Marian L Tupy. Picture: CATO Institute
Marian L Tupy. Picture: CATO Institute

A top US policy think-tank, the Cato Institute, has warned that SA is on the path to a Zimbabwe-style land disaster and has called on US President Donald Trump to take action.

An editorial on the think-tank's web site by Marian Tupy says: 

According to press reports, SA’s government has begun expropriating privately owned farmland without financial compensation, thereby ignoring the post-apartheid political settlement, which allows for land redistribution in the country on a “willing buyer, willing seller” basis.

Eighteen years ago, Zimbabwe embraced a similar policy. As a consequence, SA’s northern neighbour’s economy collapsed and the country descended into penury and political violence. This scenario is likely to repeat itself in SA. An attack on property rights will result in the destruction of SA’s farming community, dramatic reduction in agricultural productivity and mass unemployment. It could also lead to a collapse of the banking sector (which depends on land as collateral for loan-making) and the local currency, hyperinflation and even bloodshed.

Tupy said that the US "bears some responsibility for ensuring that SA's post-apartheid political settlement, including protection of minorities and private property, endures."

The article comes as the ANC prepares to amend clause 25 of the constitution to allow for the expropriation of land without compensation following nationwide hearings on land.

President Cyril Ramaphosa recently announced that the amendment would go ahead even though the constitution already allowed for expropriation because those who testified at the hearings had called for greater clarity.

Tupy wrote that SA's membership of Agoa — trade arrangement with the US on favourable terms — was on the condition that it “protects private property rights, incorporates an open rules-based trading system, and minimises government interference in the economy through measures such as price controls, subsidies, and government ownership of economic assets; (b) [respects] the rule of law, political pluralism, and the right to due process, a fair trial, and equal protection under the law.”

He said that Trump could terminate SA's designation as an Agoa beneficiary.

"Considering that SA is in breach or is about to breach a number of requirements for membership of Agoa, the president should act by issuing a preemptive warning to the South African government."

The Cato Institute is ranked as a top-10 US think-tank and a top-15 global think-tank by a University of Pennysylvania study.

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