According to a recent report by the World Bank, South Africa is the most unequal in the world. Despite significant reduction in poverty since the onset of democracy in 1994, inequality has remained high and manifests itself in wage disparities, uneven access to public services, geographical segregation, and rising youth unemployment. Black South Africans – and especially women – are still the group most disproportionately affected by inequality.
Given this reality, residents of historically marginalised areas or ‘townships’ have come up with their own solutions to issues such as lack of basic services, employment opportunities, and recreational spaces. Over the last few years, social entrepreneurs have launched fintech businesses, tourism business, extracurricular activities for children, and arts and music academies, to mention a few.
AFD has partnered with Igaleo, an organisation working to expand economic opportunities for disadvantaged South African communities, to fulfil its mandate of reducing inequalities and creating opportunities for all in the country. Igalelo runs a 12-month incubation programme that provides aspiring entrepreneurs from disadvantaged backgrounds with business training and skills development. The ultimate goal is for the entrepreneurs to turn their ideas into sustainable businesses that will have long-term positive social and environmental impact in their communities.
Mathieu Planchard, Head of Igalelo.
South Africans remain sharply divided along racial and socioeconomic lines. These challenges exacerbate existing social problems and in the long run, might impact economic development and sustainable democracy in the country.
In 2015 AFD partnered with the University of Cape Town’s Poverty and Inequality Initiative (UCT – PII) and the Institute for Justice and Reconciliation (IJR) to conduct a study exploring the relationship between social cohesion and economic inequality in South Africa, and the institutional changes needed to promote social cohesion and reduce inequality.
The study found that higher levels of income and employment are associated with higher social cohesion, and that, conversely, poverty, unemployment and service delivery protests are linked to less social cohesion. Although much more can be said about this comprehensive study, an important implication is that the high levels of inequality and the perception that inequality has not improved since the dawn of democracy in 1994 are the key barriers to social cohesion in South Africa.
The next steps of this ambitious collaborative research project is the formulation of a social cohesion index, which will be used in the formulation of policies that can be expected to materially improves social cohesion and achieve inclusive development . The South Africa Social Cohesion Index, in partnership with StatsSA is expected to be launched in March 2019.