Poverty and livelihoods
The dominant perspective on the economic situation of the former homelands is that long-term, deliberate neglect has left a durable legacy of poverty and stagnation. While this may be largely correct, there is also evidence to suggest that the former homelands are dynamic. This article presents some evidence on population, employment and unemployment, in particular through a focus on the evolving nature of the linkages between former homeland towns and their rural environs.
The Wild Coast, in the former Transkei Bantustan, is characterised by natural beauty and great poverty. Since 1994 rural land administration has collapsed, land tenure has not been reformed, a succession of coastal development plans have been proposed but not implemented – and communities have become disillusioned. The few tourist-related developments that have taken root have done so despite the general collapse of rural governance and are due largely to the determination of local developers and their community partners
In the aggregate, earnings from jobs in the informal sector play a small role in reducing national poverty rates, especially because there are relatively few informal-sector jobs. However, if we compare on a per-job basis, the poverty reduction associated with one informal-sector job is generally between 50 to 100% of the poverty reduction associated with one formal-sector job. Growth in the number of jobs in the informal sector would be a sensible component of any plan to reduce poverty.
The reasons for the closure of fairly well-established informal enterprises are varied. Between 2010 and 2015, in the Cape Flats township of Delft South, a key factor was the failure to respond adequately to the more entrepreneurial business model of foreign traders and the strict enforcement of unfavourable liquor trading policies. Still, household misfortunes and broader socio-cultural dynamics also played crucial roles. A richer understanding of why enterprises shut down should inform policy to foster the sustainability of informal enterprises.
The child support grant has been praised as one of the government’s most successful anti-poverty programmes. The rapid extension of the grant increases the importance of ascertaining its effectiveness: does the child support grant make any real difference to the lives of the millions of children who receive it? Using the 2008 NIDS data, a recently published study identifies a significant positive impact on recipient children’s health, nutrition and education as a result of receiving the grant.
Former homeland areas continue to have significantly higher levels of deprivation and poverty than the rest of South Africa. Of all the former homeland areas, the erstwhile Transkei in the Eastern Cape has the highest levels of deprivation (measured using the Index of Multiple Deprivation for 2011) as well as income poverty. Indeed, the deprivation gap between former homelands and the rest of South Africa has not declined in the period 2001 to 2011.
Amidst a decline in general poverty rates since 2000, women and people living in female-headed households still are significantly worse off. Women are up to 30% poorer than men on average. There is an even larger poverty gap between female- and male-headed households – a difference of as much as 100%, despite improved education, health and basic services. Better health, water and sanitation services, especially in rural areas, should narrow these gaps significantly.
Cape Town is the urban centrepiece of a globally unique and highly diverse natural environment which should take priority in conservation management. But these biological assets also directly serve a local market of over 5 100 traditional healers and herbalists. The author discusses this important informal economy, business and cultural activity in the face of the broadening threats to conservation in the region, and the growing potential tension this presents in terms of policy and management.
How did hunger levels in the former homelands catch up with the rest of South Africa? A hundred years after the Land Act of 1913
A century after the Land Act of 1913, and 20 years after the abolition of homelands, differences in poverty persist between the former homeland areas and the rest of South Africa. However, remarkably, hunger gaps between the former homelands and other regions have been eliminated in the post-apartheid era. The main cause has been the disproportionately high number of persons eligible for social grants in the former homelands, rather than increased food production or higher labour market incomes due to land reform.
This article examines the contrasting business models in the spaza shop sector, and compares foreign-run businesses with South African businesses. We argue that foreign shop keepers are more successful than South Africans because of the strength of their social networks, which provide them with access to labour and capital and enable collective purchasing and market domination. The article argues for a two-pronged policy that would formalise larger shops whilst permitting and encouraging informal micro and survivalist businesses.