Democracy in Peril: In South Africa, Will Philanthropy Back Economic Justice?

South Africa has long been considered exceptional among African nations for its relatively robust democracy. Thirty years ago, South Africa held its first democratic post-apartheid elections. Today, that democracy is fraying.

To support South African democracy, philanthropy faces two challenges. One is that many foundations, under the guise of philanthropic pluralism, have supported a status quo that has harmed South Africa’s Black majority.

The other is that global philanthropy itself is under threat as South African “populist” opposition advocates for so-called “foreign agent laws.” These laws, purportedly designed as a check on foreign interference, limit civil society organizations and restrict democratic practice by cutting off funding from foundations to movement organizations.

Thirty years ago, South Africa held its first democratic post-apartheid elections. Today, that democracy is fraying.

Similar laws have already rapidly spread across Europe and Central Asia, yet South Africa has avoided them so far. However, the opposition bloc in South Africa, which includes former President Jacob Zuma, wants a foreign agent law to be introduced to curb allegedly “undesirable” global philanthropies.

Philanthropy has the opportunity to support democracy in South Africa, but will only be successful if the sector has a proper understanding of the vital links between economic and political democracy.

A Bittersweet Democracy

The cracks in South Africa’s democracy are deepening. It is not unusual to hear critical leaders warning of the country becoming a banana republic. Yet despite these challenges, global philanthropy has much to learn from South Africa on democracy, development practice, and social justice.

As the Independent Philanthropy Association South Africa (IPASA) stated, “committed and knowledgeable philanthropists can make a meaningful impact and facilitate change for the better in South Africa.”

But are philanthropists willing to learn and support economic justice?

One defining feature at the core of South African democracy is its constitution. In “South Africa Is Not a Metaphor,” New York Times columnist Lydia Polgreen notes, after witnessing the May 2024 elections:

South Africa has long loomed large in the global imagination. It is a country that was born at a particularly potent time in human history, at the end of the Cold War, built in the aftermath of grave injustice and constituted under a set of egalitarian ideas. It was, and is, as a new democracy, a symbol of what a new future might look like.

Democracy only works if it works for the people and delivers a better life for South Africans. Ironically, the latter was the African National Congress (ANC)’s 2024 election slogan. Still, the party has seen declining support over the last several years and lost its parliamentary majority this year for the first time since 1994.

A Government of National Unity

As a response to the dwindling support, the ANC agreed to form a coalition government. The last time we had one was when Nelson Mandela was president. So, what should we expect from President Cyril Ramaphosa’s Government of National Unity?

The statement of intent from the government in part reads: “At this historic juncture, we must act to ensure stability and peace, tackling the triple challenges of poverty, unemployment and inequality, entrench our constitutional democracy and the rule of law, and to build a South Africa for all its people.”

With an estimated 55.5 percent of the country’s 63 million people living in poverty, gross domestic product growth that slowed to 0.6 percent in 2023, unemployment that hovers above 30 percent, racial inequality, and the extremely high cost of living, the challenges are significant. Not to mention other severe issues, such as HIV, gender-based violence, and over 2 million migrants, both documented and undocumented, with a massive asylum applications backlog.

Democracy only works if it works for the people and delivers a better life for South Africans.

Does Western philanthropy make a positive difference? If you compare what donors say with what communities say off camera, you quickly see the pitfalls of traditional donor-recipient power relationships, passive funding, and philanthropic pluralism. And political constraints impede development practices. Without a continuous process of listening, learning, and improving, the communities in the most need are disconnected from the efforts that could most benefit them. The truth is, for the Black majority, there is nothing much to celebrate about South African democracy today except self-deception.

The Need for Economic Justice

Curiously, all the things that are blamed for the ANC’s decline—political corruption, poor service delivery, massive unemployment, deepening poverty, glaring racial disparities, high migrant inflows, and so on—boil down to one demand among the Black majority in South Africa: economic justice.

In 2022, ANC veteran and former Cabinet Minister Lindiwe Sisulu asked: “How long will the center hold if economic reconciliation, restoration of the land and meaningful redistribution of wealth is not addressed as a matter of urgency?”

She added: “We have a neoliberal constitution with foreign inspiration, but who are the interpreters? And where is the African value system of this constitution and the rule of law?…If the law does not work for Africans in Africa, then what is the use of the rule of law?”

Zuma, who is also a former ANC president, went on to launch the MK Party in December 2023, which became the third-largest parliamentary party after the May 2024 elections. His party wants to scrap the constitution and replace it with a system of parliamentary supremacy.

Meanwhile, voter turnout was only 59 percent. According to Afrobarometer, between 2011 and 2024, levels of public satisfaction with the democratic state also plummeted to 39 percent from 60 percent.

Two Nations: One Rich, One Poor

In both Limpopo and Eastern Cape—two of South Africa’s most impoverished provinces—the ANC achieved over 60 percent of the vote. This support comes despite the fact that their ANC-led governments have been largely ineffective. For example, Limpopo returned over US $6 million in unspent grants—money earmarked for community development—back to the Treasury from 2022 to 2023. Even more dramatically, Eastern Cape rural municipalities have returned more than US $100 million of unspent funds since 2019.

While the reasons for unspent funds can vary (common causes include staffing issues and poor planning), the result is the same: much-needed infrastructure projects, such as electrification and improving water quality, come to a halt. And without strong social movements, public pressure on government in poorly resourced communities to meet people’s needs frequently falls short—a phenomenon often described as having a “weak state.”

Philanthropy often supports neoliberal policies that reinforce the market power of elites—and perpetuate poverty.

Where is philanthropy? Not in Limpopo and Eastern Cape. Maybe philanthropists prefer places like Cape Town near Table Mountain or Johannesburg, where they can easily take a weekend trip to Kruger National Park. The United States has similar patterns, where, for example, philanthropic spending per capita in New York state is more than five times what it is in the South.

In My Own Liberator, retired Deputy Chief Justice Dikgang Moseneke notes:

The spectre of a stagnant economy yielding widening social inequality, stubborn unemployment, and a growing and poorer underclass is not only stressful but also deeply at odds with our notions of a just society. This threatens to wipe out our democratic dividend.

Ex-President Thabo Mbeki once opined that South Africa is a two-nation society. He was right: one nation, a minority, is filthy rich and largely White; the other, predominantly Black, is poverty-stricken and less capable of claiming basic rights.

Did Mbeki do anything about it while in office? Some say he did his best. Others say he was preoccupied with economic growth, experimenting with neoliberal policies at the expense of poor South Africans. As President Cyril Ramaphosa noted in his opening of Parliament in July 2024, even in the best of times when companies are making massive profits, the majority of the people are left in abject poverty.

The Struggle for Economic Democracy

Economic injustice is multidimensional. Poverty, unemployment, and inequality are all symptoms of a deeper problem: the lack of economic democracy. Yet philanthropy often supports neoliberal policies that reinforce the market power of elites—and perpetuate poverty. If foundations see themselves as part of civil society, they must stop doing this.

In his journal article, “The Meaning of Economic Democracy,” the late Canadian political scientist professor C.B. MacPherson described economic democracy “as an economic order which would make possible the realization of the purposes or values which political democracy can no longer realize by itself.”

“Alternatively,” he wrote, “it may be defined as an economic order which would make democracy work, or permit it to be more nearly democratic.”

Dēmos, a US-based nonprofit public policy organization, says economic democracy ranges “from scenarios in which communities decide how to manage their collective needs like affordable housing and energy, to creating access channels that allow more people to participate at all levels of the government.”

I would argue that every private foundation and public charity, whatever it does, can find resonance in economic democracy. Once they begin to realize that, they will win the confidence of a majority of South Africans. They will learn that political constraints are not distractions and that public participation is true democracy in action.

As Cyril Ramaphosa Foundation CEO Mmabatho Maboya wrote in IPASA’s 2022 Annual Review of South African Philanthropy:

The notion of philanthropy as a practice aimed at addressing poverty and inequality in order to promote development must be nurtured as the basis for philanthropy’s identity in democratic South Africa. To this end, organized philanthropy must confront the widespread, negative view of philanthropy as a hidden hand that supports regime change and seeks to undermine democracy by funding anti-progressive players in communities.

Maboya is right—ordinary people want economic justice. There is no better time than now, with a government of national unity, for global philanthropy to step up and promote economic justice. They can do so by increasing support to social justice nonprofits to mobilize communities for economic justice and promoting meaningful participation in community planning.