Presenter: Lindsay Williams  Guest(s): Mandla Mabuza 

Should foreigners be allowed to buy and hold South African properties? A panel appointed by the state is to investigate foreign ownership. With official spokesperson for the Land Commission Report Mandla Mabuza

LINDSAY WILLIAMS: Estate agents and owners of fancy apartments in Clifton were quaking in their boots earlier today after news of a proposal to place a moratorium on land sales to foreigners “with immediate effect” until legislation has been promulgated. Mandla, can you tell us about the background to this?

MANDLA MABUZA: Yes, a panel was appointed by the Minister for Land and Agricultural Affairs on 24 August - the panel was basically mandated to amongst other things investigate the nature, extent, trends and impact of the acquisition of land in South Africa by non-South African citizens. The panel also has to investigate the extent to which the current lack of a comprehensive policy and the legislative framework contributes to the acquisition of land, or investment in land by non-South African citizens. It was given the period of a year to investigate this issue - the report submitted to the Minister today was an interim report, the final report is due in April 2006.

LINDSAY WILLIAMS: What were the general findings of the interim report? Are these headlines sensationalistic, or is there a chance that there could be restrictions on foreigners’ purchases whether it be residential or any other types of property in South Africa?

MANDLA MABUZA: There are a number of findings that we have made, and recommendations from that. One of the key findings we’ve made is that in South Africa there is no credible and reliable database that will give us indications about the number of foreigners that own particular portions of land in the country - the Deeds Registry system fails to actually provide clarity and information with regard to citizenship or nationality of foreigners that purchase land. To that extent it becomes very difficult for anybody to provide us with information with regard to the ownership of land in South Africa. Because of that the panel recommends disclosure requirements - in terms of which any foreigner that intends or wishes to buy land in South Africa - would have to disclose nationality and citizenship. Also, this is not only applicable to natural persons, it’s applicable to juristic persons because some people may actually hide information by using trusts and companies, so trust registration numbers will have to be provided and the categories of shareholders and beneficiaries will have to be provided.

LINDSAY WILLIAMS: We are part of the global economic community now - there has to be a certain amount of freedom of capital, and there has to be a freedom of movement of property and labour - that’s a fact of life. Is this because ordinary South Africans are now becoming priced out of their own property market?

MANDLA MABUZA: You cannot rule out that possibility, although that’s not the only reason why we are investigating this. It does appear that there’s a situation wherein foreigners - obviously because of the amount of wealth that they have - will come to South Africa and purchase property and land to the extent that South Africans will no longer be able to actually purchase property in those areas. That is a little bit problematic to us - we believe that this country belongs to all South Africans black and white, and there shouldn’t be any obstacle that prevents them from purchasing property wherever they want in SA.

LINDSAY WILLIAMS: Apart from the obvious areas like the Atlantic seaboard - and golf estates where prices are going up and foreign ownership is quite high along with wealthy South Africans - is there any evidence of other areas of the property market being targeted by foreigners like agricultural land?

MANDLA MABUZA: Of course. If you look at the Mpumalanga area, initially marked for communal restitution and distribution - foreigners come with huge sums of money, purchase that land and convert it to game reserves. Surely that cannot be allowed - once that happens it compromises land transformation in this country, a fundamental principle if we are to succeed in the ultimate objective of the prosperous kind of society that we seek to create in this country.

LINDSAY WILLIAMS: A prosperous society for all is obviously the goal of everybody, but obviously an open economy is another one. A free economy is very difficult and emotive issue. When is the final report going to be published? This is the interim report…

MANDLA MABUZA: Yes, this is the interim report. The intention now is that we want the country to really debate this rather complex challenge that is facing South Africa and other developing countries - we’ve also investigated Latin America, Europe and Asia. We want the country to debate this report - the media, academics, estate agents, NGOs - and we will then look at those submissions. In April 2006 we will be taking the final report to the Minister.