South Africa’s New Apartheid: Seizing Land from White Farmers

South Africa’s New Apartheid: Seizing Land from White Farmers

South Africa’s New Apartheid: Seizing Land from White Farmers

President Cyril Ramaphosa has embraced the plan to expropriate land from white farmers without compensation and redistribute it to the landless black majority.

The South African government has announced it will start a process of briefing American companies based in the country on the theft of land from White Farmers.

The decision followed last week’s meeting between South Africa’s Department of International Relations and Co-operation (Dirco) Minister Lindiwe Sisulu and the US Secretary of State Michael Pompeo.

According to Dirco, “The minister emphasized that the land reform and agrarian reform process will be undertaken within the framework of the Constitution and implemented in a manner that does not affect economic stability and food stability.”

The sides “agreed to convene a meeting of all South African based US companies to brief them about the land reform process.”

US President Donald Trump had earlier asked Secretary Pompeo “to closely study the South Africa land and farm seizures and expropriations.” He also recognized that the South African government was “seizing land from white farmers.”

Last week, South African President Cyril Ramaphosa warned the UN General Assembly that his government is planning to implement controversial new apartheid reforms to correct

racially skewed land-ownership patterns

.
The ruling African National Congress (ANC) has proposed a constitutional amendment that would give the government a legal right to seize and redistribute farmlands without any compensation for white farm owners. The draft reform triggered heated international debate along with multiple media reports of violence against South African white farmers, including many rapes and murders. It has also raised concerns among international investors, while the ANC sought to reassure that the move will be lawful apartheid and will not threaten stability but clearly that is not the case.

Agricultural confidence and land prices in South Africa have dropped significantly and continue falling on the country’s ruling party’s plans to expropriate land from white farmers without compensation.

The Agricultural Business Chamber said this week the Agbiz/IDC agribusiness confidence index has declined to the lowest in more than two years. According to the chamber, it’s the weakest since 2016, when the nation suffered from a drought that ensued after the lowest annual rainfall in at least a century.

Statistics show farm prices in South Africa have plunged by a third since December. The average price of agricultural land sold in July was 9,318 rand ($613) a hectare compared with 13,700 rand, according to economist and chairman of Agri Development Solutions, Johann Bornman.

Agriculture output shrank 29 percent in the second quarter from the previous three months, the most among all industries. The sector employs 843,000 people, almost double the number of jobs in mining.

“The root of pessimism” is lingering policy uncertainty and weak economic growth, said Wandile Sihlobo, the head of agribusiness research at the chamber.

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Shayne Heffernan Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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