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Economy
- South Africa is the largest, most diverse and most sophisticated
economy in Africa while occupying only 4% of the landmass of Africa.
It has more than half of the cars, the phones, the auto-banks
(automatic bank teller machines) and industrial facilities of
the whole continent.
- Manufacturing and financial services are the largest sectors
in the South African economy, each contributing more than twice
as much to Gross Domestic Product (GDP) than mining. South Africa's
mineral wealth is vitally important to the economy. Mining and
minerals still account for some 30% of foreign exchange earnings.
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view graph )
- South Africa's financial and industrial sectors are of a high
standard, supported by excellent infrastructure.
- The budget deficit reduced from 10% of GDP (1993) to under 3%
in 2000. This was achieved through more efficient tax collection
and improved financial management. Government's target budget
deficit for 2002 is 2.2%. National debt has been reduced to 44.3%
of GDP in 2000.
- Inflation (CPI), has been reduced to 7% (2000) and strict inflation
policies aim to keep it low. Analysts predict that inflation will
ease during 2001 and that the targeted CPIX inflation rate, of
3% to 6%, will be reached by 2002. (
view graph )
- Borrowing interest rates have dropped dramatically to 14.5%.
- Exports are strong and volumes have increased by nearly 9% over
the past year. A stable macro economic climate has been established.
GDP growth of 3.1% (R996 billion) was achieved in 2000 and this
rate is expected to increase to 3.5% during 2001. A growth rate
of 3 to 3.5% is expected over the next three years. This growth
rate is still below expectations and far below the 5% needed to
absorb new entrants into the job market. (
view graph )
- Of Government's non-interest spending, 58% goes to health, education
and social welfare. Education gets the single biggest allocation
(21%) of funds.
- In an effort to promote investment and job creation, R3 billion
in tax incentives will be available over the next four years for
strategic industrial investments.
- Europe is South Africa's largest trading partner accounting
for some 40% of SA's total world trade. Germany, the UK, the USA
and Japan are South Africa's main trading partners.
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