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Programme for Land and Agrarian Studies (PLAAS)

State, market or the worst of both?
Experimenting with market-based land reform in South Africa

Edward Lahiff

Programme for Land and Agrarian Studies (PLAAS), University of Western Cape

January 2007

SARPN acknowledges PLAAS as the source of this document:
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The concept of ‘market-based land reform’ has been central to policy debates in southern Africa for the past twenty-five years. During that time meanings and values ascribed to the concept have evolved considerably, with significant differences between, for example, how it has been applied in Zimbabwe in the 1980s and in South Africa from the mid-1990s.

In the transition to democracy, South Africa has adopted a strongly pro-market approach to land reform, based in part on the supposed successes of this approach in Zimbabwe but also influenced by emerging international support for market-based land reforms. The ‘willing seller, willing buyer’ approach has come to signify not only a lack of compulsion on landowners and the payment of market-related prices for land, but also a minimal role for the state in strategic planning and implementation. This has led to a slow rate of land transfer and inappropriately designed, under-financed and isolated settlements poorly integrated to the agricultural economy and state support services. Wider, structural reforms that would support the emergence of new smallholders have not been forthcoming, as government has vigorously pursued deregulation of the agricultural sector and integration into world markets.

The emerging evidence from southern Africa suggests that market-based land reforms have emerged in the context of regimes that are constrained from undertaking fundamental restructuring of the agrarian economy by a combination of internal and external forces. A market-based approach offers no threat to vested interests in land ownership, agri-business and the wider economy, while providing very limited benefits to selected beneficiaries. The experience of South Africa, in particular, suggests that market-based approaches are incapable of effecting a large-scale redistribution of land or restructuring of the agrarian economy, and are likely to be met with growing popular opposition as the crisis of rural livelihoods grows and the limitations of ‘willing seller, willing buyer’ become apparent.

This paper reviews the South African experience with land reform, and land redistribution in particular, up to the end of 2005. It does not, therefore, cover proposals for a proactive land acquisition strategy (PLAS) announced by the Minister of Agriculture and Land Affairs during 2006, nor the issuing of a small number of expropriation orders for land under restitution. While the National Land Summit of July 2005 signalled a broad political and popular support for a shift away from market-based approaches, it remains to be seen whether recent policy proposals will in fact lead in that direction.

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