Oxfam: Richest 1% bagged 82% of wealth created in 2017


Karabo Ngoepe

JOHANNESBURG- The rich continue to get richer while the poor scramble to share the breadcrumbs filtering from the top.

According to a new Oxfam report released on Monday, 82% of the wealth generated last year went to the richest one percent of the global population, while the 3.7 billion people who make up the poorest half of the world saw no increase in their wealth.

The report, titled: Reward Work, Not Wealth was released just days before world leaders and politicians gathered in the holiday resort town of Davos in Switzerland for the 48th annual World Economic Forum meeting.

The report reveals how the global economy enables a wealthy elite to accumulate vast amounts of wealth while hundreds of millions of people are struggling to survive on poverty pay.

According to the report, 2017 saw an unprecedented increase in the number of billionaires, at a rate of one every two days. Billionaire wealth has risen by an average of 13 percent a year since 2010 – six times faster than the wages of ordinary workers, which have risen by a yearly average of just 2 percent.

In South Africa, it takes 4.58 days for the best-paid executive at Shoprite to earn what a temporary farm worker at a wine farm in Cape Town will earn in their lifetime (presuming 50 years). Shoprite Group is Africa’s largest food retailer with branches across Southern Africa. And it takes 1.62 days for the best-paid executive at Shoprite to earn what a tea picker in Malawi will earn in their lifetime (presuming 50 years). In South Africa, the top 10% of the society receives half of all wage income, while the bottom 50% of the workforce receives just 12% of all wages.

Oxfam’s report outlines the key factors driving the phenomenal rise in rewards for shareholders and corporate bosses at the expense of workers’ pay and conditions. These include the erosion of workers’ rights, as we have seen with the eight workers at Shoprite Pelican Park in Cape Town, Heineken casual workers in Sedibeng, and the Dis-Chem workers who were protesting the previous past week. The report further states that another problem which drives up rewards for the wealthy at the expense of workers is the relentless corporate drive to minimize costs in order to maximize returns to shareholders.

“In 2015, world governments adopted an agenda for sustainable development which recognised addressing inequality (goal 10) as a problem. Everyone including the superrich is talking about inequality, yet we saw last year, after many years of annual Davos speeches, an increase in the record number of billionaires in a year when the wealth of the poorest 50% had, in fact, not grown. We are making the call that the dynamics that we have allowed of a global economy that continues to overly reward the richest and already most privileged, has to change,” says Siphokazi Mthathi, Oxfam South Africa Executive Director.

“Whilst the situation we are in South Africa has historical roots, decisions of the post-apartheid government have failed to balance the scale in SA. The neo-liberal economic framework our country adopted post-1994 could only produce a scenario where those who are already privileged, have the most capital, have the most control over the economy, have continued to grow at the expense of the poor and working people. The inequality we see, the extreme poverty which recent government numbers say has risen to a staggering 55% of the population since 2011 as per Stats SA figures, is as a result of the economic direction our government took. Government has the power to change this” Mthathi added.

Winnie Byanyima, Executive Director of Oxfam International added: “The billionaire boom is not a sign of a thriving economy but a symptom of a failing economic system. The people who make our clothes, assemble our phones, and grow our food are being exploited to ensure a steady supply of cheap goods, and swell the profits of corporations and billionaire investors.”

Thembinkosi Dlamini, Economic Justice Lead at Oxfam South Africa said women workers often find themselves at the bottom of the heap in all this boom. Across the world, including in South Africa, women consistently earn less than men and are concentrated in the lowest paid and least secure forms of work. By comparison, 9 out of 10 billionaires are men.

“As Oxfam South Africa we work with workers, many of them women, in different sectors. Our strategic focus is to help empower these women because their stories point to a structural deficiency, a situation of people left behind in all that our government is doing. From women in mining and those living in mining communities to domestic workers to Sheraldine Damonds, a seasonal farm worker based in George, southern Cape, waitresses, and sex workers, their stories demonstrate the structural poverty and inequality. They work long hours, are paid less if they are paid at all, abused by the system and the employers, often experiencing sexually harassed. This needs to change. The study shows that currently, women provide $10 Trillion in unpaid care work annually to support the global economy. The world owes women. This is why we call for an economy that will recognise and reward work done by all equitably,” added Dlamini.