Aug 25, 2010 (LBO) – A World Bank study has called on Sri Lanka to loosen controls on land ownership and use, saying restrictions tend to keep poor farmers poor. “Land-development ordinances that regulate the use and transfer of land keep a larger proportion of people dependent on agriculture,” the report said.
“They also keep people poorer because they earn less for their labour.”
Relaxing these ordinances is likely to raise agricultural incomes and accelerate poverty reduction and longer term transformation, said the study called Sri Lanka: Reshaping Economic Geography: Connecting People to Prosperity.
It suggests that rather than relocating existing industries from leading areas to those lagging behind, making land more mobile”not across locations but across uses and users”is likely to transform the economy and accelerate growth.
“Particularly important are institutional reforms that can improve the functioning of agrarian land markets,” the report said.
“Targeted incentives to promote economic development work best when they are preceded by institutional reforms improving the fluidity of land markets.”