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Africa's growing inequality gap

         Date: 2012-05-22

           Tag: Africa growing, Africa growing inequality

Summary: This is the conclusion of the 2012 Africa Progress Report, titled “Jobs, Justice and Equity”, which was launched recently in Addis Ababa, Ethiopia.

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.

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