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Land Policies and Development - Study for the European Parliament

Land Policies and Development - Study for the European Parliament

In a policy brief for the European Parliament, researchers at Ecologic Institute examine how access to land affects development and poverty eradication in developing countries. The authors discuss the assumption that land ownership increases productivity and provide an overview of land reforms and large-scale land acquisitions in developing countries. Finally, the brief provides a series of recommendations for European policy-makers. The brief is available for download.

Most of the world’s undernourished people live in rural areas and most depend on land for food security and economic development, typically through agriculture and livestock. However, land is a finite resource and there are frequent struggles over access to land in developing countries. As a result of environmental degradation, fertile land is becoming even scarcer, thus intensifying these pressures.

Most land holdings in developing countries are relatively small and formal property rights are the exception rather than the rule among small-holders in developing countries. Some scholars claim that formal property rights are needed to improve small-holders socio-economic situation. Proponents of the thesis hold that formal property rights are an incentive for investments and give poor people access to credit. However, empirical studies have shown that this is only sometimes the case. The evidence suggests that while long-term, secured access to land is an essential tool for pro-poor economic development, this is not to the same extent true for formal, individual property rights. The authors also argue that land reforms to establish and enforce property rights a popular policy in many countries will only be successful if complemented by other policies that help small-scale farmers to successfully engage in agriculture, and have access to markets, e.g. allocation of water and capacity-building.

The brief also reviews the currently ongoing process of large-scale land acquisitions by foreign investors, which takes place in developing countries and economies in transition (so-called land grabbing). There is a heated debate over the impacts of land grabbing on food security, the environment (water, soil and biodiversity) and human rights. While most civil society organizations have focused on the downside of this movement, international organizations such as the World Bank highlight the opportunity for regional investment. Current weak legal, political and institutional frameworks make it doubtful whether positive effects of large-scale land acquisitions can outweigh the negative ones, the authors argue. Land grabbing can only be a win-win situation for both investors and recipient countries if adequate regulations are in place.

Finally, although the EU and member states’ public sectors mostly play no direct role in land reforms in developing countries or in large scale land-acquisitions, they may still have a significant impact on land distribution and land reforms in developing countries through development cooperation, trade policies and their involvement in multilateral financing institutions such as the World Bank and the IMF.

The brief was written as part of the framework contract on development policy. Christiane Gerstetter presented its results to the European Parliament’s development committee on 14 June 2011.