• Friday, April 26, 2024
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Black South Africans lose out as economic divide bites

Black South Africans lose out as economic divide bites

South Africa votes next week in its sixth democratic election since 1994’s first all-race poll, which followed the end of apartheid.

Politically the country has changed a great deal in the past 25 years. But polling stations will still be divided between well-off gated suburbs and corrugated-iron shacks in shanty towns, in what the World Bank calls “the most unequal country in the world by any measure”.

About a tenth of the country’s population is estimated to own about nine-tenths of the wealth. The inequality reflects the old racial divide.

President Cyril Ramaphosa is seeking another majority for the African National Congress, which has ruled throughout the country’s democratic era, with a promise of a “new dawn” for the economy. But it has been a long night.

Symptoms of inequality — such as one of the world’s highest unemployment rates, at 27 per cent — have been exacerbated by what even Mr Ramaphosa admits were “wasted years”.

Under his predecessor Jacob Zuma the economy languished as grand corruption spread through the state. It meant that the black majority fell even further behind in overcoming apartheid’s legacy.

Since the turn of the century, after Nelson Mandela relinquished the presidency, the jobless rate for black South Africans has stubbornly remained at about a quarter. Unemployment for their white peers has never moved above 8.1 per cent in that time.

This has an impact on incomes: on average black South African households earn less than 20 per cent of white South Africans’ average earnings.

The divide is entrenched early in people’s lives: in the education system. Almost all white pupils pass the final-year secondary school exams that are required to enter university. Only two-thirds of their black counterparts manage the same feat.

Black South Africans also face disadvantages accessing healthcare and other services.

To some, Mr Ramaphosa encapsulates the country’s failure to tackle inequality at its root. He is a wealthy tycoon, part of a narrow — some say oligarchic — black business elite that was forged by ANC policies.

Others believe the former trade unionist is the last hope for reviving economic growth.

Gross domestic product grew by 2.9 per cent on average between 1994 and 2000 after Mr Mandela led the ANC into power and set out to rebuild an economy wrecked by apartheid’s last years.

Under Mr Mandela’s successors, growth accelerated to an average of 4.2 per cent a year until the 2008 financial crisis. But the economy has stalled in the decade since, recording average growth of 1.6 per cent.

South Africans blame the rot within state institutions and erratic policymaking under Mr Zuma for the slowdown, and for scaring off foreign investors. Mr Ramaphosa has begun some of the clean-up. But next Wednesday’s vote will also be a window on South Africa’s broader problem of how to tackle inequality.