Land Reform Nightmare

Zimbabwe: Land Reform Nightmare

Financial Gazette  - By Nelson Chenga

11 June 2015

GOVERNMENT, battling to stem an accelerating economic crisis that was primarily triggered by its land reform programme, is contemplating returning some underutilised farmlands back to a number of former white owners after failing to compensate them, the Financial Gazette can report.

The move comes as a US judge last week dismissed a bid by ZB Bank against a US$25 million compensation case brought against the financial institution by 40 Dutch nationals whose farms were seized under the country's 2000 fast-track land redistribution programme. This development threatens to open a legal minefield, as there would be the possibility of more claims against government-owned institutions for compensation of evicted farmers in offshore jurisdictions.

President Mugabe this year made a stunning admission that the land reforms had failed, insisting, in his first frank remarks since he embarked on a decisive campaign that disposed former white farmers of their land: "I think the farms we gave to people are too large. They can't manage them."

He has recently been joined in his condemnation by several ZANU-PF functionaries, notably Vice President Phekezela Mphoko as well as Parliamentarians, Blessed Geza (Sanyati) and Irene Zindi (Mutasa South), who recently said the land reform process had been "a huge failure".

Sources indicated that President Mugabe, whose land redistribution programme in 2000 displaced over 4 000 white farmers, was under pressure from his lieutenants to institute an internationally acceptable and non-segregating land tenure system, along the lines of the 1998 United Nations proposals, which ZANU-PF rejected.

One government official claimed that several Cabinet ministers, as well as security services chiefs, had privately negotiated with dispossessed white farmers for title deeds to the expropriated land to insulate themselves against any future claims on the properties.

Most of these deals were reportedly facilitated by a senior official in the Ministry of Lands.

Douglas Mombeshora refused to discuss this issue when contacted by telephone for comment yesterday. He insisted on written questions.

Following the country's controversial fast-track land reform programme, the Zimbabwe government placed caveats on title deeds belonging to the former white farmers indicating that all farmland was now State land but failed to compensate the former commercial farmers even for developments in line with laws tailor-made to support the expropriations.

In the absence of title deeds, government has since 2000 struggled to transfer ownership of the land to the new settlers, a situation that has frustrated its plans to issue 99-year leases and offer letters that are tradable and bankable.

The Financial Gazette understands that the government has now put together a land audit team which will, among other things, seek to come up with recommendations on how best it should proceed after the land reform process failed to produce desired results.

Led by agricultural expert and consultant, Mandi Rukuni, the land audit will also seek to establish who grabbed what, as well as come up with a new land reform model that many believe will see farms subdivided into smaller holdings that will either carry title deeds or some form of ownership document that will be sellable on the market.

There are also moves for a new tax to raise money to pay for the expropriated farms.

Indeed compensation for the former white commercial farmers is a pressing issue that the audit is expected to address, because most of the acquired farms can still be contested in a court of law as long as there are people still holding on to title.

According Section 16 (a) and (b) of the country's Land Acquisition Act, which was last amended in 2006, the Zimbabwe government was duty bound to "pay fair compensation within a reasonable time" to any person who suffered loss or deprivation of rights as a result of expropriation of land.

This included owners of any specially gazetted land and any person with right or interest in land acquired in terms of the Act.

And 15 years after the government failed to keep that promise, which is also enshrined in the country's new Constitution, Zimbabwe is now under increasing pressure to meet its end of the bargain as the southern African nation desperately seeks reintegration into the international community after years operating as a pariah State due to the controversial land redistribution programme.

The international community, including Zimbabwe's all-weather ally, China, has largely remained mistrustful of the country's government because of its policy inconsistencies and apparent disregard of the rule of law in relation to property rights.

That thousands of former white commercial farmers who lost land since the southern African nation began its fast-track land redistribution exercise in 2000 remain uncompensated in now haunting Zimbabwe as it strives to regain international trust.

This, according to economic analysts, has been one of the main reasons why the country has been shunned by investors, further undermining efforts for economic revival and condemning the country to the bottom of the World Bank's ease of doing business rankings.

Latest World Bank (WB) ease of doing business rankings place Zimbabwe at 171 out of 189 countries. The country has also been raked 180 out of 189 on the WB's starting a business ranking and 180 out of 189 on the trading across borders ranking.

Because business is about trust and goodwill, the WB says: "For policy makers, knowing where their economy stands in the aggregate ranking on the ease of doing business is useful. Also useful is to know how it ranks relative to comparator economies and relative to the regional average."

The Global Property Guide, which uses a property rights index to measure the degree to which a country's laws protect private property rights, and the degree to which its government enforces those laws, has awarded Zimbabwe 10 points out of a possible 100 because of its failure to respect its own laws.

"Higher scores are more desirable, i.e. property rights are better protected... The index also assesses the likelihood that private property will be expropriated and analyses the independence of the judiciary, the existence of corruption within the judiciary, and the ability of individuals and businesses to enforce contracts," says the guide.

The Zimbabwe Human Rights Forum (ZHRF) points out that besides property rights having been taken away from the previous landowners, the rights were not extended to the new land occupiers.

"The land reform programme has failed to fulfil its stated objective of empowering the landless... The restoration of the rule of law will enable the government to come up with a credible land reform programme that will address the historical imbalances and the injustices of the 2000 fast track land reform process," said ZHRF.

Because of these glaring problems that triggered the country's isolation in the first place, Zimbabwe is now miles away from its neighbours like South Africa and Botswana who rank 61 and 149 respectively in the WB's ease of doing business rankings, despite the country having vast tracts of arable land and mineral resources.

Since 2000, about 300 former white farmers, out of nearly 4 500 former white farmers, have ceded title deeds to government after accepting 'nominal compensation'.

Commercial Farmers Union director, Olivier Hendrick, expressed doubts that government would own up to its obligations.

"It's now 15 years since those farms were taken... We are still waiting and it remains to be seen whether people are going to be compensated or not... But I don't see that happening," said Hendrick.

But others are still hopeful.

Writing on the CFU website, a former white commercial farmer, Wynand Hart, said: "While we find ourselves in a very desperate situation as commercial farmers that have lost our properties to the so called Fast Track Land Reform Programme, there are certain rulings that have taken place in International Law that have a significant impact on our right to claim full and fair compensation. For many of us it seems that the idea of International Law is as farfetched as acquiring real estate on the moon, but certain events bring this ideal situation within our reach. It is important that as Zimbabwean commercial farmers we have to remain confident of legal action. However legal action must have a goal other than appearing in court."

The court case Hart was referring to was in India where the Supreme Court in that country held that if compensation for land that was acquired under that country's 1894 Act has not been paid to the land owner or deposited with a competent court and retained in the Treasury, then the acquisition would be deemed to have lapsed and would be covered under the 2013 law entitling the landowners to higher compensation.

The Indian bench ruled thus: "The deposit of compensation amount in the government treasury is of no avail and cannot be held to be equivalent to compensation paid to the landowners/persons interested... Under section 24(2) (of The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013), land acquisition proceedings initiated under the 1894 (Land Acquisition) Act by legal fiction, are deemed to have lapsed where award has been made five years or more prior to the commencement of 2013 act and possession of the land is not taken or compensation has not been paid."

It is such rulings in other countries that have prompted Zimbabwe to be seen to be moving towards effecting justice and the rule of law as it seeks unconditional acceptance back into the international community.