| 17 September 2021, Friday |

Wealth disparity in South Africa unchanged since apartheid, report finds

According to World Inequality Lab, a research group focusing on the study of income and wealth distribution worldwide, the social architecture formed over more than three centuries of White rule has maintained South Africa’s position as the world’s most unequal society.
Attempts by the now-democratic government to wipe away the legacy of apartheid and colonialism have failed to narrow the imbalance between the rich and the poor, with 3,500 adults owning more than the poorest 32 million people in the country of 60 million, it said in a report released this week.

“There is no evidence that wealth inequality has decreased since the end of apartheid,” the Thomas Piketty-backed group said. “Asset allocations before 1993 still continue to shape wealth inequality.”

During colonialism and structured apartheid from the late 1940s, Black South Africans were largely denied economic opportunities. More than a quarter century of democratic rule has seen the growth of a Black middle class and a Black business and political elite.

Yet, most South Africans still suffer from a woeful education system that leaves them ill prepared for jobs, while townships, built for Blacks during apartheid, leave them far away from workplaces.

Discontent with economic prospects and an unemployment rate of more than 30 per cent has stoked unrest in Africa’s most industrialised economy. That’s limited expansion and curtailed investment.

Laws ranging from affirmative action to mandating minimum Black-owned stakes in businesses have done little to narrow inequality, according to the group.

“South Africa’s successive governments endorsed several ambitious socioeconomic policy frameworks whose primary objectives consistently included reducing economic inequality inherited from colonial and apartheid regimes,” it said. “Yet, wealth inequality has remained remarkably stable.”

In South Africa, the richest 10 per cent of the population own more than 85 per cent of household wealth, while over half the population have more liabilities than assets, the report showed.

That gap is higher than any other country for which sufficient data is available, the group added.

While Blacks have outnumbered Whites in the richest 10 per cent of the population for about seven years, the gap between South Africa’s richest and poorest hasn’t narrowed as the decline in racial inequality has been driven almost entirely by a surge in the top Black incomes rather than increased wealth for the poorest, according to World Inequality Lab data.