Using state-owned land for development in Africa
Herald 4 September 2017
William Gumede Correspondent
Many African countries underutilise, waste and neglect state-owned land and property, losing the opportunity to leverage them for development, industrialisation and economic growth.
The majority of the land and property in most African countries, except communal land, which is under control of traditional leaders, chiefs and kings, belong to the state.
However, other developing and industrial countries have significant state land and property holdings. In Singapore 58 percent of the land and property belong to the state and in Israel nearly 80 percent of the land and property do. Sometimes state-owned land and property is disposed of cheaply through corruption.
More recently emerging powers private and state-owned companies have been buying fertile, often strategic state-owned African land or property, for example ports, or parts of nature and water reserves, for very cheap and often through very questionable deals.
The disposal of surplus state-owned land and property in Africa must be done transparently, fairly and to secure maximum value for the state. In many African countries, state-owned land and property are often not maintained, falling into disrepair, and then become a financial burden on the state, rather than being an income generator. In most cases there is no central registry of land and properties owned by the state.
State-owned land and property are difficult to manage efficiently even in industrial countries such as the US, Canada and France, which have substantial amounts of state-owned land and property.
Most African countries do not have the capacity to monitor state-owned land and property. Often African countries lack accurate information about the quantity, location and the condition of land and property owned by the state. This means governments cannot sell them, if they are not core, or lease them to generate income.
They often do not have a uniform system to assess the value, the costs and to do inventories of state-owned land and properties. Often the government departments, state-owned entities and agencies overseeing state-owned land and property are ineffective, are themselves poorly managed and plagued by corruption.
How can African countries leverage state-owned land and property for development, industrialisation and economic growth? African governments must work out a long-term industrialisation plan, if they do not have one.
Governments must have a clear policy, which must be aligned with their national industrialisation plan, which sets out how state-owned land and property should be managed, acquired or disposed of, and state-owned land and property use fits into the broader developmental, industrialisation and growth strategies of the country.
Most African countries do not have a specific policy on state-owned land and property, which causes different governments departments, spheres and entities coming up with their own rules and regulations, causing poor management of government assets.
African countries must do an inventory of the state land and property they own. The results of such an audit of state land and property must be registered in a centralised registry, which must be open to the public.
A decision should be made about what is strategic or core land and property, either as national key points, to be used in the future; or what land and property is to be disposed of. This must be done with relation to whether it is core or strategic to the national industrialisation plan of government. The disposal of surplus state-owned land and property must be done transparently, to secure maximum value for the state.
But the proceeds of the disposal of state-owned land and property must also be used for maximum development, industrialisation and growth. For example, Canada and the US stipulated that the proceeds or at least significant proportions thereof from sales of state-owned land and property must be used to finance new development and infrastructure projects.
The management of state-owned land and property are often fragmented between different spheres of government, line departments and agencies, undermining efficiencies.
The state-owned entities and agencies overseeing state-owned land and property must be better managed. There should be better performance management of these entities and agencies to ensure that state-owned land and properties are being managed in line with an industrialisation strategy.
In some countries one department manages the state-owned land and property, and another is the user. Because these different departments do not work together, state-owned land and property are not efficiently used because the departments expect the other to do this.
Some industrial countries, such as Canada, have tried to establish cross-cutting national committees with representatives from all government departments, spheres and entities with significant state-owned land and property.
Such a structure would co-ordinate state-owned land and property management in line with the national development, industrialisation and growth strategies.
Malaysia has established a special Government Asset Management Committee (JPAK) to try to ensure alignment between the state-owned property and land management practices of the three levels of government, the federal, state and local government. African countries should pursue a diverse mix of strategies to add value to their state-owned land and property. In many African countries state-owned land and properties take up a significant part of government’s total costs, rather than bringing in revenue.
The least African governments can do with the state-owned property and land held in reserve is to lease them in the open market, as countries such as Singapore and Israel do, to finance their fiscus.
Many countries, such as Sweden and Singapore, have successfully used state-owned land and property for public housing – and received significant rental and rates income from it. African countries could look at leasing state-owned land and property for public housing, industrial parks and commercial farming.
Some state-owned land and property which is non-core, non-strategic and for which the government does not have the capacity to manage, should be sold off. When selling the land and property the government can still influence industrialisation, development and growth by putting conditions on what the land and the property should be used for.
Some African state-owned land and property could be developed in the form of public-private partnerships – in line with the government’s industrialisation, development and growth strategies. In some countries, government may need land and property to house a government agency, community or development project but cannot afford to build it.
Governments can then sell the property to private developers with the condition that these developers construct a building which government would, upon completion, hire from the developer.
Finally, transparency in state-owned land and property sales and use of is crucial to maximise the developmental, industrialisation potential of state-owned land and property.
William Gumede is chairman of the Democracy Works Foundation. His most recent book is Restless Nation: Making Sense of Troubled Times