Land grabs remain a touchy subject for the African continent, as evidenced by the South African Government’s recent decision to seek legislation that would strictly limit foreign ownership of agricultural and coastal properties.
On 24 August 2011, the South African Cabinet approved a Green Paper calling for the enactment of land laws designed to ensure that “all South Africans, blacks in general and Africans in particular, have a reasonable access to land with secure rights’”. The Green Paper, which will provide the basis for the more defined ‘Land Protection Bill’ set to be released within the next three months, highlights South Africa’s struggle to find a balance between economic development and state preservation, as well as its mission to rectify the nation’s discriminatory apartheid-era legacy.
The decision has been years in the making. In February 2006, a government-appointed panel initially recommended stricter land-ownership requirements that would have effectively barred foreigners outright from owning land, but South African leaders have since backtracked on their initial stance, reportedly due to pressure from businesses and foreign interest groups. Nevertheless, the new reforms are still expected to be restrictive and include the implementation of several new rules as well as the establishment of a new agency, the “autonomous” Land Management Commission. The Commission is expected to have the authority, among other things, to subpoena individuals and entities regarding their land interests; validate or nullify deeds, as well as to confiscate land acquired through practices the South African Government deems unethical. The Green Paper has been met with much criticism on both sides, with mostly white commercial farmers criticising the move as highly restrictive and anti-free market, whilst campaigners working on behalf of black citizens and the poor saying the proposed legislation does not go far enough in amending the country’s racist past. However, South African leaders are walking a fine line and do not want to appear to favour either side. Sunday Ogunronbi, a senior Department of Rural Development and Land Reform (RDLR) official, said that although the government was not against foreign ownership of land, land purchases must be strictly regulated by the state.
The sentiment underlies how sticky the topic of post-colonialism and foreign land ownership is for the country. South Africa, like most African countries, has had a difficult time dealing with its colonial past while improving its economic conditions. The country has been forced to operate in a neo-liberal system set up by its former European colonisers, and yet still has a duty to please both its black and white citizenry. This is a difficult situation. On the one hand, 80% of South Africa’s agricultural output comes from the 15% of its mostly white-owned farms. This fact does not go unheeded by the South African leadership. They know they cannot create an environment that is hostile to either white land owners or foreign investors. At the same time, however, they have a duty as outlined by Section 25 of the country’s 1994 constitution to ensure the equality of country’s black citizens. When Nelson Mandela ascended to power in 1994, 87% of the country’s land was owned by whites, despite the demographic only representing 10% of the population. In the first five years of the new democracy, the ruling African National Congress (ANC) set out on a path to right former wrongs, by implementing a plan to redistribute 30% of the land from whites to blacks. The plan, however, was unsuccessful. As of 2010, only 8% of the land has been reallocated. Although the presumably well-meaning government initially made progress by buying back the white-owned property at rates many considered higher than the market value, and giving the properties to black farmers by either reselling it or giving it away, in the years following the enactment of the policy, black farmers discovered that in many ways the land they acquired was a huge burden. In reality, the black farmers found that working the land was hugely ineffective cost-wise and thus many resold the land back to whites at a higher price. In the process, both white and black farmers profited-whites sold their properties at a high cost to the government, while blacks received the land at discounted rates, or in some cases, received the properties for free and were able to keep the profits when they sold the land. The South African Government, meanwhile, lost money. As a result, the South Africa’s Land Reform Minister, Gugile Nkwinti, has been forced to admit that since the start of the redistribution programme in 1994, nearly 30% of the land redistributed to black farmers has ended up back in the hands of the previous owners, white farmers. For their part, the South African Government is not giving up in its mission to improve equality whilst keeping foreign investment intact. Nkwinti has said that the South African Government has promised to invest R49 million (about US$6,843,000) to complete a land audit process across the country by March 2012. However, Nkwinti noted that the goal of correcting this situation by 2014 will be an uphill battle, saying, “We’ll do the best we can to try and get close to that.”
The Way Ahead for South Africa
Overall, the political situation facing South Africa only scratches the surface of the continent’s continuing uneasy relationship with its former colonial past and the contemporary issue of foreign land investment. Compared to Latin America, African leadership has traditionally welcomed foreign purchases, believing it to be an asset its economic development. However, as famine continues to wreak havoc across the Horn of Africa, many African leaders are reconsidering their colonial legacy and are poised to take a different approach, one that could mirror the tough nationalist stance taken by Latin America. Although some experts pessimistically believe that the situation brewing in South Africa could lead to a Zimbabwe-style scenario in which land reforms were met with widespread violence and and economic collapse, others are more hopeful as South Africa appears determined not to let the same problems ruin its development prospects. In the end South Africa has a difficult task ahead in its goal of rectifying years of colonialism and apartheid and preventing foreign interests from completely taking over. It has to walk a fine line by balancing economic development and state preservation, as well as completing its mission to right the nation’s discriminatory apartheid legacy. However, while the Green Paper attempts to prevent seemingly greedy investors from taking advantage of South Africa’s economic situation as well as correcting past indiscretions, the document does not appear to go far enough into solving the nation’s land and agricultural crises.
As for South Africa’s goal of fixing its apartheid past, even with equitable land redistribution, there is simply enough money to be made for either small-scale white farmers or black farmers as both groups feel they are unable to profit in the current recession. As a result, South Africa is expected to see the growth of multinational agricultural corporations, which would create factory farming style situations that would see more financial incentive to export food to other countries instead of keeping the produce in South Africa, a situation which mirrors that of the Democratic Republic of Congo. Although on an economic side this could prove beneficial for the country, it could have detrimental long term effects including the loss of state security leading to an increased likelihood of famine, an experience the continent sadly knows all too well.
In the end, the South African Government should look to ensure that investments benefit their own country first and maintains state sovereignty, whilst also encouraging a climate of investment and development. From an economic perspective, South Africa must improve its competiveness. According to the World Economic Forum’s Global Competitiveness Report, South Africa currently ranks 50th out of 142 countries in terms of its economic performance. The country also struggles with a poor economic recovery and high levels of poverty and unemployment. To mitigate this problem, the South African leadership needs to find a way to balance the needs of its black citizenry while simultaneously attracting much needed foreign investment. Understandably this is easier said than done. Nevertheless, South Africa looks to be in a much better position than many of its neighbouring African countries to deal with the issue of foreign land investment.
[Image Credit: Programme for Land and Agrarian Studies, University of the Western Cape, South Africa]