Land information: To be or not to be transparent

Farmers make the journey to Oloki, Nigeria, to attend a farmers' meeting. The complexities of land registration and verification is keeping many smallholders from taking advantage of their rights to land. Photo by: Gates Foundation / CC BY-NC-ND

The relationship between people and land defines a society and forms the basis for how we organize the world we live in. It influences our relationship with the environment, and also how we interact with other members of society.

Land information defines the right we have to land, or inversely the restricted rights we have to land; whether or not we can farm it, build a factory, open a business or establish a mine. It also tells us what the rights of others are to that land.

Land information also defines our responsibility as owners or stewards of land, such as the responsibility to pay tax for the use of land, or the responsibility to protect the resources such as water, forests and minerals on that land.

Information black holes

U.N. Habitat estimates that 70 percent of land in developing countries has no recorded or mapped rights. Simply stated: Many governments lack the essential recorded knowledge of who has what right to lands and also lack information on the physical extent and geographic location of those lands. Complicating this issue is the fact that there are often overlapping rights to the same lands — often with some rights not formally recognized by government, such as water or forest use rights. History clearly shows us that these overlapping interests to land and resources are all too often a source of conflict.

Information is crucial to economic growth, social development and environmental stewardship at all levels. Yet for so many in the world, what should be a simple act to register a land right is too time-consuming, too expensive and too burdensome. Compare Nigeria and Singapore, for example. According to the World Bank’s 2012 “Doing Business Report,” in Nigeria a person must go through 13 different procedures to register a property. All of these steps together require on average 86 days to complete, and the registration process costs 20 percent of the property value. Comparatively, in Singapore, the same act (to register a property) requires five procedures, takes 37 days and costs 2.9 percent of the property value.

In many cases, the costs to search for information and receive title for land is so prohibitive that it is accessible for only the wealthiest and most connected members of society. In the most extreme of cases, this disparate access to and lack of land and property information leads to land hoarding.

Transparency improves governance

Land information matters for transparency. Having equal access to land information and a known process to register lands which is neither too cost-prohibitive nor too time-consuming provides for a very basic degree of social and economic security for people.

This codification of governance standards can be pushed down to all levels of government, providing a concrete and exemplary way of conducting operations.

Clearly defined processes and procedures to register or transfer land rights can root out corruption. A digital record can affirm that the proper fees were charged, or leases for government lands paid, and be checked against a financial ledger to ensure that revenue had not been fraudulently skimmed. Land ownership interests can also be tracked, especially when such systems are public-facing and web-enabled. Additionally, with records linked to parcel maps, the extent of land claims can be verified, for instance to be assured that one interest is not overstepping the physical extent of other groups’ or individuals’ rights, a common issue especially in extractive industries. 

Transparency improves confidence

Information transparency influences investor behaviour. Incomplete information breeds uncertainty and diminishes investor confidence, whether it be an individual looking to invest in a plot of agricultural land or an institutional investor wanting to invest in a country’s economic future. One can also argue that incomplete information attracts a particular class of investor: vulture investors that take advantage of weak governance structures and informal black markets.

Inversely, transparent and open information stimulates land and property investment. Confidence is essential to making long-term investment decisions, be they domestic or foreign investments. Land information is the key to a virtuous cycle of investor confidence.

At the microeconomic level, an individual land owner is much more likely to invest in land if they have secured land rights.

The Royal Institute of Chartered Surveyors conducted a telling study on the impact of land titling in Gharinda Union, Bangladesh. The government there had conducted a systematic land registration campaign in 1984. RICS surveyed villagers on the impacts that this campaign had had on their livelihoods. Villagers reported that post-titling, they had invested more in cash crops, animal husbandry, property fencing and the planting of fruit trees. With titling also came a 78 percent increase in access to and use of credit and, additionally, an increase in income per unit of land and an increase in land values.

At a macroeconomic level, land is a very significant portion of most countries economies.The United Nations estimates that 20 percent of gross domestic product for any country is derived from the productive value and asset base of land, property and construction. In the United States, land and property (real estate) represents 28 percent of GDP, accounts for 9 million jobs, and supports 70 percent of local government revenues.

Transparency requires infrastructure

Land is a principle source of wealth for individuals and also communities, and with land rights, restrictions and responsibilities recorded, serves to define how the environment should be protected. Governments need to, therefore, consider land and property information as critical infrastructure and be prepared to invest in not only the establishment of systems but the ongoing maintenance of this infrastructure.

Projects to overhaul land information systems should be tied to economic returns. Such returns are evident, have been well-modeled, and can return both social and economic gains. Tying land registry and land administration systems transformations to revenue generating goals, such as to better collect rents on government leased lands, or by implementing property tax collection systems, is a pathway to sustained development and improved governance.

The reasons why land information matters to transparency are clear and evident; it’s better to be transparent than not to be transparent.

Want to know more? Check out Land Matters, a new campaign to showcase innovative solutions in the areas of food security, economic development, conservation and more.

About the author

  • Nick collier thomson reuters

    Nick Collier

    Nick Collier is the Global Head of Government and Regulatory Affairs, Thomson Reuters. He moved from Morgan Stanley, where he had been Head of EMEA Government Relations since June 2007. Nick previously held roles as the Head of Regulatory Policy at the International Capital Market Association, as the Director of International Risk, Compliance and Government Affairs at Instinet, and as the European head of the International Swaps and Derivatives Association. He started his career in the Bank of England, including a spell as the UK financial attaché to the EU. He holds a MSC in Economics and Finance from the London School of Economics and a BA from Oxford.