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EL SALVADOR: Land Administration (2008)

Nation-wide mechanism for mapping and land registration
El Salvador: 1.1 million parcels registered, increasing land values and better access to credit 

Impact

The El Salvador Land Administration Project successfully established a nation-wide mechanism for mapping and land registration that registered over one million parcels, or about two-thirds of all parcels in the country, resulting in greater asset security, increased land values, and better access to credit, particularly for small farmers.

Project Context and Description:

POver the last 30 years, the Government of El Salvador promoted land reform through which 300,000 hectares of large farms were expropriated and distributed to cooperatives and individuals. This process was accelerated when peace was restored to El Salvador in 1989, and the 1992 Peace Accords formally ended the 12-year civil war. The Accords mandated specific programs to support the economic and social reintegration of the population most affected by the conflict, including land transfers. However, this process was slowed by the lack of a land registry and information system. In addition, lack of legal titles and cumbersome registration procedures impeded the development of land markets and the use of land-related information for investment and planning purposes.
 
The Land Administration Project was a response to the urgent need to improve land registry and cadastre services. The project sought to regularize land registration for El Salvador’s estimated 1.6 million parcels of rural and urban land by creating an efficient and financially self-sustaining national cadastral mechanism for mapping and land registration – the new National Registry Center (Centro Nacional de Registros - CNR). The registration system involved mapping via aerial photography and field surveys, regularization of land records that identified the legal status of each parcel, and development of alternative dispute resolution mechanisms to avoid lengthy court procedures in the case of conflicts. In this context, the goal was to ensure that land titles were legally valid and registered, with a clear link between the parcel and the landholder. The enhanced security of property rights stemming from registration in the system was expected to lead to improved efficiency of rural and urban land markets, enhanced land investments and productivity, and increased use of property as collateral.
 
The project was complemented by the partially-blended Protected Areas Consolidation and Administration GEF project, which aims to catalyze the consolidation of key protected areas and develop a strategy for consolidating other protected areas, which is directly linked to the systematic land regularization process.
 
The Land Administration Project successfully consolidated cadastre and registry functions into a single agency, the CNR, which has become an example of best practice worldwide. The Project regularized about 1.1 million out of 1.6 million parcels in El Salvador. Registration of real estate transactions now takes between 15 to 17 days compared to 30 to 45 days in 1997. The average number of visits to CNR needed to register a land transaction has been reduced from 3.5 to 1.5. Transaction costs of the process dropped from $28 per parcel to $12. Improved records management has avoided the issuance of double and overlapping titles and helped detect duplicate titles. Feedback from service users found increased customer satisfaction in land administration services.
 
As a result of more secure tenure, property owners appear to have better access to credit. Property owners in areas benefiting from the project were more likely to use their property as loan collateral and were more likely to request credit through a formal financial institution than districts not yet under the program. Moreover, the value of properties with secure tenure is 17% higher than those not registered.
 
With regard to land management, the Project contributed to the preparation of a map detailing the land use pattern in El Salvador  , which served as the basis for the identification of the Mesoamerican Biological Corridor of El Salvador and for demarcation of natural protected areas and mangroves areas to be included in the National System of Protected Areas. The CNR also responded to emergencies and political events, for example by   identifying and mapping areas affected by Hurricane Mitch in 1998, assessing homes destroyed in the 2001 earthquakes, and redefining the boundaries between Guatemala, Honduras and El Salvador in 2003-2005.  
 
Other notable achievements of the project include:

  • The project financed an innovative land regularization methodology that covered systematically urban, peri-urban and rural lands as well as protected areas. This methodology was successfully replicated in other countries ( Honduras , Guatemala , Panama , Nicaragua , etc.).
  • The projects strengthened the capacities of municipalities to use digital cadastral information for municipal and land use planning and better targeting of their investments.
  • The project financed a modern land information system (SIRyC) that integrates property registry and cadastral services and improves the delivery of such services at the local level.


World Bank contribution:  

The Bank’s value added was critical in several aspects:

  • The Bank helped develop consensus around the conceptual approach to land registry. The Bank provided expertise and facilitated project design workshops around land policy, land registry and cadastral systems, and alternative dispute mechanisms
  • The Bank brought international experience gained in similar successful Bank projects in other developing countries (Thailand) and advanced countries (Australia, Netherlands), as well as lessons learned from a pilot carried out in the Department of Sonsonate under a Bank-financed agricultural development project.
  • The Bank also showed flexibility in meeting CNR's needs following the impact of natural disasters, by approving the reallocation of funds for emergency civil works.


Elements that made this project successful:  

The Project benefited from the full support of the Government and a stable macroeconomic environment. Specific elements that made the project successful include:

  • A successful pilot experience that provided the basis for a national scale-up.
  • Effective CNR management, which responded promptly to technical and procedural issues as they arose.  
  • Pro-active involvement of the private sector, including contracting private surveyors and using the private sector and NGOs for the field work proved to be significantly more effective and efficient, preventing a ballooning of the institution.  Moreover, the financial sector provided support to the project from the start.

 

Next steps:

The CNR land registration system is now an ongoing service. A law approved in 2002 enabled CNR to increase its service fees by 28 percent, contributing to sustainability. CNR has recently received a direct loan from the Central America Development Bank to finance the second phase of the Land Administration project, reflecting the project’s impact on CNR creditworthiness. CNR continues to serve as a reference institution for other land administration efforts in the region.

 

Date Posted: 02/06/08



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