World Bank Group

01/24/2023 | Press release | Distributed by Public on 01/24/2023 13:27

MENA can no longer afford to ignore its land problem

For decades, many countries in the Middle East and North Africa (MENA) region have benefited from abundant natural resources, including oil and gas. But the region is not rich in all resources. In fact, MENA is land poor, and increasingly so. In a region that is 84% desert, there is less and less land left for growing food. As a matter of fact, given the poor quality of land in the region, if MENA farmers decided to cultivate more land, they could increase cropped areas by an additional 17% at most without having to resort to irrigation.

There is also little land to accommodate the region's growing urban population causing cities to expand into agricultural land or into the desert. By 2050, the total urban land area in the region might have to increase by 50% to accommodate the growing population. Our report, "Land Matters[SEP1] ", looks at the nature and extent of the land problem in MENA, at its numerous causes, and at what can be done to address the challenge. It also makes clear that MENA can no longer afford to ignore its land problem, particularly as governments deal with the risks posed by climate change and the pressure of population growth.

Governments have either ignored the issue or responded in the following three ways. Many countries have developed their desert land (for agricultural purposes and to build cities), with mixed results and with added stress to an even scarcer resource: water. Some countries have constrained land use to serve their strategic goals (such as food sovereignty) but created inefficiencies in doing so. An interesting anecdote illustrating this point in the report is the case of farmers leasing fertile public land complaining that they are required by their government to produce milk instead of cultivating it! Over the past 15 years, some of the most land poor countries in the region have been buying (or at least trying to buy) large tracts of land elsewhere to produce commodities which are then exported back to the investor country, a practice that has raised some international controversy.

Although, it is perfectly understandable why these responses have emerged, they are clearly not going to resolve the problem. In some ways, they could even make matters worse. In our latest report, we argue that the root of this problem to a large extent is poor governance of land, which prevents land from being used efficiently. Poor land governance has many causes, ranging from complex legal frameworks to the omnipresent role of the state, institutional fragmentation, lack of recognition of market principles, lack of transparency, weak land right rights for women, and, possibly, misguided policies.

Even the countries in the region that fare better in terms of land governance (i.e., the richer Gulf countries) face strong inefficiencies in their use of land, be it the presence of water-consuming agriculture in the desert or of large tracts of empty land in their cities. In turn, poor governance and the inefficient use of land are likely to be very costly to all MENA economies (as businesses struggle to access land and as governments are unable to generate revenues from land).

After sub-Saharan Africa, MENA is the region where businesses find it most difficult to access land. As many as 23% of firms in the region declare land to be a major or severe constraint to their business operations. People also find it difficult to access land for housing. Slums are widespread in the MENA region, with over 24% of the urban population estimated to be living in slums. It is also a region where property taxation to generate revenue is little used or even absent altogether.

Land issues are a drag on economic development in the region and a hurdle that stands in the way of economic diversification and prevents parting with the oil rent model. If land problems are not addressed, the region might face even starker consequences of climate change, increased inequality and social discontent.

Although not all countries in the region face these problems with the same intensity (as some countries are more land scarce whereas others have relatively more land but much poorer land governance), fixing property rights, i.e., clarifying who owns what, is a prerequisite. It will not be enough, though. State land needs to be better and more transparently managed. Properties need to be better valued (at market prices) and taxed. And women's rights to land need to be better protected.

"Land Matters" provides a deep overview of these issues (and many other) and hopes to fuel the much-needed debate for land reform. With the evidence in the report, we feel that land issues cannot be overlooked much longer given the climate, social and political crises in the region.