Johannesburg, the economic capital of sub-Saharan Africa
|Fiscal year||1 April – 31 March (government); 1 March – 28/29 February (corporate & private)|
|Trade organizations||WTO, G-20, SACU and others|
$390.9 billion (2012 est.) (nominal; 28th)|
$585.6 billion (2012 est.) (PPP; 24th)
|GDP growth||+2.6% (2012 est.)|
|GDP per capita||
$8,078 (2011) (nominal; 71st)|
$11,035 (2011 est.) (PPP; 77th)
|GDP by sector||agriculture 2.5%, industry 31.6%, services 65.9% (2011 est.)|
|Inflation (CPI)||5% (2011 est.)|
below poverty line
|31.3% (2009 est.)|
|Labour force||17.89 million (2012 est.)|
|agriculture: 9%, industry: 26%, services: 65% (2007 est.)|
|Unemployment||25.2% (Q1 2013 est.)|
|Main industries||mining (world's largest producer of platinum), gold, chromium, automobile assembly, metalworking, machinery, textiles, iron and steel, chemicals, fertiliser, foodstuffs, commercial ship repair|
|Ease of Doing Business Rank||39th|
|Exports||$101.2 billion (2012 est.)|
|Export goods||gold, diamonds, platinum, other metals and minerals, machinery and equipment|
|Main export partners|| China 14.5%|
United States 7.9%
United Kingdom 4.1% (2012 est.)
|Imports||$106.8 billion (2012 est.)|
|Import goods||machinery and equipment, chemicals, petroleum products, scientific instruments, foodstuffs|
|Main import partners|| China 14.9%|
United States 7.3%
Saudi Arabia 7.2%
Japan 4.5% (2012 est.)
|FDI stock||$73.6 billion (31 December 2011 est.)|
|Gross external debt.|
The economy of South Africa is the largest in Africa, accounts for 24% of its gross domestic product in terms of purchasing power parity, and is ranked as an upper-middle income economy by the World Bank; this makes the country one of only four countries in Africa in this category (the others being Botswana, Gabon and Mauritius). According to official estimates, a quarter of the population is unemployed, however unofficial estimates put the real unemployment rate as high as 40%. A quarter of South Africans live on less than US $1.25 a day.
South Africa has a comparative advantage in the production of agriculture, mining and manufacturing products relating to these sectors. South Africa has shifted from a primary and secondary economy in the mid-twentieth century to an economy driven primarily by the tertiary sector in the present day which accounts for an estimated 65% of GDP or $230 billion in nominal GDP terms. The country's economy is reasonably diversified with key economic sectors including mining, agriculture and fisheries, vehicle manufacturing and assembly, food processing, clothing and textiles, telecommunication, energy, financial and business services, real estate, tourism, transportation, and wholesale and retail trade.
The unemployment rate is very high, at more than 25%, and the poor have limited access to economic opportunities and basic services. Poverty also remains a major problem. In 2002, according to one estimate, 62% of Black Africans, 29% of Coloureds, 11% of Asians, and 4% of Whites lived in poverty.
The high levels of unemployment and inequality are considered by the government and most South Africans to be the most salient economic problems facing the country. These issues, and others linked to them such as crime, have in turn hurt investment and growth, consequently having a negative feedback effect on employment. Crime is considered a major or very severe constraint on investment by 30% of enterprises in South Africa, putting crime among the four most frequently mentioned constraints.
South Africa, unlike other emerging markets, has struggled through the late 2000s recession, and the recovery has been largely led by private and public consumption growth, while export volumes and private investment have yet to fully recover. The long-term potential growth rate of South Africa under the current policy environment has been estimated at 3.5%. Per capita GDP growth has proved mediocre, though improving, growing by 1.6% a year from 1994 to 2009, and by 2.2% over the 2000–09 decade, compared to world growth of 3.1% over the same period.
= The formal economy of South Africa has its beginnings in the arrival of Dutch settlers in 1652, originally sent by the Dutch East India Company to establish a provisioning station for passing ships. As the colony increased in size, with the arrival of French Huguenots and German citizens, some of the colonists were set free to pursue commercial farming, leading to the dominance of agriculture in the economy.
At the end of the 18th century, the British gained control of the colony, imposing the English language on the colonists, who were now developing a culture of their own. This in turn lead to the Great Trek, spreading farming deeper into the mainland, as well as the establishment of the independent Boer Republics of Transvaal and the Orange Free State.
In 1870 diamonds were discovered in Kimberley, while in 1886 some of the world's largest gold deposits were discovered in the Witwatersrand region of Transvaal, quickly transforming the economy into a resource-dominated one. The British, seeking the riches of the gold fields, invaded the Boer republics and gained control of them in 1902 after the Second Boer War. The country also entered a period of industrialisation during this time, including the organisation of the first South African trade unions.
The country soon started putting laws distinguishing between different races in place. In 1948 the National Party won the national elections, and immediately started implementing an even stricter race-based policy named Apartheid, effectively dividing the economy into a privileged white one, and an impoverished black one. The policy was widely criticised and led to crippling sanctions being placed against the country in the 1980s.
South Africa held its first multi-racial elections in 1994, leaving the newly elected African National Congress (ANC) government the daunting task of trying to restore order to an economy harmed by sanctions, while also integrating the previously disadvantaged segment of the population into it. The 1994 government inherited an economy wracked by long years of internal conflict and external sanctions.
The government refrained from resorting to economic populism. Inflation was brought down, public finances were stabilised, and some foreign capital was attracted. However, growth was still subpar. At the start of 2000, then President Thabo Mbeki vowed to promote economic growth and foreign investment by relaxing restrictive labour laws, stepping up the pace of privatisation, and cutting unneeded governmental spending. His policies face strong opposition from organised labour. From 2004 onward economic growth picked up significantly; both employment and capital formation increased.
In April 2009, amid fears that South Africa would soon join much of the rest of the world in the late-2000s recession, Reserve Bank Governor Tito Mboweni and Finance Minister Trevor Manuel differed on the matter: whereas Manuel foresaw a quarter of economic growth, Mboweni predicted further decline: "technically," he said, "that's a recession." In 2009 the Nobel Prize winning economist Joseph Stiglitz warned South Africa that inflation targeting should be a secondary concern amid the global financial crisis of 2007–2009.