Siseko Njobeni

Trade and Industry Correspondent

ALLEGATIONS that a proposed moratorium on land ownership by foreigners would scare off investors were unfounded and hysterical, the chairman of the panel that made the proposal, Shadrack Gutto, said yesterday.

Gutto defended the recommendation, saying it was an ideological argument “from those who say you must never interfere with the markets because the markets can achieve transformation, justice and equity”.

The panel last Friday recommended a halt “with immediate effect” on the purchase of land by foreigners as an interim measure until new legislation was formulated.

Property analysts, economists, and political parties warned of the signals that such a move would send to foreign investors.

Addressing journalists in Johannesburg yesterday, Gutto said: “These accusations are not informed by an understanding of how foreign investors work. Foreigners do not want to buy land that they will keep for their grandchildren. They sell the land after a few years”.

He said investors wanted security of tenure, and studies from Chile, Brazil and Canada showed controls on foreign land ownership did not affect investor confidence.

“The debate is as if SA is doing something that has never been done before,” he said.

He said the implementation of the moratorium depended on whether the cabinet accepted it. Agriculture and Land Affairs Minister Thoko Didiza was expected to take the report to the cabinet “soon”.

He said the panel had found “holes” in the registration of deeds.

“Our records are not ideal and must be revamped,” he said.

The panel had recommended a new set of disclosure requirements. These would apply to natural persons and corporations owning land.

He said natural persons would be required to disclose their gender, citizenship and nationality. He said “for now” foreign buyers would not be required to disclose their race.

“It is a matter that we are still discussing within the panel. There is a view that requiring them to disclose their race would be bringing them to our historical legacy,” he said.

Gutto said the panel was working on a final report, which was expected to be handed to Didiza either in April or May.