South Africa has reduced poverty but remains the world’s most unequal society, a report said on Friday, with analysts warning the yawning gap between whites and blacks threatens social stability.
The Development Indicators report showed that the income of South Africa’s poorest 10 percent rose by a third from 783 rand (US$105) in 1993 to 1,041 rand a month last year.
The richest 10 percent got richer by nearly 38 percent over the same period.
While the report acknowledges a “racial underpinning” of inequality, figures show that while black South Africans’ salaries increased by 38 percent, the incomes of white South Africans jumped by 83.5 percent between 1995 and last year.
Haroon Bhorat, an economist with the University of Cape Town, said sustained growth up until about 2006 had partially reduced poverty, but the gap between the rich and the poor had widened.
“Income inequality in the long run is bad for growth. It is a threat to social stability,” he told journalists at the report’s launch.
While South Africa and Brazil were the world’s most unequal societies in the early 1990s — based on the “Gini co-efficient,” which measures inequality — South Africa has now surpassed the South American nation.
While other countries may occasionally come in below South Africa in inequality indices, as a nation with regular and reliable data it was “now singularly the most consistently unequal society in the world.”
South Africa is considered an advanced developing nation with an annual GDP of US$144 billion, growing rapidly since the end of white-minority apartheid rule in 1994.
In 1995, 31 percent of the population lived under the poverty line of 283 rand a month, which dropped to 22 percent last year.
“The change out of extreme poverty is occurring; there are still too many people there, but there is a shift out of that,” Ronette Engela of the presidential policy unit told journalists.
“The improvement in people’s lives could be attributed to economic growth and expanding employment as well as government’s poverty alleviation initiatives ... social assistance support and better housing,” the report said.
Bhorat said South Africa had managed to finance its high poverty levels through “positive growth and high revenues through social security.”
More than 13 million people now receive social grants in South Africa, nearly double the figure in 2004.
However, amid the country’s first recession in 17 years, and high budget deficits, this was no longer sustainable.
Planning Minister Trevor Manuel said the report gave a “warts and all” account of the state of South Africa and would be used to gauge the outcomes of policy.
“The current recession of course casts a very long shadow over what we do,” he said.
OPTIMISTIC: A Philippine Air Force spokeswoman said the military believed the crew were safe and were hopeful that they and the jet would be recovered A Philippine Air Force FA-50 jet and its two-person crew are missing after flying in support of ground forces fighting communist rebels in the southern Mindanao region, a military official said yesterday. Philippine Air Force spokeswoman Colonel Consuelo Castillo said the jet was flying “over land” on the way to its target area when it went missing during a “tactical night operation in support of our ground troops.” While she declined to provide mission specifics, Philippine Army spokesman Colonel Louie Dema-ala confirmed that the missing FA-50 was part of a squadron sent “to provide air support” to troops fighting communist rebels in
PROBE: Last week, Romanian prosecutors launched a criminal investigation against presidential candidate Calin Georgescu accusing him of supporting fascist groups Tens of thousands of protesters gathered in Romania’s capital on Saturday in the latest anti-government demonstration by far-right groups after a top court canceled a presidential election in the EU country last year. Protesters converged in front of the government building in Bucharest, waving Romania’s tricolor flags and chanting slogans such as “down with the government” and “thieves.” Many expressed support for Calin Georgescu, who emerged as the frontrunner in December’s canceled election, and demanded they be resumed from the second round. George Simion, the leader of the far-right Alliance for the Unity of Romanians (AUR), which organized the protest,
ECONOMIC DISTORTION? The US commerce secretary’s remarks echoed Elon Musk’s arguments that spending by the government does not create value for the economy US Secretary of Commerce Howard Lutnick on Sunday said that government spending could be separated from GDP reports, in response to questions about whether the spending cuts pushed by Elon Musk’s Department of Government Efficiency could possibly cause an economic downturn. “You know that governments historically have messed with GDP,” Lutnick said on Fox News Channel’s Sunday Morning Futures. “They count government spending as part of GDP. So I’m going to separate those two and make it transparent.” Doing so could potentially complicate or distort a fundamental measure of the US economy’s health. Government spending is traditionally included in the GDP because
Hundreds of people in rainbow colors gathered on Saturday in South Africa’s tourist magnet Cape Town to honor the world’s first openly gay imam, who was killed last month. Muhsin Hendricks, who ran a mosque for marginalized Muslims, was shot dead last month near the southern city of Gqeberha. “I was heartbroken. I think it’s sad especially how far we’ve come, considering how progressive South Africa has been,” attendee Keisha Jensen said. Led by motorcycle riders, the mostly young crowd walked through the streets of the coastal city, some waving placards emblazoned with Hendricks’s image and reading: “#JUSTICEFORMUHSIN.” No arrest