Critically discuss how can financial fraud and corruption contributes to an increase of youth unemployment in south africa?

Question: Critically discuss how can financial fraud and corruption contributes to an increase of youth unemployment in south africa?

Financial fraud and corruption are serious problems that affect the economy and society of South Africa. They undermine the trust and confidence of investors, businesses, and citizens, and they divert scarce resources from productive sectors to illicit activities. One of the negative consequences of financial fraud and corruption is the increase of youth unemployment, which is a major challenge for the country.

Youth unemployment is defined as the percentage of people aged 15 to 24 who are not working and are actively looking for work. According to Statistics South Africa, the youth unemployment rate in South Africa was 64.4% in the second quarter of 2021, the highest in the world. This means that almost two out of three young people in South Africa are jobless and have little prospects for the future.

How can financial fraud and corruption contribute to this situation? There are several ways:

- Financial fraud and corruption reduce the tax revenue that the government can use to fund public services, such as education, health, and infrastructure. These services are essential for creating a skilled and healthy workforce, and for improving the business environment and competitiveness of the country. Without adequate public services, many young people lack the qualifications and opportunities to access the labor market or start their own businesses.

- Financial fraud and corruption distort the allocation of resources and create an unfair advantage for those who engage in or benefit from them. This reduces the efficiency and productivity of the economy, and discourages innovation and entrepreneurship. It also creates a culture of impunity and cynicism, where young people feel that merit and hard work do not matter, and that success depends on connections and corruption.

- Financial fraud and corruption erode the social fabric and trust in institutions, which are vital for a stable and cohesive society. They increase inequality and poverty, and fuel resentment and frustration among young people who feel excluded and marginalized. They also undermine the legitimacy and accountability of the government, which is supposed to represent and protect the interests of the people. This can lead to social unrest, violence, and instability, which further damage the economy and security of the country.

Therefore, financial fraud and corruption are not only moral issues, but also economic and social issues that have a direct impact on the lives and prospects of young people in South Africa. To address these problems, it is necessary to strengthen the rule of law, transparency, accountability, and participation in the public sector, as well as to promote ethical values, education, and civic engagement in the private sector and civil society. By doing so, South Africa can create a more inclusive, prosperous, and sustainable future for its youth.