Poverty

A theme of commentary on South Africa’s May 8 elections is that many voters will be motivated by anger at corruption and growing economic and social inequality, particularly the continuing poverty of the black majority. Commentators are also noting the low levels of voter registration among young people. There is speculation that such factors will lead to an erosion of support for the African National Congress (ANC), which has governed South Africa since the transition to “non-racial” democracy in 1994. At present, it is anticipated that the principal beneficiary of a decline in ANC support will be the radical Economic Freedom Fighters (EFF) and, less likely, the formal opposition, the Democratic Alliance (DA). While polling shows that President Cyril Ramaphosa, who is the ANC party leader, is much more popular than the EFF’s Julius Malema or the DA’s Mmusi Maimane, under South Africa’s system of proportional representation, voters vote for a party, not an individual. In the run-up to the elections, the BBC has done a service by presenting statistical data on how South Africa has changed since 1994. The data is drawn from Stats SA, the official statistics office, and think tanks. South African statistics, official and non-official, are credible. The BBC’s selection of statistics shows greater social progress since the end of apartheid than the current political debate would indicate, but that poverty remains mostly black and coloured. (Coloureds often regard themselves as a separate race, not of mixed race.) Between 2006 and 2015, poverty declined across all races. For blacks, it declined from 76.8 percent to 64.2 percent; for coloureds, from 56.1 percent to 41.3 percent; for Indians/Asians, from 20.9 percent to 5.9 percent, and for whites from 1.4 percent to 1 percent. It is worth noting that much of this progress was achieved between 2006 and 2011, at which point the declines stalled or even reversed. Hence, for some, progress has not been seen or felt for eight years.  Other data also shows some improvement. For example, in 1996, 58.2 percent of households had access to electricity and 60.8 percent had access to piped water; in 2016 it was 90.3 percent and 83.5 percent, respectively. Despite improvement since the end of apartheid, poverty and unemployment remain high. It can be politically dangerous for a government in power when a positive trajectory is interrupted, as poverty reduction among Blacks and Coloureds has been. South Africa’s rate of economic growth has also been low. The country has recovered only slowly from the global recession of 2008, and the prices of some South African export commodities have fallen. Further, the poor governance and bad economic policies of the 2009–2018 administration of President Zuma undermined domestic and foreign investment necessary for growth. All of that said, voting behavior is still largely determined by race, and the ANC has been the political party of blacks, and is institutionally robust. It may not perform as badly as the pundits predict on May 8. 

Alexandra Bro is a research associate at CFR's Women and Foreign Policy program. Jack McCaslin is a research associate with CFR's Africa program. On February 23, Muhammadu Buhari was reelected as Nigeria’s president, beating his opponent and former Vice President Atiku Abubakar. While running on different platforms, central to both of their campaigns was the poor state of the country’s economy. Broadly speaking, Buhari’s solutions bent toward social justice for the poor, while Atiku’s focused on privatization and deregulation. But of the many remedies proposed by the two candidates, neither sufficiently focused on a proven strategy to boost the economy: increasing the participation of women. A large body of evidence demonstrates the positive relationship between women’s economic participation and a country’s prosperity. According to the CFR Women and Foreign Policy Program’s new digital report, Growing Economies Through Gender Parity, which visualizes data from the McKinsey Global Institute, Nigeria’s gross domestic product (GDP) could grow by 23 percent—or $229 billion—by 2025 if women participated in the economy to the same extent as men. And the International Monetary Fund (IMF) has found that strengthening gender equality in Nigeria could be an economic game-changer, leading to higher productivity and greater economic stability.  These are benefits that Nigeria cannot afford to ignore. Under Buhari’s leadership, Nigeria’s unemployment rate has continued to grow, and while the country has begun to recover from an economic recession in 2016, the IMF’s growth forecast for Nigeria’s economy remains bleak. In June 2018, World Poverty Clock estimated that ninety million Nigerians were living in extreme poverty, surpassing India as home to the largest number of poor people in the world. Furthermore, Nigeria’s poverty rate is predicted to increase from 44.2 percent today to 45.5 percent in 2030, as its GDP growth fails to keep up with population growth.  This situation disproportionately affects Nigeria’s women and girls. Girls are less likely than boys to attend school and more likely to be illiterate. In the poorest parts of the country, 75 percent of girls are out of school, and in some regions, the share of unenrolled girls is close to twice that of boys. Women also have lower access to health and financial services, and are more likely to be part of the informal economy. According to the World Bank, only 50 percent of Nigerian women participate in the labor force, compared to almost 60 percent of men. Rather than enabling women to contribute to the economy, Nigeria still has several laws on the books that make it harder for women to work than men. For example, Nigerian law does not mandate nondiscrimination in employment based on gender, nor equal remuneration for work of equal value. Women are not even allowed to work in the same industries, or perform the same tasks at work, as men; among other restrictions, it is illegal for women to work overnight in manual labor. And women who are sexually harassed at work do not have access to civil remedies. According to the Women and Foreign Policy Program’s Women’s Workplace Equality Index—which visualizes data from the World Bank and ranks 189 countries on how level the legal playing field is for women in the workforce—Nigeria comes in at number 87 on its global ranking. Merely changing the law definitely has its limitations. Government bureaucratic capacity is extremely limited and Nigerians tend to have greater faith in traditional and religious leaders than they do in secular judges and courts. Nevertheless, ensuring equality under the law remains an important first step in closing the economic gender gap, and governments around the world are starting to take action. Between 2015 and 2017, more than 110 countries undertook legal reforms that increased women’s economic opportunities. Sub-Saharan Africa is no exception. Burkina Faso now provides civil remedies for cases of sexual harassment in the workplace, and within the last three years, Zambia has made a number of reforms. It now prohibits gender-based discrimination in hiring and promotions, and mandates equal remuneration for equal work.  Certainly, increasing women’s economic participation is no panacea for Nigeria’s ailing economy. The recession in 2016, caused by its dependence on oil prices, requires economic diversification. Nigeria’s poor infrastructure is well-documented—only half of Nigerians have access to reliable electricity and frequent blackouts force businesses to run costly diesel generators to keep the lights on—and requires greater and more efficient public expenditure.  But decades of research indicate the significant economic benefits of improving women's status and allowing them to make their own decisions about work. As President Buhari and Vice President Yemi Osinbajo begin to think about how to improve the economy over their second term, eliminating legal barriers to women’s economic participation is a good place to start.

At a business breakfast on February 7, Doyin Salami pointed out the elephant in the living room of Nigeria’s economy. The country is not oil rich; rather it is oil dependent. He asked attendees to acknowledge this distinction. Dr. Salami did the math. He estimated that Nigeria could produce 800 million barrels of oil per year, which means that for every one of the Nigeria’s roughly 200 million people, the country produces four barrels of oil. He also estimated a population of 200 million. That meant four barrels of oil per year per Nigerian. Filling in the blanks with some of my own math, at $45 per barrel, that equates to about $180 per person per year. He then turned to Saudi Arabia. He estimated that it would produce 4 billion barrels each year, but with a population of only 30 million, the kingdom would produce $6,000 for every one Saudi person, or over 130 barrels per person per year.  This sentiment is not new. Former finance minister and foreign minister Ngozi Okonjo-Iweala has made the same point in the past, as have many others. The reality is that Nigeria remains a very poor country, despite a handful of very rich Nigerians. As successive government have urged, the country must diversify its economy if it is to break out of the poverty trap.  Nigeria remains "Exhibit A" of the so-called resource curse. At the time of independence in 1960, Nigeria exported food to West Africa, but now, it is now a net importer. In 1960, Nigeria had a significant manufacturing sector, especially in textiles, furniture, and other goods. With the coming of oil, which began in earnest in the 1970s, fiscal and economic policy were distorted, and oil sucked-up domestic and foreign investment at the expense of other sectors of the economy.  Government borrowing when oil prices were low led to debt. Military governments punctuated by coups resulted in policy instability and uncertainty and facilitated whole-sale looting of the state. Government revenue increasingly came from oil. With the coming of civilian government in 1999, there has been some recovery, but government revenue remains hostage to fluctuating oil prices. Corruption, if less chaotic and rampant now than under the military, has become institutionalized at almost every level of government. The bright spot, if small now, has been a proliferation of good governance presidential candidates and other Nigerians who are challenging king oil, politics as usual, and are shining a light on systemic government corruption. Foreign friends of Nigeria should support their efforts. 

Perhaps for most in the developed world, the image of African poverty is a teeming urban slum, such as can be found in Lagos, Kinshasa, or Luanda. Yet, as Professor Leif Brottem discusses, rural poverty is more widespread and more extreme. He notes that by 2030, some nine out of ten of those living in extreme poverty will be sub-Saharan African, disproportionately rural residents of fragile states with weak institutions and often wracked with conflict. With respect to the Sahel, Brottem makes the important point that many or most “villages” are not really villages in the sense of a fixed point on a map. Instead, what are called villages are “constellations of settlements…dispersed across large territories.” Inhabitants across the Sahel survive through mobility, searching for agricultural land and pasturage, and moving frequently. Villages in the western sense do exist, often so designated by the colonial authorities as the lowest administrative unit. They still get most of whatever government or non-governmental organization (NGO) services are available. Further complicating the picture, Brottem calls attention to “host-stranger relations,” in which people with land loan farmland to newcomers who only rarely ever acquire security of tenure. They are outside the village structure, and often dispersed over a large area. This system worked in the past, but it is now stressed by high birthrates and fragile political arrangements. Such inhabitants are presumably especially vulnerable to becoming internally displaced in times of political insecurity. Brottern’s point of reference is primarily Mali, where he did field work. His discussion of village structure in Mali highlights how little most of us really know about rural life in sub-Saharan Africa. What we do know is the persistence—even the increase—of rural poverty.

Across the country, Nigerians have seen an uptick in violent, ostensibly non-political, crime. Further, there is anecdotal evidence that crime has become more gratuitously violent. Nigerians are especially concerned about the upsurge in kidnapping, which affects an increasingly wide spectrum of the Nigerian population. In the past, kidnapping mostly occurred in the south and west of the country, but now, it has become national epidemic. In some parts of the country, kidnapping has become a business, with whispers of involvement by politicians and the police as well as entrepreneurs in it simply for the money. In the northeast and in the Delta, kidnapping has been used as a political weapon by dissidents. Boko Haram, for example, made headlines in April 2014 when it kidnapped 276 schoolgirls in Chibok, over one hundred of whom remain captive. Kidnappers had usually focused their attention on the rich and famous. Hours before the final group stage game in the 2018 World Cup, Mikel John Obi, the Nigerian national team’s captain, was informed that his father had been kidnapped and there was a ransom demand. Foreigners are prime targets, and have been targeted by pirates in the Gulf of Guinea, by militants in the oil patch, and by "common criminals" everywhere. But now, almost anybody who appears to have the most minimal of resources, or access to resources, can be a victim. A demoralized psyche has gripped the country, with many Nigerians living in fear of being kidnapped.  The police are constitutionally responsible for fighting domestic crime, including kidnapping, and the current crime wave with kidnapping undermines confidence in the government’s law enforcement capacity. Thus far, neither of the two leading candidates, President Muhammadu Buhari and contender and former Vice President Atiku Abubakar, has advanced substantial ideas to address what has become a ubiquitous crisis of governance. Instead, in the current presidential campaign, issue-drive debates have predominately focused on the economy. Yet, it goes without saying that without an effective security apparatus that can quash the kidnapping epidemic, economic development becomes exponentially more difficult.