Windhoek - The greater portion of wealth in Africa remains in the hands of a few elites; an indication that governments are failing or are reluctant to extend opportunities to benefit millions of marginalised citizens.
This is the conclusion of the 2012 Africa Progress Report, titled “Jobs, Justice and Equity”, which was launched recently in Addis Ababa, Ethiopia.
It is the flagship publication of the Africa Progress Panel (APP), providing that body’s assessment of the progress the continent has made over the previous year.
APP chair Kofi Annan, a former UN Secretary-General, noted that high levels of inequality and income disparities in Africa are “unjustified and profoundly unfair” in his foreword to the report.
“Too many Africans remain caught in the downward spirals of poverty, insecurity and marginalisation … and too much of Africa’s enormous wealth remains in the hands of narrow elites and increasingly, foreign investors without being turned into tangible benefits for its people,” Annan said.
Urging a re-think of Africa’s development path, the former UN boss added: “Not all inequalities are unjust, but the levels of inequality across much of Africa are unjust and profoundly unfair.
“Extreme disparities in income are slowing the pace of poverty reduction and hampering the development of broad-based economic growth.
“Disparities in basic life-chances for health, education and participation in society, are preventing millions of Africans from realising their potential, holding back social and economic progress.
“Growing inequality and the twin problems of marginalisation and disenfranchisement are threatening the continent’s prospects and undermining the very foundation of its recent (economic) success.”
About 386 million people on the continent survive on less than US$1.25 a day and the continent accounts for a rising share of global poverty despite its commendable economic growth in recent years, reads the report.
When Africa’s growth started to pick up in 1999, the continent accounted for 21 percent of the world’s poverty but by 2008 that share had risen to 29 percent.
This is contrary to conventional economic wisdom that economic growth is the answer to poverty and inequality.
“The main reason for the high poverty rate is not slow economic growth but high inequality,” the report says.
Using the Gini index, the globally accepted measure of inequality which captures concentration of household income or expenditure (the higher the index, the greater the inequality), there are 24 African countries where the index is higher than 42.
China too has a Gini index of 42 and rising inequality in that country has been identified as a “threat to social stability and future growth”.
The Gini indices for Mozambique, Kenya and Zambia are between 45 and 55, while in Botswana and South Africa the figures are over 60.
South Africa is often referred to as the “most unequal society” in the world.
“Governments are failing to convert the rising tide of wealth into opportunities for their more marginalised citizens.
“Unequal access to health, education, water and sanitation is reinforcing wider inequalities.
“Smallholding agriculture has not been part of the growth surge, leaving rural populations strapped in poverty and vulnerability,” the report says.
The APP issues a grim warning to governments on “deep, persistent and enduring inequalities” that are evident across Africa. Over the long-run, inequalities will undermine growth, productivity and the development of markets.
“They weaken confidence in governments and institutions and they leave many Africans feeling that their societies are fundamentally unjust and their governments unresponsive. Economic growth alone is not enough.” The future prospects of Africa’s burgeoning young population are dimmed by lack of access to quality education and unemployment.
The panel estimates that annually, between eight to 10 million young Africans need to make the transition from school to work.
The few who are lucky to find jobs largely work in insecure, low wage and often hazardous employment with the little prospects of developing their skills or progressing professionally or personally.
In Nigeria, the most populous country in Africa, as well as in Mozambique and Burundi, more than 60 percent of young people are said to work in jobs, which pay less than US$1.25 a day.
The APP report says the young population has “extraordinary levels of energy and creativity, hopes, ambitions and dreams”.
“What they are lacking is the opportunity to develop the skills they need to realise their potential. Africa’s education and training systems in Africa are not currently fit for the purpose of providing decent quality education for all.
“Failure to tackle crisis in access to education will not only limit the right to education, but undermine prospects for economic growth and waste human capital,” the report says.
While economic growth in Africa has been impressive and future prospects are much brighter, such growth is not addressing poverty and inequality. “It is important that African leaders not be mesmerised by economic growth in and of itself. They must also consider the quality of growth, the distribution of benefits from wealth creation, the opportunities that poor people and women have to participate in growth, and the relationship between growth and progress.”
The APP brings together 10 individuals from the private and public sectors, who advocate on what they feel are global issues of importance to Africa and the world.
Apart from Annan, other panel members are Michel Camdessus, Peter Eigen, Bob Geldof, Olusegun Obasanjo, Graça Machel, Linah Mohohlo, Robert Rubin, Tidjane Thiam and Muhammad Yunus.
The Panel’s cites as its primary objective advocating for shared responsibility between African leaders and their international partners to ensure sustainable and equitable development for the continent.