The passage through Parliament of the Expropriation Bill, which is likely later this year, will be a watershed moment in South Africa’s post-1994 politics, with vast implications for the economy. 

The bill gives the central government and local authorities the right to seize agricultural and urban land, as well as other assets, without proper judicial process. Passage of the bill will mean the government will have enormous new powers to infringe property rights and grant patronage to its supporters. 

Once enacted, the law will considerably reduce property rights and render them uncertain, with many negative consequences. The rights to expropriated land will lie with the state rather than the intended beneficiaries, which means the incentives for productive use of the land will not be present.  

Clearly, the ANC is so ideologically driven on the issue of expropriation without compensation (EWC) that little has been learned from the disasters brought about by property seizures in the past.

Globally, seizures of property have brought about economic disasters for the countries that have embarked on them, and for the stated beneficiaries. The negative economic impact has, universally, spread beyond the agricultural sector, and inevitably pushed countries into penury. 

Seizures of productive farms have led to a drop in production and, in the most severe cases, mass starvation. Heavy dependency on food aid and rationing is common in the aftermath of land seizures. To achieve the goals of revolution and land distribution against resistance, there has often been extreme state violence. Examples of the killing of those deemed ‘class enemies’ are the Kulak peasantry in Russia or the vast starvation associated with the Great Leap Forward in China. 

Overwhelming culprit

In recent years in Zimbabwe, the United Nations has estimated that 60 percent of the population is food insecure. The country suffered from a terrible drought until the recent rains, but seizures of farms have been the overwhelming reason for the country’s dire food predicament. Farm seizures in the late 1990s scared away potential investors, and subsequent hyperinflation has pushed the economy into a spiral of decline. 

When Idi Amin seized the shops of Ugandan citizens of Indian origin, they were run into the ground by his cronies who lacked retail experience. 

The seizure of farms has an immediate knock-on effect on investment in an economy, as it sets a precedent for expropriations in other sectors. And governments very often see further expropriations as a means to bring about success. It is a case of knowing where it begins, but not knowing where it ends. 

Venezuela is another recent example of the calamity triggered by property seizures. In Venezuela, food production collapsed after the government took fertiliser factories and then land and other properties. The economic contraction has resulted in mass hunger, a significant loss in the average weight of the population, a humanitarian crisis and mass emigration. 

What is unknown in the case of South Africa is whether the Constitutional Court will ultimately declare an Expropriation Act unconstitutional. Dr Anthea Jeffery has pointed out in the Daily Friend that aspects of the bill are unconstitutional. But bringing a case to the Constitutional Court might take time and along the way there could be a great deal of damage. Besides, the ANC might still take the route of amending the Constitution to get its way on this. 

Sweeping powers

President Cyril Ramaphosa gave us the assurance that ‘there will be no smash and grab’ of land. But with the sweeping powers in the proposed legislation, and in the absence of criteria and a list of targeted assets, these assurances are of limited value.

The hovering threat of seizures must raise investor uncertainty and is bound to mean farmers will hold off improving their land and expanding. The farmers will have to continue to invest in order to run their daily operations. But the sheer uncertainty over whether a farm will be seized has probably already dampened the enthusiasm of many to go into the sector.

The arrangements for selecting beneficiaries is unknown. In Zimbabwe seized farmland often ended up the hands of Zanu-PF high-flyers. Farm workers who had experience in working on the land were often chased off by political functionaries. There has to be a high chance that land distribution will become part of the tools for rewarding a patronage network in South Africa. While the bill proposes that expropriated land remains in state hands, might it be possible for the land to be ultimately sold off at some stage to a designated beneficiary?

Deputy President David Mabuza has said the bill’s intention is to ‘address injustices of the past and restore land rights.’ Those are good-sounding motives, but they are at odds with the proposed legislation. Land rights of seized property will be in the state’s name and will be leased to new occupants. This could set up the scheme for failure. 

 The willing seller, willing buyer approach in South Africa has in part failed due not so much to the technique itself, but rather the failure to vest property rights in the intended beneficiaries. Instead, the state has remained the owner, which in itself creates uncertainties for resettled occupants. Is it worthwhile for them to invest in land improvements when they know they can be thrown off by the caprice of the government?

Shock waves

Property seizures will send shock waves through the economy.  Demand for farm machinery and services might well collapse. Farmers take on a lot of debt for improvements to the land and for working capital needed for planting and other activities. Whether the owners of seized farms would still be responsible for the debt will have to be tested in court.

Banks, agricultural co-operatives, and the Land Bank could take major hits in the event of a wave of expropriations. Seizures or just threatened seizures could cause banks to cut their exposure to the sector, resulting in higher interest rates for agricultural loans and those in dependent businesses. 

Last week the President declared the planned investment of R15.8 billion by the Ford Motor Company in South Africa as ‘a clear statement of confidence in South Africa’s future.’ 

Why would Ford want to invest in South Africa, with enactment of an Expropriation Bill pending? 

The government is unlikely to target such a high-profile investor as Ford. Ford’s investment in a new assembly plant in Silverton for its new Ranger vehicle is probably around an eight-year investment – about the time a vehicle model remains in production. 

So it is not a long-term bet on the South African economy. At the end of the production life of the Ranger, will Ford invest in a new production line in the country?

There are many other ways for government to achieve land redistribution and the restoration of land rights. The willing seller, willing buyer approach that has been used, has failed due to the combination of administrative chaos in government and because the land rights remain with the state or have been diluted by group ownership schemes. 

Rather than embark on a new and dangerous course of land seizures, government should try and rectify what has gone wrong with its efforts at land reform so far. 

The views of the writer are not necessarily the views of the Daily Friend or the IRR

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45 COMMENTS

  1. Cyril assured us that there would be no smash and grab. Sure just like there would be no PPE corruption. With this latest legalised theft, the ANC elite will actually own everything in the country, right down to your underpants. We will be no better than slave labour living in one of our masters houses and working in one of our masters businesses. What could go wrong ? We can only pray that the ANC/EFF voters wake up and realise that the ANC/EFF are stealing their future and subjecting them all to abject poverty. Surely there has seldom been a more evil organisation than the ANC/EFF. And for those that think Cyril is the good guy, just remember that you lost everything on his watch.

  2. I was looking at buying a property for a new business that I was considering. I was also looking at investing in a coastal property.
    Both these investments are off the cards and instead the money will be invested offshore and taken out of our economy. The economic illiteracy of the ANC is staggering, but they are too stupid to realise how stupid they are.

  3. Why would Ford invest in SA?
    They would not, and never had intention to do so. They invest in their factory for the same reason Mercedes do: to make the profit.
    We are facing much bigger problems than arbitrary property seizures. We are stuck with ANC that is waiting for 1917 soviet revolution. At the year when last communist countries are looking to privatize whatever they can.

    If you are thinking that you will sort out all your problems by immigrating to Bulgaria, it is not going to happen. As of this morning SA passport holders are forbidden to travel. Two days ago Indian PM warned that this may happen, and it just happened.

  4. EWC = Leaders getting rich ,all of South Africa getting the last nail in the coffin. And then they flee the country with our Billions. But still the people cannot stand together, at least not till everything is collapsed.

  5. Nationalisation oops I mean EWC is a clear-cut case where government solutions are worse than the problems they are intended to address.

  6. Stephen you are exactly right in your assesment. With these communists in power there is seemingly no hope left for us. I am a Christian and therefor my hope is centered in Christ he will bring change. These people are not omnipotant and they also will dissappear. My hope is that all Christians will stand together and pray together to bring a change to this illiterate party lead by a bunch of thieves.

    • Apparently Piet Retief and party all prayed before setting off to uMgungundlovu
      He would have done far better to have rather listened to Gert Maritz — who strongly advised him NOT to go !

      I CANNOT understand this — praying … en alles sal regkom

      Some people it would appear do NOT understand that G D has already given them what they need
      A BRAIN — which sadly — in some ; appears to NOT be working !

  7. “Surely there has seldom been a more evil organisation than the ANC/EFF. ”

    NO no no
    We have all seen that the ANC itself is pretty clueless ( except when it comes to thieving )
    What is MORE evil are the — ENABLERS and ABETTERS
    The “clever” experts and academics ( not to mention big business and corporates )

    Sadly ALL the “froth” generated by all the soon to be dispossessed is just that — FROTH
    Opinion pieces with NO substance , NO history , NO real application , NO reality !

    Unlike the — brains actually behind all this nonsense
    Who know EXACTLY what they are doing — and have a Nuremberg of “persuasion”with which to convince and justify everything they do.

    Suid Afrika -Onteiening: Nuwe wetsontwerp is redelik en bied broodnodige rigting

    https://www.farmingportal.co.za/index.php/all-agri-news/nuus-afrikaans/5708-onteiening-nuwe-wetsontwerp-is-redelik-en-bied-broodnodige-rigting

    Letter: Expropriation Bill remains a danger – Farmer’s Weekly
    29 January 2021 – Prof Elmien Du Plessis’ argument (8 January 2021) that the Expropriation Bill sets out a system which will serve both the state and private property owners and provide ‘clarity’ is unconvincing.

    https://irr.org.za/media/letter-expropriation-bill-remains-a-danger-farmers-weekly

    SANLAM
    Expropriation with(out) compensation:
    the road ahead

    https://sanlamprivatewealth.sanlam.com/resources/investments/expropriation-out-compensation-road-ahead/

    In 1990 / 91 / 92 I remember going to innumerable talks / advisories / workshops etc etc
    Run mostly by — these very same companies — and that Anglo-American guru ( High road and the Low Road )
    ALL in favour of a YES vote in that infamous referendum …

    Leads to some sitting down and head scratching and a bit of pondering and introspection !

    • There are plenty more legal opinion that are not nearly as hysterical as the IRR. Let’s face it the IRR’s argument is based on politics and ideology. It is a bad faith argument and one that interprets the South African constitution as some idealist libertarian framework. The IRR have been shown to be silly and reactive before on things like the Command Council / Cabinet authority and it will not be the last time if they continue along this road of activism and crowd funding through fearmongering…They have some vaild points for improving the legislation and should stick to trying to make those points.

      • In a memoir of Ramaphosa by the late Dr Mario Oriani-Ambrosini he noted the following.
        “In his brutal honesty, Ramaphosa told me of the ANC’s 25-year strategy to deal with the whites: it would be like boiling a frog alive, which is done by raising the temperature very slowly. Being cold-blooded, the frog does not notice the slow temperature increase, but if the temperature is raised suddenly, the frog will jump out of the water. He meant that the black majority would pass laws transferring wealth, land, and economic power from white to black slowly and incrementally, until the whites lost all they had gained in South Africa, but without taking too much from them at any given time to cause them to rebel or fight.”
        Mr Muller you can act like all will be well and hysteria is all that this is about and that EWC is not something to be gravely concerned about but rest assured the ANC have a path mapped of what they ideally want to see and that agenda bodes poorly for this country. Control, dominance, dictatorship, elitism etc is the way of African politics throughout this continent. Furthermore the ANC will NEVER relinquish control of this country without taking the country down with it. Beware – History repeats itself because we were not listening the first time…

      • I would like to know from which university you got your law degree, because clearly they have an absolute crap law faculty, since they could not even teach you how to read and interpret the content of laws.

        • Well not an university that teaches you to resort to insults for an argument.

          BtW have the brown shirts from PW comment section have moved over to DF and working hard in enforcing conformity of opinion? Then again – not sure I blame them – since there is nothing left there but conformity of opinion and the same old week after week…

      • I am sorry, but you are wrong. You actually appears to believe that the ANC has the country’s best wishes at heart, and that they are governing the country as best they can. This is all for the politically connected’s benefit, no one else. This is the next move in turning the whites into JUST cash cows, nothing else. The mere idea of negating/over riding individual property rights, will result in eventual slavery. There is no other way. Please read some Ayn Rand, (“The Fountain head; Atlas Shrugged; Capitalism – the unknown Ideal; The Virtue of Selfishness). She predicted this exact course of action by socialists, ever since the 1930’s, and here we are again.

    • Exactly!

      If an article does not have a comments section like the Daily Friend, you can very well know that they spew propaganda!

    • Remember the alleged Nazi Salute “scandal” at the PUK a few years ago, which turned out to be one of the most egregious examples of gutter whorenalism and fake news perpetrated by one Aapdriaan Basson, the then editor of Beeld?

      Guess who’s Aapdriaan’s big gabba? Yes, the same Elmien du Plessis.

  8. Ive got a better idea. Remove corrupt Government and bring in GESARA Post haste. These people dont Govern, they steal, destroy and and murder.

    • I wish that your idea was possible, but it will never be. The whites are on their own & the next catastrophe will be genocide, maybe not in Cyril’s time but most definitely in the next ANC government. It will be their biggest achievement in their and the rest of the free world’s viewpoint that they finally got rid of whites in Africa. Nobody in any country will be able to block them from this. We must be the most hatted people in the whole world today.

  9. Had we believed in Utopia, we would be able to educate the mass illiterates that vote for ANC/EFF. Ultimately they are the ones who are made promises to, but will be the first in line for starvation. Let’s face facts, the ANC/EFF are not the ones feeding the hungry. It is your everyday citizen.

  10. The EFF are a bunch of clowns that believe in violence , racism , anarchy and destruction.The ANC has destroyed everything in a few years that was built up in the last 100 years in this country .A first world country handed over to them on a platter and rubbished down to beyond junk status.Everything the ANC touches lands up bankrupt or needs an ongoing bail out , SAA , Sabs , Sassa , Prasa , Escom and Denel and most municipalities to mention but a few.
    Look at the CBD’s of our towns and cities , constant decay , rubble , filth, destruction all under ANC rule.All the standards in our country are rock bottom under ANC rule , Education ,Health , SAP , Judiciary , Roads , Water and sanitation to mention but a few .The Anc government have failed dismally and are clueless to run a country. They might have been an successful underground terrorist organisation but it ends there. So ,,,, there is nothing left for them to destroy , they are corrupt to the core and bankrupt .Communism , land grab and EWC is the only last survival means left for the Anc to stay in power . Desite all the warnings that in Zimbabwe and Venezuela land grabs an appropriation without compensation has caused chaos , poverty, hunger and misery the Anc with its normal arrogance , ignorance , idiocy , poverty of intellect and racist payback policies will persist with their actions. Ramaphosa and his gang must prepare themselves for the utmost resistance from all spheres , movements , nationalities , land and property owners in South Africa.! Which lastly brings me back to what my late father said way back in 1978 “son ,, one day this country will be destroyed by a civil war “,,,,, you be the judge !!!

  11. The only way to bring this to a head would be a tax boycott by the 100 biggest tax payers. This will be an accelerated example to the ANC of what happens when all business is destroyed. Only when their own pockets (salararies and perks) are affected will some sense begin to prevail. As in Zimbabwe, business will need to develop a parrallel economy to survive. We may as well start now as this headlong rush to ideological utopia is the beginng of the end.

  12. As the fox said to the chicken—-“trust me—i’ll carry you over the river safely”—and so the ANC are asking us to trust them, with this hugely dangerous piece of intended legislation, knowing , as we do , that they do not keep their promises, except in a negative way, and that this is all being brought about to achieve a”legal”(sic) land grab(as opposed to the illegal one in Zimbabwe).

    • And President Cyril Ramaphosa gave us the assurance that ‘there will be no smash and grab’ of land.
      Just like there’d be no “smash and grab” (to use a governmental term) at any given traffic light in ZA…

  13. In a memoir of Ramaphosa by the late Dr Mario Oriani-Ambrosini he noted the following.
    “In his brutal honesty, Ramaphosa told me of the ANC’s 25-year strategy to deal with the whites: it would be like boiling a frog alive, which is done by raising the temperature very slowly. Being cold-blooded, the frog does not notice the slow temperature increase, but if the temperature is raised suddenly, the frog will jump out of the water. He meant that the black majority would pass laws transferring wealth, land, and economic power from white to black slowly and incrementally, until the whites lost all they had gained in South Africa, but without taking too much from them at any given time to cause them to rebel or fight.”
    Mr Muller you can act like all will be well and hysteria is all that this is about and that EWC is not something to be gravely concerned about but rest assured the ANC have a path mapped of what they ideally want to see and that agenda bodes poorly for this country. Control, dominance, dictatorship, elitism etc is the way of African politics throughout this continent. Furthermore the ANC will NEVER relinquish control of this country without taking the country down with it. Beware – History repeats itself because we were not listening the first time…

  14. I agree with Johannes Kolver.
    Although it is very important to discuss these issues (EWC etc.) on forums such as this, I sometimes feel that even taking part in a debate of this nature gives legitimacy to this government of misfits (conflicting viewpoints, I know).
    Despite the warnings of ratings agencies, the ANC train is picking up speed while heading for an apocalyptical plunge over a very high cliff.
    Eskom, whose R850 million accommodation wastage at Medupi (?) was exposed, this morning said that the public “has a right to be angry”. If I have never heard someone stating the obvious, this must be it.
    EWC has been in the news for years now, slowly making the public used to the concept. The frog in the pot is beginning to understand….. too late though.

  15. It’s so very simple. Globally there is a positive correlation between strong property rights and high standards of living. I understand that the ANC needs to appease the voters and CR is concerned about EFF rhetoric, but messing with property rights WILL result in increased poverty, inequality and resultant crime. Unfortunately, the voting masses don’t understand that so they all want free farms (and anything else on offer.) Understanding the cause and effect of economics may be complicated but should be mandatory before you get to vote. That is the major defect in all democracies. One only has to look at the whinging in Britain by the “Leavers” regarding the effect of their decision to leave the EU.

  16. It always comes in triplicate. Firstly, when Retief refused to listen to Maritz when setting off to that kraal in KZN. Secondly, when the whites listened to De Klerk and Mandela’s’ promise of a rainbow nation (have never seen white or black in a rainbow). Thirdly, the calamitous virus pandemic – a vital cog in the ANC’s armoury.

  17. CR is an ideologue. He has on numerous occasions publicly and enthusiastically endorsed EWC. Expropriation is the next and possibly the most important step with regard to the NDR and the transformation of the country into the nationalist socialist utopia envisaged. If EWC becomes a reality expect the frogs to get boiled alive.

  18. You can argue like you want to.This country was not sold for 7 silver pieces but was given away by de Klerk and his croonies.So let us face the facts we are doomed.Billions were left in 1994 and what happened-GONE WHITH THE WIND.Stolen by the ANC and cadres.SA are so poor that we must look other countries in the eyes and beg for donations to live.That is why the ANC raise everything to get money to steal.Fuel taxes etc.Now they are going to steal your property.Again the Western world will do F all to assist the people of SA.As a matter of fact they will assist tha ANC like they did in 1994.I agree the only thing that can save us is to look up and pray.And yes SA will be destroyed by civil war.And yes again the people of SA cannot stand together especially the white people.

  19. Tinus
    The expropriation act has the undertone that it can create the impression that it can lead to total socialism (communism) and that is the worrying fact. It is also a fact that commentators on this matter refers to Zimbabwe and other countries and who went through a “similar “process without indicating on what legal basis the governments of these countries executed the processes. It is therefore wrong to reach inferences without facts to underpin it.
    We are faced with the ANC’S majority in Parliament and the matter will be become law. If the Bill goes through without any draconian issues added to it the application thereof, will be a process in itself.
    Let us consider an example of a productive farm with the farmer and his employees living on it. This is the most worrying one.
    Apart from all the requirements of the new section 25, the government is confronted by section 26 of the Constitution, just quoting subsection (1): “Everyone has the right to have access to adequate housing”. The Constitutional Court made it clear that this right is enforceable in the well-known Jaftha and other related cases.
    The right to freedom of trade, occupation and profession is protected by the constitution as it inter alia states: “Every citizen has the right to choose their trade, occupation or profession freely”. The farmer has the right to claim protection of his occupation of which he has the knowledge to create income and provide work for others, and to which he has the right to choose unopposed freely.
    I can name more sections of the Constitution that guarantees applicable rights such as, to name three, Equality, section 9(1), Human Dignity section 10, section 12(1) (e) not to be treated in a degrading way. It is degrading to be kicked off your farm without proper compensation. Sections 10 and 12(1)(e) are in the Table of Non-Derogable Rights.
    One thing that the ANC do not want to make known is that the white population voted and caused so the end of apartheid and that the Government failed to govern properly.
    Stopping the bill would be difficult but we can make sure that those who are still left behind be completely informed of who caused their situation.
    A fund should be created now to oppose in court any wrongs caused in the application of the bill, and to stop further tampering with the Constitution. It should be made known that we are preparing to successfully oppose any wrongdoings of any party empowered by the proposed amendment

  20. Read this article by Advocate PAUL HOFFMAN. What he states is in the Constitution may prveent EWC happening.

    https://www.biznews.com/thought-leaders/2019/12/09/anc-constitution-dangerous-land
    Wrong procedure proposed for ‘EWC’
    By Paul Hoffman*

    It is a primary element of the rule of law that the system in place in any given constitutional democracy should include respect for property rights. The SA Constitution regards the rule of law as “supreme”. The National Accord, which preceded the adoption of the Constitution, was premised upon upholding the rule of law, not “rule by law” which is what was in place under apartheid. Respecting the rule of law is the right way in which to aspire to a society in which the inherent human dignity of all is respected, the achievement of equality is promoted and guaranteed human rights are enjoyed by all.
    In short, security of property rights is a basic tenet of the rule of law everywhere on the planet where the rule of law holds sway.”

  21. The train is in motion and it’s breaks don’t work. Those relying on the constitutional court to save the day will be disappointed. Africa is the casualty. I’m not sure it had a chance either way. This article certainly brings home the realities and consequences of the route the government is embarking
    On.

  22. The question before us is how to stop this legislation! To expect the black population to stop them is naive. The white voters plus the Indian coloured voters can’t either. The ANC knows, as do all politicians, they won the last election with a majority of the minority of the voters. Less than 45% actually voted. To prevent any voting upset, they have to throw morsels to the unemployed to keep them vaguely happy. African socialism, the chief rules and the masses share what they have, in a rural environment. I spent a lot of time in the townships in the 70 & ’80s, and I saw what the UDF and ANC did to the population in the townships. Rule of fear was the plan and carried out by young unemployed thugs. I suspect what we now have is a version of the Stockholm syndrome affecting the black voting classes older than 50 years. Since more than half of the youth are unemployed they are fair game for any suggestions that will improve their lot, like the whites have it all!
    The only way we can stop this runaway train is by manipulating the signals, ie in this case, the Law. Making the educated aware of the risks is clearly a good move but the ‘New’papers especially the eNglish ones are so enthralled by the ANC and their controlling interests that nothing will come from that side. The DA and FF are our only hope to save the day plus the smattering of Interest groups who are active in this field. We can but hope because few can afford to settle elswhere except in penury!

  23. Given the “custodianship” or mineral rights entrenched in the problematic MPRDA (Mineral and Petroleum Resources Development Act) and the divisive and failing Mining Charter (now in its third and worst edition) it’s hardly surprising that the cronies, cadres and deployees are feeling the cash squeeze of a bankrupt state. The RET Brigade have run out out of other people’s money to fund their patronage games, so they are turning to the expropriation and subsequent “custodianship” of other peoples land to provide that leverage!

  24. A completely other angles to the debate …. Chinese allover Southern Africa…China needs economic growth and space for its people
    ANC is bankrupt and all State-owned enterprises are down on their knees….so no more real opportunities to steal.
    Income EWC and they will take as much as they want and hand it on a plate to the Chinese, who will feed them until they burst.

  25. I have said it many times before but will repeat it again. Why do we persist with this bunch of ANC communist/socialist thieves who can never ever drag us out of this quagmire they have dumped us in?
    The ANC has proven time and again their complete inability/unsuitability to govern. In fact they are only capable of self-enrichment, placing themselves before the country. So much for the OATH when taking office. It means absolutely nothing to them and failing the oath should all be charged with treason.
    I only wish their eternal factionalism and in-fighting will hastily bring about the ANC’s self-destruction, which I believe is their “ACHILLES’S HEEL” to be exploited somehow.

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