Fears as government announces intent to nationalise land

There were fears that the Zimbabwe African National Union-Patriotic Front wanted to increase its political patronage when The Herald reported that the government intended to abolish title deeds and replace them with 99-year leases with wildlife and game conservancies being limited to 25-year leases.

The United States embassy said the move would effectively give the ruling party additional leverage over the individual ministers, military officers, civil servants, judges, and party supporters who received property under land reform.

“While a title deed system would spare these tens of thousands of beneficiaries that measure of control and would significantly empower them economically, it is unlikely they could meaningfully influence resolution of pivotal issues even if they wanted to,” the embassy said.

Full cable:

Viewing cable 04HARARE959, GOZ ANNOUNCES INTENT TO NATIONALIZE LAND

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This record is a partial extract of the original cable. The full text of the original cable is not available.

C O N F I D E N T I A L SECTION 01 OF 03 HARARE 000959

SIPDIS

NSC FOR SENIOR AFRICA DIRECTOR J. FRAZER, D. TEITELBAUM

INTERIOR FOR USFWS – SHEILA EINSWEILER

LONDON FOR C. GURNEY

PARIS FOR C. NEARY

NAIROBI FOR T. PFLAUMER

E.O. 12958: DECL: 06/09/2009

TAGS: EINV PGOV ECON EAGR SENV PHUM ZI

SUBJECT: GOZ ANNOUNCES INTENT TO NATIONALIZE LAND

REF: (A) HARARE 939 (B) HARARE 862

Classified By: Political Officer Win Dayton under Section 1.5 b/d

¶1. (C) SUMMARY: GOZ media reports that the GOZ is prepared

to nationalize the country’s farmland and conservancies —

essentially limiting land use to limited term leasehold

arrangements — may be somewhat premature. While a leasehold

system appears to be the ruling party’s objective, resolution

of crucial details within the ruling party will likely prove

complicated, time-consuming and potentially divisive. In any

event, the GOZ continues to appear determined to reduce white

ownership in the agricultural sector further, if not

eliminate it entirely. END SUMMARY.

99 Years for Farmland; 25 for Conservancies

——————————————-

¶2. (U) According to the June 8 cover story in the

government’s Herald newspaper, the GOZ plans to abolish title

deed holdings and replace them with 99-year leases. Wildlife

and game conservancies would be subject to leaseholds of no

more than 25 years. Urging all land owners to come forward

for vetting in order to qualify for leaseholds, Minister of

Special Affairs in the Office of the President and Cabinet in

charge of Land Reform and Resettlement (and ZANU-PF

Secretary-General) reportedly called existing processes for

SIPDIS

state land acquisition “odious and unnecessary because in the

end all land shall be State land and there will be no such

thing as private land.” The article asserted that Zimbabwe

was one of only a few African countries not already using a

land nationalization/leasehold model. It noted also the

listing June 4 of 259 additional farms for compulsory

acquisition, bringing the total this year to 918. (Note:

Commercial Farm Union representatives estimated to us in

April that about 650 white owned commercial farms remained in

operation, although many were fractions of their former size

due to partial land seizures or settlements. End Note.)

Details to be Worked Out

————————

¶3. (C) Permanent Secretary Pazvakavambwa of Minister Nkomo’s

office told poloff emphatically on June 8 that comments

attributed by the Herald to Nkomo were inaccurate. He

confirmed that the GOZ was heading toward a long-term

leasehold system in accordance with recommendations of last

year’s Utete Commission Report, but asserted that the Cabinet

had not agreed yet on the timing or mechanics of

implementation. Director General Mtsambiwa of the Parks and

Wildlife Management Authority declined to comment to econoff

until the full policy had been released.

¶4. (C) An NGO representative who works closely with the

Parliament told poloff June 8 that Parliament was not

consulted on the move and had seen no draft legislation on

the matter. He said that, canvassed informally about the

measure, ruling party MPs exhibited a very shallow

appreciation of the measure’s potential implications and did

not see past the fact that the 99 year term would more than

cover their intended tenure on farms received under land

reform. Opposition MPs already are denouncing the move,

which MDC President Morgan Tsvangirai characterized in his

weekly letter to the nation as reckless, unconstitutional,

inefficient, and anachronistic.

Doom for Conservancies?

———————–

¶5. (SBU) The notion of 25-year lease terms for conservancies

has raised alarm among environmentalists and conservancy

interests. Charles Jonga, Director of the CAMPFIRE

Association (which manages environmentally sensitive areas

adjacent to national parks) expressed concern to econoff that

such limited terms would drive away and keep out responsible

investors, who could not expect adequate returns on their

investment. Similarly, financial institutions were unlikely

to regard short-term leases as adequate collateral for

necessary loans. Short term leases further would induce

rapid extraction of wildlife resources, thereby undermining

prospects for sustainable management. He also asserted that

new owners lacked the experience necessary for wildlife

management and the trust relationships with customers

necessary to make the conservancies viable concerns.

¶6. (SBU) Jonga’s sentiments echo those voiced previously by

Weldon Schenck, an American with property interests at the

Save Conservancy (ref A). The consortium of interest-holders

at Save has been negotiating with an indigenous company for

indigenization of the property’s ownership and operation

based on shareholder equity in a deal that would have to be

approved by the GOZ. We have not yet been able to contact

Mr. Schenck for his reaction to the announced policy and its

potential impact on the Save negotiations. (Note: Minister

Nkomo has played a role in brokering among the parties to the

Save negotiation; he told the Ambassador earlier this year

that the GOZ would likely institute 99-year leaseholds for

conservancies like Save.)

Comment

——-

¶7. (C) Moving on formal nationalization of land represents

just the next step in the ruling party’s aggressive efforts

to bring the nation’s economic assets under party control.

With the collapse of the commercial agricultural sector,

conservancies — one of the economy’s few remaining

profitable sectors and a generator of foreign exchange —

were an obvious next target, even though the Utete Commission

Report recommended against their inclusion in land reform.

Senior GOZ and ruling party officials, including some already

under USG financial sanctions, are jockeying for position to

enter the sector. The extent to which such officials take

financial interests in the industry will have implications

for our financial sanctions here. (Note: Americans

historically have been the principal market for Zimbabwe’s

hunting sector. End note.)

¶8. (C) Commercial farmers had hoped that the polished

Nkomo, generally regarded as a relative “moderate” within the

party leadership, would rationalize land reform after getting

the portfolio from “hard-liner” Minister of Agriculture

Joseph Made in January’s cabinet reshuffle. The alleged

misquoting of the Minister by the official media suggests the

mischievous hand of hard-line Information Minister Jonathan

Moyo, but may simply reflect disingenuousness by Nkomo’s

office, which is well-known for trying to please

interolocutors from all sides. Nkomo’s public comments may

have been intended to dampen criticism from the Moyo-Made

hardline axis (ref B) and to maintain his position. In any

event, the announcement (and new listings for compulsory

acquisition) further underscores that there will be little if

any room for residual pre-land reform operators in Zimbabwe’s

agricultural sector.

¶9. (C) The commitment to nationalization/leasehold

arrangement squelches hopes that “new farmers” will get title

deeds to their land, a measure regarded by some as a first

step necessary to begin to rationalize the agricultural

sector after redistributive objectives were achieved.

Continuing legal challenges by existing title-holders

effectively precluded the GOZ from moving to issue reliable

new titles to recipients of property under land reform.

Nationalization will dispense with the cumbersome and

time-consuming legalistic process — heavily criticized by

the ruling party (and usually ignored by enforcement

authorities in any event) — required for compulsory

acquisition under current law.

¶10. (C) State ownership of the land and a revocable leasing

system will effectively give the ruling party additional

leverage over the individual ministers, military officers,

civil servants, judges, and party supporters who received

property under land reform. While a title deed system would

spare these tens of thousands of beneficiaries that measure

of control and would significantly empower them economically,

it is unlikely they could meaningfully influence resolution

of pivotal issues even if they wanted to.

¶11. (C) It is unclear how long the nationalization process,

which will require enabling legislation and implementing

regulations, will take. Although the ruling party’s control

of parliament assures that it will get what it wants,

critical details of what it wants remain unclear. The

measure almost certainly will face legal and constitutional

challenges. Furthermore, it would wreak havoc in Zimbabwe’s

already debilitated financial sector, where title deeds

collectively are the most significant asset collateral on

many banks’ balance sheets. Finally, contention over

complicated associated issues may expose and deepen rifts

among increasingly fractious ruling party interests, some of

whom already have been sparring over allocations under land

reform. Settling land reform issues within the party may yet

prove as vexsome if not more so than overcoming opposition to

land reform outside the party.

WHITEHEAD

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