In a likely political move ahead of general elections next November, President Hage Geingob discontinued the ‘willing seller, willing buyer’ land scheme during the country’s second National Land Conference on 1 October – a policy that aims to address racial injustice left since colonial times but without coercive government expropriation of land. Official national land statistics from 2018 showed that the 10 per cent white minority own 70 per cent of Namibia’s commercial and freehold farmland, while black Namibians owned only 16 per cent.
With land reform an emotive and increasingly politicised issue across Southern Africa, the conference has unsurprisingly caused great alarm among commercial businesses and investors. However, the new policy is unlikely to effectively tackle injustices relating to land ownership in the one-year outlook. This is due to poor governance, growing levels of corruption, and the lack of an effective political opposition.
The previous National Resettlement Programme allowed the government to buy freehold land and resettle landless Namibians through a ‘willing seller, willing buyer’ land scheme. However, white landowners were not willing to sell profitable farmlands in mining, tourism, and conservation – all with high real estate and commercial value.
the new policy is unlikely to effectively tackle injustices relating to land ownership in the one-year outlook
Consequently, many investors typically withdraw and invest their land capital into other profitable businesses. Against this backdrop, the October conference scrapped the ‘willing seller, willing buyer’ to pursue a ‘one Namibian, one farm’ land scheme, which discourages ownership of multiple farms. However, this new scheme keeps in place the main perturbing commercial risks for businesses and investors in Namibia.
Namibia, while a democracy, is a one-party state dominated by the South West African People’s Organisation (Swapo) who controls 80 per cent of the National Assembly, the lower house of the legislature. Opposition from outside the party, therefore, appears unlikely. However, there are fears that Geingob will cave into pressure by powerful figures from inside the party. This probably also explains the lack of progress in this space, and why friction between commercial investors and black Namibians remains elevated. The second National Land Conference sought to balance the demands of both sides: ensuring that land is distributed to the political base while making sure that this does not harm Namibia’s vital industries. It is likely that the balance will shift in favour of businesses with links to Swapo or the government, while competition over the scraps will intensify.
Such elites with close ties to the government and international investors have benefitted the most from Namibia’s land redistribution programme by procuring the most profitable land through corruption, cronyism, bribery, and patronage. This includes foreign investors, despite public outcry over absentee foreign landlords. The Lumumba Papers – an investigation released in November 2016 based on leaked beneficial ownership documents published by Belgian newspaper Le Soir – revealed many of the business dealings of Joseph Kabila, the president of the Democratic Republic of the Congo, and his family members and cronies. It revealed how his Entreprise Générale d’Alimentation (EGAL) and Ferme Espoir – a planned game reserve – could have benefitted from his political networks in Namibia as he managed to obtain customs documents signed and stamped by Namibian officials.
In consequence, there is a scramble among landless, black Namibians for the little government-acquired freehold land left, which is only 3 million hectares. This in turn has resulted in emerging informal land markets that threaten tenure security and user rights. The new scheme does not sufficiently address this suggesting that associated risks with informality, such as customary rights to land, are likely to increase as many will try to accrue more than ‘one farm’ through illegal and exploitative means.
Given this commercial reality, businesses and investors should ensure that they have adequate internal due diligence procedures in place, including the mapping of key stakeholders and conducting enhanced due diligence on politically exposed persons. Such assessments will help chart potential corruption risks by political interests before moving forward on land acquisitions, alongside monitoring compliance with local and international regulations.
The new scheme does not sufficiently address this suggesting that associated risks with informality
Foreign businesses and investors are also advised to review their external communications strategy , i.e. local engagement or corporate social responsibility programmes, as there is strong, anti-foreign sentiment towards non-local landlords and they may be targeted if there is overt evidence of being a foreign entity.