UNLOCKING NIGERIA’S LAND POTENTIAL
An efficient land administration system will boost economic activities
Last week, the federal government vowed to unlock over $150 billion in dormant land capital nationwide to boost economic growth and improve living standards. Minister of Housing and Urban Development Ahmed Dangiwa noted that billions of naira in potential internally generated revenue are untapped for state governments, and an estimated $300 billion in “dead capital” for the federal government, a term often used for property which is informally held, but not legally recognised, and cannot be exchanged for financial capital.
Undoubtedly, Nigeria has large stock of dormant assets which cannot be converted to economic capital. Some reports have estimated dead assets in trillions of dollars, especially residential real estate and agricultural land. A few years ago, PwC, one of the leading global professional services firms, estimated that Nigeria’s high value real estate market segment holds between $230 billion and $750 billions of value, while the middle market carries between $60 billion and $170 billion in value. But the current land administration system, according to the minister, is inefficient, with less than five per cent of land formally titled. The lack of recognition constraints economic activity, and limits access to credit for individuals and businesses. He said the government is committed to deploying standardised, interoperable Land Information Systems and Geographic Information Systems, strengthening state land agencies and registries, and increasing formal registration of land titles by at least 50 per cent within 10 years.
The country’s informal economy, which accounts for about 65 per cent of the Gross Domestic Product (GDP), poses some constraints. The land tenure system is still largely communal, and land ownership is still a stressful process. The Land Use Act, created to support fair access to land by establishing a certificate of occupancy system, has failed to establish a uniform land tenure system that governs ownership in the country. Issues around proper land registration are complicated, making it difficult to ascertain proper land ownership. All these, according to PwC, “makes it difficult for banks to validate claims to land or for land occupants to use their land to create wealth.”
Beyond the foregoing, thousands of government-owned buildings across the country continue to lay waste even when they could be converted to profitable economic assets. The Building Collapse Prevention Guild, Ikoyi, Lagos recently expressed concerns about the deteriorating state of some national monuments and federal government’s property within the area, arguing that the lack of occupancy and regular maintenance are contributing to their rapid dilapidation. The guild cited the abandoned multi-storey Federal Secretariat Complex, Ikoyi, and the Ikoyi Towers, as public investments that are wasting. The Nigerian Institute of Estate Surveyors and Valuers also estimates that there are at least 50,000 abandoned government projects, valued at N9.5 trillion. In Lagos alone, there are an estimated 2,000 abandoned buildings.
Many of these edifices, built over several decades are currently in disuse. Some of the buildings include the old National Assembly Complex at Tafawa Balewa Square, Independent Building, which housed the Defence Ministry and former Federal Ministry of Commerce at Tinubu Square, the Federal Ministry of Works and Housing, Ministry of Education Building and the NITEL Building. Others are the former Supreme Court Building, former Navy Headquarters on the Marina, the NNPC Complex in Ikoyi, and the NITEL offices at Falomo and Iponri. Many of these buildings, which can be repurposed for other uses, are lying fallow, and have become more or less ‘dead capital’.
But there is much to gain if the administration is committed to its avowal. A digitised and efficient land administration systems, including comprehensive land titling and registration will increase transparency, and make it easier to formalise property rights. These certainly will unlock significant capital and boost overall economic activity.
