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On Malagasy Land Titling

Karol Boudreaux

January 1, 2006

Millennium Challenge Monthly

QUESTION: I am particularly interested in one of the MCC's major initiatives – the land titling program in Madagascar – which may have significant ramifications for the future development of Madagascar's economy. Of the two key development benefits to land titling – creating incentives for capital improvements and the ability to use the land as collateral – which do you think will be more important to Malagasy farmers over the next 10 to 20 years, and how can similar programs be encouraged in other compact countries?

Karol Boudreaux
Senior Fellow
Mercatus Center at George Mason University

RESPONSE: First, I'd like to thank the author of the question for sharing our view on the potential for significant impact from the MCA Madagascar land project that MCC is supporting.

Next, let me provide a bit of background. This project forms part of a multi-donor supported Madagascar National Land Program that seeks to formalize land rights for Malagasy citizens, and to improve the laws and the land registry to make land rights more secure and transactions like sales and inheritance processes more efficient. This will be achieved through a comprehensive approach that has a strong focus on local access to land registration services incorporating informal and customary norms and practices. MCA Madagascar is also investing in improving financial services and helping farmers, particularly small land holders, expand their productivity and income.

Now, to answer your specific question. The most immediate impact MCC expects from the land titling project is increased productivity and investment in land. While over time, MCC anticipates greater ability to use a land title or local certificate as collateral for a loan, this result might take longer to realize by many farmers. Secure property rights are necessary for land to serve as collateral; however, there are several other factors (e.g., borrower income, supply of relevant financial products, and the quality of other aspects of law and its enforcement). These types of interlinking needs lead us to believe that the Malagasy chose a wise “tripod” package of land tenure, agricultural and financial sector intervention. The results of each are mutually reinforcing and together stand to transform the livelihoods of many in the five zones selected for implementation. At the same time, each project will help create a platform for broader transformation.

Felipe Manteiga
Managing Director for Agricultural Programs