July 31, 2018 / 8:40 PM / 3 months ago

South Africa's ANC to amend constitution to allow land expropriation

JOHANNESBURG (Reuters) - South African ruling African National Congress will push ahead with plans to amend the constitution to allow for the expropriation of land without compensation, President Cyril Ramaphosa said on Tuesday, a move likely to unnerve investors.

FILE PHOTO: Farm workers harvest cabbages at a farm in Eikenhof, near Johannesburg, South Africa May 21, 2018. REUTERS/Siphiwe Sibeko/File Photo

The ANC had said in May it would “test the argument” that land redistribution without compensation is permitted under current laws, a plan that would have avoided the risky strategy of trying to change the constitution.

The proposal was first adopted in December by the party.

“It has become pertinently clear that our people want the constitution to be more explicit about expropriation of land without compensation as demonstrated in the public hearings,” Ramaphosa said in a recorded address to the nation.

“The ANC will through the parliamentary process finalize the proposed amendment to the constitution that outlines more clearly the conditions under which expropriation of land without compensation can be effected.”

Most land remains in white hands, making it a potent symbol of lingering inequalities 25 years on from the end of apartheid.

FILE PHOTO: South Africa's President Cyril Ramaphosa speaks after his meeting with Britain's Prime Minister Theresa May in Downing Street, London, April 17, 2018. REUTERS/Hannah McKay/File Photo

Since white minority rule ended in 1994, the ANC has followed a “willing-seller, willing-buyer” model whereby the government buys white-owned farms for redistribution to blacks. Progress has been slow.

Some investors are concerned that the ANC’s reforms will result in white farmers being stripped of land to the detriment of the economy, although Ramaphosa has repeatedly said any changes will not compromise food security or economic growth.

South Africa’s economy has barely grown in recent years, with the growth outlook remaining much lower than the 5 percent annual growth government is aiming for to make a dent in near-record unemployment.

Data showed on Tuesday that South Africa’s unemployment rate rose to 27.2 percent of the labor force in the second quarter from 26.7 percent in the first quarter.

Ramaphosa said the unemployment figures were “quite worrying,” saying the ruling party has told the government to move with urgency to develop and implement a stimulus package to ignite economic growth.

Ramaphosa said the measures will, among others, include increasing investment in public infrastructure.

“This stimulus package will be based on existing budgetary resources and the pursuit of new investments, while remaining committed to fiscal prudence,” Ramaphosa said.

Reporting by Olivia Kumwenda-Mtambo; Editing by Matthew Mpoke Bigg, Angus MacSwan and Richard Chang

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