WORLD BANK SUPPORTS LAND REFORM IN UKRAINE
Contacts
:
Kyiv
Dmitro Derkatch (380 44) 490 66 71/2/3
e-mail
dderkatch@worldbank.org
Washington
Miriam Van Dyck (1-202) 458-2931
e-mail
mvandyck@worldbank.org
WASHINGTON, June 25, 2003 - The World Bank’s Board of Executive Directors yesterday approved a US$195.13 million loan for the Rural Land Titling And Cadastre Development Project in Ukraine. The objective of this project is to establish a national cadastre and title registry system, privatize land parcels to individuals in rural areas on an equitable basis, establish their property rights by issuing state deeds for land, and encourage the restructuring of farms into more efficient units, with due consideration for environmental and social safeguards.
Poorly-defined ownership rights, no mortgage legislation and the lack of a modern title registry system have resulted in a critical shortage of medium- and long-term credit in the rural sector of Ukraine in the past.
In the last three years, the Ukrainian government has made significant progress in moving the land reform program in rural areas forward. The Land Code has been enacted, the legal framework for land distribution is in place and the government has already started implementation of the land reform program. A Presidential Decree was recently issued, providing the institutional basis for a unified national cadastre and title registry system. In addition, a modern mortgage law was recently passed by Parliament.
"This loan will provide the financial resources that the Government needs to complete its land reform agenda, in particular the issuing of state deeds for land in rural areas and the establishment of an efficient cadastre and registry system
," said
Iain Shuker
,
World Bank
Task Manager of the project.
"
This will reduce the cost of land transactions, improve security of tenure, enable mortgage markets, and facilitate urban and environmental planning."
In the short term, the project is expected to result in the equitable distribution of rural land assets and the development of a rural land rental market. This should provide rental incomes to a bulk of the rural population, thus mitigating the social impact of the transition, while at the same time allowing entrepreneurial individuals access to land. In the medium-term, it is expected that the project will lead to increased prosperity in rural areas and a reduction of poverty through an equitable distribution of assets and the establishment of efficient, privately-managed, and profitable farming units.
The project will finance the activities under the following main components:
Land Survey Works.
This component will focus on the systematic issuing of State Deeds for Land free-of-charge to individual rural land owners who receive agricultural land as a result of the land privatization process.
Cadastre System Development.
This component will support the development of a national cadastre system and title registry system which will be managed by the Cadastre Center. Once developed and in use, the cadastre will have multiple purposes. The most critical of these purposes for Ukraine in the next few years is that it will be the basis for a title registry system, which records the legal rights to ownership, transfers of ownership, mortgages and restrictions on the property.
Institutional Development and Legal Reform.
This component will assist the State Committee for Land Resources (SCLR) to begin reorganizing and changing its function from the old land-use planning to land-use regulation better suited to a market economy.
Public Awareness.
This part of the project envisages mass media campaigns, production of pamphlets and leaflets on a mass scale and the holding of public meetings at individual farms to give instructions and answer questions related to the land reform. It will also provide legal services to land owners.
Training.
Training will be provided by Ukrainian educational institutions to consultants, lawyers and surveyors on farm restructuring and issuing of State Deeds for Land. In addition, funds will be provided for four agrarian universities in Odesa, Lviv, Kharkiv and Kyiv to equip them and to assist them with further development of their courses and their long term training capacity.
Farm Restructuring Services.
The farm restructuring component will provide advisory services to new or potential land owners. These advisory services will include explanation of legal rights and obligations to new land owners, advice on drafting of rental agreements, technical support in cases where there are disputes between parties over division of land or non-land assets, and advice on the development of plans for land use where land is used in common. It will also provide advice to farm members on the distribution of non-land assets of former collective farms and on reducing outstanding debt.
The State Committee of Ukraine for Land Resources (SCURL) prepared the project and will be responsible for its implementation. The loan will fund a Project Implementation Unit in Kyiv comprising of a core team of professional staff in Kyiv and regional representatives in each of the 24 Oblast offices and the Autonomous Republic of Crimea hired to coordinate and promote project activities.
The loan will be at the Bank's standard interest rate for LIBOR-based, single currency dollar loans, repayable in 20 years, including a 5-year grace period. Since Ukraine joined the World Bank in 1992, commitments to the country total more than US$3.5 billion for 28 operations.