* This article first appeared in the Farmers Weekly magazine, dated 31 March 2017.

There is a broad consensus that a Zimbabwe-style land reform process will be grossly counter-productive in South Africa. But after two decades of frustration over the slow pace of land reforms, there are growing fears that the proponents of radicalism are beginning to find a voice, particularly amongst a broad section of the poor, desperate for any respite from their continued suffering.

The pressure has undoubtedly mounted on the government to deliver on the promise of land reform, and experts and observers believe that the next 10 to 15 years may prove crucial in ultimately determining the fate of the agricultural sector.

On the one hand, the ruling party will feel the need to strategically deflect attention from the broader failures of economic policy and unemployment, while opposition politics will likely use land reform to grow political capital among the poor.

This scenario has already been playing out strongly, particularly in the last five years, and it is now epitomised by President Jacob Zuma’s new “expropriation without compensation” message, generally associated with Julius Malema and the Economic Freedom Fighters (EFF).

With President Zuma’s utterances at the State of the Nation (SONA) address going against the African National Congress’ (ANC) policy, the contradictions within the ANC itself will continue to play out.

The country’s land reform debate is now narrowly focused on two options: whether to expropriate farmland “with” or “without” compensation. This dichotomy seems to defy the complex nature of the “land question” itself.

Yet, options are in themselves a false dichotomy, not least because the latter will come at a heavy long-term economic cost that will attract some very unpalatable and unintended consequences – some of which could, very well, negate the benefits that land reform intends to deliver.

Therefore, the public discourse for land reform should continue to emphasise two overriding factors. The first is that, expropriation without compensation will overnight wipe out about R160 billion of bank loans for which land was collateral. This will undoubtedly cause irreparable damage that will not only destroy the value of land, but will also make any future long-term investment in farmland unlikely.

The second factor would be the crisis in confidence as a result of the apathy of foreign and domestic investors to inject capital into the sector, especially given weakened and insecure property rights. It would take years, if not decades, to overcome this leading to permanent and irreversible structural damage to the sector, which could cost the country billions of rands in lost production, unrealised export potential, and losses in taxable agricultural revenues.

Therefore, the critical consideration of land reform should not only be to achieve equitable land ownership, but to achieve this feat without disrupting commercial agricultural production. While due consideration should be given to the landless, the primary target beneficiaries should be black farmers intent on becoming full-time small to medium, or even large-scale, commercial farmers.

Land reform expert, Prof Ben Cousins, estimates this group of black farmers to be around 200 000, and argues that they could be allocated to farms that have remained under-utilised in the sector, with such farms still being acquired through market purchases.

This sentiment goes against the radical economic transformation narrative, mainly because radicalism is disruptive and costly, by nature. As the debate continues, the guiding principles should remain in preserving the value of farmland, food security, property rights, and a system that can attract foreign and domestic capital.

Such a process is neither quick nor perfect, but it will, at least, keep the sector relatively stability, which is key to attaining the long-term growth and equity.

ENQUIRIES:
Tinashe Kapuya
E-mail: tinashe@agbiz.co.za