Wednesday, April 1, 2009

Ghana's land reform struggle - losing the battle?

In 1997 I first came to Ghana on a short mission for the World Bank together with two experts in urban planning and title registration respectively, to try and find out where the land reform program had jumped the track. Ghana had been the shining star of West Africa for the Bank, but the failure to rapidly provide secure tenure to ordinary Ghanaians, and especially the poor, via a much vaunted new title registration system was disturbing, to say the least. There are few things more important to economic growth and reduction of poverty than land reform.

We interviewed all the usual suspects: government representatives, bank official (accesss to credit which land ownership provides), urban planners and lawyers. We wrote a report. Apparently, no one listened because when I arrived here at the end of January this year I was presented with virtually the exact set of problems we had identified more than a decade earlier. Incidentally, the land market reform program intitiated by the Bank was known as Urban I. Urban V - or VI (I need to check on this) is the latest iteration.

Ghana has received more than $750 million in aid from the Bank alone in the past 20 years. A significant portion of that was sunk into resolving land tenure issues. The poor have no cash. But they have assets. It's the frozen capital described by Hernando de Soto in "The Mystery of Capital". Give the poor tenure and unfreeze the capital so that the poor can escape the informal sector. That's the theory and I happen to agree. So what has gone wrong in the past twelve years that has in many ways witnessed rather large sums of money have rather minimal effect? Why are slums growing on average of 3.5% a year in Africa? This is an accelerating train wreck and the solutions will only be more painful as time passes without a better approach. To be continued...

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