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September 01, 2011

South Africa: new black farmers sell 30% of their farms back to whites

Black farmers have resold nearly 30% of the white farmland bought for them by the government, often selling back to the previous white owners, Land Reform Minister Gugile Nkwinti said on August 31.

He said the government had bought about 6 000 000ha to date, of which nearly 2 000 000ha has been resold.

"The government bought land and handed it over to aspirant farmers who then sold it again, in many instances back to the original owner," Nkwinti said.

Nkwinti was speaking at the launch of a long-delayed new draft reform policy that aims to overhaul lagging efforts to transfer farms to the black majority, with restrictions on private and foreign land ownership. The 11-page draft sets out the state's vision to transform land ownership patterns and will lay the basis for future legislation.

Nkwinti reaffirmed South Africa's commitment to an open market system, where only willing private owners will sell to the state, but said the state planned to act on "distorted" pricing.

"There are no silver bullets to the resolution of the post-colonial land questions anywhere in the world," Nkwinti said. "In our country we wanted to solve it yesterday - it's not possible, such an emotive issue. So we think it's going to take a bit of time and it will require patience."

The draft proposes the leasing of state and public land, limits on private land, conditions and obligations for foreign owners, and communal tenure on land under traditional chiefs.

"Anywhere else, foreigners do own land but on strict conditions if they actually have that privilege of owning land," said Nkwinti. "In our country as well, we have reached the point that we want to make sure that we take control of the national asset that is land. We've got to make sure that we do exactly the same as other countries are doing, to control the holdings of our land by foreigners in the interests of our country."

The state plans to keep buying white-owned farms to redistribute to blacks, but proposes tackling the sticky problem of pricing with a new land value office that will "level the playing field".

"The willing-buyer willing-seller model on its own, it's a problem, because it distorts the market," said Nkwinti, pointing to above market value prices. "There will always be a willing-buyer willing-seller model working, except we want to make sure that some of the vagaries would be dealt with."

Redistribution efforts have largely failed so far with only 10% of redistributed projects productive - of 6.3 million hectares transferred - and Nkwinti said land reform targets were "slippery".

A previous bid to transfer 30% of farms by 2014 was unlikely as R40bn was needed to buy farms.

"I can't see us raising that kind of money to acquire the 30% we're talking about by 2014," he said.

The target had been "to transfer 30% of the 82 million hectares that is arable land in the hands of white commercial farmers to black emerging farmers," Nkwinti said. "That's where you have a challenge - it's a fiscal issue as well as it's a qualitative, productive issue."

The proposed restriction on private land is a concern, said Annelize Crosby, legal adviser of the commercial farmers body Agri SA.

"We are very worried about the potential consequences of such a step because if you start interfering with that, there will be consequences," she said. "It's a very complex issue. I can see why it would be an attractive option for the ministry and government but I don't think they fully realise the possible consequences of such a step and just the complexity of it."

Last year, a quarter of the land buying budget was allocated to rescue collapsing projects, with 100% productivity now being targeted.

A land management commission is also proposed to advise, co-ordinate and regulate on land matters with subpoena rights and the power to seize or confiscate land gained corruptly.

Land is a sensitive issue in southern Africa where reforms in neighbouring Zimbabwe from 2000 saw more than 3 000 white-owned farms seized by militant supporters of President Robert Mugabe.

South Africa's much anticipated and delayed strategy will be open for public comments.

"We don't have answers, ready answers," said Nkwinti who said the "streamlined" document was meant to be a platform for discussion.

"We're looking for answers but we will search for answers together. What we have is a vision of where we should be going and the kind of institutions that will support that vision and make us actually realise it."


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