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Sub Saharan Africa
South Africa |
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Country information
Economy
Basic economic facts
GDP: US$276.5 billion (2008 estimate)Annual growth: 3.1% (2008 estimate).
Inflation: Annually 8.6% (February 2009)
Major industries: mining (world's largest producer of platinum, gold, chromium), automobile assembly, machinery, textile, iron & steel, chemicals, fertiliser, foodstuffs; financial services; manufacturing; wholesale & retail trade; transport, storage & communication; mining; other
Major trading partners: US, UK, Germany, Japan
Exchange rate: (March 2009 average) ZAR US$ – 9.33
In part, South Africa has a sophisticated economy based on manufacturing, mining and financial services, in which macro-economic indicators like interest rates and the strength of the Rand are critical. But it also has an economy consisting of the very poor who eke out a living through near-subsistence agriculture or the informal sector, for whom economic statistics mean little. Relatively small improvements in living standards can make a huge difference to their lives. Unemployment levels are officially 23.5% (March 2009) but some commentators quote figures as high as 40%.
Government has viewed economic restructuring through privatisation as important for growth and employment generation in the long run, despite short-term transitional costs. There have been political difficulties in pushing privatisation forward. The left-leaning and union elements within the ANC governing alliance are strongly opposed to privatisation which, they argue, involves handing control of state assets to a white and 'black elite' dominated business sector. The Government has recently shifted its focus from pursuing wholesale privatisation to developing profit oriented public sector enterprises. Strike action in 2006 demonstrated strong union resistance to restructuring in the state-owned transport parastatal, Transnet, that aimed to sell off non-core operations. Since 1994 the South African Government has followed prudent economic policies which are beginning to be reflected in increased rates of growth.
International Monetary Fund - South Africa
Black Economic Empowerment
Black Economic Empowerment (BEE) is the main thrust of attempts to correct the imbalance in ownership of the economy and distribution of wealth. Its intention is to redress the exclusion of the majority of South Africans from the mainstream economy by supporting and favouring the economic empowerment of previously disadvantaged people in the private sector.
A Black Economic Empowerment Commission chaired by Cyril Ramaphosa reported to Government in 2001 and in March 2003 the Government released a strategy document entitled: South Africa's Economic Transformation, A Strategy for Broad Based Black Economic Empowerment. It provides a clear definition and guidelines for businesses to follow. In 2004, the Government published the Broad Based Black Economic Empowerment Act and Codes of Good Practice to increase the pace of BEE and to broaden it beyond pure business ownership to include management, employment, skills development and corporate social investment.
