Govt officials accused of inflating farm prices ….As it pays more than double the price offered by private buyers

05 October 2018 Author   KAULA NHONGO
Officials in the Ministry of Land Reform have been accused of inflating farm prices in cahoots with white farmers after statistics presented at the Second National Land Conference showed that government has on average spent double the amount offered by Agribank and other private buyers.
Statistics show that government has forked out N$1.9 billion in the last 27 years to acquire about 549 commercial farms or 3.2 million hectares under the willing buyer willing seller initiative, while Agribank has used about N$800 million to buy about 3.4 million hectares.
A presentation by Agribank Chief Executive Officer, Sakaria Nghikembua, also showed that since 2010, government has been paying more money per hectare compared to previous years.
In 2016, government was paying an average farm price of N$1,800 per hectare while the average farm price in that year was about N$1,400.
Nghikembua said from 2010 onwards farm prices have been increasing at a very high rate.
“Farm land has become unaffordable, he said. “People talk about willing buyer/willing seller and they are saying the willing seller is offering at a high price, but it looks like on average government pays more than the market so it cannot be a willing buyer willing seller issue, but probably a negotiation capability.
“Government pays more, why is that so? Is it because the private citizen offering a farm for sale may negotiate harder and the government does not negotiate wisely, they just pay?
“Let us understand why that is so. It explains why the price has been going up; this process may have driven up the market.”
A land expert, who spoke to the Windhoek Observer on condition of anonymity, said government might be forking out more money to buy farms than Agribank and other private buyers because the valuation formula used by the Ministry of Land Reform takes the market prices as their departure point while Agribank uses productivity of land.
The expert also said the lands ministry might not have the capacity to negotiate better prices.
“We also should not rule out that officials could have been negotiating and factoring a percentage for themselves afterwards, otherwise how do we explain how government pays double the price for farms in marginalised areas than private individuals,” the expert said.
Other delegates to the land conference felt that farm owners were inflating prices because they don’t have the honest intention to sell their land.  They claim to be ‘willing sellers’, when in fact they may not be.
Namibia Agricultural Union President, Ryno van der Merwe, said over the past 27 years, government was offered about eight million hectares through the willing buyer/willing seller principle.
Of the eight million, government only acquired about 3 million and waived its rights on the rest.
Deputy Finance Minister, Natangwe Ithete, said he strongly suspects that white farmers were inflating prices so as to not sell off their land or to frustrate the intentions of the willing buyer/willing seller efforts.
“White people do not want to give the land that is why they inflate prices. The reason why government waived its rights to acquire the land first was because the farms being offered were too expensive.
“If it was not expensive, government would have bought the land. The willing buyer/willing seller policy should be abolished,” Ithete said.
President Hage Geingob reiterated on Monday that the willing buyer/willing seller principle has not delivered results.
Speaking during the official opening of the land conference, Geingob encouraged delegates to consider changing the constitution to allow government to expropriate land and redistribute it to the majority disadvantaged black Namibians.
 “We need to revisit constitutional provisions which allow for the expropriation of land with just compensation, as opposed to fair compensation and look at foreign ownership of land especially absentee land owners.
“It is in our interest, particularly the ‘haves’, to ensure a drastic reduction in inequality by supporting the redistributive model required to alter our skewed economic structure. We should all be cognizant of the fact that this is ultimately an investment in peace,” Geingob said.
Delegates also complained that farm owners were selling unproductive barren farms forcing government not to buy them.
In their view, government must find a way to get productive farms.
“Land offered through willing buyer willing seller principle is useless and barren,” one participant said.
Delegates suggested that government should come up with a price regulation body to regulate farm prices.
“There should be a standard rate set for each area of the country,” another delegate said.
SWAPO Party Elder’s Council Secretary, Mukwaita Shanyengana, suggested that government replace the willing buyer/willing seller principle with ‘nominal public ownership’ where there is the ownership of an asset by the state representing a community as opposed to an individual or private party.


The Windhoek Observer is an English-language weekly newspaper, published in Namibia by Paragon Investment Holding. It is the country's oldest and largest circulating weekly.

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