President Cyril Ramaphosa stuck his neck out on the thorny issue of land expropriation without compensation on Tuesday, and saw the rand take a tumble.
After a two-day lekgotla of the ANC’s National Executive Committee, the organisation resolved that the constitution must be amended in order for land expropriation to work properly.
Currently, Section 25 of South Africa’s much-revered legislation outright states that no land can be taken without compensation being offered to the landowners. This looks set to change as the ANC are preparing a bill to present to Parliament.
During his speech last night, Ramaphosa declared he was making his party’s stance on land “unambiguous and clear”. Here’s what he had to say:
“The ANC reaffirms its position that the Constitution is a mandate for radical transformation both of society and the economy.”
“A proper reading of the Constitution on the property clause enables the state to effect expropriation of land with just and equitable compensation and also expropriation without compensation in the public interest.”
“It has become patently clear that our people want the Constitution to be more explicit about expropriation of land without compensation, as demonstrated in the public hearings.”
However, his 10-minute speech saw the rand drop from R13.10 against the dollar to R13.26. As the American market closed in the early hours of this morning, the exchange rate settled at $1 to R13.33, where SA’s currency weakened by 23 cents.
The wobble has come at a time where the rand was staging something of a comeback against its American counterpart. On Monday, it had gained ground on the dollar and was threatening to break through the R13 mark, and into the twelves.
However, land expropriation without compensation still has the capacity to upset the applecart. Despite Ramaphosa’s desire to make his position crystal clear, it seems that honesty might not have been the best policy.