British Premier Theresa May’s response to South Africa’s controversial and patchily explained drift towards expropriation without compensation elicited headlines this week implying Britain’s unqualified support for the ANC’s approach to land reform.
On the face of it, some of May’s phrasing – ‘the UK has for some time now supported land reform…’ and ‘I welcome the comments that (President Cyril Ramaphosa) has already made about approaching land reform…’ – seemed to justify what many took to be an endorsement.
But May’s comments were significantly qualified – qualifications underscored by the theme of her speech in Cape Town on Tuesday.
Even in her off-the-cuff remarks, May was much more cautious than some headlines suggested. She said, for instance: ‘The UK has for some time now supported land reform, land reform that is legal, that is transparent, that is generated through a democratic process.’
As for welcoming Ramaphosa’s ‘comments …about approaching land reform’, she added this caveat: ‘… bearing in mind the economic and social consequences. He’s made reference to no smash-and-grab land reform.’
These qualifications were explicit in the repeated and unambiguous sentiments of her speech on Tuesday, in which she emphasised Britain’s commitment to a free market economy based on ‘well-established rules and principles of conduct’, ‘transparency, high standards, the rule of law and fairness’ and ‘a free and thriving private sector’, which May saw as being the ‘key to driving growth that will deliver jobs’. She warned that ‘investment cannot be attracted nor growth achieved in the absence of security and the stability it brings’.
May might easily have plucked this checklist from any one of a number of research documents produced in recent years by the Institute of Race Relations (IRR), and, more recently, the IRR’s vigorous contributions to the debate about expropriation without compensation, and the need for effective land reform.
What’s much more likely, however, is that she was simply expressing what is true of – and taken for granted by – the free world, and, importantly, the investors who are key agents in sustaining that environment of freedom, choice, innovation, accountability and change.
In the context, especially, of South Africa’s terminating its bilateral investment treaties (BITs) with a number of European countries in recent years, and the direct threat to the principle of property rights in the ruling party’s commitment – ahead of the conclusion of the democratic process – to tampering with the constitutional provisions on property rights, May’s message is surely unmistakable.
The British leader could not have been more blunt than when she observed: ‘As a Prime Minister who believes both in free markets and in nations and businesses acting in line with well-established rules and principles of conduct, I want to demonstrate to young Africans that their brightest future lies in a free and thriving private sector. One driven and underpinned by transparency, high standards, the rule of law and fairness. Only in such circumstances can innovation truly be rewarded, the potential of individuals unleashed, and societies provided with the opportunities they want, need and deserve.’
Later in her speech, she noted: ‘Without the stability and certainty provided by reliable legal systems, enforceable contracts, recognised standards and so on, it is impossible for responsible private sector companies to make long-term investments. It is impossible for economies to create sufficient numbers of skilled, jobs. And growth cannot be fair and inclusive if markets, whether domestic or international, are not governed by transparent and effective rules that are actively enforced.’
She returned to this theme, saying: ‘And the embrace of free markets and free trade, which accelerated further with the end of the Cold War, has acted as the greatest agent of collective human progress the world has ever seen. In those countries that have successfully embraced properly regulated market economies, life expectancy has increased and infant mortality fallen. Absolute poverty has shrunk and disposable income grown. Access to education has widened, and rates of illiteracy plummeted. And innovators have developed technology that transformed lives.’
Creating employment was especially important, she argued, particularly given the prospect of Africa’s being home to ‘a quarter of the world’s population and a quarter of the world’s consumers’ by 2050.
But, May said, ‘to make the most of this promise it needs to be properly harnessed’.
‘Between now and 2035, African nations will have to create 18 million new jobs every year just to keep pace with the rapidly growing population. That’s almost 50 000 new jobs every single day, simply to maintain employment at its current level.’
The IRR’s own research in South Africa aligns with May’s observation that ‘(e)very African leader I speak to identifies jobs as the number one demand of their people and their greatest political priority’.
The same is true of her statement that ‘it is the private sector that is the key to driving the growth that will deliver those jobs – transforming labour markets, opening up opportunity and unleashing entrepreneurial spirit’.
The IRR’s concern, however, is that if South Africa erodes property rights – instead of implementing effective land reform (in city and countryside) founded on guaranteeing and extending rights to property – the country risks becoming ‘uninvestable’, and the jobs, the growth, the dynamism and the brighter future will slip from our grasp.
Which is really Theresa May’s point.
* Morris is head of the media at the Institute of Race Relations (IRR), a think tank that promotes political and economic freedom. If you agree with what you have just read SMS your name to 32823 or visit the IRR website.
** The views expressed here are not necessarily those of Independent Media.