Purple hiring (providing employment opportunities to the differently-abled) or positive discrimination in jobs and financial literacy are seemingly unrelated concepts. However, the underlying idea is common - inclusion. Some people talk about ‘inclusion’ as though it is topical, for politicians it is new rhetoric, for activists it is an instrument of social justice and, for businesses, it is an opportunity. In South Africa, inclusion is being seen by many as a way to correct apartheid era injustice through land expropriation.
The issue has its genesis in the Natives Land Act, 1913, that reserved about 93% of the land for the white minority. The Native Trust and Land Act, 1936, subsequently reduced it to 87%. Further, these Acts legally sanctioned historical dispossession of the African people’s land. The year 1994 saw the end of apartheid in South Africa. It brought along with it hope of land redistribution to the Rainbow Nation’s communities. Section 25 of the Constitution provided for land expropriation with just and equitable compensation. The government relied on a “willing-seller, willing-buyer” land redistribution policy to correct the historical wrong. Under this approach, the government bought land against compensation and redistributed it to the dispossessed people. The policy did not yield desired results due to the unwillingness of property owners to sell and their demand of exorbitantly high prices in many cases. Even today, 72% of agricultural land is in the hands of white South Africans, i.e. 8% of the population, whereas only 4% of land is owned by black South Africans (over 80% of the population). President Jacob Zuma’s government tried to address this issue in 2016 by introducing a bill in the parliament to end the “willing-buyer, willing-seller” policy and providing for payment for land acquired by expropriation in the public interest at adjudicator value. In view of growing discontent coupled with a high rate of unemployment, Zuma’s successor, Cyril Ramaphosa pushed the idea of redistribution of (only unused) land without compensation in 2017. The year 2018 saw the adoption of a report by the South African Parliament, recommending the amendment of section 25 of the Constitution to expropriate land without compensation.
This idea of addressing the present skewed land ownership issue has initiated a debate and has made land a hot-button issue. The breakaway group of the ruling African National Congress, the Economic Freedom Fighters (EFF), is in principle against Ramaphosa’s policy. But only because it favours a more radical nationalisation of banks and land as the only means to undo historical injustice. However, opponents of expropriation without compensation argue that South Africa may go Zimbabwe’s way, where a fast track land reform process led to large-scale violence. Many white farmers fled the country at the turn of the century to neighbouring countries like Zambia, Mozambique, the Congo and Nigeria. This exodus converted Zimbabwe from a food exporting country to one facing frequent food shortages. According to an estimate by a Zimbabwean economist and legislator, Eddie Cross, the total cost that the economy has borne due to the adoption of this policy is around $20 billion. Banks have also expressed their reservation on the proposed amendment. They have about $114 billion of mortgages outstanding against land. Their concerns are not being addressed. Further, the possibility of civil war engulfing the most industrialised country in Africa cannot be ruled out. Many far-right groups have claimed that white farmers are being killed and forced expropriations are already happening. In August 2018, Donald Trump’s tweet in their support added fuel to the fire. If violence spreads, it is likely to affect tourism, which contributes about 10% to the GDP. It would dampen the investor sentiment as well. The country, at present, is an attractive emerging market despite economic woes for investors because of two reasons. Firstly, it has an expanding middle class and secondly, its location at the tip of the African continent makes it a perfect gateway to the huge African market consisting of about one billion people.
There are many defects in Ramaphosa’s policy design. It is unclear on what basis land will be redistributed, and how the beneficiaries will be identified. If land has changed hands against adequate compensation, will it have any impact on new owner’s rights? The parameters to identify ‘unused land’ have not been clearly defined. The policy seems to be the government’s ploy to counter the growing popularity of the EFF in the country, particularly against the background of upcoming elections in May 2019.
One really wonders why politicians around the world try to achieve inclusion of one group by excluding another. Such inclusion-exclusion is certainly not a zero-sum game because players over the years change. After all, why must the present generation pay for the ‘wrongs’ done by their forefathers? The Indian policy of caste-based quotas for achieving social justice through inclusion is continuing even after seventy years of independence. More and more groups are demanding quotas, causing social unrest at times. In South Africa, even after 25 years in power, the ANC has failed to conclude a fair land reform process successfully. But will South Africa’s new (and potentially dangerous) experiment with inclusion lead to the desired result (whatever that is)? Only time will tell.
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