South African President Cyril Ramaphosa announced this week that his government is to press on with a plan to overhaul how land is owned in the country, a move that has alarmed some investors in Africa's most developed economy.
Ramaphosa said Tuesday that the ruling African National Congress (ANC) party is to put through parliament an amendment to the South African constitution that would permit the seizing of land without compensation.
The bulk of South Africa's land is owned by its minority white population, a vestige of its colonial past. Although apartheid ended almost 25 years ago, South African society remains one of the most unequal in the world.
"It has become pertinently clear that our people want the constitution to be more explicit about expropriation of land without compensation as demonstrated in the public hearings," said Ramaphosa in a televised address.
He said that the proposal would "promote redress, advance economic development, increase agricultural production and food security."
But, some investors are fearful that constitutionalizing land grabs would undermine business stability and economic growth, which has remained subpar thanks to years of corruption under former President Jacob Zuma's administration. South Africa's already-high unemployment rate rose in the second quarter of this year to 27.2 percent, it was announced Tuesday.
The volatile rand dropped to a one-week low of near 13.40 per U.S. dollar overnight after Ramaphosa's announcement, according to Reuters.