Explainer: How SA can expropriate without damaging the economy

Explainer: How SA can expropriate without damaging the economy

- Land reform is an issue that is close to many South Africans' hearts, with strong opinions on both sides of the debate

- While several economists have expressed doubt about the proposals, others say it could be done in a way that does not damage the economy

- While a path forward is not yet clear, the government will need strong political will and a clear vision if it wants to properly address land reform

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The proposal to amend the constitution to allow for land expropriation without compensation gripped headlines last year and stoked strong emotions on both sides of the issue.

For some, it represents redress for South Africa's "original sin". For others, it's a surefire path to Zimbawe-style economic ruin.

So how could expropriation be done in a way that won't harm South Africa's economy?

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Land ownership has been a major issue for the country, dating back to at least the 1913 land act that prevented black people from buying white-owned land. The dispossession of black people from land only worsened during the apartheid era. 

As a result, many South Africans feel passionately about land reform.

However, several economists have stressed that land expropriation needs to be handled properly in order to really have a positive effect, Briefly.co.za has learned.

For example, one way that has been put forward is to hand land over to individuals rather than nationalise it, according to the Daily Maverick.

Giving the state ownership of the land opens up possibilities for mismanagement and corruption - something which has already been the case in terms of South African land reform.

READ ALSO: Mmusi Maimane says corrupt politicians belong in jail, not in Parliament

Another benefit of giving land to individuals is that it might strengthen the economy, because people will be able to leverage the land in order to get loans, start businesses or earn income through renting, for example.

However, the issue is a complex one, and some economists have expressed concerns about its feasibility.

Thomas Sowell and Francis Fukuyama, for example, have stressed that secure property rights are essential for a healthy economy. If people fear that their landed might be expropriated, they will be less likely to develop it and capitalise on it. 

While there is no clear path forward, the government will need a clear vision and strong political will in order to implement land reform in a way that will help - rather than harm - South Africans.

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Source: Briefly.co.za

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