The House Thabo built

Something to make you think about how truly we never have proper standards to judge good leaders. Our love for populists in Africa and our addiction to instant gratification makes us very vulnerable to demagogues. Black Diamonds well Mbeki shaped the market and nurtured them with his policies here is their success so far. The desire for all or nothing makes Good the enemy of better and Better hate best. To Thabo Mbeki a true son of Africa and a true hero of every true African thinker.

Black diamonds sparkle on
Article By: Marcia Klein
Mon, 13 Oct 2008 12:36
SA's new middle class is still growing despite economic slowdown, writes Marcia Klein.

For the first time, the spending power of the three-million people that make up South Africa's black middle class has matched the spending power of the country's white population.
The latest Black Diamonds research by UCT Unilever Institute of Strategic Marketing and TNS Research Surveys shows that the black middle class has grown by 15 percent to three-million people over the past year, while their annual spending power has mushroomed nearly 40 percent to a massive R250-billion.
Black Diamonds are still growing in number, despite the economic woes that surround them.
Resilient to rates

A surprising finding of the research is that the black middle class has remained fairly resilient to the interest rate and inflation hikes that have put pressure on many South Africans.

Professor John Simpson, director of the UCT Unilever Institute, said that despite predictions of the black middle class reeling under debt pressure, the opposite is true.
"The most astounding evidence of their financial resilience can be seen in a 39 percent increase in spending power — from R180-billion in 2007 to R250-billion this year."
Rudo Maponga, Black Diamond research manager at TNS Research Surveys, said that, despite perceptions, the black middle class is not highly indebted. Almost half of them have a debt to income ratio of less than 50 percent.
Maponga said if economic conditions had been more favourable Black Diamonds numbers would have seen greater growth. The sector grew 15 percent in the year, but by 30 percent the year before.
She said growth had also slowed because the base was getting bigger, "which means growth will inevitably slow in percentage terms. What's also significant is that, despite the downturn, their spending power continues to grow, which suggests that this segment is also becoming wealthier."
Simpson said interest rate and inflation hikes had affected Black Diamonds, as they had everyone, but the effect had been patchy.
"But one thing is clear: they are less indebted than people thought they were."
Black Diamonds are managing their finances better and are far more financially astute than they once were, Simpson said.
The fact that the number of people has not increased as much as their spending power has suggests that people established in the middle class are getting better jobs, and that companies are attracting people of colour.
The study showed appreciation within the sector of the difference between good debt (like a home and investments) and bad debt (buying chocolates with a credit card), Simpson said.
Less than 10 percent of Black Diamonds have had anything repossessed.
"Life stages"

Paul Egan, managing consultant to UCT/Unilever, said the Black Diamond group is not homogenous, and includes people at different "life stages" — those with children who have been working for longer and are fairly established, and those who are still playing catch up, using income and, perhaps credit, to acquire assets.

He said the 2007 study had shown a huge migration from townships to suburbs, averaging about 1200 families, or 60 000 people, a month.
This slowed in 2008. This could be partly because of the increasing cost of housing and the high cost of borrowing, but could also be due to the densification of townships and investment within them, such as the construction of shopping malls.
Egan noted that there is a high percentage of black middle-class families with two earners, and a significant percentage with more than that.
The change to democracy and enabling legislation have enabled black women to move swiftly into the middle class.
Black Diamond women

Black Diamond women represent more than 40 percent of the R120-billion in female consumer spending.

"Many women respondents revealed that their earning power had a significant impact on decision-making when it comes to making purchases — not only for grocery shopping, but with regard to larger purchases such as household appliances, investments and cars," Simpson said.
Maponga said almost half of the women interviewed said they earned more than 50 percent of the household income and more than 80 percent said they were the main household decision-maker.
She said women's aspirations are higher than their mothers and grandmothers, and women are far more ambitious since 1994.
Sunday Times