Poverty in South Africa
Taming Globalization & Inequalities

Published Apr 2011 - Updated May 2013

Map highlighting the correlation between social unrest and poverty in South Africa

The South African Constitution

The fight against poverty in South Africa is actually supported by the country's Constitution, through social security:

"Everyone has the right to have access to [...] social security, including, if they are unable to support themselves and their dependents, appropriate social assistance."

Well, it's certainly not the first time that a constitution doesn't become reality - it tends to be an expression of a nation's ideals - but in this case, the country is quite far off that picture.

Half of South Africans live in poverty

Around half of the population (i.e. 22 million) live in poverty in South Africa.

And a half of them live in households that have no access to any kind of social security.

Specialists talk of a heritage of inequalities. Indeed, inequalities are widespread and huge all over the country, be it in terms of income or overall quality of life.

The early days of democracy

The first decade of democracy (since 1994) in South Africa is also one marked by a cruel lack of data on poverty, especially until 2000. Hard to compare then, and know more about the progresses made back then.

From 2000 on, numbers showed a decrease in poverty per capita and of the poverty gap. But a common feature of globalization also started to take place there: the better off end up better off, and conversely for the worse off. However to be fair, all those who managed to secure a job, and maybe develop some “human capital” (education, skills, knowledge), saw their situation improve. The rest might be trapped there until a more favorable wind blows in their neck of the wood (usually a pro-poor or social safety net kind of policy).

Pro-poor strategies

These better trends in South African poverty have various origins: government expenditure on redistribution of income in the market (aka transfer payments), creation of the Child Support Grant (plus extension of the children eligible to such grants), improved access to services from basic welfare to electricity (health and work improvements), which in turn modernizes and generates income in entire areas. Those policies have played a vital role in balancing market-generated inequalities.

Globalization, market and poverty in South Africa

Shanty town in South Africa

Rising unemployment, declining social security

Globalization has had rather damaging effects on poverty in South Africa, in particular on the unemployed population. Therefore, while the government liberalized the economy and undertook to reduce debt like anywhere else, it also launched programs such as the EPWP (Expanded Public Works Programme) “aimed at providing poverty and income relief through temporary work for the unemployed to carry out socially useful activities”.

But the EPWP, as a compensation for the downsizing of social security (caused by liberalization), can’t be considered a full-blown policy for employment and poverty reduction. In too many cases, people lack the education and skills needed to find a job on today's market.

South Africa's BIG (Basic Income Grant)

In order to solve this problem and develop the South Africa's social capital, numerous NGOs have called for the introduction of the Basic Income Grant (known as BIG) that they have been promoting since 2001 as a very inexpensive (if not low-cost) and easily implementable policy against poverty in South Africa.

Why low-cost? Simply because in a country like this one, which is “big” enough to sustain this kind of grant through its middle class, a very tiny income grant can literally change the lives of millions. The inequalities are so massive that for the poor the smallest amount of money would be enough to lift them out of destitution or at least dramatically reduce the effects of poverty in South Africa.

Funding empowerment

Rather than being an incentive for people to sit on their butt all day, a small income would give people back the control of their lives by being able to able to pay for school fees, transportation, access to basic health care, maybe set up a small business… or simply buy food.

The needed amount can sound like barely enough to afford a restaurant in London or Paris (for which you'll soon need to apply for a loan) but would be sufficient to turn people’s lives around and dramatically decrease poverty in South Africa.

Market vs. the government ?

The South African government is still hesitant as to which policy to favor: between marketization and democratization, in the sense of enabling people to take part in the country’s life. Of course, in theory the market in itself empowers people, and that's true but only to some point of the theory.

Markets are by no means perfect and big businesses themselves are the first ones to distort them (e.g. collusion on prices). If free market (& "no government") was the solution, Africa should have become rich as hell by now. Yes, after all the continent has lacked government structure and regulation for the past few decades. And yet nothing good has come out of it and it hasn't developed a sound market or a rich economy. Conclusion: the market won't come into being on its own, just as poverty won't disappear naturally. If governments are necessary to ensure laws are respected in the market, they're also needed to ensure their citizens can participate and thrive in their society.

Legal reforms to reduce poverty in South Africa

When South Africa became part of the group of democratic nations, it had to adopt the system of the the rule of law and fairer justice, which guarantees political and civil rights. This way, a greater variety of interests and concerns in the population can be taken into account by the ruling class (e.g. the EPWP).

The United Nations consider it an important step to poverty reduction via the creation of a democratic capitalism which would better redistribute the country’s wealth. Of course the outcome of debates and social struggles is uncertain but there is a new potential for:

1) Resist exploitation and forms of modern slavery

2) Provide the means for the poor to organize themselves politically

3) Denounce unjust treatments, working and living conditions

In this sense, law is needed to shift the balance of power – even if only a bit – in favor of the poorest.

The HIV/AIDS plague

HIV-AIDS in South Africa, compared to the rest of the world

People living with HIV in the world

A cause and effect of poverty in South Africa

South Africa counts around 5.5 million people infected by the HIV and a million waiting for an anti-retroviral therapy. This represents over a quarter of all the people in Sub-Saharan Africa in need of a treatment. Despite its middle class, the heritage of the apartheid, the lack of political will, the huge inequalities as well as the cultural barriers are just as many obstacles that slow down the efforts to provide treatment to the country’s citizens.

With poverty in South Africa affecting more than half of the population via widespread food insecurity (and related malnutrition) and unemployment rate around 25-30%, it makes it particularly difficult for local populations to afford any medication at all, even less a costly therapy. When treatment happens to be available for free, people have problems simply accessing it. Local hospitals are usually a long distance away from rural areas, so that over 70% of the poor are put off by the extra transportation cost. Not to mention that those who are employed often cannot afford to miss a single day’s work (and pay). Overall the system is still undermined by insufficient infrastructure and a heavy bureaucracy.

The twisted effects of a flawed disability grant

Apart from people who choose not to get treatment so as to avoid unemployment, others just stop their medication on purpose so as to keep on receiving a disability grant. This grant would indeed come to an end as soon as their health recovers to a certain degree - even though no one's can be cured of AIDS.

It's just more profitable for them to be seriously sick than not-so-seriously sick. In this case the need for a basic income grant is all the more obvious, since amounts from $10 to $15 (per month, per person) would be enough to sustain jobless households in poor areas. Does anyone really want to make a choice between income and health?

The problem with traditional medicine

Three people out of four in the country have sometimes no other choice but to accept help from traditional healers. The remedies they prepare are known not only for their toxicity (mental alterations, vomiting, diarrhea,...) but also for their dangerous interaction with the anti-retroviral treatment. Even as those are becoming more and more accessible, a lot of people keep on taking treatments from traditional healers anyway, thus putting their health at great risk. Strong commitment from the government can help health care workers overcome these hurdles on the ground.

Telecommunications in rural areas

Quick dissemination of new technologies in South Africa, here in Cape Town

The promise of democracy

Access to telecommunications has become one of the flagships of South African democratic achievements in the provision of basic rights to its population. As the definition goes, poverty also means barriers to activities that are vital to the participation and inclusion in social life. As such communications have an ever increasing role in enhancing social, political and economic performance.

It’s all the more important in South Africa considering its Apartheid history of censoring and moving black populations around (for specific labor tasks) that tore families apart. Consequence: the core of the democratic process lies in freedom of expression and communication as well as equitable access to these infrastructures (phone, Internet,...).

More exclusion and marginalization

Market competition brought down the cots of access and helped developing the technology nationwide. However, here again the hegemony of the free market principle has even more marginalized unprofitable areas (i.e. rural ones) who cannot afford the cost of the technology and/or communication.

Thus policies such as universal access (access to telecommunications facilities for a community) that seek to meet basic rights requirements rest upon government action to channel market forces (e.g. system of licenses) and extend the network to populations left out of the system. The risk of marginalization is that those people remain firmly anchored in poverty as it only gets more and more difficult to catch up with innovations in the rest of the country.

Good points for the market

No one can deny nonetheless that the market system has its strengths. Even the achievement of several universal access goals is due to the private sector in rural South Africa. Indeed, rural elites - usually civil servants - have been able to invest in cell phone micro-enterprises and ventures. This has finally allowed most people in the country to have access to a telephone for a reasonable cost and within a fair distance (i.e. not having to travel for days to find a telephone).

Between nation-building and globalization

Social cohesion & harmony in South Africa

Keeping liberalization under control

The liberalization and opening up of the South African market has not led to a growth with proper job creation, instead it has seen rising joblessness and favoritism for better-educated workers (usual effect of globalization). Social grants designed for the poor have therefore proved essential safety nets to prevent more people from falling into poverty in South Africa.

The impact of welfare on poverty in South Africa

For one person, being eligible to a social welfare grant (like a retirement pension) often means being able to lift his entire household out of poverty. It opens access to education, health, telecommunications, etc. That’s the reason why calls for a universal basic income grant have been ongoing in the past ten years. It’s important to keep in mind that in the black population is still the one that is hit the hardest by the different effects of poverty in South Africa, although things are slowly getting better and a small black middle-class has emerged.

The extreme income inequality in the population is still considered a threat to social and political stability, which is why the issue is at the core of many policies undertaken by the government until today. Let's finish with a short video on the daily experience of going to school in the violent environment of a township in Cape Town's:


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