The Need for Security – Eddie Cross

via email 7 November 2013

We must understand that all progress is based on individuals feeling secure and knowing that what they create will not be taken from them on an arbitrary basis. You could link this to the rule of law and the need for everyone to feel that when needed they can turn to the institutions of their society that will deal with their problems and conflicts when they arise, in a just and equitable manner.

Take these elements away and all progress in innovation, economic activity and development suddenly become impossible. In Africa, I have long argued that one of our greatest shortcomings is our failure to give people security over the assets they create or use. Our cultures were created in an era when land was a free good and in abundant supply – people used simple technologies to clear land, exploit it for a few years until it was exhausted and then they simply moved to a new location and repeated the process.

Now that our populations have reached the point where this system can no longer be sustained, if we do not give our rural populations security of tenure there is little or no chance that our farmers will be able to develop their land and will be willing to invest in it on a long term basis. Only a small proportion of global land resources are held under secure, legal tenure but such land supplies the great majority of global food supplies. The majority of people living in rural areas where the land tenure is communal are locked into a system where the equity value of the land they are using is not available to them as collateral and where they have little or no security over any assets they create on the land in question. So these hundreds of millions of people in rural Africa are locked into a system that keeps them in poverty and as their populations grow, their conditions of poverty simply deepen.

During the colonial era in Africa, tracts of land were taken over by settlers and were then held under freehold title rights that were protected by both the Constitution and the legal system. These farmers were able to use these resources as collateral and in Zimbabwe the farmers were able to borrow many billions of dollars for both long term and short term investment. The result was the development of a farm system that became a leader in the world in terms of yields and technology. The country not only exported half of its production but maintained food supplies at the lowest cost of any regional State to its people while supplying 60 per cent of all raw materials used by industry.

Elsewhere these historical developments brought major international firms into the agricultural industry in Africa to exploit resources on an agri-business basis. The outcome was large plantations of timber, palm oil, coffee, tea, cocoa and sugar. Despite the turmoil that has gripped the continent in the past 30 years, these agribusiness enterprises have survived and in some cases expanded.

In Kenya, Angola and Mozambique and now in Zimbabwe, settler farms have been taken over by the State and attempts made to circumvent the legal restrictions on such transactions. As these countries have matured, they have started to reverse these early post Independence policies because of the subsequent collapse and failure to maintain the productivity of these farms. But the damage done has been enormous. In Zimbabwe the total cost of the farm invasions is impossible to quantify but it runs to billions of dollars. It is not farfetched to claim that the collapse of the wider economy after 2000 is directly attributable to the destruction of the commercial farm system.

What is often not appreciated is that the creation of a commercial farming system established linkages with the farmers living in the Communal Areas. When the commercial sector collapsed the subsequent decline in output in commercial farming districts (71 per cent) was tracked by an identical decline in Communal Farmer output (73 per cent). Subsequent attempts to support the Communal sector by international agencies and the State have totally failed to fill the gap created by the removal of 5000 commercial farmers.

Global warming is going to make these issues even more critical – it is going to take capital and technology to manage agricultural production under conditions where weather patterns are more unstable and unreliable.

But the issue of security goes far beyond the confines of rural land management systems. In urban areas we deny the absolute poor any security of tenure in their shanty towns. Drive down any street anywhere in the world and if you see properties that are run down and poorly developed or maintained, you will be looking at property that is not owner occupied. Any quick examination of the RDP housing in South Africa outside most cities and towns will show two things – no extensions or development and no trees or gardens. I do not need to ask if they own those properties, the facts and appearances speak for themselves, they are only available on a leasehold basis from the State.

A few years ago I visited India and while there I visited a community which had been living in plastic shelters for over 20 years on a green belt in a major City. The City had destroyed their homes several times in an attempt to get rid of them, to no avail. Then an Australian organisation arranged for the City to cede the land to the organisation and they then held discussions with the 2300 families in this squatter settlement. The outcome was a plan, the allocation of 500 square metres of land to each family and land reservations for commercial activities, retail enterprise and industry as well as schools and clinics.

The organisation then advanced $500 in cash to every family as a self build home loan. I was there just three years after this transformation had taken place and the changes were startling. I spoke to one young girl in her home about the change – she described what it was like to live in a plastic shack and in total insecurity. She then said that they now owned their own home and she was in school. I asked her what she wanted to do when she qualified; she said she wanted to be a doctor. The organisation told me that 98 per cent of the home loans had been repaid and ploughed back onto social services.

Transformation and empowerment for the majority is possible if we take this issue seriously and take steps to ensure that people have security of person and property. This does not need money – just the political will to ensure that people can hold assets securely and that markets are then allowed to function. These are choices for society – already made in many countries but which Africa still has to decide on for the future.

Eddie Cross

Bulawayo, 2^nd November 2013