Inequality in South Africa: Nature, causes and responses - November 2003
Section 1. Introduction1
Speaking in South Africa’s parliament in 1998 in the debate on the report of the Truth and Reconciliation Commission,
(then-Deputy) President Thabo Mbeki argued that
“material conditions …have divided our country into two nations,
the one black, the other white. …[the latter] is relatively prosperous and has ready access to a developed economic,
physical, educational, communication and other infrastructure…The second, and larger, nation of South Africa is black
and poor, [and] lives under conditions of a grossly underdeveloped infrastructure…
This paper examines the nature of the divide which
Mbeki pointed to between the ‘two nations’ and the reasons for the limited response to this divide during the
post-apartheid era since 1994 at which he hints. This paper argues that this response can be understood only
through an historical analysis of the transition to democracy. Section 2 provides an overview of inequality,
poverty and economic growth in South Africa and their trends during the past ten years.
Neither are we becoming one nation.….Unlike the German people [after unification in 1990] we have not made the
extra effort to generate the material
resources we have to invest to change the condition of the black poor more rapidly than is possible if we depend
solely on severely limited public funds, whose volume is governed by the need to maintain certain macroeconomic
balances and the impact of a growing economy.” (Mbeki, 1998)
Section 3 briefly examines the historical roots of inequality in colonial conquest and patterns of capitalist development resulting in the apartheid system. Section 4 argues that the democratic transition in 1994 emerged from a two-decade ‘crisis’ during which
economic and social changes occurred which shaped both the form of the transition through negotiations as well as post-apartheid policy and institutions, which resulted from an accommodation between the ANC and business.
Section 5 spells out how policies, institutions and ideas in post-apartheid South Africa reflect the outcome of the transition and have shaped the trends described in Section 2. Section 6 concludes by examining current approaches to addressing inequality in South Africa, and the constraints upon them.
The author is Executive Director, The EDGE Institute.
Without implicating them in positions taken here, I would like to thank for their comments on earlier drafts:
Bridget Dillon, Richard Thomas, Kate Philip and others at DfID (Pretoria); Andy Mckay and others at ODI
(London); Firoz Cachalia of the Gauteng Legislature; Ann Keeling,
Alison Tierney and others in DfID (London); and participants in the DfID
“Inequality in Middle Income Countries” workshop, London, Dec 4/5 2003.
I also thank Shireen Hassim for helpful discussions on many of the issues covered,
and Phillipa Tucker and Owen Willcox for research assistance.