Sunday World

World Bank report: race and land drive inequality in SA

Political progress not matched by economic fairness

- By Kabelo Khumalo and Bangani Mdakane

Race and land fuel inequality in SA. This is the finding of a World Bank report, which surveyed SA and its neighbours, Lesotho, eswatini and Namibia, collective­ly called the Southern African Customs Union (Sacu) – the world’s most unequal region.

The World Bank also identified the legacy of apartheid as one of the main drivers of inequality in SA.

The study found that the rural economy can benefit from resolving land inequality and strengthen­ing land rights both in law and in practice.

“The legacy of a highly skewed distributi­on of land perpetuate­s inequality in Namibia and South Africa, which in turn undermines rural developmen­t and entreprene­urship. Weak property rights remain a key source of policy uncertaint­y in these two countries. In Botswana, eswatini, and Lesotho, agricultur­al land tenure is not properly secured and land markets are underdevel­oped,” the report reads in part.

“Inequality in some Sacu countries stems from their shared legacy of apartheid. In Namibia and South Africa, the story is one of incomplete transition after apartheid.

“Political progress in these countries has not been matched by progress in equity and economic fairness mainly because distortion­s from their past pose critical obstacles to social progress.”

The governing ANC at its 54th conference held in 2017 resolved that the party should, as a matter of policy, pursue expropriat­ion of land without compensati­on.

However, the ANC in December scrapped plans to change the constituti­on to make it easier for the state to take land without paying for it after failing to secure sufficient backing from the opposition and will now resort to using regular legislatio­n to facilitate the process.

“This report shows that lack of access to key productive assets such as skills and land, is slowing progress towards a more equitable income distributi­on,” said Pierella Paci, the World Bank’s practice manager of the Poverty and Equity Global Practice for Eastern and Southern Africa. “Improving access and availabili­ty of private sector jobs and access to productive assets such as land will help equalise opportunit­ies.”

Economist Duma Gqubule said SA had a long way to go to bridge the inequality divide. “Blacks own less than 2% of JSE, which is also a worrying factor that needs to be addressed. BEE has failed completely as its only benefits the few. We still have a lot to deal with to close the gap of inequality in this country. We also have to open a debate on land expropriat­ion and labour market on inequaliti­es and race. We also need wealth tax that can raise R100 billion for the country,” he said.

 ?? ?? According to the World Bank recently released report, race and land fuel inequality in SA, Lesotho, eswatini and Namibia.
According to the World Bank recently released report, race and land fuel inequality in SA, Lesotho, eswatini and Namibia.

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