Keynote Speech on the theme “Economic Growth and Pursuit of Inequality Reduction in Africa”
Wednesday, June 6, 2018
Addis Ababa, UNCC CR2

Professor Haroon Bhorat economist of international fame will deliver a presentation on the 6th June at 11:00 at the United Nations Conference Centre unpacking why an apparent paradox of the growth- poverty-inequality nexus in Africa remains precisely a paradox during an Expert Group Meeting (EGM) and Policy Forum on Poverty, Inequality and Jobs in Africa organised by the Social Development Policy Division of the Economic Commission for Africa (ECA).

Prof. H. Bhorat analysed why in Africa the pace of poverty reduction is slow. The relationship between growth and poverty in Africa, excluding North Africa, in the last twenty years has been -0.7, which means that a 1% growth in consumption is estimated to reduce poverty by 0.7% compared to a global figure of 2 percent drop in poverty for every 1 percent growth. Prof. Bhorat added that income inequality had on average declined in Africa, driven by economies not highly unequal. In high initial inequality African economies there was a stronger relationship between economic growth and inequality. There is no obvious predictive trend around nature and pattern of African inequality over time.

He went on to say that a key defining feature of the African labour market was that an exceptionally high proportion - approximately 74 percent -  of the SSA labour force were self-employed, as opposed to being engaged in wage employment. Income from self-employment, which is directly dependent on the profits of the enterprise, is historically more variable than wage employment. Also noteworthy was that the majority of the labour force (56%) are engaged in agricultural activities, while 77 percent of the self-employed workers found themselves in the agricultural sector, having a compounding effect on the volatility of household incomes.

Prof. Bhorat concluded that this paradox is finally partly revealed through an assessment of a resource-led growth path and the African manufacturing malaise that are amenable to corrective policy interventions.

Haroon Bhorat is Professor of Economics in the School of Economics and Director of the Development Policy Research Unit (DPRU), at the University of Cape Town, South Africa.  His research interests cover labour economics, poverty and income distribution. Haroon has his PhD in Economics through Stellenbosch University in South Africa. He studied at the Massachusetts Institute of Technology and was a Cornell University research fellow. He holds the highly prestigious National Research Chair under the theme of Economic Growth, Poverty and Inequality: Exploring the Interactions for South Africa. Haroon is a Non-resident Senior Fellow at the Brookings Institution affiliated to the Global Economy and Development Program, and the Africa Growth Initiative (AGI). He is also a Research Fellow at IZA, the Institute for the Study of Labour in Bonn, and an Honorary Research Fellow at the Human Sciences Research Council (HSRC).  He is a member of the Board of the UNU World Institute for Development Economics Research (UNU-WIDER). Haroon was recently appointed an Advisor on the South African Parliament’s High Level Panel on Acceleration of Change and Transformation. He was an economic advisor to two past Ministers of Finance, and previous Presidents Thabo Mbeki and Kgalema Motlanthe, formally serving on the Presidential Economic Advisory Panel.

Economic Growth and the Pursuit of Inequality Reduction in Africa by Haroon Bhorat