multitude of words, the length of the list of abbreviations, and the sheer number of pages can transmit the sufferings experienced by the local communities, whose land has been illegally acquired by investors or expropriated by the state.

The Tanzanian policy analyst, Chambi Chachage, has produced a couple of this kind of reports. I have had them on my desk for quite a while, wondering if I would ever get to read them. Over the last couple of weeks I did. It turned out to be rewarding and thought provoking reading.

Chachage sets himself the huge task of investigating what has happened to the state farms when privatisation of state assets started in Tanzania in the 1990s. In the report The State of the then NAFCO, NARCO and Absentee Landlords’ Farms/Ranches in Tanzania, co-authored by Richard Mbunda, he provides an overview of the fate of 34  NAFCO (National Agriculture and Food Corporation) farms and 13 NARCO (the National Ranching Corporation) farms, covering almost 550,000 hectares. The other report, Land Acquisition and Accumulation in Tanzania. The Case of Morogoro, Iringa and Pwani Regions, is an in-depth study of farms in selected districts.

The state farms were established in the 1960s and 1970s on land expropriated from large-scale settlers and small-scale farmers and pastoralists alike. Their establishment was part of an attempt to promote state-driven development of the country under the banner of African socialism.

Economically, the NAFCO farms never became viable. No wonder, then, that they were on the list of businesses to get privatised when the era of socialism was over. NARCO, on the other hand, still exists. That, however, has not prevented a number of its farms from being sold also. The outcome is a mixed picture of farms being kept by state authorities and farms sold or leased to private investors.

Some of the investors are foreigners, but land has also been acquired by public-private partnerships involving the Tanzanian state or by Tanzanian investors. One of the former state farms mentioned in Chachage’s reports is Mzeri, which is situated in one of Handeni Districts where I carried out much of my research. There, I was told, the local MP and a former Tanzanian prime minister have acquired large tracts of land.

When reading about these deals I understand Chachage’s indignation. The privatisation path chosen by the decision makers rarely benefits the local communities, whose land was expropriated in the first place. Often people, who have moved into land left vacant by ineffective state farms, are expelled a second time when land is privatised.

Chachage blames the World Bank and other foreign actors for propagating these privatisation policies and rightly so. After having finished reading his reports, however, I am left with a feeling that there is more to it than that. Privatisations can be carried out in different ways. I have the feeling that Tanzanian decision makers have a decisive say over how it is being carried out in Tanzania. Land could, as described by Chachage, be given back to the communities. That rarely happens. The Tanzanian decision makers choose to sell the former state farms to investors. When President Kikwete met local protests in an area which had been privatised he responded: I cannot repossess the farms and give them to you. They have already been divested... Let us stop lamenting and give the investors time to revamp wheat production. You had the opportunity when the farms were still government-owned but you failed to sustain them (Kikwete in Daily News 18 September 2008 according to Chachage).

The debate makes me realise that there is much I do not understand about Tanzanian politics. I do not understand why people keep electing representatives who seem disinterested in safeguarding ordinary people’s rights. Is it because their policies are thought to bring growth and prosperity and benefit the public in the future, as the quote by Kikwete suggests?

There may be good reasons why these policies are pursued. There may also be good reasons for why people keep electing the same representatives. I would be happy to learn more about them.

Demand-driven or Donor-driven Land Reform? (2)

About a month ago, I posted a blog post which caused some debate about whether the Tanzanian land law reform was donor-driven or not. I wrote about the topic because I had met people who claimed that the two land acts were the result of a foreign scheme. The alleged foreign involvement was used as an explanation for why the reform from 1999 had not been implemented. Tanzanian ownership was lacking, so was the argument.

By then, however, I had seen any empirical evidence which sustained the claim that the policy formulation had been initiated by donors. But I had to acknowledge that the subsequent implementation efforts were donor driven to some extent.

I have now come across some other pieces of evidence which shed new light on the origins of the land reform. It is older and thus closer to the events. It, too, places the major part of responsibility for the new land reform policies on the Tanzanian decision makers of the early 1980s. I found the first piece of evidence in an article from 1993 by C. S. L. Chachage in the book Social Change and Economic Reform in Africa. It describes how private land ownership, which was institutionalised with the land reform, was introduced as part of Tanzania’s homegrown Structural Adjustment Programme in the early 1980s:

From 1982-83 the government initiated cost-cutting exercises in budget allocations, and started removing food subsidies, while 15000 government employees were axed as a retrenchment measure.  Accompanying SAP was the introduction of the 1982 National Agricultural Policy. This policy recommended liberalisation in the countryside, including encouragement of private ownership of land (Chachage in Gibbon 1993; p. 225).

These new policies were not imposed on Tanzania by donors. The reforms were the responsibility of the Tanzanian government. They were enacted after the negotiations in the early 1980s between the Tanzanian government, under the leadership of President Nyerere, and the international financial institutions had broken down. The former Tanzanian Minister of Finance, Edwin Mtei, in his exciting autobiography From Goatherd to Governor, explains that the negotiations failed because of disagreement over the exchange rate between IMF and Nyerere. As an IMF representative, Mtei later came to negotiate an Economic Recovery Programme with Tanzania. The negotiations started in 1985 and finished in 1986, i.e. after the private land ownership had been encouraged. The programme did not, to my knowledge, include a land reform.

Whereas the seeds to the land reform process were sown before the Tanzanian government had come to terms with the financial institutions and donors, the land reform policy formulation process was initiated afterwards. Furthermore, the World Bank, in the report ‘Sub Saharan Africa, From Crisis to Sustainable Growth’ from 1989, for the first time recommended changes in land law. That is also before the Tanzanian reform process started for real. That could leave room for foreign influence. The scholars, however, describe the process as a Tanzanian affair.

Gibbon, Havnevik and Hermele in A Blighted Harves. The World Bank and the African Agriculture in the 1980s from 1993 (p. 66) describe the establishment of the Commission of Inquiry into Land Matters as a response to an increase in the number of land conflicts caused by the land market and a wish to promote investments. So does C. S. L. Chachage:

On the basis of constant public complaints arising from similar cases up and down the country, President Mwinyi was in 1990-91 compelled to form a commission to investigate land problems in the country (Chachage in Gibbon 1993; p. 239).

The descriptions do not, of course, rule out the possibility that the World Bank and IMF influenced Mwinyi’s decision to establish the Commission or directed the work being done by the Ministry of Lands. As UDADISI remarked in a comment to my previous post, access to the persons involved in the decisions back then and to their documents and diaries would be required to rule out that possibility completely. The analyses I refer to above, however, do not indicate that the reform process should have been orchestrated by foreigners.

Maybe this debate about the origins of the Tanzanian land laws appears a bit outdated. But I do not think that history should be used an excuse for not implementing the laws. The Land Act and the Village Land Act do after all, if implemented, provide some tools which people can use to protect their rights to land.

Land and microcredit as vehicles for poverty reduction?

A title deed or a microcredit loan?

A heated debate about the merits of microcredit in developing countries has been going on for a couple of months now. For long, microfinance was hailed as the ultimate answer to poverty and underdevelopment. New findings question the positive effects of providing loans to the poor. The debate reminds me of the equally politicised debates about land titling. I find both debates relevant. But I usually disagree with the alternatives presented by the critics.

The microcredit controversy started towards the end of 2010, when evidence about the microcredit sector in India came out and a critical documentary about microcredit in Bangladesh was broadcast simultaneously. The latter was aired in Norway, but soon caused uproar in Bangladesh. It shows how some borrowers got caught in indebtedness. New loans were taken out to repay old ones, often at sky-high interest rates. Thus, those meant to benefit from microcredit could end up in a worse situation than the one they were in from the outset.

Should the microcredit system be abandoned from the development agenda, then? Yes, say some scholars, who see microcredit as a part of a global neoliberal conspiracy.

Similar controversies can be found in debates about land titling in Sub-Saharan Africa. In the 1970s and 1980s titling was encouraged by the World Bank as a means to enhance economic growth. But empirical research showed that titling did not necessarily generate growth. On the opposite, it turned out, that titling was potentially damaging to the livelihoods of poor and vulnerably groups. Research from Kenya, where titling was carried out in the 1970s and 1980s, showed that titling did not necessarily give access to credit. On the opposite, titling could have negative distributional consequences, especially for women, whose rights were often not registered. Among some researchers, in particular among left-leaning anthropologists, a new orthodoxy evolved, which consistently claimed that titling was a threat to poor and vulnerable groups.

I find the critique highly relevant, though I disagree with the conclusions drawn by some of the critics. Hopes about the poverty alleviating effects of microcredit and land titling have been raised too high. But rather than outright abolishing these approaches, expectations should be adjusted to more realistic levels. The interventions should not be seen as quick shortcuts to poverty reduction. Still, significant benefits could be reaped. Recent empirical findings support this.

A new systematic review of the available evidence of microfinance shows, that microcredit has a positive impact on poor people’s savings and on health and food security. But it also shows that microcredit has the potential to do harm. Setbacks are found on education (to repay loans quickly children are taken out of school, thus saving school fees). Indebtedness, for those unable to repay their loans, was also a reported consequence. A mixed picture, in other words.

A similar mixed picture appears from recent evidence from land titling. In the article Property Rights for the Poor: Effects of Land Titling it is acknowledged, that titles may not give access to credit (as claimed by many). But it also shows that people are more likely to invest in their land, their houses, and their children’s education, if they have a title deed. The findings are based on comparative case studies conducted in a squatter area in Buenos Aires, Argentina, where some people had received titles in the early 1980s, and other’s had not. Furthermore, I find that titles may provide people with at least a little bit of security against the endemic land grabbing observed in many countries.

Microcredit and land titling are complicated issues. Outcomes vary from one place to another.In some contexts programmes should be avoided. We may experience outright failures. Still, to abolish these approaches totally would be a mistake. We may not be able to eradicate poverty using them, but we can improve many people’s livelihoods and quality of life. The key question is how to achieve the benefits without putting too many people’s livelihoods at risk because of the dynamics they set free. There is a balance to strike there.

A title deed or a microcredit loan?

Tanzania’s Land Law Reform - Slow and uneven Progress

NGOs and the Ministry of Lands, Housing and Human Settlement Development are involved in a significant number of projects to implement Tanzania’s land law reform from 1999. Still, implementation in rural areas is slow and uneven. That is my conclusion in the working paper I published this month. You can download the working paper free of charge here.

If you have comments to the working paper, please, feel free to write to me here or on my E-mail address, which you find here.

Land Banks and Land Investments

I always get a bit confused when I hear activists and politicians discuss investments in land in Tanzania. In an article in the Citizen recently, the Director of the NGO Hakiardhi, Mr Yefred Mnyenzi, criticised the government’s land bank for not benefitting smallholder farmers. Smallholders, he said, had a lot of land conflicts because foreigners were grabbing their land for investments.

I have no doubts that land grabbing is a serious problem, also in Tanzania. To judge from their public announcements about vast areas of vacant land on the countryside, many politicians in Tanzania see land as a resource for investments without considering user and owner rights attached to it.

In a developing country with high economic growth, land for investments is undoubtedly required. Since Tanzania, for various reasons, is behind with planning this may also entail expropriations. In a leaked World Bank report, Tanzania was highlighted, as one of the very few developing countries where investments in land benefit the broader community. The crucial question, however, is how the land is being taken from farmers and rights holders.

Recently a district land officer explained the procedure they use in the districts to me; potential land for investments is being identified, but negotiations about acquisitions are left to the local communities and the buyer to carry out. If the village has made a land use plan, and no one is forced to move, I see nothing wrong in it selling a part of its land.

On the other hand the stories of people loosing their land to investments without having a say and without getting a proper compensation are abundant.

So which of the two versions of land acquisitions do you choose as your point of departure in land rights debates; the one where land is legitimately needed for development and is acquired following all legal norms and procedures, or the one where corrupt politicians and officials grab the land in order to sell illegally it to greedy foreign investors? Both may be true...

Land and politics (2)

The debate about investments in agriculture in developing countries is slowly gaining speed. In January the World Bank together with FAO, IFAD and UNCTAD released the principles in a discussion note; Principles for Responsible Agricultural Investment that Respects Rights, Livelihoods and Resources. In April came the response from civil society organisations in a press release with the headline Stop Land Grabbing Now. It was simply a no. No to the principles, no to debate and no to dialogue.

The NGOs criticise the principles for legitimising land grabbing. And land grabbing is indeed a worrying phenomenon; thousands of people in developing countries loose access to land every year because of it. A report from last year found that in five African countries almost 2,5 million ha of land had been allocated between 2004-9 in large-scale allocations, all measuring more than 1000 ha. However, I find that the suggested principles deserve a thorough debate and not just an outright refusal.

The NGOs, I believe, will not get far by refusing to engage in discussions about how to handle the problem. The current pressure on land is simply too big. Furthermore, by defining all investments as land grabbing, they risk loosing out on debates about what are desirable and undesirable investments respectively. I assume that there is a difference between land utilised for infrastructure projects or for projects which also transfer knowhow and resources to local populations and land expropriations which benefit local elites or a few foreign investors only?

My name is written... Women, land and certificates

I just came across a press release from the World Bank about a successful project for registration of land rights in Ethiopia, which the Bank has supported. It states that the women, because they have learned that they have the same rights to land as men and because they have received land title certificates, have become stronger and more self-confident.

Usually I am sceptical about press releases from NGOs and other organisations about their successes. I always find it too difficult to establish the difference between what has actually been achieved and what potentially could be achieved if they had more money, if the world was decent, and if people were honest and nice to each other. But actually I find the World Bank statement about these Ethiopian women quite credible.

I have experienced the same phenomenon with Maasai women here in Tanzania who, according to Maasai tradition, cannot own land. But after having received information about their rights and after having applied for land, either for themselves or together with their family, they change. When I ask them how they can own land like that, they usually answer; Because my name has been written - no one can take that land away from me.

I am always amazed when I hear those statements. Just a few years ago those women would loose everything if they got divorced or if their husbands died. Back then they knew they could only access land through their husbands, never on their own.