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South Africa’s impending Expropriation Bill, which supports expropriation without compensation (EWC), is facing significant backlash due to potential threats it poses to private property rights. The Institute of Race Relations (IRR) has warned that the legislation could endanger the livelihoods of exporters and their employees.
The Expropriation Bill contradicts the requirements of the African Growth and Opportunity Act (AGOA). AGOA provides zero-tariff market access to nations that are progressing towards a market-based economy and safeguarding private property rights. The proposed legislation, however, introduces EWC for reasons such as the appropriation of hijacked buildings and invaded land.
At the AGOA Forum in Johannesburg, the risk of South Africa’s exit from AGOA due to the EWC provisions in the Expropriation Bill was largely overlooked. To be eligible for AGOA, an African nation must protect private property rights. However, the Expropriation Bill approved by the National Assembly, which is set to be enacted before the 2024 election, threatens these rights by endorsing EWC on various grounds.
Despite no public warnings from US delegates, some US lawmakers have voiced concerns over the bill’s impact on US-South Africa trade. Congressman Jim Baird questioned the potential implications of the bill, while Congressman John James labeled EWC a “disastrous policy” that threatens South Africa’s constitutionally protected private property rights.
The Biden administration, known for its stringent AGOA eligibility criteria, has recently removed several African countries from potential benefits. This move highlights the seriousness with which the US government views adherence to AGOA criteria. While South Africa’s Expropriation Bill is yet to become law, its potential effects on trade relations and private property rights are already causing concern among stakeholders.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.