LETTER: Mike Pompeo’s views are common sense
US secretary of state is right about the effects of expropriation without compensation
US secretary of state Mike Pompeo’s very direct comments on SA’s impending policy of expropriation without compensation (EWC) will not have gone down well with much of SA’s political class and commentariat.
It is no doubt seen as an instance of an imperialist power interfering in the affairs of a proud nation, with all its revolutionary intentions. The comments of an SA leader from a different generation may be apposite: “Don’t push us too far.”
Nevertheless, what Pompeo said was eminently sensible. EWC is a dreadful disincentive to investment, and the “policy debate” about it has already done damage. The implementation of the policy will torpedo SA’s economic prospects. The consequence will be economic malaise for years to come.
Pompeo’s recommended solutions — “strong rule of law, respect for property rights, regulation that encourages investment” — are no more than common sense. SA’s attitude towards property rights will also have very real implications for its access to the US market.
But the US will not “save” SA. Whether we choose the path of growth or the mirage of EWC will depend squarely on our own choices. As the deadline for comment on the amendment of section 25 of the constitution approaches, the country’s people, along with its business and civic institutions, will need to decide where they stand on the perilous and reckless drift of policy.
Institute of Race Relations