Monday, May 9, 2011
By: News Agencies Mshale Team
The number of middle class Africans has tripled over the last 30 years to 313 million people, or more than 34% of the continent’s population, according to a new report from the African Development Bank (AfDB). The reasons for the increase in size and purchasing power of the African middle class include strong economic growth, and a move towards a stable, salaried job culture and away from traditional agricultural activities.
The report ‘The Middle of the Pyramid: Dynamics of the Middle Class in Africa’, however, warns that despite this phenomenon income inequality in Africa remains very high, and that the overall middle class figure includes large numbers of a ‘floating class’ whose hold on status is insecure.
Over the decades, the numbers have steadily risen from approximately 111 million or 26% of the population in 1980 to around 151.4 million (27%) in 1990. The 2010 figure, however, shows a significant surge of 60% from the 2000 figure of 196 million or 27.2% of total population.
The report defines middle class largely in terms of higher income relative to the average. That average is of course lower in Africa than in the west. The report notes: “the middle class is usually defined as individuals with annual income exceeding USD3,900 in purchasing power parity terms’.
However, the report acknowledges that other factors come into play when defining who is middle class, saying: ‘other variables such as education, professions, aspirations, and lifestyle are also important features that help establish who is in the middle class’.
Overall, it is economic growth that determines the rise of the middle class, but economic growth is in turn driven by social and economic factors. The report notes: ‘Africa’s middle class is strongest in countries that have a robust and growing private sector as many middle class individuals tend to be local entrepreneurs. In a number of African countries, a new middle class has emerged due to opportunities offered by the private sector’.
Other determining factors include the establishment of stable, secure, well-paid jobs, and higher levels of tertiary education.
Geographically, middle class levels vary a great deal across African countries. North Africa has the highest. Tunisia has the highest concentration at almost 90%, followed by Morocco at almost 85% and Egypt with almost 80%. But a significant number of these belong to the ‘floating’ category with a strong danger of falling into poverty due to economic shocks.
Other countries with high percentages of the middle class include Gabon, Botswana, Namibia, Ghana, Cape Verde, Kenya and South Africa. Countries at the bottom end include Mozambique, Madagascar, Malawi, Rwanda, Burundi and Liberia.
The report maintains the growth in the middle class is good news for the future prosperity of Africa, but also points out the continued high levels of income inequality on the continent. The continent has a extremely rich elite: ‘About 100,000 Africans had a net worth of USD800 billion in 2008, or about 60% of Africa’s GDP or 80% of sub-Saharan Africa’s’.