In Nigeria, it is a well known fact that arbitrary rates are usually use on economic trees and herbs during valuation for compensation arising from compulsory land acquisition practices. This practice ignores the economic life of the trees, which if put into consideration would supply value above the one obtained from the valuation using the rate.
Thus I am looking at the possibility of integrating sustainability in the compulsory land acquisition and compensation practice.
Dear Asmat and Mohammad, thanks for your excellent contributions. Firstly regarding compulsory acquisition, I agree with Asmat, must it be done? In several other countries, the word is compulsory purchase not acquisition which probably puts the owner in a better bargaining position and where an interplay of market forces of demand and suplly can be considered in his negotiation.
Mohammad raises very very serious and critical issues on the subject of ecosystem services being destroyed. The question here is WHO gets compensated. Is it an individual or society as a whole. I think it is important to separate the two. If the proposed development is in response to the Government's need to provide social services to a community, I believe that such a community should be made to know the total cost of such a project. This cost should include physical loss to the owner and loss in ecosystem services to the wider public.
Financial losses may be paid to the displaced owners but the loss in ecosystem services can be used to weigh the viability of the project and what mitigation must be done. I do not think an individual has the right to claim for losses in ecosystem services as it is our common heritage.
Dear Mohammad Mohammad Ishaq ,
You have raised a very interesting question. I fully agree that economic life of trees is usually ignored during valuation process of land. On the other hand, compulsory land acquisition itself is a big debate i.e. should it be allowed or not. Indeed, the concept of sustainability is impossible to achieve without considering the points raised by you. Let us see what others say more in this context.
A colleague of mine in the Department of Commerce has written several papers on this subject, now he is engaged in writing a book on environmental accounting. In fact, in my country value of a tree determine in terms of its timber or firewood value in the market, though there are laws protecting trees there, but when the government is involved in law or no law, land is acquired in the name of development. However, in valuation of trees and other vegetation services they render must be taken into consideration. These not include in my country not only maintaining oxygen-corbon cycle and minimisation of pollution when stomata with carbon dioxide also take up toxins which passing through biological and geological phase are render inert, but also moderation of temperature and maintenance of local water cycle apart from their value as biodiversity which immediately or in long term may be required in developing crops and fodder etc. If all these services are added for the remaining age of a tree or herb or creeper, it would be too high that any organisation acquiring the land will be deterred. However, when acquiring land these aspects are not taken into consideration. It is simply undermining sustainability. So is the case with wetlands. In a town or city wetland are filled up by dumping solid waste and then they bring in high commercial value, but what about their services as water purification, a scenic spot if developed and an ecosystem and possibility of piscicultur.
Dear Asmat and Mohammad, thanks for your excellent contributions. Firstly regarding compulsory acquisition, I agree with Asmat, must it be done? In several other countries, the word is compulsory purchase not acquisition which probably puts the owner in a better bargaining position and where an interplay of market forces of demand and suplly can be considered in his negotiation.
Mohammad raises very very serious and critical issues on the subject of ecosystem services being destroyed. The question here is WHO gets compensated. Is it an individual or society as a whole. I think it is important to separate the two. If the proposed development is in response to the Government's need to provide social services to a community, I believe that such a community should be made to know the total cost of such a project. This cost should include physical loss to the owner and loss in ecosystem services to the wider public.
Financial losses may be paid to the displaced owners but the loss in ecosystem services can be used to weigh the viability of the project and what mitigation must be done. I do not think an individual has the right to claim for losses in ecosystem services as it is our common heritage.
Referring to Malaysia Practices, in evaluating compensation for trees, I think the value of trees is differentiate with the economic life of trees. For example, the 10 year oil palms trees will be compensate higher than 3 year oil palms trees. This is due to the 10 year oil palms having higher yields than 3 year oil palm.
Wan, this is an important contribution and such information on species and life expectancy are crucial in determining the term of years for use in valuation.
I think it is very important that Nations follow this path of associate evaluation with natural assets and with the sustainability necessary to human survival. In Brazil an evolution of the national Norm (NBR 14653) on evaluation, adopts provisions concerning natural assets.
The availability of international best practices regarding environmental accounting for sustainability should be a global goal assumed by organizations like FAO or FIG. In EU, this could be implemented through Directives (then passed to national legislations). In Portugal, a law on the creation of a Land Fund (we called it "Bolsa de Terras") was recently passed, Law 62 / 2012. It assumes that individual owners, state (national or local) private domain and derelict land with no identified owner, can be leased or purchased by farmers. It is mandatory that the land be used for agriculture or forestry. So, no compulsory purchase here. The main concern is to increase productivity (and so, land value) by put this land to economic use. Without much concerns for sustainability. There is, however, when the land from the fund comes from (privately held) state or local - municipal sources, a secondary criteria for the bids to the use of this land, which considers the existence of research programs evaluating the resistence of species to dry seasons, a major cause of concern in my country, and also on the existence of projects for so called "biological" agriculture. So, in all I consider is a modest contribution to environmental accounting and sustainability.
When there are compulsory takings of property, owners will temper their investment in trees and fixed capital depending on the probability of taking and the level of compensation. As a result, the public sector should minimize the number of takings and should attempt to compensate for the owners' losses.
Of course, compulsory takings are necessary to produce certain types of public investments, especially roads and public utilities that need to connect to a network of such things. However, compulsory takings are not necessary to build a post office or any other stand-alone facility.
Compensation is difficult when there is sentimental value or private information that create losses exceeding market value.
Sustainability requires that owners are neutral regarding these takings. Otherwise, there will be a race to the bottom of property investment. Fear and loathing of public officials can result in under-investment. Of course, under-investment by some owners leads to under-investment by others . . . a destructive cycle of disinvestment.
Dear Peter,
Your comments on underinvestment and disinvestment are so true and there are several case studies in my locality.
We have a recent situation where an artificial and fear induced slump has been introduced into land values in the per in urban areas of Port Harcourt such as Igbo-Etche where property values which initially became stagnant somewhere between 2008 and 2010, are now on a downward spiral.
This can be linked to fear of the likelihood of compulsory acquisition. Investors are unwilling to invest and communities are eager to sell at lower prices than they did previously due largely to fear of compulsory acquisition and the knowledge that compensation payments t will be much lower than even the reduced market values at which they are willing to sell.
By contrast, there is hyperinflation and over investment in parts of the city where compulsory acquisition is least likely and this has resulted in a rather distorted property market.
- Badges
- Science topic