South Africa’s land reform: why is big business suddenly in favour?

Over the last week, some sections of the ruling class have changed their tune about the debate around land expropriation without compensation in South Africa. The rabidly conservative and far-right Afrikaner groups such as Afriforum, which were given a strong voice in the mainstream media at the beginning of the debate, are increasingly being squeezed out by the big capitalists.

Now different players, from Theresa May and the Belgian deputy prime minister to the big commercial farmers, from some major banks to the International Monetary Fund and the World Bank, have all made a 180-degree-turn and have started to speak in favour of the proposed reforms! This is a startling turnaround. Paranoia and scaremongering have given way to cautious optimism and even critical support. What is the reason for this?

Critical support... from the bourgeoisie!

The first to express such support was none other than the prime minister of the former colonial master, Britain. On her recent tour of African countries, British Prime Minister, Theresa May was asked for her views on South Africa’s debate around land expropriation without compensation. To the surprise of many journalists, she said the UK supported land reform as long as it is “legal, transparent and follows democratic process.”

“I welcome the comments that he [president Ramaphosa] has already made about approaching land reform bearing in mind economic and social consequences... and that land reform will be no smash and grab… The UK has for some time now supported land reform that is legal and transparent and generated through a democratic process. I discussed it with President Ramaphosa during his visit to Britain earlier this year and will discuss it with him again later today.”

Theresa May’s comments were quickly echoed by that other bastion of reaction, the International Monetary Fund. Following May’s line, the IMF gave its full backing to the proposed land-reform plan as long as the process is “transparent and based on the constitution.” The senior representative of the IMF in South Africa, Montfort Mlachila, said:

"We are in full support of the need to undertake land reforms in order to address the issues of inequality. There is need to have a transparent, rules-based, and constitutional process that leads to desirable outcomes. It is particularly important not to undermine agricultural production and food security.”

May and Ramaphosa 2 Image GovernmentZAIf Theresa May supports the land reform process now, it is because the reforms do not pose any vital threat to her material interests / Image: Flickr, GovernmentZA

This high praise for transparency and democratic processes by Britain and other western powers is of course hypocrisy of the highest order. All of them have a long history of meddling in the affairs of former colonial countries, subverting the will of their peoples, overthrowing democratically elected leaders and replacing them with puppet regimes and brutal dictatorships that do the bidding of the imperialist powers. If they support the land reform process now, it is has nothing to do with a new respect for “democracy” but because the reforms do not pose any vital threat to their material interests.

Other bourgeois representatives have expressed cautious optimism that “a way out” will be found. These include big agricultural businesses such as the Agriculture Business Chamber (Agbiz) and Agri-SA, which represent the major commercial farmers. These organisations have, of course, warned of the dire consequences of a broad and blanket approach to land expropriation without compensation. But they have also called for “cool heads” as this process navigates its way through the Joint Constitutional Review Committee and the rest of the parliamentary process. This desire to contain the process within the parameters of the bourgeois parliamentary system is in line with what the British imperialists and the IMF are saying.

The bourgeoisie has every reason to be optimistic about the parliamentary process because up to now it has served to completely dilute any radical outcome of the land expropriation motion.

A watered-down programme

On 27 February, the National Assembly passed a motion on land expropriation, tabled by the Economic Freedom Fighters (EFF) and supported by the majority of parties in parliament, including the ANC. The original motion brought by the EFF was very radical, basically calling for the nationalisation of all land in South Africa.

But after they introduced the motion and made some radical speeches, the EFF immediately capitulated and allowed their motion to be watered down by ANC.

The ANC’s parliamentary caucus made seven substantial amendments to the EFF’s motion before it was adopted by the National Assembly. The cumulative effect was to weaken the original motion substantially. The clearest example of this is clause six, in which the original motion as tabled by the EFF:

“...recognises that at the centre of the present crisis regarding the resolution of the land question is section 25 of the Constitution, the ‘property clause’, which protects private property rights, and requires the State to pay compensation when expropriating land in the public interest and for a public purpose."

By contrast, the ANC’s amendment says it:

“...recognises that the current policy instruments, including the willing buyer willing seller policy, and other provisions of section 25 of the Constitution may be hindering effective land reform.”

The original motion by the EFF explicitly identified the property clause in the constitution and the requirement to pay compensation for expropriation as the central obstacle to land reform. The EFF’s original proposal, therefore, was for the nationalisation of all land. The ANC's amendment does not blame the property clause but specifically the “willing buyer, willing seller” principle and other unnamed provisions of section 25 of the constitution.

EFF 2 Image Flickr GovernmentZAThe EFF conceded to removing the essence of their original, radical land-reform motion in return for ANC support / Image: Flickr, GovernmentZA

In the debate, the ANC also proposed that expropriation without compensation is only one of the methods that could be used. In other words, different methods, including paying for the land, could still be utilised. There is, therefore, a fundamental difference between the original motion tabled by the EFF and the one adopted by the National Assembly. In effect, the EFF conceded to removing the essence of the original motion in return for ANC support.

Under the amendments and new proposals, a framework of property rights would continue to exist. In other words: private property will continue but with new conditions, which will be specified during the work of the Constitution Review Committee. Also, it is important to note that section 25 of the constitution does not allow for unlimited and wholesale expropriation: the amendment to the EFF’s motion now guarantees this! In other words, it allows for expropriation on an individual and case-by-case basis only.

The motion was substantially watered down before it was adopted on 27 February. Since then, this process has continued. Under the grinding mechanisms of the bourgeois parliament, nothing is left of the original motion brought by the EFF.

Ramaphosa’s version

The slogan of “land expropriation without compensation” sounds very radical. But the question should be, which land is being talked about? Writing in the Financial Times on 23 August, president Cyril Ramaphosa explained that parliament will not adopt a position of the widespread expropriation of land. Ramaphosa’s way out of this conundrum has been to suggest it will be applied selectively, and not to expropriate commercial farms:

“There have been several suggestions on when expropriation without compensation may be justified. These include, for instance, unused land, derelict buildings, purely speculative land holdings, or circumstances where occupiers have strong historical rights and title holders do not occupy or use their land, such as labour tenancy, informal settlements and abandoned inner-city buildings.”

Cyril Ramaphosa Image Erfan KouchariRamaphosa has assured the capitalists that the new law will be applied selectively, and not to expropriate commercial farms / Image: Erfan Kouchari

As we can see, these measures, as unpalatable they might be to a tiny handful of landowners, do not in any way pose a substantial threat to the big agri-businesses or commercial farmers.

Ramaphosa further explained that this mechanism of limited land expropriation without compensation under certain circumstances is not an assault on property rights:

“This is no land grab; nor is it an assault on the private ownership of property. The ANC has been clear that its land reform programme should not undermine future investment in the economy or damage agricultural production and food security. The proposals will not erode property rights, but will instead ensure that the rights of all South Africans, and not just those who currently own land, are strengthened. SA has learnt from the experiences of other countries, both from what has worked and what has not, and will not make the same mistakes that others have made.”

It seems therefore likely that Section 25 will be changed to allow for expropriation without compensation. But the clause will specify very clearly that this can only happen in very particular circumstances, which it will carefully define, as Ramaphosa says in the FT:

“In promoting accelerated land reform, the ruling ANC recently resolved to propose a constitutional amendment that would make explicit the conditions under which land could justifiably be expropriated without compensation.”

This does not pose any threat whatsoever to the big commercial farmers, the banks or the system of private property rights. It is a very small price to pay for the ruling class to contain the heated debate “within the law” and bourgeois democratic process. The more far-sighted section of the ruling class is clearly using the parliamentary process to manage the situation from above to prevent it from spiralling out of their control.

Moreover, land expropriation is actually allowed under the current constitution. But for the last 25 years, the ANC government has taken up a position even further to the right than the constitution. That is, the method of “willing seller, willing buyer”. Of course, amongst the rich, profitable agribusinesses, there are no willing sellers; and amongst the poor peasants, there are no willing buyers. The fact that the ANC is now willing to pass legislation explicitly allowing land expropriation without compensation under very limited circumstances, shows a desire to contain the process rather than radically change it.

The opportunism of the EFF

We have seen how the EFF’s capitulation has opened the door for the ANC parliamentary caucus and bourgeois politicians like Ramaphosa to steer the whole process into safe, parliamentary channels. The result of this process will not be any radical land reform programme.

This capitulation is not a tactical error: it flows from the opportunist direction in which the EFF has been moving ever since Jacob Zuma was kicked out as president. Zuma’s presidency destabilised the whole political situation in South Africa and fueled huge amounts of anger from amongst the masses, which posed a serious threat to the ruling class. Thus, the ruling class was compelled to get rid of Zuma to stabilise the situation. Ever since, the position of the EFF towards the ANC has changed. The first concrete realization of this was how the two parties worked together on the motion on land expropriation. But as we can see, based on the way this debate is going, the outcome will not fundamentally change anything.

EFF in Parliament Image GovernmentZAThe EFF’s capitulation has opened the door for the ANC and bourgeois politicians like Ramaphosa to steer the whole process of land reform into safe, parliamentary channels / Image: Flickr, GovernmentZA

Recently the EFF has changed its attitude towards the ANC. The latest example was in Nelson Mandela Bay where it had worked hand-in-hand with the ANC to remove the DA mayor. This is a drastic reversal because they – in an equally opportunist manner – made a deal with bourgeois opposition parties after the 2016 Local Government elections to install the DA candidate as mayor, promising never to bring the ANC back to power! Barely a week after the development in Nelson Mandela Bay, they introduced a motion in the City of Tshwane to remove that DA mayor – whom they also helped to install. But they struck a deal with the DA at the last minute because they had to scramble to cope with the fallout from their own base, who could not understand the sudden reversal of the party line.

Now, a few months before the general elections, the EFF is swinging opportunistically between the ANC and the DA. With the possibility of the ANC losing its majority, the EFF is clearly hedging its bets. But in the process it is spending the political capital it acquired in the first three years of its existence.

The party had a golden opportunity to lead the land reform process through revolutionary means. But the lack of a consistent revolutionary approach has opened the door for Ramaphosa and the ruling class to hijack the land debate. The outcome will be a law that does not touch the property of the big farmers and the capitalists and does absolutely nothing to change the desperate conditions of the rural masses.

The way forward

Out of a population of 57m, around 20m South Africans live in rural areas: the majority are black women. The living conditions among these rural communities are significantly worse than in the urban areas. According to Stats SA, 60 percent of poor individuals live in rural areas despite these areas housing only one-third of the population overall. The majority of these poor individuals live in KwaZulu-Natal, the Eastern Cape and Limpopo. A large proportion of the poorest households continue to live in informal and traditional dwellings.

Pondoland South Africa Blue Huts ImageA large proportion of the poorest, rural households continue to live in informal and traditional dwellings / Image: fair use

In contrast to this, South Africa has a well developed agricultural economy that is highly diversified and includes the production of all the major grains, oilseeds, deciduous and subtropical fruits; sugar, citrus, wine and most vegetables. Livestock production includes cattle, dairy, hogs, sheep; and a well-developed poultry and egg industry. Despite being only 2 percent of GDP, the agricultural sector contributed around 12 percent to total export earnings. This is owned by around 35,000 big commercial farmers, who dominate the agricultural sector.

The extreme inequality has often led to upheavals in the countryside. In several instances in Western Cape and Gauteng, rural and urban poor on a local level have organised spontaneous land occupations through improvised committees. Unfortunately, due to the lack of a clear programme and a revolutionary organisation these movements have disintegrated shortly after they took off. In order to change this situation, what is required is a revolutionary programme that links up the demands of the rural workers and peasants with the demands of urban communities and the workers in the cities.

There are 700,000 rural workers who must be unionionised and brought closer to their working-class brothers and sisters in the cities. In addition, the 2.2m small and subsistence farmers should be won over by giving them the land and beginning to introduce the collectivisation of agriculture.

Agricultural labourers SA Image Solidarity CenterIf the EFF wants to carry out a real revolutionary programme, it is necessary to rely on the masses, and not to stop at land reform, but to break the power of capitalism itself / Image: Solidarity Center

In the countryside, the first step would be the expropriation of the big commercial farms and agricultural businesses, followed by all land except for small farms. The biggest industrial farms would be run on a nationalised basis to provide high quality and affordable food for all South Africans. All poor peasants would be offered sustainable plots of land to grow their crops if they chose to, but at the same time, the state would wage a campaign for voluntary collectivisation of all land. On the basis of the high level of productive resources and the latest machinery and farming methods, the introduction of voluntary collectivisation would revolutionise the agricultural sector, dramatically increase food production and lift millions of people in the rural areas out of poverty.

These tasks will only be carried out meaningfully by the initiative of the revolutionary masses from below. If the EFF wants to carry out a real revolutionary programme, it is necessary to rely on the masses to carry out this process, using the structures that are already springing up whenever occupations occur. Such structures, like the local committees used to coordinate the land occupations in Gauteng and the Western Cape for example, should be linked to community structures in other areas, and ultimately on a national level. An appeal should then be made to all working-class neighbourhoods; along with workers in the factories, mines, commercial farms and big monopolies. In this way, a national movement of genuine organs of workers’ and popular power could be formed to carry out the land reform process. Such a movement, however, would not stop with the land but would move to expropriate the commanding heights of the economy and break the hold of the capitalist class.