One of the chief obstacles to propelling progress in Ghana’s agricultural sector is land distribution. Obtaining proof of individual ownership is difficult and most lands are not owned by people but by groups or tribes, often with competing claims. The country lacks a proper registry, along with titles, which has often offered complications to agricultural land acquisition and distribution.
FROM SMALL TO BIG: For small farmers, the inability to prove land ownership is an obstacle because without proper documentation indicating proprietorship, land cannot be used as collateral to secure financing for other projects. On the other hand, large farms are more prohibited by an inability to access to land despite having access to capital.
With government envisioning a future in which large-scale farming helps boost yields, modernise practices and attain food security, the need for agricultural land reform is becoming ever more pressing. “We see a lot of investors who are going through the process and becoming frustrated,” World Bank senior agricultural economist Jan Nijhoff told OBG. “The way forward is to develop an approach that brings investors and local communities together to talk in a structured format that can be repeated.”
TRIBAL LAND: Ghana’s system of land tenure is one in which most rural land is considered “stool land”, meaning it is owned by tribes. About 80% of the country’s land belongs to tribes, according to the Ghana Investment Promotion Centre (GIPC).
Ownership is a sensitive issue. Not only is purchasing land a long and arduous process for foreign investors, due to the lack of a reliable registry and local attitudes less open to outsiders, the difficulties for investors in commercial agriculture extend beyond the time it takes to buy property.
Some companies have taken time negotiate with tribal chiefs on the assumption that their support will translate into support from the tribal communities that often claim land rights, but those who do get backing from local leaders can still encounter problems. “If another chief [from a different tribe] sees success, they might try to claim the land too,” said Brian Frimpong, who manages a pan-African agriculture fund for the Accra-based securities firm Databank. While Frimpong and others see the establishment of a more reliable registry as a development that would create long-term benefits, for the time being Ghana is working on a small-scale solution that it hopes will at least make it easier for foreign investors to enter the sector.
COLLECTING THE FACTS: The effort for the short term is to gather a database of potential lands that could be acquired from individuals, families and tribes willing to participate in an out-grower scheme or sell rights to the land on a leasehold basis, taking back an equity stake in an agricultural venture as part or all of payment.
The GIPC has been working with the Lands Commission on establishing the database as quickly and efficiently as possible, because the government hopes to attract foreign investment to the sector. The idea of establishing such a database has been around for several years, but work did not begin on the project until June 2012.
COMMUNITY OUTREACH: The process will involve meeting with local communities to describe the plans the government has for the country’s agricultural sector and gauging the level of interest in participation. For landowners, that would mean surrendering control in a leasehold arrangement or selling a small amount of land. For individual farmers, the new measures would mean either giving up their autonomy in favour of an equity stake or becoming an out-grower and accepting the direction, inputs and financial help of a nucleus farmer. Those farmers, tribes, families or groups who agree to the terms would sign a contract stating their willingness to participate, and that contract would then ostensibly serve as accepted collateral for credit purposes.
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