There has been allot of high emotions around the land debate issue in SA. I thought that I would put this together from a number of articles that were written in the last couple of months and hope this brings some balance and ease of emotions.
I think it is important to understand how dangerous close we came to having Jacob Zuma still in power post the ANC's Nasrec conference in December 2017. It was Zuma who started the emotional and racial narrative about land expropriation without compensation to gain support in his dying days.
At the ANC’s Nasrec conference in December 2017, the issue of land expropriation without compensation was the only thing that nearly caused violence. Many believed that the Constitution should not be messed with and that the concept of no compensation should be treated with extreme caution.
The more radical Zuma faction was, however, adamant and viciously insisted that it must go through. Faced with the possibility of violence and a total breakdown of the precious "unity" on the last day of the conference, the Ramaphosa camp had to make a quick decision.
In order to prevent a total collapse of the conference and ensure a Ramaphosa victory, they accepted the principle of land expropriation without compensation, but with the qualifications that any changes must promote rather than disincentivise agricultural investments; they must not threaten food security; they must be the result of consulting widely on this including with financial institutions.
In doing so, peace was restored and the conference could conclude with the election of Mr. Ramaphosa as the new president of the ANC. If the Ramaphosa camp did not make the compromise, Zuma would still be in power and where would SA now be heading ?
Mr. Ramaphosa now has the opportunity to cut out the cancer of corruption and start rebuilding the damage that was done by the Zuma camp in the past 10 years. He has already made sweeping changes to the boards and senior management of most affected government departments and State-owned Enterprises and has also brought corruption investigations and charges against numerous high-profile politically exposed persons. This includes among others:
Making Zuma resign as president of SA;
Changes to the Eskom (state power supplier) board and management structure;
The Commission of enquiry into State Capture;
The decision to charge the Gupta brothers for corruption and to seize their assets both in South Africa and abroad;
The investigations into the Estina Dairy and North West Mobile Clinic scandals;
The suspension of the SARS (Tax authority) commissioner;
The removal of the head of the SA Police Service Crime Intelligence and his replacement by Major General Peter Jacobs;
The appointment of a New National Commissioner of the SA Police Service; and
The re-institution of charges of corruption against Zuma.
The ANC's present position on expropriation without compensation has a lot to do with next year's general election.
It is no secret that the Ramaphosa camp still believes that the present Constitution provides enough room for expropriation without compensation, when circumstances determine that, but for now Ramaphosa and his faction are playing along with the populists to steal the EFF's (Julius Malema) thunder until after the 2019 election.
The EFF (6% of the vote) has lost the most lethal election propaganda arrows in its bow: Jacob Zuma, the Guptas, state capture and corruption. The EFF has now replaced Zuma and the Guptas with two new arrows they hope will be as lethal: land expropriation and anti-white sentiments. These are the drums it will be beating for the next year until the election.
The ANC has indeed stolen much of the EFF's thunder when it embraced the EFF's parliamentary motion on land - mostly political rhetoric with an aim on next year's election.
The proposal to change the Constitution would have to be approved by at least six of the nine National Council of Provinces. In addition, two thirds of the National Assembly would have to agree to change Section 25 of the Constitution (to allow for the expropriation without compensation). Given that its majority has been on a steady decline, the ANC only holds 62% of the seats in the National Assembly.
It has also been argued that if changes to Section 25 of the Constitution – which forms part of the Bill of Rights – impinge on the founding values of the Constitution, then a 75% majority might be required to effect a change. This might require taking the matter to the courts for a declaratory order.
The reality is that a critical issue such as the sanctity of ownership of property ensconced in the Constitution cannot reasonably be resolved without lengthy debates, in-depth research, workshops and summits, which probably means no final decision on a change in the Constitution will take place before next year's election.
The disparities in land ownership and the issue of expropriation without compensation remains a highly emotive subject which will require strong leadership to resolve. Unlike his predecessor, Mr. Ramaphosa has all the attributes of a true leader and a true statesman to steer SA through this process. He has a reputation as a skilled negotiator and dealmaker, being credited with the crucial role he played during the negotiations to bring about a peaceful end to apartheid and steer SA towards its first fully democratic elections on 27 April 1994. As a very wealthy businessman, he is also acutely aware of the potential for it negatively affecting investment and development in SA which is required for growth to alleviate the unemployment rate.
There is much that can be done without changing the Constitution or affecting the property rights of others. For instance the SA government sits on 17 million hectares of land, which mostly lie fallow, which can be used for redistribution of land.
SA has definitely turned a corner and the process to clean up the Zuma rot has started. I am confident that the debate on land would result in the adoption of a sound land policy that can take SA forward.
Orion has indeed made a well timed counter cyclic growth investment.
ORN Price at posting:
4.2¢ Sentiment: Buy Disclosure: Held
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