A shanty town in Pietermaritzburg, KwaZulu-Natal. Picture: SUNDAY TIMES/JACKIE CLAUSEN
A shanty town in Pietermaritzburg, KwaZulu-Natal. Picture: SUNDAY TIMES/JACKIE CLAUSEN

Policy uncertainty, weak economic growth, high unemployment, rising prices and lower investment are threatening to undermine progress SA has made in its fight against poverty.

Remarkable strides to fight poverty have been made since the country obtained majority rule in 1994, but the drought, low economic growth and rising unemployment over the past few years has reversed those gains, resulting in a poverty ratio of one in every two South Africans in 2015.

This comes after one of the biggest democratic triumphs, which led to poverty falling dramatically from 66.6% (31.6-million people) in 2006 to 53.2% (27.3-million people) in 2011.

But according to the latest Poverty Trends in SA, released by Statistics SA on Tuesday, the figure jumped to 55.5% (30.4-million people) in 2015. The figures in the report also suggest SA is unlikely to meet its National Development Plan (NDP) goal to eliminate poverty by 2030.

At least one in two South Africans was poor in 2015.

Speaking about the NDP goals, Statistician-General Pali Lehohla said: “There’s a serious divergence between where we are and where we want to go.

“If we think about the drought and the negative growth SA is facing, the poor are increasing. Unless we start looking at these problems as policy makers, we are far from solving these problems.”

“When you look at economic growth, you can see that our target is 5.4% per year, but that the growth is not going in that direction. We have had two quarters of negative growth — which is a technical recession.

“We do know that unemployment is very high and we have seen that in our quarterly labour force survey,” he said.

“The key driver of poverty is unemployment. The poverty situation in SA is never going to be won when you have all these things. When you have education, you resolve both problems,” Lehohla said.

Senior economist at Trade and Industrial Policy Strategies Neva Makgetla said poverty had dipped from 2006 to 2011 because of the commodity boom. “Slow global growth and the abrupt end of the commodity boom in 2011 fed into this.

“GDP growth and employment growth also slowed significantly,” she said.

The boom had a marked effect on mining-dependent economies such as SA, which account for about 60% of output for middle-income economies, Makgetla said.

DA leader Mmusi Maimane said these problems stemmed from the ANC’s economic policies that had failed to grow the economy and create work.

menons@businesslive.co.za 

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