Letter: Investors right to fear expropriation - Businesslive

20 May 2019 - To invoke the constitution as offering protection — as the president does — is rather disingenuous, since he and his party are formally committed to amending it.

President Cyril Ramaphosa assured foreign investors at an investment conference hosted by Goldman Sachs that their assets would be safe in SA, despite his commitment to expropriation without compensation (EWC).

He is quite correct that asking for investment and then confiscating it is “not something that any sensible person does”. But — irrespective of how EWC is couched — in degrading the protection of property rights, this is precisely the threat.

Putting EWC into practice is closer than many realise. Regulations promulgated under the Property Valuation Act give the government a substantial discount on any property acquired for land reform. The Expropriation Bill establishes procedures that are heavily skewed against owners and in favour of the state. Its definition of expropriation would enable the state to confiscate property without this being legally expropriation, and thus exempt from compensation.

To invoke the constitution as offering protection — as the president does — is rather disingenuous, since he and his party are formally committed to amending it.

It is also revealing that the ANC in the Northern Cape recently produced a list of working farms they intend to seize as a first step when EWC is legislated. No refutation has been made by the president of this.

SA has already paid a steep price for all of this. Economist Azar Jamine recently pointed out that the “debate” on EWC had destroyed whatever prospects existed for a “Ramaphoria” windfall.

If the president and the government are intent on pursuing EWC, they do so at the peril of the country. No amount of soothing rhetoric will change this.

Terence Corrigan
Institute of Race Relations

https://www.businesslive.co.za/bd/opinion/letters/2019-05-20-letter-investors-right-to-fear-expropriation/

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