File picture: David Ritchie/African News Agency (ANA)

Johannesburg - Minutes after the adoption of a report paving the way for expropriation of land without compensation, economists, business and farmers’ organisations warned that the amendment of the Constitution would destroy the economy.

The DA and other opposition parties announced on Thursday that they would be waging a “titanic” legal battle at the Constitutional Court to set aside the report.

AgriSA, which has been in consultation with the ANC and the government, was outraged by the latest developments and promised a “big fight”.

It described the recommendations as diametrically opposed to the crucial goals of protection of property rights, economic stability, job creation, investor confidence and sustainable agrarian reform.

AgriSA president Dan Kriek said the report was an unacceptable outcome of an extended consultation process wherein the organisation took a firm stance against the expropriation of land without compensation.

“We have made extensive preparations in order to act effectively and will cast additional resources to this fight.

“AgriSA believes in constructive dialogue with all stakeholders, but now is the time to draw the line,” he said.

AgriSA said it would mobilise internally and internationally as well as consult to pursue legal action to review the procedural and administrative law compliance of the parliamentary consultation process.

“AgriSA continuously consults with lawyers and we are considering litigation,” said policy head Annelize Crosby.

“The recommendation is only the first step in a long and arduous process to amend the Constitution and related legislation. AgriSA will continue to stand its ground throughout the process,” Crosby said.

The Transvaal Agricultural Union of SA (Tau-SA) said it was a sad day for SA that the committee adopted a resolution recommending the Constitution to be amended. Tau-SA’s Bennie van Zyl said: “There is enough space within the Constitution that they can use to address land reform and all the other things they want to do.”

The Banking Association of SA (Basa) said while it firmly supports land reforms, the process had to be handled properly. The banks were sitting on more than R140 billion in loans to commercial farmers.

Basa’s managing director Cas Coovadia said it has always argued that there was no need to change the Constitution. “What people want is certainty and that certainty is that property rights are protected. Government has to move swiftly to create certainty to assure investors and ratings agencies because it’s more of a definition issue than anything,” Coovadia said.

Economic expert Mike Schussler said the report had created a lot of uncertainty, adding that even President Cyril Ramaphosa’s investment envoy Trevor Manuel recently said expropriation without compensation was a hard sell to international investors.

“It creates a lot of uncertainty, and uncertainty is not good for economic growth. This thing will have bigger impact on our primary sectors, that is mining and agriculture. You are looking at about 25% of our economy that might feel constrained to buy things,” Schussler said.

Azar Jammine of Econometrix said what was of concern was the principle to change the Constitution because it was one of the progressive constitutions in the world. “That Constitution is sacrosanct,” Jammine said.

The investors will start to react once Parliament has formally adopted the report and this could result in the Rand to fall, he said. AfriForum and Freedom Front Plus also warned on Thursday that the adoption of the report was not the end, but the beginning of the fight to ensure that land expropriation without compensation does not go ahead.

Political Bureau