A new Oxfam report has revealed a staggering wealth gap in Africa, showing that just four individuals now possess more wealth than half of the continent’s 750 million people combined. The poverty-fighting group Oxfam on Wednesday said this increasing wealth gap was eroding democracy throughout Africa.
Oxfam included Nigerian businessman Aliko Dangote, who is the wealthiest man on the continent, as one of the four. While the report did not specify the others, Forbes has them as Johann Rupert and Nicky Oppenheimer, the South African billionaires, and Egyptian entrepreneur Nassef Sawiris.
According to the report, Africa’s billionaire class has seen their fortunes soar by 56 percent over the past five years, with the richest among them recording even larger gains. Oxfam argues that this growing concentration of wealth is no coincidence – it is a direct result of government policies that benefit the elite while neglecting the needs of the poor.
Nearly half of the 50 most unequal countries in the world are in Africa, the report noted. Oxfam pointed out that most African governments have failed to adopt progressive tax systems that would require the wealthiest to pay a fair share.
“Most African countries are not fully leveraging progressive taxation to effectively tax the super-rich and address inequality,” the report stated.
But the responsibility doesn’t fall on African leaders alone. Oxfam also blamed the International Monetary Fund for promoting regressive policies that exacerbate inequality. The report also implicated illicit financial flows, particularly the use of offshore tax havens which enable wealthy individuals and corporations to hide vast amounts of money abroad.
The charity warned growing inequality is sapping democracy, slowing the elimination of poverty, and driving the climate emergency. It said the wealthy use politics to serve themselves, hijacking policies for the poor and undermining public institutions.
In the largest democracy in Africa, Nigeria, Oxfam provided an illustration of how inequality prevents political participation. According to the report, political parties’ expensive nomination fees to stand for election exclude ordinary citizens from contesting seats and lock leadership into the hands of the elite.
And vote-buying remains widespread in countries where tens of millions of individuals live in abject poverty, further eroding democratic institutions across the continent.
In spite of the setbacks, Oxfam says nearly 90% of African countries since 2022 have stepped back from significant policies on taxation, workers’ rights, and minimum wages – policies the agency says are crucial to closing the inequality gap.
In order to reverse this, Oxfam is calling for a complete overhaul of tax authorities right across Africa. The charity revealed that current tax systems right across the continent are nearly three times worse at redistributing income from the wealthiest one percent than the global average.
The report further indicated that Africa loses approximately $88.6 billion each year due to illicit financial flows, including tax evasion and the use of offshore financial havens to conceal assets.
Oxfam’s review of the tax policies of 151 nations revealed that Africa was the only continent where nations have not increased effective tax rates since 1980, which underscores the immediate need for reform in order to tackle the widening wealth gap.
