The Southern African Times
South Africa’s middle-class is disappearing
JOHANNESBURG, (The Southern African Times) – Less than a third of middle-class South Africans (30%) are positive about the future of South Africa, while 27% say that they are likely to emigrate within the next five years.
These are some of the major findings in the latest BrandMapp survey – a dataset that uses a mega-sample of more than 30,000 South African respondents to profile the 12 million adults who live in mid-to top-income households earning in excess of R10,000 per month.
While the findings should be understood in the context of the
Covid-19 pandemic, it is the latest dataset that points to a shrinking middle-class in South Africa as a stagnating economy and multiple lockdowns take thier toll.
Data published at the end of 2020 by the University of Cape Town Liberty Institute shows that South Africa’s shrinking middle-class has been years in the making, declining from 6.1 million to 2.7 million individuals between 2017 and
June 2020, translating to a 55.73% reduction.
On the other end of the spectrum, the number of ultra-poor individuals, earning below minimum wage, increased by 6.6 million individuals (54%).
Analysts and investors have repeatedly warned that the Covid-19 pandemic and repeated lockdowns will also have a disproportionate impact on the middle-class.
Financial services company Transaction Capital said that as much as a third of South Africa’s middle-class could be wiped out due to the various lockdowns.
Citing credit statistics, wage data and unemployment figures, the group said that overdue debt balances continue to increase, with a R33 billion increase seen in 2020 alone. It said that around 38% of loans are not in good standing.
This is combined with the highest unemployment rate in 12 years at 32.5%, deteriorating monthly income, and below-inflation increase. As such, more than a third (34%) of households in South Africa are forecast to fall out of the middle-class, it said.
This is further emphasised by wage data, with fewer South Africans reporting income in the R22,000+ wage range, while significantly more South Africans are seeing incomes of less than R8,000.
The number of people in debt who are relying on their credit to stay alive has sky-rocketed, leaving the South African economy teetering on the edge of borrowed time, said Hans Overbeek, founder and chief executive of Cyber Finance.
While the impact is being felt by all sectors and groups, Overbeek said that middle-class families are falling increasingly behind.
“Many permanently employed workers have had to transition to contractual or informal employment, as businesses try and mitigate their own losses,” he said.
“Households below the poverty line have increased dramatically, while an estimated 34% of middle-class families are estimated to fall into vulnerability.”
LONDON, (The Southern African Times) – Amazon was fined 746 million euros ($880 million) by Luxembourg authorities over allegations it flouted the EU’s data protection rules, the online retail giant said on evening Friday.
The fine was issued July 16 by the Luxembourg National Commission for Data Protection following its determination that “Amazon’s processing of personal data did not comply with the EU General Data Protection Regulation (GDPR),” Amazon said in a securities filing.
“We believe the CNPD’s decision to be without merit and intend to defend ourselves vigorously in this matter,” the company added, using the organization’s French acronym.
The fine was believed to be the largest ever for a data protection violation since the passage of the regulation.
The Securities and Exchange Commission (SEC) document offered no details, but Amazon was sued by a European consumer group claiming personal data was collected for ad targeting without permission.
The Luxembourg agency confirmed that it made a ruling this month on Amazon but declined to elaborate, saying its investigations are confidential.
It was the latest case of US tech firms being hit with violations of the landmark GDPR.
French authorities fined Amazon 35 million euros last year for failing to follow laws on browser “cookies” that track users. Google was hit with a fine of 100 million euros for similar violations.
Facebook is under investigation in Ireland after details on 533 million users were leaked on a hacking website
Under the GDPR, which came into effect in 2018, internet users have a wider range of rights relating to their data.
Regulators have been armed with new powers including the ability to fine firms up to four percent of their annual global turnover.
The GDPR has resulted in fines imposed not only on technology firms but marketers, data brokers, Austria’s postal service and even the Spanish football association, La Liga.
Amazon made the disclosure as part of its quarterly update which showed profits jumped 48 percent from a year ago to $7.8 billion and revenues increased 27 percent to $113.1 billion in the April-June period.