Opinion: South Africa′s land expropriation plans could wreck regional economy | Africa | DW | 06.12.2018
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Opinion: South Africa's land expropriation plans could wreck regional economy

South Africa's lawmakers are moving towards amending the constitution to expropriate land without compensation. This is a hot issue more than two decades after the end of apartheid, writes Privilege Musvanhiri.

Efforts to resolve the imbalances in post-apartheid South Africa, where the country's white minority is considered by many of the majority black population to own a disproportionate amount of land, could have a negative effect on the regional economy.

South Africa is the biggest economy in the Southern Africa Development Community (SADC). Its economy intertwines with those of several neighboring countries who are dependent on it for manufactured goods and supplies.

In this regard, South Africa cannot afford to have a chaotic land redistribution exercise like the one witnessed in Zimbabwe in the early years of this century.

The lessons from neighbor Zimbabwe cannot be overemphasized. Chaotic land redistribution has cost Zimbabwe close to two decades of economic decay. Agriculture, which was the main pillar of the economy, collapsed and the country is struggling to return to its former glory.

Privilege Musvanhiri (DW/B. Geilert)

Privilege Musvanhiri is a DW correspondent based in Harare, Zimbabwe

Need to put reason before populism

When former president Robert Mugabe allowed the compulsory acquisition of land in Zimbabwe, he failed to understand that land goes beyond farming and is interlinked with the rest of the economy. 

Zimbabwean economist John Robertson wrote in a paper published in November 2017 by The Brenthurst Foundation: "A key reason for the crash that destroyed Zimbabwe's manufacturing sector was the government's failure to recognize that commercial farming was an industry with complex links into every other industrial sector."

If South Africa is to expropriate land, there is need to look at the whole value chain and appreciate that whatever is done should not disrupt upstream and downstream industries.

Zimbabwe currently imports more than half of its basic commodities but this was not always the case. The country had a working manufacturing industry that exported within the region and beyond.

To date, the country's industry is operating at below 40 percent capacity utilisation. There was a huge capital investment flight owing to the land reform. 

Hamstrung farmers

Zimbabwe made the mistake of withdrawing titles to land ownership. All land expropriated from former commercial farmers belongs to the state. Farmers have no title to the allocated land. What this has done over the years is to hamstring farmers amd prevent them making meaningful infrastructure investment in the farms since the government can remove them at any time.

This obviously discouraged investment. Land without title also meant it could not be used for collateral, leaving the new farmers in need of adequate resources and stranded as they could not borrow capital to run the farming business.

A black South African farmer stands on his land (DW/T. Andrews)

Only four percent of farmland is in the hands of black farmers in South Africa

If South Africa goes ahead with the expropriation of land, respect for property rights must be paramount. There is no investor who will come and invest in a country where there are no guarantees for property rights.

Zimbabwe today is isolated and failing to attract meaningful investments as a result of the property right violations that happened in 2000.

Politics and land relations in southern Africa

There is an interesting relationship between land, politics and elections in southern Africa. There is an unfortunate trend of abusing land to whip up people's emotions ahead of an election.

In Zimbabwe's case, scholars say former President Mugabe embarked on the futile land reform program in order to bolster his support. At that time it is believed he was losing power within his party and for the first time found himself faced by a strong opposition.

South Africa goes to elections in 2019 and political parties like the ruling Africa National Congress (ANC) and the opposition Economic Freedom Fighters (EFF) may want to use land as a tool to win votes.

Some observers say the ANC's willingness to discuss land reform may have to do with the challenge it faces from the EFF, fronted by firebrand Julius Malema .

South Africa's new president Cyril Ramaphosa has been promoting a business-friendly impression but the term compulsory acquisition alone is enough to send out shockwaves.

As South Africa debates the land expropriation roadmap, authorities and those leading the campaign need to make the right decisions. Zimbabwe's land reform pitfalls should not be repeated.

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