"Land Reform" Distracts From Poverty Alleviation in South Africa

Much of the current conversation in South Africa around black poverty links it to the disproportionate white ownership of the commercial agricultural sector. Simply put, the narrative within the governing African National Congress (ANC), the radical Economic Freedom Fighters (EFF), and many others, is that enduring black poverty is a result of the white domination of land ownership, itself the result of colonialism and apartheid. The EFF’s Julius Malema and the ANC’s Jacob Zuma highlighted that the disproportionate ownership of the land by white South Africans was an historic injustice and its perpetuation a moral outrage. Indeed, much of the public conversation about land ownership is conducted in moral, rather than economic terms. However, if the goal is the reduction of poverty, there should be more focus on education and labor policy and less on land reform, which is increasingly irrelevant to most South Africans.

About half of South Africa’s population is poor by most standard measurements, and the poverty rate is not decreasing. Most, but not all, of the poor are part of the 90 percent of the population that is black or "coloured," while the white minority of 9 percent by and large enjoys a standard of living comparable to that of the developed economies of eastern Europe. South Africa’s Gini coefficient, a standard measure of inequality, is among the highest in the world. 

Certainly white ownership of most of the productive land shaped the modern history of South Africa, just as the potato famine shaped modern Ireland, the highland clearances modern Scotland, and the forced expulsion of Native Americans the westward expansion of the United States. In the twenty-first century, however, white land ownership would seem to be increasingly marginal as a cause of black poverty. South Africa is predominately an industrial, information, and market-driven economy. The country is already about 60 percent urban and urbanizing rapidly. Few who migrate from rural to urban areas appear to wish to return to the land. In fact, most of those indemnified by the post-apartheid state for the seizure of their land under apartheid opted for a cash payment rather than the land itself.

Experiences elsewhere show that the establishment of small holders through land reform requires the state to provide significant technical and financial support if they are to succeed, which successive post-apartheid South African governments have been unable or unwilling to do. Furthermore, while both Zuma, Malema (ironically fierce personal enemies), and like-minded politicians have sought to build political support by advocating “expropriation of land without compensation,” it is not clear that there is still substantial demand for such a change in the rural areas. There is, however, demand for security of tenure from black farmers, especially those working in tribal trust areas where fee-simple ownership of land is absent. Moreover, there is real land hunger in urban and suburban areas, where new arrivals from rural areas too often find land unavailable, resulting in squatter settlements in which residents have little security of tenure. Much of the political discourse surrounding the subject is largely irrelevant to  the kind of land reform demanded by much of the public.

There appears to be a correlation between poverty and unemployment. The country’s unemployment rate is usually estimated to be around 25 percent, rising to 50 percent among males in the townships. Female unemployment in rural areas is similarly very high. Meanwhile, potential employers complain about a shortage of workers. Unemployment is exacerbated by the failure of the educational system to prepare students to participate in the modern economy. The issue is not government funding—in some years, South Africa spends up to 25 percent of the government’s budget on education. Rather, education innovation and reform is held hostage by the political power within the ANC of the teachers unions, poor teacher training and discipline, and the multiplicity (eleven) of legal languages, among others. English—the international language of business—is the first language of only 9 percent of the population, and they are mostly white. Elementary education of black children is too often is in African languages or Afrikaans rather than in English.

South African labor policy has long favored a high-skilled, high-wage work force. That approach is strongly supported by organized labor, an important part of the ANC’s electoral base. Unsurprisingly, a large percentage of the unemployed and the poor are unskilled because the economy has too few low-skilled and low-wage opportunities, and there is little space for organized labor in that respect. The bottom line is that, in order to address the drivers of poverty in a meaningful way, there should be more focus on education and labor policy and less on the distraction of land reform.