Land reform needed for agricultural investment

Tanzania's land laws and ownership rights will have to be reformed if the country is to succeed in encouraging investment in agriculture, the presidents of the World Bank and Tanzania agreed last week.

Visiting World Bank chief James Wolfensohn highlighted the ability to mortgage land as a prerequisite for development. For his part, Tanzanian President Benjamin Mkapa said that while there were clauses in the land statutes that had dissuaded investors, a process of reform was underway.

"Land tenure and the issue of being able to mortgage land are of interest to everybody in Tanzania," Wolfensohn told reporters after opening an Investors Roundtable in Dar es Salaam. "I think that the reform of the land system is something that could be of enormous stimulus for development in Tanzania."

"It's not rocket science - if you own land and can mortgage it, it's a way of developing financial systems and expanding your activities," he added.

Closing the Investors Roundtable, Mkapa said that in terms of investment, the land factor was an "obstacle to the commercialisation of agriculture".

"We reviewed the land statues several years ago, but still there are general clauses in it that have not encouraged potential investors in commercial agricultural activity," he said. "So we have already started a local process of consultation with the private sector and the government to help us overcome this hurdle, and I think that in six months, we will find a way out."

Agricultural specialists say that, at present, the land laws are very complicated and make the question of ownership a difficult one. People interested in investing money in the sector will be hesitant to do so, unless they are sure of what they will be getting for their money.

During the meetings, national and international corporate leaders participated in consultations between government representatives and the private sector. Economic reforms were discussed and the general consensus of the investors was that Tanzania was heading "in the right way".