About the Program
The Land Transparency Program continues the systematic support of land reform in Ukraine from international partners. The World Bank has contributed to the creation of the State Land Cadastre (2003-2013), development of the first and most complete land database “Land Governance Monitoring in Ukraine” (2015-2017), and supported analytical work in land relations and agrarian sector. The EU is working in the areas of supporting farms and promoting decentralization.
International donor community is ready to support Ukraine in developing a transparent and efficient land governance system.
Ukrainian agriculture potential
Ukrainian lands are among the largest resources to drive higher economic growth and living standards in Ukraine. Ukraine has over 40 mln hectares of agricultural land, including the largest endowment of arable land in Europe – 33 mln ha, compared to 18 mln ha in France, 12 mln ha in Germany, and 11 mln ha in Poland. Ukraine also has 1/3 of the world’s best soil (“black soil”). However, the agriculture added value per hectare in Ukraine is somewhat higher than $400, compared to $1100 in Poland and $2500 in France. This is despite the fact that neither Poland, nor France has such fertile soil and such large areas of land resources as Ukraine. Low agricultural value addition causes annual losses of an estimated USD 8 billion in foregone export revenue.
The World Bank estimates that an additional 1.6% can be added to the Ukrainian GDP growth in the first year after land market opening. A 30% agriculture productivity increase would raise GDP by 4.4% in five and 12.5% in ten years. To reap this potential, investment is needed – something that will not happen without transferable and transparent land rights and a better business environment.
Today, because of the lack of competition for land and, as a consequence, the lowered cost of rent, Ukrainian small landowners, many of whom are of retired age, receive only 10-20% of land rent revenue, compared to its potential value.
More efficient land management can increase local community budget revenues up to at least $ 150 million from the current $ 617 thousand, i.e., nearly 250 times more. What is more, this calculation shows the potential of state and communal land only, i.e., only 1/4 of Ukrainian agricultural land.
Absence of land market, land unregistered in the State Land Cadastre, complicated procedures of registration and error correction in the Cadastre and the State Registry of Property Rights to Real Estate and related corruption risks are factors that reduce investor’s interest in Ukrainian lands. Establishing transparent land relations, reliable protection of the owners’ rights of owners, and simplification of procedures will significantly increase land investments. This, in turn, will lead to higher budget revenues (both state and local), development of farms, creation of job opportunities in rural areas, and improvement of living standards in villages.
Thus, in addition to launching the land market, Ukraine needs to build an integrated system of transparent and modern land governance. This involves a complete inventory of land resources and error correction in the Cadastre. Incomplete information and errors open space for corruption, raider attacks, and hinder investment in the agricultural sector. It is necessary to ensure openness and transparency of land data, as any political or investment decision can be justified and evidence-based only if it is based on the most complete, reliable, and versatile data, which is impossible without open public access to data. It is necessary to simplify the land procedures, such as land parcel and land rights registration in the Cadastre, transactions related to land lease and sale, land data error correction, etc.
Components of efficient land governance
- Transparency of land data enables public monitoring which prevents communities and the state from corrupted land management and private landowners from raider attacks.
- Complete and accurate land registration helps to be informed on what and how much land is owned by the state/ communities/ citizens; protect property rights to land; prevent conflicts between private landowners and land tenants in communities (for instance, caused by overlaps in the StateGeoCadastre); accelerate establishing small and medium farms as an essential pre-condition of agri-sector crediting by banks; simplify access of agri-producers to finance and stimulate generation of added value; create new job places and raise living standards in rural areas; increase the potential land value when land market is opened.
- Analysis of actual land use helps to determine the efficiency and productivity of land use, land use beneficiaries, and environmental impact of land use. It also allows each community to increase the economic returns on using its land.
- Simplification of land procedures decreases corruption and catalyzes land-related business activity. Public access to legal aid and using digital capabilities for error detection and notification of landowners on registry data modifications helps to reduce the risks of abusive and illegal land operations.
Land Transparency Program for developing efficient land governance
The Program plans to
- Contribute to creating an “ideal cadastre” by increasing data accuracy and correcting existing errors
- Simplify land registration and error correction procedures
- Define administrative boundaries (for settlements and rayons) and register them in the Cadastre
- Create and promote instruments for ensuring transparency of land governance data (Land Governance Monitoring web-portal, price registration, Geo-portal for the Program data, public access to Land remote sensing data)
- Create a database of regional land use (using remote sensing tools)
- Provide practical assistance to local communities in arranging information on their land
- Provide economic analysis to enhance evidence-based political dialogue
- Develop tools for strengthening rights protection of landowners and local communities (SMS-alerts; delivery of specialized training to lawyers and legal advice to citizens).
- increased economic return on land use
- new job places; economic growth in communities
- establishing conditions for the most effective use of land assets by citizens, the state, and local governments after land market opening.
Outcome: welfare growth of individual landowners, local communities, and the state.