‘Do not fear expropriation’
• Ramaphosa says it can be done without hurting the economy
President Cyril Ramaphosa on Wednesday insisted expropriation of land without compensation would be implemented in a way that will circumvent damaging the economy and compromising food security.
In February, the National Assembly adopted a motion brought by the EFF to begin a process to amend the Constitution to allow land expropriation without compensation.
Since Parliament passed a motion paving the way for a review of section 25 of the Constitution to explore the viability of expropriation without compensation, vacant land in Tshwane, Midrand and other areas, including near Johannesburg, has been occupied.
In his maiden question-andanswer session in the National Assembly, Ramaphosa said the government would not tolerate land grabs and occupations.
“As we implement this resolution [expropriation without compensation], we should be clear on how we will not damage the economy and food security,” Ramaphosa said in response to a question from DA leader Mmusi Maimane.
Ramaphosa said there was a strong case to be made that the use of expropriation without compensation in certain circumstances to advance land reform was consistent with the provisions of the Constitution.
“The property clause was never constructed for the purpose of retaining existing property relations.… The property clause in the Constitution specifically requires that the state take reasonable legislative and other measures to [make it possible for] citizens to gain access to land on an equitable basis,” said Ramaphosa.
“Rather than be scared [of expropriation without compensation], I say come to the party, let us discuss and find solutions,” he added.
Maimane said the policy would actually devastate the economy and disadvantage those who are meant to benefit from land reform.
Many observers believe the push for expropriation without compensation would most likely spook investors. As business confidence soared to a threeyear high on the back of the recent political developments, analysts remain concerned about Ramaphosa’s ability to swiftly implement policy changes, with land reform emerging as a glaring issue.
The RMB/BER business confidence index jumped by 11 points from 34 in the fourth quarter of 2017 to 45 in the first quarter of 2018.
While a score below 50 still indicates dampened confidence, RMB said an increase of such a magnitude was rare.
The huge jump has been driven more by the expectation that the recent market-friendly political developments will boost activity levels in future than by an immediate improvement in the real economy, said Ettienne le Roux, the chief economist at RMB.
Ramaphosa said in Parliament that there will be “broad discussions” and that the Constitution Review Committee will decide on whether the Constitution should be amended.
“With this in mind, it goes without saying that the current uncertainty around land reform needs to be resolved as quickly as possible,” said Le Roux.
If uncertainty was “allowed to linger, the latest rise in the RMB/BER [index] could easily fizzle out with little or even no enduring positive impact on business capital expenditure and the economy at large”.
The Agribusiness confidence index, which measures sentiment in agriculture, improved by nine points to 58 in the first quarter of 2018, after falling to below the 50-point mark in the last quarter of 2017.