Lessons from Zim’s failed land reform

Source: Lessons from Zim’s failed land reform – DailyNews Live

William Gumede      16 October 2018

HARARE – Zimbabwe’s failed populist-based land reform is a salutary lesson
for South Africa on how land reform must be pragmatic, safe-guard
commercial agriculture and focus on boosting ordinary subsistence, small,
medium and emerging black commercial farmers already committed to farming.

In 2016, then Zimbabwean president Robert Mugabe declared a state of
disaster for agriculture, a declaration which allowed international donors
to help. This declaration was also a clear and very public admittance that
land reform had failed.

The effect of Zimbabwe’s failed land reform programme is clear.

According to the United Nation’s children’s agency, Unicef, around three
million Zimbabweans regularly need food aid. Around 40 percent of
Zimbabwean households are hungry.

“We have not seen these levels of malnutrition in more than 15 years,”
said Jane Muita, Unicef’s Zimbabwe representative.

The World Food Programme (WFP) reckoned that over a million people in
Zimbabwe’s rural areas will face hunger during the 2018 and 2019 dry
season, which is between October and March.

China has donated $5m to help starving Zimbabweans in the rural areas over
this year’s dry season.

Ironically, in 2015 Mugabe maintained there was “no suffering” in his
country. Mugabe, who addressed a Zanu PF women’s league meeting in Harare
asked angrily: “But what is that the people are suffering from? Didn’t we
give them land?”

A decade ago Mugabe, with the country facing economic collapse and his own
leadership being challenged within Zanu PF, launched a populist land
reform programme to strengthen his own waning position within the
governing party, which saw white-owned land being expropriated. The land
reform boosted his and Zanu PF’s popularity, particularly in the rural
areas.

Because the act of colonialism started off by forcefully taking African
land, the act of returning the land is an almost existential, deeply
emotional and cathartic imperative, to undo, so to speak, colonialism.

This means that land reform can easily be used by opportunistic leaders to
bolster their support among blacks – as Mugabe did.

Furthermore, it also makes land reform susceptible to populism, revenge
and ideological reasons.

For another, redistribution strategies are by their very nature highly
prone to corruption, rent-seeking and manipulation – this is often one of
the main reasons why redistribution strategies in almost all African and
developing countries fail.

All of this means that land reform will have to be done honestly,
pragmatically and to expand, rather than destroy, the industrial base of a
country.

In Zimbabwe, land reform was absolutely necessary to address past land
injustices, but Mugabe’s land reform was simply exploiting the necessity
of land reform for purely selfish gain.

Last week new Zimbabwe President Emmerson Mnangagwa promised compensation
to white farmers who lost their land during the disastrous expropriation
of land by his predecessor. The white farmers are owed $9 billion in
compensation for improvements made on the farms before they were
expropriated.

However, Lands and Agriculture minister Perrance Shiri, responding
recently to opposition member questions in Parliament said it is not the
State that will be paying the compensation, but individuals who received
the expropriated farms, will be expected to do so.

Shiri said: “It makes common sense that instead of labouring the tax
payer, the person who is directly benefiting from those improvements
contributes towards the compensation of the former farmers.” He added:
“The policy is that the new farmer pays for the improvement on the farm
and that money is used to compensate the white farmer, and that is
government’s position.”

Land reform undermined agricultural productivity.

Before the land reform, the country was agriculturally almost
self-sufficient, but land reform collapsed agricultural productivity to
such an extent that the country now imports most products.

The land reform focused exclusively on taking successful commercial farms.
This almost immediately undermined agricultural productivity.

This meant Zimbabwe’s exports income was immediately and devastatingly
cut. Its food production was also immediately disrupted as productivity
plummeted.

Although some of the land was transferred to poor blacks who had basic
farming skills, a lot of the best land was transferred to Zanu PF
politicians.

Even the ordinary Zimbabweans who got land and who had real farming skills
often lacked the commercial management skills which modern commercial
farming now demands.

But most importantly, land reform in Zimbabwe did not empower the genuine
subsistence, small and medium and emerging commercial black farmers. It
did not upscale them, give them access to finance, help them to adopt new
production methods and diversify their products, or secure markets for
them.

The Zimbabwean land reform failed, like black economic empowerment in
Zimbabwe and South Africa; because it did not transfer land rights to
blacks already in business, especially in the SMMEs sector – the real
black entrepreneurs – but transferred commercially successful assets to
political capitalists with no business inclination or skills whatsoever.
This undermined, rather than added value.

Land reform in Zimbabwe was not part of a long-term industrialisation
strategy, which aimed to create entirely new commercial black farmers,
develop a manufacturing sector aligned to it and establish industrially
relevant technical higher education institutions to produce new
agricultural related skills.

The expropriation undermined market confidence in the credibility of the
government’s policies; it undermined the value of property and disrupted
the financial system – because it disrupted the system of seeking credit
based on one’s assets. Foreign and local investors moved their money out
of the country – and started divesting because their assets were not
secure.

There was a jobs bloodbath in the commercial agriculture sector. This not
only caused unemployment within the agriculture, but within the sectors
that feed into the commercial agriculture economy.

The destruction of commercial agriculture also damaged the manufacturing
sector aligned to agriculture.

The sectors provided the inputs to commercial agriculture – which created
jobs – which meant over and above the jobs on the commercial farms, jobs
in the manufacturing sectors aligned to agriculture were also lost.

But as importantly, the populist, chaotic and vengeful land reform also
undermined the financial system underpinning the economy, market
confidence which is needed for new local and foreign investments and the
credibility of the government’s broader economy policies.

Zimbabwean economist John Robertson puts it succinctly: “By destroying the
collateral value of a vitally important national asset, government removed
billions of dollars’ worth of collateral value from Zimbabwe’s economy.”

Land reform is complicated and demands complex coordination and management
of market perceptions. It therefore needs a competent public sector to
manage it.

The State institutions, whether State development finance institutions or
agricultural marketing boards, that were supposed to provide new finance
or skills transfer to black farmers were all at near collapse, because
incompetent Zanu PF cronies were appointed to run them. The money for
development of black farmers was corruptly siphoned off.

Zimbabwe’s land reform did not include building housing in urban areas.
Again, any meaningful land reform programme must include providing mass
housing. A housing programme must be part of the industrialisation
strategy – building a manufacturing sector, expanding industrially
relevant technical skills and fostering technology development based on
producing the materials for the built programme.

As importantly, in the rural areas, land controlled by traditional leaders
through customary law remained untouched. This means that the vast
majority of rural dwellers are still living as second class citizens, with
little rights of tenure, on communal controlled by traditional leaders as
if they personally own the land.

Although they technically “own” land, they cannot invest in it, use it for
commercial purpose or to secure finance, because their property “rights”
can be taken away from them the moment they disagree with the traditional
leader or the Zanu PF party or leader.

Giving communal land to individual households, rather than mostly corrupt
traditional overseers, will unlock real value, energy and entrepreneurship
not only in Zimbabwe, but across the continent.

NOTE: Gumede is chairperson of the Democracy Works Foundation and author
of South Africa in BRICS (Tafelberg).