The most unequal country on earth
SOUTH AFRICA has overtaken Brazil as the country with the widest gap between rich and poor, University of Cape Town economics Professor Haroon Bhorat told Parliament. “In the long run it’s bad for growth. It’s a threat to social stability and to growth itself. The long-run trend is a worrying one,” warned Bhorat, who drew his conclusions from Statistics SA’s income and expenditure survey. Those confirm SA’s Gini-coefficient index – which shows the level of income inequality – stands at 0,679. A Gini-coefficient above 0,5 is considered unacceptably high.
Bhorat’s key concern is SA’s long period of growth meant it could sustain a swelling social security bill. But the recession has changed that. We’re now facing a much higher deficit and unlikely to be able to maintain those payments, he says.
Government isn’t too worried. While its 2009