Improving the land assets of poor people through land reform can be an effective way of reducing poverty, facilitating broader economic growth through enhanced agricultural productivity, and producing greater social harmony. Community-based land reform relies on grants and/or loans to help beneficiaries purchase land through voluntary sales. In some circumstances, this provides an attractive model for land reform. Additional support typically includes production credit and technical assistance, because they increase the productivity and sustainability of farming operations. This support can be provided with the same funding as that for land acquisition or through parallel programs. Producer and community organizations are key implementing agencies in this model for efficient and equity-enhancing asset redistribution. Colonialism, civil upheavals as a result of internal power struggles, and government policy distortions that affected land markets have led to the extremely inequitable distribution of land ownership in many developing countries. Land reform is an important issue, especially in countries where land has been a central demand and in post-conflict countries where land distribution remains highly unequal. Land reform carried out in an ad hoc manner under political pressure rarely reflects the needs of poor communities. Conventional land reform programsincluding expropriation and privatization of state landhave often been expensive and slow, and they have not sufficiently addressed beneficiaries’ needs for capacity building and training. Government-directed programs of compulsory land purchase and settlement are suited to some circumstances but are only one of several possible models for land reform. In the early 1990s, Bank staff working in Latin America and Asia piloted the use of market mechanisms to make land redistribution more efficient, cost-effective, and better tailored to local conditions. With the strong support of NGOs and governments, community-managed land reform pilot projects were undertaken in Brazil, Colombia, and South Africa. Because of the limited experience with this approach, best practices cannot yet be established definitively, but the pilot projects offer some useful lessons. Community-managed land reform provides potential beneficiaries with grants and/or loans to purchase land on the market. It differs from government-directed land reform initiatives in which the government takes land from a large-scale farmer and transfers it free of charge to poor people. In community-managed land reform, the selection of beneficiaries and land acquisition are handled at the local level. The government’s role is limited to establishing the necessary policy and regulatory framework for making grants and for purchasing land. Land is transferred voluntarily between willing parties, with community organizations, NGOs, or other implementing agencies helping beneficiaries identify land available for purchase, negotiate and reach agreement with the seller, and submit this agreement for approval to a local coordinating entity, such as a district, municipality, or development committee. The local coordinating entity verifies the eligibility of beneficiaries, ensures that there are no legal impediments to transferring the land, and confirms that the negotiated price is at fair market value.     
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