South Africa’s extreme levels of inequality have the potential to derail the nation’s Fourth Industrial Revolution (4IR) ambitions – or cause further division – if left unchecked.
Sakan independent consultant Walter Brown explained that the country’s immense economic, social and technological opportunities and prowess, driven by business and technological competence and skills, were not shared equitably throughout the nation.
“Inequality is probably the most dangerous social phenomenon facing humankind,” he says, noting that it was, and had been, a trigger for unrest and protest across the country, including the current and future xenophobic violence, and had been linked to the apartheid civil war that “nearly destroyed” South Africa.
Addressing delegates at the recent WapaLoza conference, in Pretoria, he pointed out that high levels of inequality were the norm in history, often leading to massive plagues and health pandemics; violent revolutions; mass mobilisation and warfare; and state collapses, that, in effect, had reduced inequality historically.
Wireless Access Providers Association chairperson Tim Genders, speaking at the information and communication technology (ICT) infrastructure conference, pointed out that, with a Gini coefficient score of 63, South Africa was the most unequal country in the world.
“The richest 10% hold 71% of wealth and the poorest 60% own 7%,” he said.
This is much higher than the Organisation for Economic Cooperation and Development average, where 10% of the richest hold 50% of wealth and the poorest 60% own 13% of the wealth.
“We have to look at the long-term implication of inequality and we have to be addressing inequality,” he said.
In 2015, more than 50% of South Africans were recorded as poor and living below the international poverty line of $5.50 a day, or R918 a month, with 30.4-million citizens averaging R768 a month, said Brown.
South Africa’s poor majority could not afford the ICTs they needed for self, family and community development.
“If [imprinted at] the baseline of 5% spend of income on telecommunications, what developmental quality and quantity ICTs can they purchase with a R38 price tag,” he questioned.
With a severely challenged education sector, wherein 78% of grade 4s cannot read and South Africa came last in mathematics and science, ICTs are vital learning tools.
“But, whittling away at the cost of communications using the traditional models of ICT growth, necessary as this may be, will not reduce the nation’s inequality challenges,” Brown added.
The pursuit of 4IR, without considering inequality and a flailing education system, will cause further division, he says, warning that, with the current ineffective educational performance and inadequate access to information through ICTs for lifelong self-driven learning, South Africa faces a grim future.
“4IR is about youth – they must be educated to fit into the unknown work. Failure to do this will change 4IR from friend to foe – and result in a disastrous future for South Africa.”
Mobile broadband was near ubiquitous, but unaffordable for 55% of the population as it equated to 13% to 20% of income for 1 GB a month, Genders pointed out, highlighting that mobile data cost 37 times more than WiFi data.
Further, 7.5-million lower-income homes are paying up to 80 times more for Internet access than higher-income homes, owing to the more expensive prepaid data bundles.
Compared with postpaid contracts, which effectively equate to less than R10/GB, pre-paid data can cost up to R500/GB.
Further, only 10% of South African homes have fixed affordable Internet, with 1.5-million to 1.7-million homes having fixed Internet piped-in connections, while 50% rely only on mobile data.
“That is the problem we are facing,” Genders noted.
“This should be worrying us much more than being left behind in the fifth-generation technology [era]. What we need is more fixed connections . . . to get to rates where 75% to 80% of homes are on fixed or fibre [connections],” Genders adds.
“We are not creating a future for 4IR – we are creating a crisis,” Brown said.
However, he pointed to a need for an economic restructure that could restore more equitable conditions and govern 4IR in a more sustainable manner, distributing – or redistributing – the benefits of technology, and avoiding a further increase in inequality.