Focusing solely on the sum of goods and services produced within their borders cannot alone reduce the inequality that plagues the economies of countries throughout southern Africa, a report published by Oxfam International concludes.
Despite periods of economic growth during the past two decades, the benefits have yet to reach the poorest in countries such as Swaziland, Nigeria, Namibia and South Africa, notes Oxfam, which adds that the inequality falls most heavily on women and young people.
“The shape of many of the continent’s economies – characterized by an overreliance on the extractive sector, inadequate investment in agriculture and large informal sectors – has meant that the consequences of inequality have mostly been felt by the young and by women,” concludes Katy Wright, author of the report, which was released in the run-up to the recent World Economic Forum on Africa. “Instead of focusing solely on GDP and hoping to tweak it to make it more inclusive, leaders should focus directly on reducing inequality and eliminating poverty, in ways that lead to economic prosperity for all.”
“These aims should be placed above GDP growth – not because growth is unimportant, but because poverty and inequality represent the most significant barriers in Africa to achieving sustainable and inclusive growth,” she adds.
Swaziland has the greatest inequality in the world, followed by Nigeria, Namibia and South Africa, notes Wright (below chart). Oxfam found recently that three billionaires in South Africa have the same wealth as the bottom 50 percent of the population.
The 20 most unequal countries in the world, using raw and adjusted Gini measurements
Across Africa, up to three-quarters of women work in the agricultural, low-paid and informal sectors, notes Wright, who adds that women who work in manufacturing, services and trade earn about 70 percent of that of their male counterparts.
The continent also has yet to deliver jobs to a majority people under the age of 24, who, she notes, have the potential to drive economic prosperity with the right investments and policies. In South Africa alone, more than half of all young people are likely to be unemployed.
The report recommends that countries boost their tax-to-GDP ratios to at least one-quarter, including reducing tax avoidance and “enhancing capacity to collect taxes from highly paid individuals and large firms.”
According to Oxfam, governments also must meet commitments to spend a fifth of their national budget on education and 15% of their budgets on health, and “make explicit plans to reduce poverty and eliminate inequality” in line with the United Nations Sustainable Development Goals, a series of 17 goals that aim to end poverty, protect the planet, and promote peace and prosperity.