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South Africa Economy
Character and Structure: Economy based on market-oriented, private enterprise, bolstered by state subsidies; traditionally strong public sector undergoing initial privatization. Industry and manufacturing crucial to growth. Government'
s five-year Reconstruction and Development Programme emphasizes public services, job creation to ameliorate most severe impacts of apartheid. Gross domestic product (GDP) estimated US$133.6 billion; US$3,010 per capita (1995). Major contributions to GDP:
manufacturing, 25.2 percent; trade, 15.5; finance, 15.3; general government, 14.1; mining, 8.9. Economic growth, 3.1 percent (1996), predicted 2.5 percent (1997). Inflation, 8.7 percent (1995); 7.4 percent (1996).
Government budget: FY1997-98 proposed expenditures, R186.7 billion; revenues R162.0 billion; projected deficit R24.7 billion. Budget allocations: military, 5.7 percent; police, 7.0 percent; interest on government debt, 20.4 percent; ed
ucation, 21.3 percent; allocations to provinces, 43.2 percent. Proposed relaxation of exchange controls, tax reductions in lower income brackets (1997).
Mining and Minerals: Mining based on unparalleled reserves: gold, diamonds, platinum, chromium, manganese, vanadium; also coal, iron ore, uranium, copper, silver, fluorspar, asbestos, limestone. Mineral concentrations greatest in Gaute
ng, Northern Province, Mpumalanga. One offshore oilfield, further exploration underway.
Manufacturing: Steel, steel products, chemicals, electronics, automobiles, textiles, paper, food processing. Strong growth in export-oriented manufacturing, increasing capacity utilization, mid-1990s. Substantial foreign investment. Fa
ctors favoring investment: broad technological base, highly trained managerial class, abundant labor supply, specialized financial institutions. Factors countering investment: abundance of unskilled, uneducated workers; crime, violence; labor militancy. I
ndustrial interests protected by South African Chamber of Business (SACOB), Steel and Engineering Industries Federation of South Africa (SEIFSA), Afrikaner Trade Institute (Afrikaanse Handelsinstituut--AHI), National African Federated Chamber of Commerce
(NAFCOC).
Agriculture, Forestry, and Fishing: Arable land roughly 11 percent of total, mostly eastern provinces, far southwest. Principal crops: cereals and grains, especially corn; wool; sugar; peanuts; tobacco; fruits and vegetables; affected
by early 1990s periods of drought. Flourishing wine industry. Livestock, dairy farming. Government marketing boards being phased out. Land claims disputes arising out of apartheid era being adjudicated, could affect 30 percent of farm land. Small timber i
ndustry meets most domestic demand. Large commercial fishing industry exports more than 60 percent of catch.
Energy: Extensive coal reserves expected to last through most of twenty-first century; uranium plentiful. Limited hydroelectric potential, plans to import electric power from cooperative ventures in Lesotho, Mozambique. Imported petrol
eum, refined domestically. World leader in coal liquefaction to synthesize oil and gas; one nuclear power facility, plans for additional nuclear facilities after 2000.
Labor: Work force estimated 14.5 million (1995). Employment in manufacturing (16.6 percent), agriculture (12.2 percent), commerce and trade (11 percent), domestic service (8.5 percent), education (7.8 percent), mining (6.9 percent). Un
employment, 29-32 percent of formal work force. Job creation proceeding slowly. Looming shortage of skilled labor, oversupply of unskilled labor. Public-sector employment increasing, especially in provincial governments. At least 194 recognized trade unio
ns; roughly 25 percent of labor force. Wage disparities among racial groups persist, especially in manufacturing.
Tourism: More than 4.6 million international arrivals (1995), including more than 3.4 million Africans; also British, Germans; growing Asian interest. Well-developed tourism industry; key attractions Kruger National Park, Western Cape,
Blue Train (Pretoria-Cape Town).
Foreign Economic Relations: Major exports: gold, precious metals, precious stones, base metals, textiles, chemicals, paper products, agricultural products. Increasing coal exports. Major imports: machinery, vehicles, petroleum products
, chemicals, scientific instruments, base metals, textiles. Early 1990s growth in imports slowed in mid-1990s; exports rose steadily, but declining value of rand reduced impact on trade balance. Value of exports US$27.9 billion, value of imports US$27.1 b
illion (1995). Major trading partners: United States, Britain, Germany, Japan, Italy. Trade with United States: exports US$2.21 billion, imports US$2.75 billion (1995). Binational Commission with United States, binational chambers of commerce in other cou
ntries promote trade, investment. Southern African Customs Union with Botswana, Lesotho, Namibia, and Swaziland. Trade with other African countries: exports US$2.5 billion, imports US$664 million (1994). Major South African investments in Africa: tourism,
telecom-munications, railways, ports, breweries, mining. Pursuing stronger trade, investment ties to China, Japan, Singapore, India, Australia.
Currency: Rand (R)=100 cents. As of March 1, 1997, US$1=R4.66; conversely, R1=US21.4 cents, following uneven decline through 1996.
Fiscal Year: April 1 through March 31.
Data as of May 1996
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