Valuation and Registration of Customary Land in Papua New Guinea

Abstract

"This paper considers what an opportunity cost valuation of customary land can tell us about the pressures for land registration in Papua New Guinea. The discussion here presents a historical perspective on land registration, introduces land disputes and land markets in PNG, explains an opportunity cost valuation of land, and then suggest ways in which such valuations can help us interpret the processes of land registration. Calculations on the economic value of customary land draws on data from pilot surveys of land use in two provinces (Madang and Oro). This opportunity cost valuation demonstrates that low financial returns mislead and lease valuations probably greatly underestimate the real value of productive land in PNG. The historical experience of land registration in Africa does not support the current promises of rural credit, greater security of title and greater agricultural productivity through land registration. Further, evidence on the existing value of subsistence and cash crop production, when compared with the current value of land leases, suggests a great undervaluation of customary land is taking place. The paper concludes that the historical record on registration, combined with opportunity cost valuations, places a strong onus on the advocates of land registration to answer specific questions over the serious risks to small landowning families in Papua New Guinea."