Poverty in South Africa – Term Paper

Question 1

Growth and poverty are associated with improvements in the living standards and the welfare of the population. South Africa is ideally a good example of a country where records indicate that economic growth has translated improvements in the well-being of the majority of the population. Since its transition to democracy in 1994, the country has experienced economic growth. South Africa from 1995-2005 has experienced an average growth rate of approximately 3.4% indicating that there is an improvement in reducing the poverty level in the country. The incidence of poverty in South Africa has declined by 5% resulting in general robust regarding growth and development. The primary objective of the lawmakers is to create a better life for all people by establishing programs that strengthen grassroots organizations and enables them to provide affordable credit for small businesses. Therefore, this essay seeks to evaluate various strategies the government of South Africa has improvised to address the issue of growth and poverty.

Free essay on poverty in South Africa

Jobs through Public Works

The government of South Africa is ideally playing a significant role in building an economy which offers the people of South Africa an opportunity to contribute productively. All South African were given the opportunity to participate in the economic life of the country to alleviate poverty in the country. The creation of job opportunities specifically catered for youth and women so that to address the issue of unemployment in the country. The job creation ensured adequate incomes along with labor standards locally, regionally and internationally. The fact of the matter is that the government of South Africa created programs that helped to promote empowerment, education, training and community capacity to eradicate all forms of poverty in the country. This strategy is aimed at strengthening economic development, redistribution of income as well as socioeconomic opportunities for the poor. These jobs created a link towards building the economy of the country and repair environmental damage while expanding as well as reconstructing industrial and agricultural base (Chossudovsky, & Marshall, 2010, p.56). The country is a big player in the manufacturing and mining sector and the action plan through job creation in the industries has increased emphasis on macroeconomic reform to increase investment further.  Therefore, the table below illustrates how the government has made significant progress in meeting the goals of economic growth, poverty reduction and job creation in the most household in the country.

Social Security and Social Welfare

The apartheid regime in South Africa contributed significantly towards the destruction of family and community life in several ways. Since then the government has transformed various programs aimed at improving the social welfare policies and ensuring the attainment of social developmental goals. The achievement of these basic social protection rights was established irrespective of color, race, religion and physical disability (Pempel, 2010, p.67).  The government has focused on creating robust, balanced and dynamic economic policies to meet the basic needs of people in the country. For these systems to be achieved the state has established participatory, accountable and transparent policy-making procedures in both the private as well as government sectors for sustainable improvements in services and income. Through the monetary and fiscal policy, the government of South Africa aims to alleviate inequalities in income and wealth as well as expand productive opportunities so that to support small and micro enterprises. Utilization of capital remains a key factor in the government of South Africa to promote growth in production of goods which were previously imported. This policy has led to a significant contribution to foreign exchange earning thus addressing economic growth in the country. Therefore, the table below indicates the growth incidences over the past ten years regarding economic development.

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Economic Liberalization

The government has made significant progress in developing a plan for social transformation in the reconstruction and development program. This strategy ideally has helped the people of South Africa to acquire massive human resource development resulting of new attitudes towards work. The nation implemented the property rights which are the most important poverty reduction strategies. Securing property rights to land is vital to most societies in South Africa. The land is the most basic need for rural residents, and the apartheid policies pushed millions of black South African into overcrowded and improvised reserves.  The introduction of the agrarian reform program by the government has enabled the citizens of South Africa to build the economy through rural developments. The program aimed at securing tenure for rural dwellers and strengthens the economy by generating large-scale employment, eliminating overcrowding and increasing rural incomes. Under this program, the government of South Africa has made it possible for the poor and disadvantaged people to buy and access land for residential as well as productive purposes to improve their livelihoods. The growth of local economies has helped to improve the quality of rural life. The development efforts by the government of South Africa have enabled the majority of small-scale farmers to create a functionally efficient, integrated as well as equitable distribution of resources in rural areas.  The table below therefore gives a clear picture on how economic growth in South Africa has improved the living standards of people in both rural and urban areas.

Industry, Trade, and Commerce

Trade and industrial policy is ideally a solid strategy that the government of South Africa has integrated to address the growth and poverty in the country. Prudent implementation of monetary policies in particular increase in public sector investment, interest rates and gross investment in the industry resulting in productivity and foster innovation. The government has developed more cost-effective incentives schemes designed to improve performance and reduce the bias against small and medium-sized exporters. However, essentially, the government has employed the aspect of commercialization and privatization of companies to identify new economies sites of competitive advantage (Tran, 2012, p87).   Central to such an endeavor, the government has increased engagements with regional and international trade as well as the development of social and economic infrastructure so that to bring more dynamic business environment. The government has made easier for the black people to access capital for business development. Additionally, the policies aim to empower women and youth by ensuring no discrimination occurs in financial institutions. The state and private companies also provide capital for the attainment of black economic empowerment objectives. From the national economy and economy policy standpoint, government agencies have provided infrastructure and skills to raise income and create healthier working conditions in small businesses. The table, therefore, illustrates the growth regarding revenues generated through the help of the government of South Africa from both state and private companies thus addressing the issue of poverty and growth.