The leasehold system and drivers of informal land transactions in Bahir Dar city, Ethiopia

ABSTRACT

In Ethiopia, informal land transactions are proliferating in urban centers and triggering wider socio-economic and environmental challenges in the sustainable development of cities. Taking the case of Bahir Dar city, this paper examines informal land transactions in Ethiopia in terms of its rule-structuring processes, roles of actors in the transaction, and factors for its emergence and continued proliferation. Empirical evidence collected through key informant interviews, participant observation, and from secondary sources were analyzed qualitatively. The study reveals that the lease system in Ethiopia is ill-suited to the interests and reality of many urban dwellers and is unable to meet their needs. As a response to the failures of the lease system, residents are increasingly turning to informal land transactions. The success of informal land markets in Bahir Dar is reinforced by the possibility of formalization of land holdings through corrupt practices in local land administration. Moreover, the processes of the informal markets have provided adaptive and responsive alternatives for urban dwellers to access land. Unless land administration shifts to adapt to these realities, informal markets will likely continue to thrive.

KEYWORDS:

• Land
• informal
• informal land transactions
• lease
• Bahir Dar
• Ethiopia

Disclosure statement

No potential conflict of interest was reported by the author(s).

Correction Statement

This article has been corrected with minor changes. These changes do not impact the academic content of the article.

Notes

1 Cheshire and Sheppard, “Land Markets Regulation”.

2 Zevenbergen and Frank, Real Property Transactions.

3 Battersby, “Informal Transactions,” 637.

4 Rakodi and Leduka, “Informal Land Delivery,” 1.

5 Nkurunziza, “Informal Mechanisms,” 156.

6 Adam, “Informal Settlement,” 90–97.

7 FDRE Constitution, Article 40(3).

8 Ambaye, “Informal Settlement,” 18.

9 Ibid, 19.

10 Goodfellow, “Taxing Property”.

11 De Soto, Mystery of Capital, 6.

12 UN-HABITAT, Challenge of Slums, 129.

13 Ibid.

14 The lowest administrative unit in Ethiopia.

15 According to the records of the Bahir Dar city administration.

16 Gerring, Case Study Research, 37.

17 Webley, “Qualitative Approaches,” 4.

18 Mack et al., Qualitative Research Methods, 30.

19 Foster, “Observational Research,” 59.

20 Finnegan, “Using Documents,” 139.

21 Boulton and Hammersley, “Analysis of Unstructured Data,” 244.

22 Schlager and Ostrom, “Property-Rights Regimes,” 250.

23 Ibid.

24 Durand-lasserve and Selod, “Formalisation,” 102.

25 Kasimbazi, “Land Tenure,” 6.

26 FAO, Land Tenure, 8.

27 Schlager and Ostrom, “Property-Rights Regimes,” 254.

28 Ibid.

29 Kombe and Kreibich, “Informal Land Management,” 10–15.”

30 Hart, “Informal Income Opportunities Opportunities,” 61–89.

31 Godfrey, “Theory of the Informal Economy,” 247. Wilson, “Approaches To The Informal Economy,” 205.

32 Godfrey, “Theory of the Informal Economy,” 249.

33 Rogers, “The Legalist Approach,” 5.

34 Desta, “The Urban Informal Economy in Ethiopia,” 44.

35 Okeahialam, and Ogbuefi, “Determinants of Informal Land Transactions,” 76.

36 Berner, “Learning from Informal Markets,” 5; Leaf, “Informality and Urban Land Markets,” 134.

37 Fekade, “Deficits of Formal Urban Land Management,” 130.

38 Rakodi, and Leduka, “Informal Land Delivery Processes,” 4.

39 Berner, “Learning from Informal Markets,” 5.

40 Fekade, “Deficits of Formal Urban Land Management,” 120-150.

41 Oloyede et al., “Informal Land market,” 598.

42 Article 3 of proclamation no. 47/1975.

43 Archer, “The Leasehold System,” 229–31.

44 Article 7(2) of Proclamation no.721/2011.

45 Ibid., articles 12 & 13.

46 Ibid., article 24.

47 Beza, “Corruption in Urban Land Governance,” 8.

48 Teferi, “An Assessment of Urban Land Lease,” 72.

49 Ibid., 70; Alemie et al., “Land Governance in Ethiopian Cities,” 8–9.

50 Melese, “Impediments to Cooprative Housing,” 77.

51 Alemie et al., “Land Governance in Ethiopian Cities,” 8–9.

52 Beza, “Corruption in Urban Land Governance,” 10.

53 Interview with informal land buyers, and sellers; Interview with land brokers.

54 Interviews with informal land buyers and sellers in Dagmawi Minilek and Tana sub-cities, 12 February - 6 May 2020.

55 Ibid.

56 Ibid.

57 Ibid.

58 Ibid.

59 Ibid.

60 Ibid.

61 Ibid.

62 Ibid.

63 Abdo, “Reforming Ethiopia’s Expropriation Law,” 309–32.

64 Interviews with informal land buyers and sellers in Dagmawi Minilek and Tana sub-cities, 12 February - 6 May 2020.

65 Ibid.

66 Interviews with Land Brokers in Bahir Dar City, 12 February - 6 May 2020.

67 Ibid.

68 Ibid.

69 Ibid.

70 Interviews with informal land buyers and sellers in Dagmawi Minilek and Tana sub-cities, 12 February - 6 May 2020.; see Beza, “Corruption in Urban Land Governance”.

71 Interview with head of code inducement and control team, 12 February 2020.

72 Interview with head of code enforcement office, 11 February 2020.

73 Interviews with informal land buyers and sellers in Dagmawi Minilek and Tana sub-cities, 12 February - 6 May 2020.

74 Ibid.

75 Quan, and Robert, “Housing Affordability,” 116–20.

76 Interviews with informal land buyers and sellers in Dagmawi Minilek and Tana sub-cities, 12 February - 6 May 2020.

77 Ibid.

78 Interview with the head of tender executive team, 12 May 2020.

79 Ibid.

80 Interviews with informal land buyers and sellers in Dagmawi Minilek and Tana sub-cities, 12 February - 6 May 2020.

81 Interview with the head of housing association arrangement organization team, 12 May 2020.

82 Ibid.

83 Interview with the head of code violation control and follow-up team, 11 February 2020.

84 Ibid.

85 Interview with the head of land preparation and urban betterment team, 11 February 2020

86 Interviews with informal land buyers and sellers in Dagmawi Minilek and Tana sub-cities, 12 February - 6 May 2020.

87 Interview with informal land buyers and sellers in Dagmawi Minilek and Tana sub-cities, 12 February- 6 May 2020.

88 Walle, “Kebele-Administered Dwelling Units in Bahir Dar,” 30–39.

89 Ibid.

90 Ibid.