Analyzing Land Management Challenges and Willingness to Pay of Developers to Pay For Land in Special Zone of Oromia Region Surrounding Addis Ababa the Case of Sululta Sebeta and Legetafo-Dadi Towns
No Thumbnail Available
Date
2010-07
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Addis Ababa University
Abstract
ABSTRACT: Land management addresses all issues related to the sound and susta inable use of land. It
is the process by which the resources of land are put to good use. Like in many other developing
countries, in Ethiopia, land management process has not been immune to the growing phenomena of
land management cha llenges. This paper analyzes land management challenges and determinant factors
of Willingness to pay (WTP) of investors for land. It specifically questions causes, effects and response
options of the problems such as land speculation, the issue of governance and information in relation to
land management and land lease policy implementation as well as informality on land. It also seeks to
identify factors that affect WTP of developers to pay for land using Ordinary Least Square (OLS)
econometric model. The study utilized the survey method, interviews with selected government officials,
and review municipal documents to generate empirical data. A sample of 290 households from formal
residents (200), informal settlers (40) and developers (50) was used. Simple random sampling technique
was employed to select formal residents and developers, whereas purposive sampling was used to select
informal settlers. Empirical evidence was complemented by a study in three selected towns from a
Special Zone of Oromia National Regional State surrounding Addis Ababa, namely Sebeta, Sululta and
Lege Tafo-Dadi. Descriptive statistics, multivariate analysis and Liker Scale questions were employed
using SPPS-16, E-Views-6 and Severity index calculation, respectively, to analyze the collected data. The
results obtained from th is study ind icated that governance, information, lease policy, speculation and
informality in the land management process are plu ral and characterized by multiple linkages. These
multiple dimensions affect the content, process and outcomes of the land management system in the
study area. A significant number of developers buy land not for consumption but for saving. Like the local
town government, land speculators have also provided land for those who have the capacity to buy.
Farmers at the expansion area have break up their land in small sizes and offered it for sell. Informal
settlements in the study area are not necessarily perceived as illegitimate by the actors concerned. Major
determinants of informality in this analysis include poverty, shortcomings associated with the social
housing programs, unrealistic urban land use regulations and standards, bottleneck bureaucratic
tendencies and bad governance. Institutional response options from state and local authorities have
taken a va riety of forms including 'laissez-fai re' approach, negotiation and bulldozing.
Public opinion on some governance norms (l ike transparency, inclusiveness, equity and responsiveness)
clearly depicts the absence of good governance in the study area. Rampant corruption is also another
major factor that decreased the efficiency of the land administration and delivery system. Adequate land
information systems are prereq uisites to land management and administration. However, the findings of
the study revealed that land registration procedure in the study area is t ime consuming and cumbersome.
Most town municipalities in the study area lack clear enabling law to affect real property registration.
Shortage of critical mass of skilled man power coupled with lack of technolog ical support system further
compounded the problem. Respondents blame the existing lease price as discouraging real developers
and unaffordable to the poor. Lease was initially publicized as it will finance the local government's
revenue from land lease and has to be re-invested for local infrastructure development. However, in
reality, the commitment on the part of the implementing agencies is incredibly low. Even though more
efforts have to be ca rried out to promote the notion of lease holding tenure, no significant measure had
so far been taken by the local administration to build trust among the citizens. Econometric model
indicated that the va lue for a particular land in towns is positively affected by plot size, investors' capital
and accessibility to basic services. In the study area, investment cost, distance of the plot from the main
road and price of land had negatively affected investors' WTP for a particular land. Finally, the analysis of
the study strongly suggest for the need to promote public participation, public awareness raising and
outreach on land lease policy, build inst itutional ca pacity including critical mass of skilled manpower,
facility, etc in local administra tions, bridge the prevailing gap in the contract agreement and information
communication technology tra nsformations. A more proactive mechanism to deal with informality is
adopting a collaborative approach consisting of three steps, namely recognit ion, awareness creation and
identification, and result assessment is recommended
Description
Keywords
Developers to Pay For Land