Rich get richer while the poor just pitch their tents

08 April 2018 - 00:00 By SUTHENTIRA GOVENDER and JEFF WICKS

Mbhekiseni Chiliza lives among the well-heeled in Durban's Morningside but he doesn't drive a Rolls-Royce Phantom, pop champagne or snack on caviar.
The 40-year-old lives on scraps and handouts in his tent that he pitches every night in one of Durban's most affluent neighbourhoods.
Unemployed Chiliza, like millions of South Africans, lives in poverty.
Meanwhile, his neighbours splash out on fine art and wines, line their walk-in closets with designer clothes and are unmoved by VAT and fuel price increases.A report by Sandton market research group New World Wealth and AfrAsia Bank suggests that South Africa's dollar millionaires are becoming richer.
A World Bank report this week named South Africa as the most unequal country in the world. Chiliza epitomises this disparity.
The report said 1% of South Africans owned 70.9% of the country's wealth while the bottom 60% controlled 7% of its assets.
According to the report, South Africa's private wealth, including property, equities and business interests, stood at $722-billion (over R8.6-trillion) last year, rising from $670-billion in 2016.
As of last year South Africa had 43,600 high-net-worth individuals - people with net assets of $1-million or more. In 2016 there were 40,400.
Multimillionaires - those with assets of more than $10-million - rose from 2,130 in 2016 to 2,200 last year.
The country had three more centimillionaires - 98 in 2017 compared with 95 the previous year - each with assets of more than $100-million.
The luxury sector in South Africa, which included cars, clothing and accessories, watches, private jets, yachts and luxury accommodation, generated over R26-billion last year.
Collectables, from art and classic cars to fine wine and stamps, "are a growing segment in South Africa", the report found.
The art market was valued at about R5.5-billion.Hugo Boss, Louis Vuitton, Burberry, Zegna and Jimmy Choo are what the super-rich are wearing, while Woolworths is the store of choice for luxury food.
When the rich take time off, they head for five-star hotels and game lodges in Kruger National Park, or go to Cape Town, Umhlanga or the Garden Route.
Small, ultra-plush boutique hotels in Franschhoek and Plettenberg Bay also appeal to the wealthy.
Umhlanga dollar millionaire Vesen Chetty, who has interests in retail and financial services, said that in his circles, "it's no longer about who's the next dollar millionaire, it's who is going to be the next double-digit millionaire or the next rand billionaire".
He added: "It's a very positive and encouraging sign for the economy that there are now more dollar millionaires in our country. This means greater investment and consumer spending, which leads to further job creation."
Chetty attributed the growth of high-net-worth individuals to the affluent investing in stocks and shares abroad.
Economist Dawie Roodt said the good performance of financial markets globally had resulted in the wealthy growing their riches.
"The financial markets have been doing very well, so the wealthy are becoming wealthier. In the past three to four years the average South African has become poorer because of the economy. But the rich have not done too badly because a lot of their assets are invested abroad," Roodt said.
Julie Smith of Pietermaritzburg Agency for Community Social Action, believes society "should shame excessive levels of wealth and question not only the ethics of this wealth but how it was accumulated".
She said: "We have to start seeing such high levels of inequality, caused by excessive wealth, as damaging to society."..

There’s never been a more important time to support independent media.

From World War 1 to present-day cosmopolitan South Africa and beyond, the Sunday Times has been a pillar in covering the stories that matter to you.

For just R80 you can become a premium member (digital access) and support a publication that has played an important political and social role in South Africa for over a century of Sundays. You can cancel anytime.

Already subscribed? Sign in below.

Questions or problems? Email or call 0860 52 52 00.