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Slaves To Debt: Oh, What We Owe!

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If you want to know of the damage and desperation of debt, just ask 63-year-old Memory Oosthuizen.

Oosthuizen and her partner, Carol, felt the wrath of the 2008 recession when they lost their jobs. Money was tight and the going tough. They used up R750,000 ($56,000) of their retrenchment packages, retirement funds and even took up a second bond on their home to start a car washing business. It ushered in more financial problems.

“The business wasn’t doing so well because money was tight for a lot of people. We had to pay 10 of our staff members and pay our own bills. We also had to pay R25,000 ($1,900) rent at the business premises,” she says.

They turned to credit cards and loans to keep the business running.

“I had three credit cards and my spouse also had three credit cards. We got them so easily. I know that we have to be in control but when you are in a situation like that, it’s so easy to see it as a way out. You can have a credit card without a credit check in just a day. They would call you and say you have been pre-approved, even if you haven’t applied,” says Oosthuizen.

In just a year, the pair racked up R1.2 million ($90,000) in debt. Their landlord took their car washing equipment in lieu of unpaid rent.

“It was the toughest time of our lives. We struggled and had nothing. It was quite a humiliating situation… We managed to get out of debt through debt counselling but it took us years. I never want to be in debt again. Funnily enough, just the other day, I got an SMS from a bank offering me a credit card of R50,000 ($3,800). The banks tempt you by sending you such messages when you are in a bad situation.”

It may be tough to say no, but there is help. The two dug themselves out through debt counselling that is becoming a boom industry.

There is also a volunteer, Nicolette Mashile, who left her nine-to-five job to teach people how to handle money.

“I noticed people sign up for these financial products but they don’t really know what they are, what they will pay out or when they will pay out. I once had a policy with Old Mutual. It was the easiest thing to get into. I just filled in a contact form on the internet, they asked for my ID and all of a sudden I had a policy. The day I wanted to withdraw my money, it was a struggle,” says Mashile.

Nicolette Mashile (Photo supplied)

The worst thing, according to Mashile, is that qualified people are the most vulnerable. They have a salary and qualify for loans.

“A friend of mine wanted to buy a home and she got an approval at 16%. The prime at the time was 10.25%. Banks have a target to reach but remember sometimes it can be at your expense.”

Mashile, a social entrepreneur and self-taught financial literacy educator, says the problem is people don’t learn how to handle money at a young age.

“Most of us grow up in homes where it is cool to be in debt and they perpetuate the idea that everyone is in debt and it’s easy to get loans. Even at the ATM, there are options you can click to get a quick loan. You also find many people who have never had money and all of a sudden, they start working and they have R25,000. Why would they not buy a car? The other issue is that people don’t prioritize. Our attitude towards debt is a problem, we wish it away,” says Mashile.

She says people have to talk openly about debt and money, ask questions before taking credit, read contacts, understand their financial situation and live within their means.

“If you can’t afford something, you can’t afford it. Don’t become a slave to debt. Also don’t agree to interest rates that are high. Remember the bank needs you more than you need it,” says Mashile.

The big picture is frightening.

Statistics from the National Credit Regulator (NCR) show that, in South Africa alone, about 25 million people have active credit records and 10 million are in severe arrears. In the 2015/2016 financial year, total consumer credit in the country amounted to R1.66 trillion ($125 billion), an increase of 2.94% year-on-year.

South Africa saw a shift when government introduced the National Credit Act (NCA), in June 2007, to open up credit to those who struggled to get it. It worked, but problem is, it also steered the country down a slippery slope of debt. South Africa is one of the most over-indebted consumer nations in the world.

“The designers of the NCA naively thought this credit would be spent on ‘wealth creating assets’. What has transpired over the last 10 years is that the increase in mortgages and use of credit in funding businesses has been relatively dismal, and the vast majority of the increase in credit has been in expensive unsecured credit that has been spent on consumption with the recipients having very little, if anything, to show for it at the end of the last 10 years,” says DebtBusters CEO Ian Wason.

Wason says approval rates, for borrowing, have slowly been falling and are currently around 50% with some credit providers having approval rates in single figures. The regulators believe credit shouldn’t be given to those who can’t afford it. What is happening is some credit providers look at their books of business and ignore the individual’s affordability to pay.

“A good example is the furniture sector which tends to have 50% non-performing loans and the difference is those who pay are charged high interest and fees thus in the end making the business profitable. What is deeply frustrating is that the NCR has the power to increase the minimum expenses threshold that the credit providers have to use, currently at around 9% and less, and it has not done so,” he says.

At first glance, South Africans look relatively financially healthy with the debt to income ratio at 74%, compared to the UK at 145%. The difference is, the bulk of this debt, in developed nations like the UK, is backed by bricks and mortar, through mortgages, typically at interest rates around 2% and, in South Africa, unsecured debt is the big boom in town.

“Nearly 50% of South Africans’ debt is in expensive unsecured credit over shorter terms. Of the consumers that approach DebtBusters for help, they are spending an average of 98% of their income on debt repayments,” says Wason.

The World Bank’s Global Findex database found that, between 2013 and 2014, 86% of South Africans borrowed money. According to the survey, which interviewed 150,000 people over the age of 15 from 140 different economies, sub-Saharan Africa had the highest number of borrowers at 54%, with 42% using family and friends as sources of new loans. It’s not always the consumer’s fault. Lack of financial literacy and unscrupulous credit providers are some of the causes of Africa’s personal debt problem.

African Bank was arguably one of South Africa’s notorious biggest lending banks. At its worst, in August 2014, the bank had a loan book of around R60 billion ($4.5 billion). According to the Myburgh Report, the bank was receiving 60 to 80 complaints of reckless lending a month, mostly from debt counsellors, and was granting between 100,000 and 120,000 loans monthly.

That’s not all.

Capitec Bank, founded by one of Africa’s richest people and FORBES AFRICA cover, Michiel Le Roux, recently found itself in the headlines when consumer watchdog, Summit Financial Partners, served the bank with High Court papers. It was about the banks former multi-loan practices which relied on one prime agreement that gave the consumer 12 different payday loans.

“Their product was most certainly illegal in that it was either reckless, because no proper affordability assessment was done, or charged initiation fees incorrectly… Unsecured credit in South Africa charges interest on a fixed rate basis, thereby not affecting the consumer when rates increase. However, interest, initiation and service fees on these payday loans mean the total cost of such multi-loans vary between 150% and 450% making prime rate adjustments immaterial. Capitec has been able to create a few billionaires sitting in Stellenbosch by charging such ludicrous rates on payday loans, since their inception, to the financially ignorant masses who don’t understand the consequences of such high yields. Further, we have many cases where Capitec actually prey on these ignorant, vulnerable groups to get stuck in debt spirals thereby relying on Capitec’s monthly payday loans to stay afloat,” says Clark Gardner, CEO at Summit Financial Partners.

There is more.

In March this year, the NCR announced that it had referred Wesbank, a division of FirstRand Bank, to the National Consumer Tribunal, for alleged breaches of the National Credit Act 34 of 2005, after an investigation found that Wesbank, through its debt collection agents, coaxed defaulting consumers into surrendering ownership of their motor vehicles.

“Consumers are reminded that a credit provider can only repossess a motor vehicle from the consumer if there is a court order authorizing the credit provider to do so,” says Jacqueline Peters, NCR’s Manager for Investigations and Enforcement.

Wesbank says it respects the NCR’s decision to refer the matter to the National Consumer Tribunal, however, disagrees with the conclusions.

“This referral does not constitute non-compliance with the National Credit Act but is instead a result of differing interpretation of the applicable legislation. WesBank has a strong commitment towards achieving fair treatment of our customers and will continue to cooperate with the National Credit Regulator and the National Consumer Tribunal,” it says in a statement.

Small credit providers are also guilty.

In September 2015, the National Consumer Tribunal cancelled the registration of credit provider, Mayibuye Cash Loans, following a lengthy investigation that found the company failed to conduct affordability assessments; to provide copies of pre-agreement statements and quotations; and charged interest and fees in excess of the prescribed rate.

It can destroy lives.

Maybe it’s time you get your head out of the sand.

‘You Can’t Borrow Your Way Out Of Debt’

The tale of an entrepreneur who saw money in the keys that free people from debt slavery. 

Neil Roets (Photo supplied)

Imagine working all your life and more than 98% of your income goes towards debt? Maybe it was that luxury car you knew you couldn’t really afford or that fateful day you said yes to a credit card?

Ten million people, in South Africa alone, plus millions more across the continent, are in severe debt according the National Credit Regulator. On the other side of the coin, smart entrepreneurs have seen a gap.

Neil Roets saw an opportunity to make money, from people without money, when the National Credit Act was introduced in 2007. At the time, he was in conveyancing where he saw the ravages of a tough recession and struggling economy.

“I experienced first-hand how people were struggling to pay their bills and couldn’t get loans. I realized people needed debt counselling so I did a course, and thereafter went on the quest to start Debt Rescue,” says Roets.

Debt Rescue makes a repayment plan, through budget advice and negotiation with credit providers, for reduced payments and the restructuring of debts.

The difficulty for the business was very few people knew about debt counselling.

“Coming out of a legal background, I understood the process but just getting the word out to people, so they know there is help out there, was the most difficult… because of the name, people sometimes think debt counselling is just sitting on a couch and talking but that’s not the case,” he says.

Another problem was people didn’t understand how debt counsellors make money from helping people who are already struggling to pay their bills.

“The fees are regulated and worked out based on what you can afford to pay your credit provider on a monthly basis. After we have worked out what your monthly instalment would be, the first instalment comes to us, and is capped at R6,000 ($450). We also have an aftercare fee of 5% of the amount that needs to go to the credit provider which is also capped at R400 ($30).”

Debt counselling is big business. Debt Rescue, alone, signs close to 1,000 clients a month and employs 110 people. Imagine how much debt that is? Roets feels a lot more people should be under debt review.

“The National Credit Regulator statistics show that 45% of all credit active consumers are over-indebted meaning that they are in areas with at least three payments on one of their accounts. That amounts to more than 9 million credit active consumers in South Africa that can benefit from debt counselling but currently there are close to about 300,000 people under debt review,” he says.

Many of these consumers are in a fix because credit providers are pushing unsecured credit.

“People are financing their lives, and even buying clothes and food, through credit. That’s very worrying because you should never finance your life through credit. If you can’t afford it, you can’t afford it. People forget that if you finance it now, you have to pay it back with interest meaning next month you will be in a worse situation. You can’t borrow your way out of debt,” says Roets.

There may be a business opportunity in the debt counselling industry but Roets warns it needs entrepreneurs of steel, who also understand legal processes.

“There are over 3,000 registered debt counsellors but you only really see the big five companies featuring all over. The process is not easy, you have to form relationships with the credit providers otherwise you won’t get a good deal for your client.”

Debt is not going to go away, in Africa, in the 21st century.

Did you know?

To qualify for debt counselling, you need to be over-indebted as defined by the National Credit Act – that is, you can’t repay your minimum monthly instalments. This is determined by a debt counsellor. While you are on debt review, you can’t take out further debt.

Tips To Avoid The Debt Trap

  1. Say no to a credit card
  2. Check your interest rates
  3. Don’t buy without a budget
  4. Look for best value when making purchases
  5. Don’t finance living expenses and luxury goods with credit
  6. Never take out a loan
  7. Have an emergency fund
  8. Pay bills on time
  9. Save and buy cash
  10. Always read your terms and conditions and understand your contract before signing on the dotted line

Daughter Of Debt

The life of a college graduate who grew up watching her mother pile up debt, and feels the pain 30 years later.

 

Photo by Getty Images

Debt reaches down through the generations. At just 30 years old, Luba Dube* has seen enough debt for three lifetimes. It all started when she was in primary school, when her parents separated.

“At first it was subtle. I remember on payday, my mom would buy us a lot of things and three days later we would be broke again… She would send us to go borrow small amounts like R50, or send us to return money she had borrowed,” she says.

When Dube went to high school, it got worse.

“My sister, at the time, had just started working and wasn’t making a lot of money but a lot of responsibility fell on her. I was a weekly boarder and she even had to pay R250 per week towards my boarding fees.”

Dube realized something was seriously wrong. Her mother never had money. She searched for a way out – there was none. Debt loomed ever larger.

“There were times we had to suddenly move because of unpaid rent… Whenever it was approaching the first of the month, I could see there was a lot of tension and stress in the house. We, as kids, would also get stressed because the landlord would come ask for rent and we would have to open the door when mom wasn’t home. Sometimes she would come home very late at night trying to dodge the landlord and we were the ones who had to answer,” she says.

Older sisters tried to help. They moved Dube’s mother to a cheaper house where she would use one bedroom, and have tenants in two others, so she could pay as little as R1,000 ($75) in rent. It didn’t help.

“Even though the tenants paid rent, she collected the money but it wasn’t going where it was supposed to. I realized that if the relationship with money doesn’t change, it doesn’t matter what we do to try and help.”

According to Dube, the worst thing was that her mother appeared desensitized to borrowing money that she never returned. Her children ended up more worried about the debt than she was.

“She would even borrow someone else’s rent money with the promise to return it, in time, knowing she might not be able to. I have not been able to understand her lack of respect for other people’s money,” says Dube.

In Dube’s view, when her over-indebted mother needs to get money, she tries to get it at all cost. One of the worst examples was when her mother spent close to a R100,000 ($7,500) of her client’s money. She was supposed to put the money in a trust so her client could buy a home. To make matters worse, this was money from a disability pay out.

“These were people’s livelihoods. We just had to do what we could to make sure the people got their money back. I had to borrow money I had no intention to borrow. For a good year, my stuff was on hold so I could pay that back.”

It wasn’t the first time Dube has bailed her mother out.

“Sometimes I have had to say ‘no’ because her relationship with money still hasn’t changed. When I was a kid there was nothing I could do but now, because I’m a grownup, I try to have these conversations with her but it’s very difficult because of the child/parent relationship,” she says.

So, if you are in debt up to your ears, it’s not only you who is suffering; just ask your daughter.

How Your Socks Can End Up Around Your Ankles

Sbusiso Ngwenya jumped for joy when he made the FORBES AFRICA 30 under 30 list with his money-making colourful socks. What you don’t know is that, last year, he lost it all in a dangerous dance with debt.

Sbusiso Ngwenya (Photo by Jay Caboz)

 

It all began, so innocently, with a golden opportunity to put his socks on the shelves.

“I was so excited when Stuttafords gave me the opportunity to list my products. I was so happy I signed the contract out of trust only to find that, by listing my products there, it means that I agree to only buying retail space… I signed a deal I didn’t understand that just emptied my pockets,” he says.

It cost a pretty penny to buy shelf space at Stuttafords, one of South Africa’s top retailers. Sock sales came to about R40,000 ($3,000) a month at best and a mere R2,000 ($150) or R1,000 ($75) at worst.

“There was also a big spend on making sure we market the products and drive traffic to the store. At the time, the store itself wasn’t doing well and less and less people were going there… it was tough but we tried to keep up appearances for it to seem like we are doing well,” says Ngwenya.

It was expensive. He started taking money from his corporate division, that distributes bulk unbranded socks, to finance Skinny Sbu Socks. The problem was he was also living a life of a rock star, traveling, partying and buying gifts for girls; all through the business account.

“Stuttafords was taking a big percentage of the money and all in all, in just a year, all these things cost me R800,000 ($60,000).”

The whole business suffered. He tried to take up speaking engagements to supplement the income. It didn’t help.

“I started borrowing money from friends and family just to survive. I lost my apartment, car and everything. I couldn’t afford the life I was living anymore and my debts kept piling.”

He moved back home, to Tsakane, a township east of Johannesburg, with his grandmother. It humbled him. It was time to start over.

“My sister went out of her way and took a huge personal loan to help me. My uncle also played a huge role in helping me. I needed someone who could look out for the numbers of the business so we didn’t mismanage the money,” says Ngwenya.

His uncle was what he needed. He helped him revive the dying business.

“We did a whole turn around to make sure we build up the business again. I am now very careful with every rand. It was a huge character-building experience that taught me not to rush into things and not to treat a business account as a personal account.”

Together with his uncle, they are also reassessing the business marketing strategy and ensuring Ngwenya concentrates on the creative design of the socks.

“I am happy this happened now rather than in 10 years when I have a family and larger responsibilities.  Someone once said to me ‘you didn’t go to school to study what you are doing. This mistake was your school fees. You needed something that was going to wake you up’. Unfortunately I had to pay close to R1 million ($76,500) for my fees,” says Ngwenya.

Let’s hope he pulls up his socks.

Did You Know?

  • If you default on your debts your credit provider can, and will, take legal action against you which will result in a judgement and can involve an emolument attachment order, or garnishee order as it is more commonly known, where the court can order your employer to deduct a payment from your salary every month to pay your debt.
  • A default will stay on your credit record for six months, and sometimes up to 12 months. Judgements are on there for 30 years unless you repay the debt! If you do repay a judgement then it has to be removed from the bureaus within seven days.
  • If you spend money you don’t have, on things you don’t need, to impress people you don’t even like, maybe it’s time to get help.

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A Statement On The Skyline

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South Africa is on its way to another record with Africa’s tallest building.


A new superstructure is making its mark in Sandton in the heart of Africa’s richest square mile.

The $3 billion project is expected to be completed by the end of 2019 and beat Carlton Centre’s reign as the tallest building in Africa since 1973.

The 223-meter, 50-storey Carlton Centre in Johannesburg has for 46 years stood the test of time as a skyscraper dominating the skyline in South Africa and the continent.

The new building coming up in Sandton will be a 55-storey, 234-meter classical Italian eponym paying homage to Leonardo da Vinci, the Italian artist of the Renaissance era.

READ MORE | Re-constructing Johannesburg The City Of Opportunity

It adds to the luxurious portfolio of hotels by the Legacy Living property group.

As The Leonardo rising from the bedrock and gradually etches its presence on the skyline, Gijs Foden, Director of Retail Management in Legacy Living, says it is a beacon that represents economic growth far beyond the surface.

“From a development perspective, everyone knows about the crisis in construction. There is light at the end of the tunnel, through a tough economy. It is a tough market and we are working our way out of it. We are going up. We are part of the beacon of hope through tough times,” he says.

South Africa has nine out of 20 of the continent’s tallest buildings, amounting to 1,277 meters in total and 5,000 steps up a staircase.

While most of these buildings were erected in the 1900s and early 2000s, records have stayed the same.

Johannesburg’s Ponte City Tower standing as the third tallest building in Africa, coming in after Kenya’s Britam Tower at 200 meters.

The Leonardo was initially set out to be a mixed-use building with 33 floors but has since escalated to dominating the South African skyscraper inventory.

Foden says the development will not only provide investment opportunities for South Africa, but it will celebrate African authenticity.

Set to be completed in the year of Leonardo Da Vinci’s 500th death anniversary, African art will be the center-piece of the tower.

You look out of the window and that is your canvas. Internally, the art in the building is African art.

“We are supporting the African artist, it is what it is. The art defines the building. Keeping the essence of the building and at the same time the warmth and lifestyle will be an attraction, irrespective of the Italian name,” Foden says.

By following due processes in getting the height approved, overtaking Carlton Centre’s record, Foden says: “It [Carlton Centre] is still an icon and no one has been able to beat it. It is different times and it is also different generations. This is our generation which is going to be a timeless building for many years to come. It is an urban flight.”

However, the record by The Leonardo may be short-lived as yet another African skyscraper may overshadow it by the end of 2021.

 The Pinnacle, currently being built in Nairobi’s financial hub, is set to be a 70-storey mixed-use development.

According to a yearly study published by The Council on Tall Buildings and Urban Habitat (CTBUH), Beijing’s China Zun 528-meter skyscraper was the tallest building completed in 2018, making it the eighth-tallest building in the world.

 The study reports that 16 new buildings entered the 100 tallest lists in 2018; up from 14 in 2017, 76% of these were in Asia.

Co-Arc Director, Francois Pienaar, says the influx of skyscrapers in Africa is a way for property investors and developers to exploit the options of sites.

“Sites can become very valuable. There are a lot of things to do with money – [for] better returns for the investment of the land, and that is why people go up. It takes quite a lot of courage, to go 55 floors.

You need to have a client who is inspired to do it. Especially, with the volatility of Africa,” Pienaar says. 

Despite the competition for a piece of the sky, none of the 2019 projected top 30 tallest buildings will supersede the world’s tallest building in Dubai at a towering 829.8 meters with 163 floors above the ground.

The Burj Khalifa has boasted this record since its completion in 2010.

According to Pienaar, the opportunity to build a structure of this magnitude does not come by every day in Africa.

Breaking his 30-storey skyscraping record, Pienaar, who is currently working on The Leonardo, adds:  “It takes a lot more when it comes to delivering services and the kinds of aesthetics that take place.

READ MORE | Richest Cities In The World: The Top 10 Cities With The Most Billionaires

“The building has a skin outside which is imported from Spain. It is a new invention from Spain that reduces the heat load on the glass. We have produced a building that is responsible for the climate. We are trying to keep the building energy-efficient,” he says.

As the global economic outlook develops, there is fierce competition for a piece of the sky.

The taller the building, the more money it pulls in.

As the South African economy picks itself up, the lingering shadow of the Leonardo will represent a symbol of growth and a new dawn.

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Lab-grown Diamonds: Never Mined, It’s Man-Made

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Turns out there is literally no difference between lab-grown diamonds and natural diamonds, well, apart from the price.


Ever wondered what the difference between lab-produced diamonds and natural diamonds was? Well, nothing. They are exactly the same.

As with most things of value, a great deal of information has been produced over the years about the price of diamonds. In short, many believe the real price of diamonds is far lower than what ‘big business’ would have us believe and that it is driven up by our insatiable hunger and the social importance we place on the stones.

In line with this, there is a widely-held belief that they are not rare and the market is being deliberately controlled to create the façade that they are difficult to produce. Therefore, their price is dictated by the fact that they symbolize the most enduring of all human emotions – love.

 With that out of the way, in recent times, society has developed a pragmatic relationship with diamonds, rather than a romantic one that has long sustained the industry.

It might be that we live in the era of instant gratification or that we have stopped romanticising the idea of waiting millions of years for the precious stone, but more people have embraced the idea of purchasing lab-grown diamonds.

READ MORE | From Medicine To Nanotechnology: How Gold Quietly Shapes Our World

Unlike an imitation gem like cubic zirconia, it has the same physical characteristics and chemical components as a natural diamond but production time is much shorter, enabling producers to create it in a matter of weeks.

Lab-grown diamonds producer Ross Reid offers FORBES AFRICA a very sobering perspective with the following analogy to describe man-made diamonds.

“If a couple can’t fall pregnant using conventional methods, they do IVF where the baby’s origin of life is manmade. Is that not a real baby when it’s born?”

The room falls silent as all contemplate this question.

“So by that logic, it is a real diamond,” Reid states emphatically.

Reid is the Co-Founder and Managing Director of Inception Diamonds, One of South Africa’s first Diamond companies to offer lab-grown diamonds and fine jewelry.

The world’s leading diamond producer, De Beers, however, has a different perspective.

“We view natural diamonds and lab-grown diamonds as very different products as they have completely different production processes. Natural diamonds are created in the earth, under intense heat and pressure over billions of years. Each diamond is rare, finite and unique,” says Bianca Ruakere, a De Beers Group spokesperson.


De Beers Lightbox range. Picture: De Beers

Reid says he recognizes the market potential for global growth in being able to offer conflict-free, environmentally-friendly lab-grown diamonds, especially to the millennial market.

“With the creation of laboratory-grown diamonds, it allows you to offer the consumer the same thing optically, physically, and chemically at a big discount. So you can have the same beauty, the same hardness, the same look and the same feel for less money,” Reid says.

Large diamond producers have also recognized the same potential.

De Beers Group has been producing synthetic diamonds for industrial purposes for more than 50 years. “Last year, we launched Lightbox in the United States to market a range of fun, fashion jewelry using lab-grown diamonds. They are accessibly priced, and a distinct product offering compared with natural diamonds,” Ruakere says.

 Price is not the only reason that encourages the market to opt for lab-grown diamonds. They are also other ethical factors such as having a guarantee that the rock on your finger is conflict-free.

 Shogan Naidoo, who proposed to his fiancé, Preba Iyavoo, on Valentine’s Day at the popular independent cinema house, The Bioscope, did so with a healthy bank balance and clean conscience.

They were traditionally engaged in July last year, so by the time the ring engagement happened, Iyavoo was caught completely off-guard and was pleasantly surprised.

“Shogan is the most endearing person, but he’s not romantic in the slightest,” says a giddy Iyavoo, who recalls the proposal that happened in a filled theater, with a movie Naidoo had created just for her.

The couple are besotted with their lab-grown diamond. Naidoo says after doing exhaustive research to find the perfect ring to propose with, all conventional options had failed him.

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 He says his final ring choice far exceeded his expectations in price and design. Naidoo explains that Iyavoo has a very specific preference and that he was not willing to compromise in getting her the perfect ring but the one he initially wanted was in the range of R80,000 ($5,500).

  “We were planning a wedding and we’d just bought a house,” he says. The exorbitant cost of retail rings led him to search out of the box, and eventually the box returned with the perfect gem.

 The couple who lead a very environmentally-conscious lifestyle, say they are especially proud to be the custodians of this ring because they are guaranteed it’s conflict-free and no miners were exploited.

 Reid says he has to grapple with a great deal of scepticism because many are not ready to fully embrace the idea of lab-grown diamonds despite their advantages.

“The Federal Trade Commission has changed the definition of a diamond. It does not need to come from the ground.

“We have opened up the market for people to be able to afford beautiful pieces without compromising on quality,” Reid says.

Change is inevitable and with that, there will always be those resistant to it. But one thing is for sure, society’s relationship with diamonds are changing.

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A New Language Doesn’t Hamper Kids Learning. Other Things Do

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South Africa is a linguistically and culturally diverse country. There are 11 official languages and several other minority languages. But English continues to be preferred as the language of learning and teaching.

Many South African children are still in the process of learning English by the time they first start going to school. In a single English-medium classroom, one can find children with various levels of English proficiency; from children with English as their mother tongue to children who have never learnt English before.

This situation poses a range of challenges for both the teacher and the children. One of the biggest challenges is that a certain level of proficiency in English is required for the children to be able to perform well academically in an English-medium school. It’s a widely known factthat academic success is very much dependent on language competence and proficiency.

READ MORE | African Curricula That Mean Business

This means that there’s a great need to understand how language develops in children’s early school careers. It is also important to understand the cognitive mechanisms that underlie language learning. To further explore how this happens in the early years of schooling I did a study involving pre-primary children in an English-medium school in Cape Town.

The group consisted of children who were still learning English as well as children whose mother tongue was English. The children were very diverse – there was a total of nine different home languages in the group of children who were still learning English.

The findings showed that the ability of children to develop their language skills didn’t depend on whether they were proficient when they started out. Their ability to learn and advance – or not – was in fact dependent on a range of other factors, none of which had to do with English language proficiency.

The findings

The research aimed to understand the link between language and working memory development. I did this by tracking how working memory developed for the children chosen to take part in the study.

Working memory is the ability to store and use information in the short-term and is important for our everyday lives. For example, we use working memory when we need to remember an address that we just heard while we are looking for a pen to write it down. Working memory also underlies many important academic competencies, like reading and mathematics.

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The children were broken into two groups: those with English as their primary language, and those still learning English. They were given the same tasks; these were an English language assessment and working memory tasks. They were assessed three times over the course of the year – at the beginning, middle and end.

The results showed that both groups improved over the year on the assessment of English language abilities. The results also revealed that great improvements were made in language development during the first year of formal schooling.

Results from the working memory tasks indicated that children who were still learning English, as well as the children who have English as their mother tongue, performed the same on these tasks and achieved comparable scores. Children in both groups saw their language abilities and working memory abilities improve over the year.

The most interesting finding is that the route, or trajectory, the children’s cognitive and language development followed was the same for both groups, regardless of the English abilities they had at the beginning.

Importantly, the result that working memory scores between groups were comparable also indicated that the amount of knowledge of English that a child had didn’t affect their working memory abilities.

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What this points to is that, if a child’s working memory scores are low and the trajectory of the development is not the same as their peers, there may be cause for concern. In this case, the children should be referred to an occupational or speech therapist for further assessment. Our research shows the fact that they’re struggling can’t simply be explained away as a “symptom” of the child not knowing English well enough.

Falling through the cracks

Studies like these are important for giving professionals better ways of seeing if a child has a disorder or is only struggling because they have not acquired a sufficient level of English yet.

In the context of a classroom with various languages and proficiencies of English, it is easy for a child with a disorder to be overlooked.

Along with the under-resourced schools and over-burdened teachers, heterogeneity among learners results in them not receiving the support that they need, be it academic or linguistic. Those whose primary language is English as well as those learning English suffer alike. The upshot is clearly seen in the worsening educational crisis in South Africa.

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