High population growth rates, shrinking budgets, and urban migration are some of the factors that have led to an increase in demand for jobs in South Africa. This demand cannot be met by the formal enterprise sector and many job seekers have to be absorbed in the informal sector. With many people being unemployed it is important that they be helped to regain their self-esteem by being economically active. When people are economically active it leads to their empowerment and they are able to address their needs. Abbey (1999:3) indicates that strategies to combat poverty must concentrate on ensuring empowerment and creating opportunities for the poor. The informal sector consists of a large mass of the excluded such as women, the illiterate, the voiceless and the unrepresented. The people in this sector tend to lack the infrastructure, technical and managerial expertise or knowledge, financial resources, transportation and information that would make them successful. The informal sector plays a very important role in addressing the unemployment crisis and alleviating poverty for the majority of people in South Africa. Support for the informal sector can be through micro-lenders who can help finance the poor when formal lending institutions are not able to assist them (Kirsten, van Zyl and Vink, 1998:13). Women and children are the most vulnerable groups when it comes to poverty. The informal sector could help them become organised small entrepreneurs to enable them to provide a decent living for themselves and their families. But for many women it is difficult to find credit institutions that can help them to start their own businesses. Some of the reasons could be that they do not have a credit record, are unemployed and do not have collateral when they apply for credit. Micro-lenders can be of help as they are at times able to provide credit to groups of people who are not able to obtain credit from formal institutions to start their own businesses (Russell, 1995:33). This study was undertaken because research on the determinants of rural poverty emanates from the increasing concern to understand the reasons for the failure of development strategies in many Third World countries to reduce mass poverty. The living standards of the majority of the rural population in the Third World have failed to improve. In many countries there has been deterioration in their living standards, especially among the lower income groups. This has happened not only in countries where no significant growth in per capita income was achieved, but also in those countries or areas where growth has been rapid (Elkan, 1988:175). Increased poverty has been accompanied by increased under-utilisation of human labour. Development literature, on the whole, does not provide satisfactory explanations for this phenomenon. This has contributed to a failure to design and implement appropriate strategies and policies (Kirsten, van Zyl and Vink, 1998:11). Economists have been working on economic strategies for decades. The main purpose has been to tackle the issue of poverty by addressing the economic evils of the world. But despite all the impressive efforts by economists, politicians and other experts in different disciplines, the majority of the world's population continues to be trapped in absolute poverty: a condition of life characterised by diseases, illiteracy, high infant mortality, squalid surroundings and low life expectancy (Kirsten, van Zyl and Vink, 1998:14). / Prof. C.S. van der Waal
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:uj/uj:9372 |
| Date | 09 June 2008 |
| Creators | Mphulo, Tshakane Refilwe |
| Source Sets | South African National ETD Portal |
| Detected Language | English |
| Type | Thesis |
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