Ramaphosa invites business to join expropriation talks
Corporate heads told land redistribution cannot be ignored
● President Cyril Ramaphosa has told business leaders that the land debate is unavoidable and challenged them on Friday to weigh in on the government’s much contested plans to redistribute land.
“Right now we’re dealing with the issue of land and this, so we all understand, was bound to come. It was waiting to come,” Ramaphosa told heads of banks and other major corporations in Sandton at a meeting primarily to discuss the new youth employment scheme that will be launched later this month.
This week the cabinet welcomed a motion to review the property clause in the constitution, on which parliament’s constitutional review committee will report back in August. Although there were aims to expropriate land without compensation, the cabinet said the country remained open to investment in agriculture.
Ramaphosa said that in 1993, during the negotiations that culminated in the constitution, calling a referendum had been an option on several issues, and one was land redistribution. “It almost led us to a referendum. I promise you if it had gone to a referendum it would have only gone one way,” he said.
But instead the property clause was crafted to acknowledge the rights of property owners as well as those without land. Embedded in this clause, he said, quoting former deputy chief justice Dikgang Moseneke, was the ability to speed up land reform, but this had not been used to good effect.
There was now a “festival of ideas” and several solutions had come to the fore, also from farmers.
“I invite you to be part of the dialogue . . . As business executives let us not panic, let us be part of the process of finding a solution, and already a solution is emerging, we see it on the horizon.”
But it remains to be seen how Ramaphosa will convince investors. He himself said data compiled by the Treasury showed that foreign direct investment and local investment had been tapering down.
Executive chairman of the World Economic Forum Klaus Schwab has offered to bring 100 business leaders to South Africa ahead of a government-proposed investment summit later this year as a contribution “to the new direction in which South Africa is moving”.
“I welcomed that,” Ramaphosa told the business leaders.
American entrepreneur and philanthropist Michael Bloomberg has also pledged to organise an investment conference on South Africa on the sidelines of the Commonwealth heads of government gathering in London next month. An African business leader proposed a similar initiative in Kenya or Nigeria to round up potential African investors in South Africa.
This would drive momentum towards the government’s investment summit.
A jobs summit is also on the cards this year as well as the launch of the Youth Employment Service scheme on March 27. The initiative between business and the government will provide a year-long paid internship to one million youths over three years.
Corporates may also sponsor a salary for a year-long starter position at a black-owned business if they are unable to create internships. A third option is to support youths wanting to launch enterprises.
About 28% of South Africa’s population is aged between 18 and 35 and the youth unemployment rate is 29.7% compared to the national unemployment rate of 26.7%.
Colin Coleman, MD of Goldman Sachs South Africa and co-head of the committee driving the youth initiative, said the cost of the scheme was calculated on a R55 000 cost to company a year basis for each intern.
The base salary is roughly modelled on the R3 500 monthly minimum wage that launches in May. Companies who participate in the youth scheme would be entitled to a R1 000 monthly rebate per intern when claiming through the Employment Tax Incentive. One of the major banks had committed to support 5 000 interns, of whom 1 500 would be placed internally and the balance with third-party service providers.
In a meeting this week state-owned companies told Ramaphosa they intended to participate in the scheme and invest in the economy in the next five years in projects that could be funded without using public funds.
Ramaphosa said the country was primed Picture: Halden Krog
I invite you to be part of the dialogue. As business executives let us not panic, let us be part of finding a solution Cyril Ramaphosa President of South Africa
I promise you if it had gone to a referendum it would have gone one way Cyril Ramaphosa President of South Africa
to move ahead and that governance challenges were being addressed.
“I promise you we are going to continue dealing with all of those challenges, corruption, wastage and all that,” he said.
Speculation that SARS commissioner Tom Moyane will be removed over the fallout from the resignation of his deputy, Jonas Makwakwa, has increased.
Makwakwa resigned ahead of being suspended for further investigation into allegations that he contracted a company he was associated with to help the revenue service with debt collection.
Reappointed Finance Minister Nhlanhla Nene, to whom Moyane reports, said he was unaware of plans to change SARS’s leadership “. . . other than that we are concerned about the things that are happening. There is going to be a commission of inquiry.
“We do need to be very careful in how we handle the matter with urgency but also with the due carefulness that it requires.”