Poverty among South African persists : Although South Africa is an upper-middle-income country, a significant proportion of South African households have remained poor despite a plethora of government policies that target the less resourced. While estimates vary, over 22.9 million South Africans are categorised as being poor, with almost 2.5 million people suffering from malnutrition. This is common among the South Africans who still believe that they inherited poverty from there forefathers and also the effect of apartheid government practiced in South Africa from 1948 to 1994. Apartheid was a system of institutionalised racial segregation that existed in South Africa that was characterized by an authoritarian political culture based on baasskap (boss-hood or boss-ship), which ensured that South Africa was dominated politically, socially, and economically by the nation’s minority white population. According to this system of social stratification, white citizens had the highest status, followed by Asians and Coloureds, then black Africans. The economic legacy and social effects of apartheid continue to the present day.
Broadly speaking, apartheid was delineated into petty apartheid, which entailed the segregation of public facilities and social events, and grand apartheid, which dictated housing and employment opportunities by race. Most blacks were denied the opportunity of good job, housing and other social amenities and as a result, many become poor. The first apartheid law was the Prohibition of Mixed Marriages Act, 1949, followed closely by the Immorality Amendment Act of 1950, which made it illegal for most South African citizens to marry or pursue sexual relationships across racial lines. The Population Registration Act, 1950 classified all South Africans into one of four racial groups based on appearance, known ancestry, socioeconomic status, and cultural lifestyle: “Black”, “White”, “Coloureds”, and “Indian”, the last two of which included several sub-classifications. Places of residence were determined by racial classification. Between 1960 and 1983, 3.5 million black Africans were removed from their homes and forced into segregated neighbourhoods as a result of apartheid legislation, in some of the largest mass evictions in modern history. Most of these targeted removals were intended to restrict the black population to ten designated “tribal homelands”, also known as bantustans, four of which became nominally independent states. The government announced that relocated persons would lose their South African citizenship as they were absorbed into the bantustans.
Despite improvement since the end of apartheid, poverty and unemployment remain high. As poverty reduction among Blacks and Coloureds remain despite government effort, South Africa’s rate of economic growth has also been low. The country has recovered only slowly from the global recession of 2008, and the prices of some South African export commodities have fallen. Further, the poor governance and bad economic policies of the 2009–2018 administration of President Zuma undermined domestic and foreign investment necessary for growth.
South Africa has made considerable strides to improve the wellbeing of its citizens since its transition to democracy in the mid-1990s, but progress has stagnated in the last decade. The percentage of the population below the upper-middle-income-country poverty line fell from 68% to 56% between 2005 and 2010 but has since trended slightly upwards to 57% in 2015 and has reached 60% in 2020.
The achievement of progress in household welfare is severely constrained by rising unemployment, which reached an unprecedented 32.5 percent in the fourth quarter of 2020. The unemployment rate is highest among youths aged between 15 and 24, at around 63%.
South Africa remains a dual economy with one of the highest, persistent inequality rates in the world, with a consumption expenditure Gini coefficient of 0.63 in 2015. High inequality is perpetuated by a legacy of exclusion and the nature of economic growth, which is not pro-poor and does not generate sufficient jobs. Inequality in wealth is even higher and intergenerational mobility is low meaning inequalities are passed down from generation to generation with little change over time.
The South African government has used different tools to tackle the stubborn levels of inequality that have plagued the country, including through progressive fiscal redistribution.
Efforts to reduce inequality have focused on higher social spending, targeted government transfers, and affirmative action to diversify wealth ownership and promote entrepreneurship among the previously marginalized. To achieve this, South African need to measures the need to complement with reforms that promote private investment, jobs, and inclusive growth expecially among the South African citizens marginalised during the apartheid government.
