poverty and inequality from their high levels under apartheid. The reality has been
disappointing: despite steady economic growth, income poverty probably rose in
the late 1990s before a muted decline in the early 2000s, income inequality has
probably grown, and life expectancy has declined. The proximate causes are clear:
persistent unemployment and low demand for unskilled labour, strong demand for
skilled labour, an unequal education system, and a social safety net that is
unusually widespread but nonetheless has large holes. It is also clear that
economic growth alone will not reduce poverty or inequality. Pro-poor social
policies are important, but not as important as a pro-poor economic growth path.
Unfortunately, there is little sign of the political conditions changing to push the
state towards the promotion of a more pro-poor pattern of economic growth.
There is some chance of parametric reforms of the welfare state. Overall, however,
it is likely that, after another ten years of democracy, unemployment and poverty
rates will remain high, despite significant redistribution through cash transfers,
and incomes will continue to be distributed extremely unequally.
See also earlier post Poverty Data continues to make headlines in South Africa