by Piet Coetzer

The terror of poverty in South Africa

Gap between rich and poor still significant in South Africa

Julius Malema
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It would be a  mistake to regard the attempts by former ANC Youth League (ANCYL) president, Julius Malema, to resurrect his political career as Commander in Chief for Economic Freedom Fighters as fanciful daydreaming. The appearance of the organisation Economic Freedom Fighters on the political landscape is symptomatic of one of the biggest challenges to democracy in South Africa. 

The just-released Elections and the Management of Diversity in Africa: National Country Report for South Africa states: “Pervasive poverty and inequality are perhaps the most important crises facing South Africa 17 years after the transition to democracy. Despite political freedoms being extended to all citizens, South Africa continues to experience persistently high levels of poverty and economic inequality that are differentiated along racial lines.”

The report, prepared for the United Nations Economic Commission for Africa (UNECA) by the Idasa Institute for Democracy in Africa, notes that while South Africa is considered an upper middle-income country based on GDP per capita. But there is extreme income inequality and deep poverty is widespread.

“As ... is generally recognised, persistent levels of poverty and inequality have highly deleterious effects on the quality and sustainability of democracy,” the report says.

It is also no coincidence that the Malema and the Economic Freedom Fighters' main focus is directed at young blacks. According to the Idasa report a major contributing factor to the high poverty levels is  unemployment and under-employment, especially among African youth.

“A 2011 report on youth unemployment produced by the National Treasury states that approximately 42% of young people under the age of 30 are unemployed compared with less than 17% of adults over 30.

“Furthermore only 1 in 8 working-age adults under 25 have a job compared with 40% in most emerging economies. Significantly, employment of 18 to 24-year olds has fallen by more than 20% (320 000) since December 2008. This can be attributed to the effects of the global recession sparked by the 20007/2008 financial crisis,” the report notes.

The economic divide, however, can no longer only be drawn on racial lines. While unemployment levels have not risen sufficiently, the African middle-class has grown considerably since 1994. This is partly due to the government’s Affirmative Action and Black Economic Empowerment (BEE) policies, which sought to reverse apartheid's racial policies and achieve the rapid transformation of the economy.

“Despite these achievements, BEE has been criticised for creating a small politically-connected class of wealthy blacks at the expense of true economic transformation and redistribution,” Idasa reports.

But it is also reported that, despite the fact that  Africans experienced a decline in levels of poverty between 1995 and 2005 from 63% to 57.55%, their poverty levels remained higher than the national average and those of other race groups. For example in 2005 the national average was 49% while the African level was 58%. Conversely the Coloured and Asian levels were 35% and 8% respectively. Less than one percent of whites were poor in 2005.

“African households still account for a highly disproportionate share of the poor.

South Africa’s Gini coefficient, a measure of income equality, is 0.68, one of the highest recorded scores in the world. Though inequality has been historically associated with race, the drivers of inequality in South Africa have been both inter- and intra-race inequality,” the report states.

It is concluded, among others, that “economic transformation continues to lag behind what is widely and correctly judged a successful political transformation from apartheid to democracy. However, this lag is likely to have increasingly significant effects on the quality of democracy and politics in South Africa.”

It is also noted that “‘Service delivery protests’ have become an entrenched, worrying part of the governance landscape, denoting both a frustration with the pace of change and a continued paucity of opportunity for the historically disadvantaged.”

There is also clear evidence that endemic poverty and accompanying poor living conditions played an important role in the recent labour unrest and violence that erupted at Marikana in North-West Province.

At a recent conference Michael Solomon of the South African Institute of Mining and Metallurgy posed the question: “Are mining companies managing the expectations that came about in 1994?”

As the labour unrest, triggered by the Marikana events, spread to other mines and other  areas it was noticeable that the “Commander in Chief for Economic Freedom Fighters” Malema popped up all over the place in a seemingly well-organised campaign.

Although the Idasa report was prepared before the Marikana events and what followed, it included the warning: “... the existence of a large, politically  disorganised (and to some extent disillusioned) group of citizens must always be regarded as a fertile breeding ground for the politics of violence and the seduction of populist leaders who promise to decisively alter the status quo.

“To date South Africa has not had to contend with this kind of risk in a significant manner, but it remains in the wings should the opportunities and quality of life of South Africans not improve at a faster rate.”

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