Land titling must be administered at local level to unlock Nigeria’s dead capital

In order to unlock at least $300 billion or as much as $900 billion worth of dead capital in residential real estate and agricultural land alone, discussions or issues surrounding land titles must be transferred from the federal and state levels to local government level, according to stakeholders.

Dead capital are assets that cannot be easily transferred, where the title is uncertain, so cannot be converted to their most valuable social and economic use, and cannot be used as collateral, so prevent investment in other businesses.

PWC, in 2019, estimated that Nigeria holds at least $300 billion or as much as $900 billion worth of dead capital in residential real estate and agricultural land alone in 2019.

Land tenure system in Nigeria is still largely in the communal and informal sectors. Sporadic

efforts by the government on formalisation of property rights through titling in cities like Lagos, Abuja or Kaduna are yet to meet the intended goal.

Panellists at Businessday’s 2020 Law and Development Summit recommended that the titling of land must be transferred from federal and state government levels to local government in order to unlock Nigeria’s dead capital.

“Things need to be developed in the state or local level because we don’t have a lot of confidence in the national Systematic Land Title Registration process,” Andrew Nevin, partner and chiefeconomist, PWC, Nigeria, said at the virtual event.

Recall, Nigeria’s Presidential Technical Committee on Land Reform (PTCLR) was set up to ensure the adoption and implementation of Systematic Land Titling and Registration (SLTR) in all of the 36 states and the Federal Capital Territory.

Nigeria needs to change the model of its land titling from the national level to the state or local government level in order to make more valuable uses of its dead capital, attract more investment and create enabling business environment for opportunities, Nevin noted.

“If we don’t make progress in the land registry system, we can’t make progress in land administration,” Nevin said.

Nevin suggested that Nigeria’s adopts the Republic of Georgia’s model of Blockchain-based land titling.

Bitfury, a leading full-service Blockchain technology company, and the Republic of Georgia formed a partnership in April 2016 to create a one-year trial project to move the country’s land registry system to a Blockchain platform. Georgia had been able to maintain an accurate account of land titles in its current National Agency of Public Registry database, which is crucial for the success of a Blockchain project.

Taiwo Ayedun, founder of Credit Registry, Nigeria’s largest credit bureau and pioneer of the industry serving members since 2003, said Nigeria needs to solve a fundamental problem by getting the state more involved in the land use charge.

“We need to have a government closer to the people,” Ayedun said.

Andrew Smith, adviser, Access to Finance and Investment GIZ Nigeria Competitiveness Project (NICOP), said the absence of local land titling was having a negative effect in the unlocking of dead capital in both rural and urban areas across the country.

Smith, who has worked in Nigeria in the last 15 years on land administrative, said most states lack meaningful data on sites, which is why investors are granted outright ownership of land while there is no compensation in place for displaced communities, a development that often led to conflict and litigation.

“Land banking is a longterm risk to Nigeria,” Smith said.

“Although Kano State has data on Land Use, Occupation and Social data for 150,000 household, however, no attempt has been made to use it to deliver investment or growth because the data are with the wrong agencies who have no incentives to use them,” Smith said.

On how to solve this problem, Smith suggested local government must record all interest in land including communal land while data must underpin contract negotiations between communities and investors to mutual benefits.

Nigeria is so broke yet so rich, however, with the right titling, most stakeholders say Nigeria can use a whopping N170 trillion lying fallow in dead capital to lift 93 million of its people out of extreme poverty, create jobs and rely less on expensive borrowing.