OpinionPREMIUM

NEVA MAKGETLA | SA’s odd economy and the burdens of history

Joblessness and inequality persist despite democratic reforms

Neva Makgetla

Neva Makgetla

Columnist

Long ride: Domestic worker Khosi Mahlangu’s gruelling day starts at 2am, when she prepares to take a bus from Machiding village in Mpumalanga to her workplace in Pretoria East. Research shows the poor shoulder the biggest transport burden because of the spatial legacy of apartheid. Picture: THE TIMES
Research shows the poor shoulder the biggest transport burden because of the spatial legacy of apartheid. Picture: THE TIMES

South Africa is an odd economy by world standards. Consider the areas where, according to World Bank data, we rank toward the top of the leaderboard compared with other upper-middle income countries.

For instance, only two out of five adult South Africans are employed, a figure that has held more or less steady since the mid-1980s. In the rest of the world the average is just under three out of five. That level has also been stable for decades.

South Africa ranks fourth from lowest for this ratio among upper-middle income countries, after Iraq, Algeria and Iran. In the other three worst performers just more than one in 10 women is employed, but the ratio for men equals the global norm of 60%.

If we look only at countries where men and women have closer to equal employment chances, South Africa ranks an easy first in this unhappy contest.

South Africa is also one of the most unequal countries in the world, though the data on this topic is less reliable and complete. It is worse off among the 44 upper-middle income countries that reported a Gini coefficient in the early 2020s. It is followed at a distance by Colombia, Brazil and Kosovo.

These South African peculiarities are pretty notorious. But South Africa is an outlier in less obvious areas as well. For instance, Johannesburg’s population has grown faster in the past 30 years than the lead city in almost any other upper-middle income economy. The largest city in peer economies, excluding China, grew 40% in this period; Johannesburg doubled in size.

South Africa’s outlier status on a range of socioeconomic issues means we may be able to learn from other countries’ experiences, but we can’t just copy them.

Shanghai, China’s largest city, grew about as fast as Johannesburg. South Africa and China share an unusual history of legal restrictions based on pass laws which until the 1980s forced much of the population to live in impoverished rural areas.

South Africa is also an outlier when it comes to household infrastructure. Almost 90% of South African households have electricity, up from 75% three decades ago. In our peer economies, including China, the figure has been close to 100% since the 1990s.

Our progress on clean water has been less marked, with the share of households with piped water climbing only from 64% to 68% since the early 2000s. China doesn’t give figures for access to clean water, but in other upper-middle income countries the figure rose from 71% to 78% in the same period.

Then there’s emissions. South Africa emitted a whopping 9 tonnes per person per year in the early 2020s, down from 10 tonnes 20 years earlier. For other upper-middle income countries outside China, emissions climbed in the same period but remained far lower, rising from five to six tonnes per capita. In China it rose from four to 11 tonnes.

South Africa now ranks 11th among the over 50 upper-middle income countries, down from seventh in the early 21st century. China has risen from 27th to sixth, with Mongolia, Kazakhstan and Turkmenistan at the top of the table.

South Africa’s outlier status on a range of socioeconomic issues means we may be able to learn from other countries’ experiences, but we can’t just copy them. Too often we hear that there’s an easy fix: just introduce the other country’s successful policies and all will be well. Yet even if we could agree on the nature of those policies we would still have a different starting point and consequently different outcomes.

Ultimately we have to invent our own strategies to respond to our unique history. Yes, it’s been 30 years since the transition to democracy and certainly South Africa has not dealt with the entrenched inequalities and inefficiencies left by apartheid as well as it could have. But unless we understand how our strange past shaped those challenges, we are unlikely to improve.

Just closing our eyes and wishing hard won’t make South Africa’s historic peculiarities go away.

• Makgetla is a senior researcher with Trade & Industrial Policy Strategies.

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