Inequality in Southern Africa : An Assessment of the Southern African Customs Union
The Southern African Customs Union (SACU) is the most unequal region in the world. While there has been some progress in recent years, inequality has remained almost stagnant in the most unequal countries. Using an innovative framework, this report...
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| Format: | Report |
| Language: | English |
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Washington, DC
2022
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| Online Access: | http://documents.worldbank.org/curated/en/099125303072236903/P1649270c02a1f06b0a3ae02e57eadd7a82 http://hdl.handle.net/10986/37283 |
| Summary: | The Southern African Customs Union
(SACU) is the most unequal region in the world. While there
has been some progress in recent years, inequality has
remained almost stagnant in the most unequal countries.
Using an innovative framework, this report provides a
systematic and comprehensive analysis of inequality in the
region. The main conclusions are as follows: first,
inherited circumstances over which an individual has little
or no control (i.e., inequality of opportunity) drive
overall inequality, and their contribution has increased in
recent years. This is an important concern particularly
because this type of inequality is not the result of
people’s efforts. Second, lack of access to jobs and means
of production (education, skills, land, among others) by
disadvantaged populations slows progress towards a more
equitable income distribution. In a context where jobs are
scarce, having post-secondary or tertiary education is key
to both accessing jobs, and obtaining better wages once
employed. Third, fiscal policy helps reduce inequality
through the use of targeted transfers, social spending, and
progressive taxation, but results are below expectation
given the level of spending. Fourth, vulnerability to
climate risks and economic shocks makes any gains towards a
more equal society fragile. Looking ahead, accelerating
inequality reduction will require concerted action in three
policy areas: (a) expanding coverage and quality of
education, health, and basic services across subregions and
disadvantaged populations to reduce inequality of
opportunity; (b) strengthening access to and availability of
private sector jobs. It is important to accompany structural
reforms with measures that facilitate entrepreneurship and
skills acquisition of disadvantaged populations, and to
improve land distribution and productivity in rural areas;
and (c) investing in adaptive social protection systems to
increase resilience to climate risks and economic
vulnerability, while enhancing targeting of safety net
programs for more efficient use of fiscal resources. |
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