Vol. 9, No.1:Challenges in Access to Urban Land for Business Activities under Ethiopian Law: Between Oligarchy and Broad-based Private Sector

Abstract

Various restrictions in Ethiopia’s urban land law have adversely affected the availability, transferability and tenure security of land-use rights for business premises. These legal and administrative challenges have led to urban land lease tender price hikes that are not affordable to the majority of economic actors in the private sector. The gaps in land information and land governance exacerbate the challenges in the realms of availability, transferability and tenure security. Such land-use right market imperfections are susceptible to economic rent seeking, resource capture and land speculation. Unearned windfall income for persons involved in resource capture, the difficulties encountered by many businesspersons in loan repayments for land lease and construction, urban land lease tender rates and rising business premise rental rates corrode rather than nurture broad-based value adding economic activities. This article examines the Ethiopian legal regime and urban land governance in light of the challenges they create in the availability, transferability and affordability of access to urban land for business activities. There is thus the need to address these challenges and enhance tenure security in order to facilitate the emergence and coalescence of a strong middle class and broadbased private sector in lieu of a nascent oligarchy of the nouveau riche (the new rich) which is in the course of ascending onto its dreamland, inter alia, through resource capture attributable to various restrictions against wider access to urban land.