Chapter 4. Dynamics of the land problem

4.1. Recent land development trends
4.2. Specific land development projects

4.1. Recent land development trends

4.1.1. The dynamics of land distribution
4.1.2. Proposals and actions concerning land tenure
4.1.3. General proposals for land redistribution

The land question in Saint Lucia has been a topic of study and debate for over a quarter of a century. Initially, attention was placed upon the negative effects of the land tenure systems which are remnants of a mixed French and British colonial heritage. More recently preoccupation with the overall problem of agricultural development and its socioeconomic consequences in an independent nation has focused attention on other land-related constraints to agricultural development. Land distribution, use, and utilization are now being discussed with land tenure when debating agricultural development.

In Chapter 2, the most relevant aspects of the land problem in Saint Lucia were discussed on the basis of existing information. Although somewhat dated, the information available permits the identification of structural constraints on agricultural development: natural resource management and scarcity of cultivable land; the traditional land distribution structure; unclear definition of ownership and tenure; a sizable cohort of landless farmers and/or squatters; and lack of an effective land registration system. The discussion that allows concentrates on Saint Lucia's land problem with emphasis on recent trends in land distribution, proposals and actions concerning land tenure and general proposals for change in man/land relationships. Section 4.2 includes a review of several land transformation projects that have been proposed and reached varying levels of implementation. The relevant considerations will focus on existing institutional capacities for project implementation and costs and benefits of the various proposed projects.

4.1.1. The dynamics of land distribution

The land distribution pattern outlined in Section 2.2 of Chapter 2, has changed over the years as a result of private sector activities and Government interventions. By 1980, land sales by estate owners combined with Government acquisition of estates and settlement projects resulted in a modification of the ownership status of almost a quarter of the lands held in large holdings in 1973/74. Over the last seven years at least 17 percent (close to 7 000 acres) of the 42 000 acres that in 1973/74 were in holdings greater than 50 acres has been subdivided into smaller holdings. Six percent has come into direct Government control and one percent has just changed hands without being subdivided.¹ This represents a rapid shift in land ownership caused primarily by the desire of large landholders to move out of agriculture and the willingness of Government and some committed individuals to become involved in agricultural production. The government has accounted for the subdivided 1 549 acres and acquired ownership of other 2 700 acres; private individuals have acquired over 1 200 acres recently subdivided in medium size farms, for agricultural purposes. Over 3 400 acres have been transferred from agricultural to urban uses as a result of subdivision which accounts for close to 45 percent of the transferred lands, a substantial loss to agriculture in a country so short of productive land.

¹ Estimates based on the analysis of data from the 1973/74 Agricultural Census, Tax Paying List 1974-1980 from the Inland Revenue, Deeds of Sale registered between 1974-1980 in the Registrar, and information given by Government official and private agriculturists.

This pattern of change of land distribution has occurred fairly smoothly despite its ad hoc nature and the losses to agriculture. The impetus of demand for land has been development of tourism and industry combined with urban development. The pattern is likely to continue, but at a slower rate because most existing urban development areas have infilling capacity and almost all the land designated by the Government in its physical plans for urban development has already been affected by this process. In any case, the subdivision of agricultural land for urban purposes is likely to continue on an informal basis to supply housing lots for the urban poor in the villages within commuting distance of Castries.

Private subdivision of land for agricultural purposes, 22 per cent of total subdivided land, is a trend that has gained momentum despite the scarcity of capital and credit for land purchases and the generalized lack of secure and clear title for land.

Direct Government intervention accounted for almost one-third of total agricultural land subdivided during the period 1976-1981. This confirms the importance of Government intervention in the land market even in circumstances where its actions are fairly ad hoc. During the period considered no explicit policy concerning land distribution was defined by the Government. Nevertheless, during the last six years the control of nearly 4 600 acres of the best agricultural lands, nearly 25 percent of all good lands available, has been transferred from the private sector to Government either as a loan (Roseau Estate) for a resettlement project or by direct purchase (Dennery Farmco, Section 4.2.2).

A survey of Saint Lucian land market operations focusing on sales of holdings greater than one acre reveals that over the past five years average land values followed a recognisable pattern, with small sales more profitable per acre than large ones.² This trend is more visible if the largely urban quarters of Gros Islet and Castries are included, along with the 1.00-1.99 acre size range in Soufriere. Included in these are sales for holiday home sites of over EC$70 000 per acre without dwelling. Even in the predominantly rural quarters the value of small plots, probably for combined house and gardening use, is still twice that of the 2.00-4.99 acre size group. The 2.00-4.99 acre group consistently shows lower rates than the 5.00-9.99 acre group as does the 10.00-49.99 acre group in agricultural areas. This may be explained by the theory that those with money to buy agricultural land are not interested in farms under five acres while those interested in smaller lots for non-housing purposes suffer from an absolute constraint of capital availability and poor credit-worthiness.

² Rickman, R., "Saint Lucian Land Market, A Brief Survey," op. cit.

Table 4-1 provides a summary of registered land transactions for the entire island. The average value of large estate sales is extremely low compared to other size classes. Although it is true that large estates occupy most of the best agricultural land in Saint Lucia, they also include substantial amounts of poor uncultivated and uncultivable land. Most of the ten registered sales appear to be of such low value land. Unregistered sales, both private transfers and to Government range from EC$2 000 to EC$5 000 per acre for better land (1 EC$ = US$0.37); with little distinction between subdivision sizes. In at least one case, small plots were sold at a substantial reduction to estate workers unable to raise sufficient money to buy larger blocks which the estate preferred to sell.

TABLE 4-1. SUMMARY OF LAND TRANSACTIONS, 1976-1981 (all values inflated to 1981)

Concessional purchases are also obvious when raw data of lands and survey compilation is inspected. During one year, the value per acre for one size group within a quarter can range from tens to thousands of dollars. Although this may be explained in part by variable intrinsic value, it also suggests two other explanations which are to some extent supported by the evidence available. First, many sales are to close relatives (subdivision of family land) and former employees. Secondly, many people have little idea of the potential market value of the land they are either purchasing or selling.

The 1973/1974 Census indicates that agricultural holdings consisted of 72 000 acres. Assuming that land sold in lots of one acre and over was agricultural land initially, registered land transactions from 1976 to 1981 accounted for more than 6 percent of the land in holdings. If unregistered purchases of large estates by both Government and private individuals are also included, the total area in transactions increases by at least 8 000 acres to 12 500 acres or over 17 percent of the land in holdings. The immediate reaction to this estimate might be that, despite the archaic system of registration of deeds, the land market is active. However, the scale of such activity is greatly affected by the sales of large estates, the ownership of which is rarely in dispute. The predominance of purchasers such as Government and professional people who have resources to check on the legitimacy of the vendor's ownership also reduces problems of verification.

A qualitative inspection of the registered transactions shows that many of the small land sales are subdivisions of other properties. Few show evidence of consolidation of holdings, which may be due to a lack of desire or money for reconsolidation. A contributing factor may be reluctance to buy land for which no clear ownership exists, a frequent occurrence for small parcels.

4.1.2. Proposals and actions concerning land tenure

The first and only national land survey in Saint Lucia was conducted by the French Government in the eighteenth century and is still used as the reference point of land surveying on the island.³ The legal document for proof of ownership, the land deed, frequently omits precise information on the total size and the geographical boundaries of the property. A large number of farmers have no documentation whatsoever for the land they work.

³ Lafort de Latour "Description Générale et Particulière de 1'Ille de St. Lucia," Paris, 1774.

Individual land surveys exist and have been undertaken predominantly for larger holdings and land that has increased in value because of tourism or urban expansion. While these surveys supplement land documentation, they do not provide an adequate base for resolution of future boundary disputes. Survey tends to be so expensive that few smallholders can afford it. Consequently, information on small holdings would be required as part of a data base used for boundary dispute resolution.

Even for the few landowners with a deed and land survey, the principle of "caveat emptor" defines the basic legal attitude regarding definition of land ownership rights. Deeds are filed under the name of the purchaser rather than parcel number making the task of establishing clear title to the land practically impossible. Various specialists studying the land tenure question in Saint Lucia have, over the years, suggested a national land survey and compulsory registration as solution to this problem.⁴ Such a project would require expansion and modernization of the present Lands and Survey Department, the formation of a special Land Court, and a reshaping of the Registry. Before 1981, no action had been taken in this respect. Resistance to act may be based less upon cost considerations than upon the complexity of the issue. Besides the technical problems of producing a cadastre in the complex topographical setting of rural Saint Lucia, there are numerous questions that land registration raises but does not solve.

⁴ Foreman, R.A., op. cit.; Mathurin, Emerson D.C., "An Unfavourable System of Land Tenure: The Case of Saint Lucia," Agricultural Superintendent, Saint Lucia, ca. 1966 (unpublished); FAO, op. cit.; Allsenbrook, G, "Saint Lucia, A Study on Possible Conversion from the Civil Code of the Laws of Succession and Land Tenure," CIDA, Castries, 1978 (mimeo); Lawerence, J.C.D., "Land Tenure in Saint Lucia", BDD, ODA, Saint Lucia: 1979 (mimeo); Saint Lucia Land Reform Commission, "Interim Report," Saint Lucia: June 1980 (mimeo).

Disputes over land ownership have been muted in the past because of the cumbersome and expensive legal system. Land survey and registration will bring disputes into the open, with both political and social repercussions. Multiple and competitive claimants of ownership over a single plot of land may end up assigning certain farmers less land than they are currently occupying or may demonstrate that actual occupants of the land are not rightful claimants. Solution to the problems of these new types of landless farmers will certainly put a burden on the Government. If remedies are not directed at the land registration and survey process, implementation of the whole Land Titling Programme may be jeopardized.

A land survey may imply dividing land into minuscule plots far below what might be considered minimum size to guarantee family subsistence. This is likely to be the case for family land, since the survey and registration process will have to respect all claims to these lands, however remote. The present succession laws will perpetuate this problem over time. Reconsolidation of small holdings will need to be encouraged in areas where extreme subdivision is likely to occur in order to prevent the land from being left uncultivated. Credit for land purchases is normally a major constraint on this process; it is usually made available only after the implementation of the land titling programme. As an alternative solution, determination of what constitutes "minimum size of holding" (Section 7.2.3) and changes in the succession laws to limit the number of heirs and otherwise modify land inheritance have been suggested, but political and technical considerations have delayed any decision in this area.⁵

⁵ Foreman, R.A., op. cit., and FAO, op. cit.

Another problem that land survey and registration will help to identify, but will not solve, is that of unused and underutilized land. In the case of Crown Lands appropriate use can easily be determined by the Government. A national land use plan and a variety of instruments ranging from a more effective land tax based on present use to expropriation powers in case of non-adherence may be necessary.

A final question relates to the change in the social function of land that survey and registration will most surely expose. Smallholders in Saint Lucia consider land a guarantee for family subsistence, and therefore land do not see it as an exchangeable commodity. Once clear title is established, land becomes a capital good and necessary exchanges and sales will be permitted that can lead to more efficient use of the land. Establishment of clear title may also initiate a process of land concentration, even within smallholder communities, denying access to land to more and more families. While this has been an historical tendency in most capitalist nations and a prerequisite for efficient use of scarce land resources, the difficulty of providing alternative employment for displaced families in Saint Lucia may require short-term Government intervention in the land market to ameliorate the undesirable social effects of this phenomenon.

The foregoing observations in no way reduce the need for a comprehensive land survey and registration programme in Saint Lucia. They do suggest however, that prior experience should be acquired in one or more relatively small test areas before the programme is launched on a national scale.

4.1.3. General proposals for land redistribution

i. Land redistribution

The need to promote a more equitable distribution of land in Saint Lucia has deep historical roots dating from the original French land system of quarters. Foreman cites an 1897 British Royal Commission which recommended that the Government "... exert itself in the direction of facilitating the settlement of the labouring population on the land... as small peasant proprietors."⁶

⁶ Foreman, R.A., op. cit.

During the 1970s, debate on the need to redistribute land reached a climax with growing calls for reforms that in 1979 led to the establishment of a Land Reform Commission (LRC). Extensive hearings have taken place and the final report of the commission was being awaited at the time of this study. While it is too early to evaluate the final report or Government action on it, it is becoming increasingly clear that land redistribution is difficult politically and no more than a partial solution to a much more complex problem.

Chapter 2 of this report has clearly documented the inequality of land distribution in Saint Lucia, but land shortage is only one of a number of serious constraints faced by the smallholder. To minimize these, the institutional and technological changes suggested in Section 2.3, Chapter 2, are necessary to guarantee that the new smallholder is not condemned to a marginal existence on his own plot of land.

The concept of "land hunger" itself has to be qualified in the Saint Lucian case. For many smallholders land is a secondary source of income only supplementing cash wages. Distribution of land to these and other landless workers may remove them from the wage labour force with the consequent impact on export agriculture. Further redistribution of land in family-sized plots is a one-generation solution at best if no clear rules preventing uneconomical subdivisions are enforced.

ii. Technological solutions

The tendency to recommend technological solutions for the problem of underdevelopment in the rural sector springs from the impressive gains in productivity that can be realized from intensive application of modern inputs and capital expenditures. It is frequently assumed that technology is neutral, offering all producers the same opportunities. In actual fact, technological packages are frequently developed for specific types of farmers; emphasis on pure stand banana production research is a case in point. While the results are useful for the large farmer, only recently has research focused on the rationality of intercropping on small farms and on adapting existing technology and institutions to the smallholder's needs.

The need for irrigation has received much attention during the last few years, but again the technology proposed is designed with the large farmer in mind. While this heavy investment may be justified from a national point of view, little attention has been paid to the need for investment on small hillside farms upstream from the irrigation system and the implicit relationship that exists between the two farming systems.

Despite the lack of specific technological packages for the small farmer, it can be argued that technology is not the major limiting factor in the development of Saint Lucia's rural sector. Major investments in this field, without solving fundamental institutional problems in the area of land tenure, will benefit a restricted group of landholders at best.

4.2. Specific land development projects

4.2.1. Roseau smallholder resettlement scheme
4.2.2. Dennery Farmco
4.2.3. Private redistribution of land: Marquis estate
4.2.4. Integrated rural development: Fond Assor
4.2.5. Evaluation of proposals for change

In addition to the general proposals for change outlined previously, several types of projects have been proposed as partial solutions to the land problem. Four different types have been identified for analysis.⁷

a) Government resettlement projects. Several resettlement projects have been proposed. The Roseau Small Holder Resettlement Scheme, originally proposed in 1975 and at present in the initial stages of implementation, will be discussed here.

b) Government-owned farm. In the early 1950's the Government intervened in the sugar estates but returned them to private ownership. A more recent case of Government purchase of a large estate for production purposes, the Dennery Landco/Farmco Organization, hereafter referred to as Dennery Farmco, will be used to illustrate the problems and potentials of Government as large landowner.

c) Private land redistribution. The inability to farm land adequately and the fear of expropriation has led many large landowners to sell all or part of their estates. The Marquis Estate has been chosen to exemplify the case of the landowner who chose to sell land to his workers on a preferential basis.

d) Integrated rural development. The proposed Fond Assor Project is examined as an example of revitalization of a smallholder farm community. While it never passed the planning stage, this project illustrates the possibilities of working directly with peasant families who already have access to land. The analysis will identify the potential and difficulties that each project presents for basic changes in the rural sector with the objective of using this experience in future project identification.

⁷ See Strachan, Lloyd, "Land Reformulation in Saint Lucia: Evaluation of the Need for Change ... of Existing Proposal to Bring It About", OAS Technical Report, Castries, July 1981.

4.2.1. Roseau smallholder resettlement scheme

i. Project description

As early as 1975 Geest Industries (W.I.) Limited offered to dispose of 1 932 acres of the 5 880 acres it held in two large estates - Cul de Sac and Roseau. An integrated rural development study was undertaken, and it concluded that the Roseau lands offered the best potential for such activities and recommended that the Government acquire 330 acres in the upper part of this valley.

In 1976, the Commonwealth Development Corporation (CDC), a British state organization specializing in overseas investments, was invited to discuss a potential land development project with Geest. The CDC was subsequently asked by the Saint Lucian Government to prepare a feasibility study, which recommended the acquisition of 1 800 acres of the Roseau estate for a smallholder project.⁸

⁸ Commonwealth Development Corporation, "Roseau Small Holder Project," Castries, April 1978 (mimeo).

The original plan suggested that 400 smallholders receive 2.5 acres of valley land (for pure stand bananas) and 2.5 acres of hillside, for fruit and vegetables. The split-holding proposal was later discarded and the number of participants reduced to 175 farming 1 344 of the 1 800 acre area.⁹ There are now 115 valley farms of 5 acres each for pure stand banana production and 60 hillside farms with 12 acres apiece for banana and fruit production.

⁹ Zadek, S., op. cit.

Capital for the project will be provided by Geest (EC$2 million), the Saint Lucian Government (EC$372 000), the European Development Fund (EC$6 million), the CDC (EC$7.7 million), and other loan sources. The project will be administered by Saint Lucia Model Farms Limited (SLMF), with share capital of EC$30 000 equally divided among the National Development Corporation, the CDC and Geest. The land will be operated as an estate until it is turned over to the smallholder. The SLMF will redevelop valley lands (levelling, drainage, roads, irrigation), provide access to and necessary terracing on hillside farms and, with the help of the new farmer, plant the banana and fruit trees before turning the land over to the smallholder. SLMF will also provide and maintain the basic infrastructure (boxing plants, transport, cableways, etc.) necessary to guarantee efficient marketing. Finally, SLMF will be responsible for technical orientation of the new farmer.

The smallholder will gain access to land under a lease agreement of ten years, duration on valley farms and fourteen years for hillside properties. At the end of this time payment for the land and other investments are presumed to be completed. Both valley and hillside farmers will assume a large debt, calculated at a minimum of EC$54 000 (1979 prices). If the grants requested from the Saint Lucia Government and the European Development Fund do not materialize, the average farmer debt will reach EC$85 000 (1979 prices) or EC$104 000 in 1980.¹⁰

¹⁰ Ibid., pp. 10-13.

ii. Degree of intervention

Geest appears to have taken the initiative in proposing the sale of its land. The Government was apparently invited to participate rather than guide the direction of change. Geest's decision was motivated by both economic and political considerations. The 1978 CDC report cites "six years decline (in production) due to drought" and "violent criticism and hostility by the opposition party" as major reasons for the sale of the land.

A Geest submission to the Land Reform Commission indicates that the company began selling land as early as 1973 and by 1979 had sold 1 456 acres of the Cul de Sac estate and 205 acres of the Roseau property.¹¹ The sale of the additional 1 800 acres for smallholder resettlement was within this general plan of asset liquidation. While political pressure may have been a factor in this decision, the fact that shipping and marketing bananas is much more profitable for Geest than producing them makes the divestiture a logical one from the company's point of view.

¹¹ Saint Lucia Land Reform Commission, "Written Memoranda Submitted to the Commission 1979-1980" (unpublished).

Intervention at the level of the small holding, on the other hand, is far reaching. The SLMF determines what initial investments are made and paid for by the new farmer and what the farmer will grow and how it will be grown. Failure to follow technical recommendations during the lease period can lead to suspension of the lease and removal of the family from the project.

iii. Relation to government objectives

The project appears to meet several objectives proposed in the 1977-81 Sector Plan for Agriculture.¹² Emphasis on banana (valley) and mango (hillside) production will help maximize foreign exchange earnings. The proposed intensity of land use is a major improvement over that existing under Geest management. All 115 valley farms are still exclusively dependent on banana production, which indicates that the diversification proposed by the Government has not been extended to banana lands.

¹² Government of Saint Lucia, Ministry of Finance, Central Planning Unit, "Sector Plan for Agriculture, 1977-1981," Castries, 1977 (mimeo).

iv. Cost and financing

The major investment items of the project, in order of priority, are field development, smallholder housing, land, and infrastructure. It is surprising that such massive field development investment (EC$7 million) is required for what had been regarded as a productive estate. This cost is accounted for by irrigation equipment, levelling and drainage on valley farms and terracing on hillside units.

Valley farmers start paying principal and interest from year one, since banana production is assumed to be near its peak when the producer takes over. Hillside farmers are given a five year moratorium on principal payments because of the slower maturing rate of the fruit trees.

It has been assumed that EC$6.4 million of a total cost of EC$18.1 million (35.4 per cent) will be in the form of grants from the Saint Lucia Government and the European Development Fund. The remainder will be in the form of soft loans at 6 percent interest. A decrease in the grant component or increase in the level of interest charged will automatically increase the farmer's debt load.

v. Gestation period

The repayment period was assumed to be 20 years in the most recent project appraisal report. Present information suggests that this period has been collapsed to 10 years for the valley farms and 14 years for hillside units. This will increase annual lease costs substantially, thereby reducing the farmers net income.

vi. Implementation difficulties

In the original proposal, the turnover of land was to be gradual, beginning in 1979 and ending in 1983. Work on infrastructure has begun but no settlement has as yet taken place. This would appear attributable to:

- inability of the promoting agency to arrange all necessary financing

- lack of concordance on the necessary legal instruments (lease, deed of sale)

- lack of decision concerning smallholder selection criteria

The original smallholder selection proposal called for requiring that a EC$2 500 down payment and giving ex-Geest workers on the Roseau Estate preference. Both of these provisions have since been dropped, with selection open to all qualified Saint Lucians without any down payment.

Several first and second generation problems are evident in the project as now planned, e.g., if former Geest workers are not selected as settlers a serious social problem may emerge in the region. A survey in the Roseau Resettlement Scheme found 26.5 percent of the population over 14 years of age unemployed.¹³ It also revealed that squatting in housing and on land was a common occurrence on Geest land, a reality ignored by project documents.

¹³ Government of Saint Lucia, Ministry of Finance, Central Planning Unit, "Roseau Resettlement Scheme, Phase 11: A Sociological Analysis of the Social Aspects," Castries, n.d. (mimeo).

Another problem is the highly specialized nature of production, especially on the valley farms where bananas are the only crop to be grown. This makes the valley farmer highly vulnerable to price changes, insect and disease problems, natural disasters, and fluctuations in the availability of irrigation water. Recognition that the available water is insufficient has already led to a reduction in the projected area of irrigated banana lands, leaving more than half of the new valley farmers without this valuable input.

The critical moment for the project will occur at the lease period's end, when SLMF turns all management and common services over to the smallholders. No adequate provision for fostering a strong cooperative organization or promoting increased participation of the smallholders in SLMF decision making appears to have been made.

Land sales and subdivision through inheritance will accelerate at the end of the lease period. This will lead to the fragmentation of plots and their possible transfer from high income cash crops to lower risk food crops, thus reducing the income generating capacity of the valley. Any subsequent attempt to reconsolidate plots will be slow and expensive.

vii. Impact on land and income equality

Despite the above observations, the Roseau Resettlement Scheme has much to offer regarding its original purpose of returning land to Saint Lucian farmers. While 175 instead of 400 will acquire land, income projections suggest that participants will be able to improve their standards of living over time and to generate large volumes of production and foreign exchange earnings for the nation. The smallholders will also produce some local foodsuffs (particularly fruit) and demand for local labour will be created, since the holdings are somewhat larger than most families can farm alone. The stated objective of using this project as "a pilot for future resettlement schemes" is questionable, given the massive volumes of capital (and smallholder debt) that are involved.

4.2.2. Dennery Farmco

i. Project description

Dennery Farmco is an agricultural enterprise of 2 772 acres situated in the Mabouya Valley. Approximately 1 500 acres are considered appropriate for cultivation; the remaining 1 272 acres consist of roads, ravines, steep hillsides and infertile land.

In May 1978 the original owners, the Barnard family, agreed to sell the land and buildings belonging to their two companies, Dennery Factory Company Ltd. and Bosquet D'Or Ltd., to the Saint Lucia Government. This property is held by the Government via a wholly - owned corporation, Landco Limited, a subsidiary of the National Development Corporation. The total cost of the land was EC$3.6 million, part of which has yet to be paid off. The operating assets of the two companies were sold to another newly constituted company, Dennery Farmco Ltd. The shareholders of this company were originally intended to include the Caribbean Food Corporation, but the arrangement failed to materialize. The EC$2.0 million in shares are now owned 60 percent by Government, 20 per cent by the Barnard family and 20 percent by Booker Agriculture International (BAI), the last of which having also provided management services until early 1981. Farmco leases the land and associated fixed assets from Landco at a rent of EC$270 000 per annum.

ii. Degree of intervention

The extent of Government-initiated change in operations is minimal. The previous owners wished to dispose of the property for various reasons and the Government was a suitable buyer. As a result, social intervention has been minimal except for a possibly more benign approach to responsibility as a major employer and attempt to encourage a more productive attitude amongst the work force. In the future, this could lead to the replacement of temporary labour with permanent employees.

iii. Relation to Government objectives

Government policies relevant to the Farmco operation are reflected to some degree by actual activities. Despite hurricane and flooding problems, yields of bananas are approaching the targets laid down by BAI in the revised plan of operations.¹⁴ Although such a development is essential for project viability as well as for generating valuable foreign exchange, no activities have been initiated to produce food for local consumption. A significant diversification component was envisaged in the revised plan of operations, but capital shortage and the need to cut expenditure on experimentation have all but eliminated proposals for crop and livestock diversification.

¹⁴ Booker Agriculture International Ltd., Dennery Farmco Ltd., Saint Lucia, Revised Operational Plan, July, 1980 - June, 1985; April, 1980.

The main resources of capital, management, and labour are being used to boost banana production. When banana production is stabilized, opportunities for spreading diversification may arise. Such enterprises are not without risk, and the ability of a large estate to take temporary losses caused by innovation is one advantage of the estate system over the smallholder.

Dennery Farmco has a small core of permanent management and administrative staff, but the field workers are all employed by the day. Of the 700 people on the company's books, only about 400 will actually work on an average day. The number employed has not fluctuated dramatically since the change of ownership, nor has the system of casual labour. It is suggested that real wages have risen through bonus payments for good work, which indicates the relevance of instituting a reward system where regular workers get priority when work is scarce. Such a system could be the first step towards creating a permanent work force. Benefits of the casual labour system are: 1) available work may be distributed to several individuals during periods of employment scarcity such as after Hurricane Alien thus providing income for many people, and 2) it provides a source of supplementary income for workers who have gardens (in either estate or private land) used for subsistence.

The value posed in providing land for subsistence farming suggests another Government objective: provision of land for landless agricultural workers. The Farmco model may appear totally incompatible with this aim because the land is held and worked as an estate. However, long term opportunities for worker involvement may exist. One way to provide these opportunities is to sell portions of an estate once land has been disencumbered. Another possibility would be to issue equity to workers once Farmco becomes profitable.

iv. Costs and financing

The cost of buying and rehabilitating a large estate such as Dennery is extremely high. Land costs of EC$3.6 million and capital expenditures estimated at EC$6.2 million over the first three years are required.¹⁵ If working capital is taken into account, the total project cost is over EC$24 million and a financing gap of EC$3.9 million is envisaged over a ten-year period. Problems caused by neglect of infrastructure and crops before purchase have been compounded by Hurricane Alien and several flash floods.

¹⁵ National Development Corporation, "Position Paper Dennery Farmco Ltd.", Castries, January 1981 (unpublished).

Since March 1981 the project has been reformulated to reduce costs considerably. The Caribbean Development Bank (CDB) is being approached for the additional loan finance required at preferential rates of interest. Substantial amounts have been saved by the cancellation of the BAI management contract and a cutback of diversification projects. As a result, an even greater reliance is placed on the financial success of 500 acres of irrigated and intensively cultivated bananas. Work on other areas of the estate will take second place, possibly hastening the decline in productivity as drains, roads, and other infrastructure deteriorate.

Government intervention at Dennery facilitated soft loan financing. A total of EC$4.05 million has been allocated by CDB and further loans are being negotiated. A private owner is unlikely to obtain favorable terms or be willing to take on such a debt.

The run-down condition of the estate before purchase required a great deal of investment to ensure profitability and debt repayment. The Government often finds that intervention in estates which are neglected and underutilized requires massive financing. Unless the valuation of estates considers existing conditions and investment requirements, productive capacity cannot be gauged and prediction of debt repayment capability will be difficult.

v. Gestation period

The run-down nature of the estate is reflected in the length of the gestation period. According to the NCD, operations at Farmco will not break even until year nine, a very late point for what had been purchased as a going concern.

vi. Implementation difficulties

A preliminary assessment of first generation problems and results encountered at Farmco is now possible. The problems may be attributed to deficient infrastructure, the weather, a top-heavy management structure, and lack of working and investment capital. They have either been bypassed (lack of infrastructure led to concentration of operations in areas where it is adequate) or overcome (termination of BAI management contract and remotivation of the work force). The financing problems are under review at present. The satisfactory establishment of a productive banana operation is essential as a base from which to build.

There are several possible problems that a large Government-owned farm such as Farmco may encounter in the future. First, management may become unduly bureaucratic and unable to respond to changing circumstances, a frequent problem in Government enterprises. Second, it will be essential to maintain investment even when prices and output result in low returns. The dangers of letting infrastructure deteriorate have been well demonstrated in the last few years. Finally, the labour force must receive sufficient motivation. Although increased wages may achieve this in the short run, other, more subtle mechanisms may be of greater social benefit in the long run. Such changes may include a regularization of the work force, provision of health insurance, etc. More fundamental changes would involve not only equitable distribution to workers once company operations become profitable, but also worker participation in production decisions and the sale of land not used by Farmco to landless workers.

vii. Impact on land and income equality

Farmco's success as an efficient producer of export crops will benefit the national economy. It is reasonable to assume that whatever surplus is generated will be reinvested in productive activities. The workers may receive a more equitable income than before if the Government respects their right to organize. No provision has been made (or appears likely) to redistribute the rich valley land to the workers, although the possibility of providing workers with less fertile hillside land still exists.

4.2.3. Private redistribution of land: Marquis estate

i. Project description

A number of large private estates have recently taken the initiative to subdivide and resell land without any direct Government participation. In some cases this has resulted in land being converted from agricultural use and to tourism, industry and housing.

The Marquis Estate, which occupies the northeastern coast of the fertile Marquis River Valley, is a prime example of private land subdivision for agricultural purposes. In 1980 the estate consisted of 2 550 acres, 930 of which were in crops (primarily coconuts and bananas), 550 in natural forest and 1 070 classified as scrub land. Roughly 400 acres had been terraced (200 acres of which were previously scrub land) and 80 acres of bananas were being grown under irrigation. As of March 1980 the estate employed approximately 200 persons.¹⁶

¹⁶ Saint Lucia Land Reform Commission, "Written Memoranda...," op. cit.

Prior to 1980 about 150 acres had been sold, and during that year it was announced that the owner (Lord Waltston of Newton) planned to dispose of the Babonneau section of the estate, which consisted of 1 000 acres. The arable lands were to be "offered on easy payment terms to the estate workers."¹⁷ According to information provided to the Land Reform Commission, the estate was to be divided into areas of 3 to 25 acres with former estate workers paying half the going price. The project appeared to offer redistribution of land to those who worked it at no public expense.

¹⁷ Ibid., p. 3.

By July 1981 a total of 608 acres of the Babonneau section of the estate had been sold. Of approximately 100 families working on the property, 19 were able to buy a total of 102 acres (an average of 5.4 acres per family). The remainder was sold to estate personnel and the general public in units that varied from 10 to 78 acres.

ii. Degree of intervention

Other than a consensus that the days of the large foreign landholder are numbered, there appears to have been no official pressure prompting the sale of the land. The reasons given by the administrator were purely economic, suggesting that the sale was intended to free capital needed for development of the remaining estate lands.

iii. Relation to Government objectives

The transfer of land from foreign to local ownership and the sale of land to estate workers are in keeping with popular sentiment in Saint Lucia today. To the extent that subdivision results in more intensive use of the land, the Government objective of increased production will have been furthered.

iv. Cost and financing

Land was sold to the nineteen estate workers in three to seven acre plots at EC$1 500 per acre, with payments spread over a maximum of five years at 10 per cent interest. A down payment was required, presumably with the intention of separating workers with the capacity to save and meet future land payments from those who could not. In most cases the workers continued their jobs on the estate, paying for the land with wages and/or produce. Other purchasers acquired funds for the total price through bank loans or other sources. The price was higher than that paid by workers and no area of less than ten acres was sold.

v. Impact on land and income equality

This experience has proved disappointing in terms of making land available to the worker. Fewer than 20 percent of the 100 families working for the estate are actually qualified to buy land, although as many as 43 showed interest in doing so at some time.¹⁸ The reasons for this could be:

a) While the size of the down payment was flexible (EC$600 to EC$1 500), few working families had savings of this amount;

b) The necessity to pay for the land in five years at 10 percent interest may have been seen as an unrealistically heavy debt load; and

c) The purchase price, while apparently favourable, may have been seen as high relative to other potential purchases.¹⁹

¹⁸ Information supplied by the administrator of Marquis Estate.

¹⁹ The land sold to estate workers was not immediately accessible and only now is a road being opened. As a basis for land price comparison, the 1979 price to be charged hillside participants in the Roseau Resettlement Scheme was EC$400 per acre.

Non-estate workers were discouraged from participating by the minimum ten-acre lot requirement and the necessity of raising the money for the total price within 90 days of purchase. The estate had little interest in becoming a land bank for outsiders and was unwilling to spend additional funds on the demarcation of small units.²⁰

²⁰ Land survey and demarcation services alone are estimated at EC$300 per acre on the Marquis Estate (1981).

Despite its shortcomings, this experience has resulted in the formation of several new small- and medium-sized holdings. This is likely to lead to more intensive land use with somewhat greater emphasis on food production. While the results are disappointing with respect to the stated objective of the sale, the experience may prove useful in formulating future guidelines to ensure more effective Government and worker participation in land transfers.

4.2.4. Integrated rural development: Fond Assor

i. Project description

The Fond Assor Rural Development Project was conceived in the early 1970s to address the problems of smallholders. While it never passed the planning stage, the proposal offers an interesting contrast to the preceding three projects, all based on large estates. The project area chosen was part of the Monier/Fond Assor water catchment basin. This and three other basins had been studied early in the decade with the objective of developing a comprehensive resource conservation program in each. The project area was 750 acres, containing 90 rural properties (8.3 acres apiece) and 500 residents.²¹

²¹ Government of Saint Lucia, Ministry of Agriculture, Lands, Fisheries and Co-operatives, Office of the Chief Agricultural Officer, Castries, filed in 1973 (unpublished): "A Proposal of Integrated Rural Development for Agriculture", "Catchment Development Project: Fond Assor"; "Proposals for a Cadastral Survey, Land Registration and the Improvement of the Land Tenure Situation in the Integrated Land Development Project - Fond Assor"; "Project Costs."

When it became evident that the existing land tenure pattern would not permit a successful conservation program, the concept of a "pilot land registration project" with demarcation and registration of all properties in the area was added to the original proposal. At a later date the project was elevated to a Catchment Area Integrated Rural Development Programme.

Finally, the project consisted of the following activities:

- land demarcation, adjudication and registration;
- land use zoning;
- soil and water conservation (waterways, terracing); and
- construction of feeder roads, power lines and a cableway.

A total of 475 acres, or 63.3 percent of the area, was scheduled for terracing at a cost of EC$700 per acre (1974). Land use and cultural practices were to be carefully monitored, with farmers receiving inputs at subsidized rates.

The project was to be managed by a Land Development Authority empowered to administer Government land and acquire lands where no adequate solution could be reached regarding ownership or subdivision. The project would have been staffed by seven professionals, including three full-time extension officers at its peak period.

ii. Relation to Government objectives

Project objectives evolved over time and were initially limited to the testing of erosion control technology in a river basin setting and making a cost/benefit analysis of the results. The objective of creating secure land tenure in the area was added later. At the final integrated rural development stage the objective was the creation of "a new order of farmers, competent persons capable of bringing a satisfying income to the operator and his family." While none of these objectives contradict overall Government policy for the rural sector, their evolution indicates an increasing complexity of the project which may have been responsible for its failure to be implemented.

iii. Cost and financing

The costs during the first five years of the project were estimated at EC$1.7 million (1974). Included in this were staff and office space, equipment, terracing, road-building and other capital inputs, cadastral survey and land registration, and subsidies on the purchase of inputs. The farmer was to pay the subsidized cost of the inputs and part of the costs of terrace construction. The remainder was to be financed by Government, directly and through soft loans from agencies such as the Caribbean Development Bank.

iv. Gestation period

While the most intense period of project development was scheduled for the first five years, administration by the Land Development Authority was to continue for ten years. The internal economic rate of return, estimated at a modest 8 percent per year, was based on a 25-year period.

v. Implementation difficulties

Since the project never reached fruition, the nature of the difficulties likely to have been encountered can only be surmised. The enforcement of land use zoning would have been difficult, although the generous grants and subsidies would have facilitated acceptance by many landowners. The heavy dependence upon Government financing that this implied may well have made the project impractical from both a financial and political standpoint.

vi. Impact on land and income equality

The 90 landowners in the area stood a good chance of gaining significantly from the project, had it been implemented. However, one specialist considered the project an inadequate model for improving land tenure conditions in Saint Lucia as a whole because of its limited impact even as a learning experience for subsequent programs.

4.2.5. Evaluation of proposals for change

The four projects examined above represent different approaches to the problem of land tenure and rural development. Their common elements, however, merit a comparative evaluation.

i. Initial motivation

In all but the Fond Assor project the initial motivation appears to have been rooted in the private interest of large landowners in divesting themselves of all or part of their land. In both the Roseau and Dennery Farmco cases, Government was invited to participate after the decision to sell had been made. This in itself does not negate the importance of the projects but suggests that they were accommodated within Government programs rather than being chosen specifically for inclusion. The question of the Government's paying market prices for large estates that are clearly in a state of decapitalization requires broader discussion in Saint Lucia.

ii. Principal objectives

The projects share common objectives, and within each the objectives overlap. Production maximization is a major objective in all but the Marquis Estate project, in which the primary objective is the sale of land. Fond Assor and part of the Roseau project emphasise resource conservation. The implicit assumption, that maximum production is compatible with individual and national welfare, is questionable.

The risk-averting nature of peasant production has not been scrutinized. At Roseau a large number of participants will be dependent exclusively on banana income. Dennery Farmco has systematically eliminated proposals for crop diversification, disregarding the significant history of such production on the estate.

The objective of improving land tenure is evident in the Roseau and Fond Assor cases. Both proposed creating clear title for smallholders, although at Roseau title is to be given only after a ten- to fourteen-year period. The Marquis project also provides for demarcation prior to land sale.

iii. Proposed level of technology

Emphasis on production maximization implies heavy reliance on capital-intensive technology. While heavy capital investments may be justified in the rich alluvial valleys, the possibility of repaying a heavy debt for hillside farms must be seriously questioned. Even in the case of Roseau, the question of the ability of smallholders to maintain the heavy infrastructure planned for the project remains unanswered.

iv. Worker/producer participation

All but Dennery Farmco are projects designed to serve participant needs, yet the future participants were not consulted at the decision making stages. Lack of effective participation in any project is likely to result in failure. The Dennery Farmco project was less pretentious in this respect since no worker participation was ever envisaged. This will become an increasing problem for management, however, as worker alienation leads to labour strikes.

v. Applicability at the national level

None of the four projects studied serve as a model for land redistribution at the national level. All but the Marquis project are too expensive and technologically complex, with heavy dependence on outside financing. The Marquis project, on the other hand, addresses the needs of only a handful of worker/producers. The divergent patterns of development in the two major valley projects, Roseau and Dennery, suggest that no clear policy on future valley development exists, although this is of the highest priority for national economic planning.