Blacks on the move in South Africa

South Africa's formerly all-white neighbourhoods are becoming darker in complexion and more expensive. Analysts say that soaring house prices and booming car sales are being fuelled by an upwardly mobile black middle class emerging from the ashes of apartheid.

Blacks, who make up about 75 per cent of South Africa's 46.6 million people, are moving from the periphery of the economy into the mainstream, thanks to policies aimed at redressing decades of injustice.

Statistics compiled by the independent Human Sciences Research Council (HSRC) show that the black middle class has swelled to 7.8 per cent of the total population in 2000 from 3.3 per cent in 1994.

"The development of a black middle class was deliberately stunted under segregation and apartheid," said the HSRC's Roger Southall.

Although official figures are not available, analysts say the black middle class is behind the retail sales boom and strong house price growth - also encouraged by the lowest interest rates in 24 years and high disposable incomes.

Before 1994, blacks were precluded by legislation from owning properties in suburbs exclusively reserved for whites and had limited access to bank credit.

But the face of the former white suburbs has changed as blacks increasingly move from the townships in search of security and better municipal services. Living in posh suburbs is seen by many as a status symbol.

"The black middle class is contributing strongly to the growth of the property market and other sectors of the economy," says Jacques du Toit, an economist at banking group Absa.

House prices rose by an average of 30.3 per cent in real terms in 2004, the highest since 1967 and business is also booming for auto traders, with a growing number of sales attributed to black buyers.

"An analysis of our customer profile on new vehicles indicates that we are selling between 15 and 20 per cent of our new vehicles to blacks," said Brandt Pretorius, chairman of McCarthy Motor Holdings, the country's biggest car retailer.

"It is our view that three years from today, black South Africans will represent the majority of new car buyers." According to data from the National Association of Automobile Manufacturers of South Africa, a record 481,000 units were sold last year.

The growth in the black middle class is attributed to better education and government affirmative action policies, which analysts say are levelling the playing field for access to high-paying professions.

Black economic empowerment deals aimed at giving blacks a bigger chunk of the economy are another key factor.

"Based on our estimates ... approximately 300,000 black South Africans have migrated into the middle and higher income sectors," said Pretorius.

"Our view is that the distribution of wealth in South Africa will continue to change more in favour of black South Africans, due to a higher level of education, the positive impact of black economic empowerment, affirmative action and the integration of blacks into the mainstream economy."

But some analysts, while accepting that more blacks are playing a greater role in the economy, say they are not the only population group advancing up the social ladder.

"Given the strong growth in per capita income, all the population groups have moved up," said George Kershoff, an economist at the Bureau for Economic Research.

"Because of our racial composition it is understandable that most of the people moving up are blacks.

"But we should be careful to note that it's part of a broader improvement in the disposable income in society."

- REUTERS