South Africa in 2000: the economy and government policies under President Mbeki

After the regime change in South Africa and the lifting of the anti-apartheid sanctions there was widespread confidence that an economic upswing would set in, not only in South Africa but in the region as a whole. This was all the more the case as peace in Angola was in sight and as hopes grew for more orderly conditions in Congo/Zaire. Zimbabwe was also included as one of the additional pillars of this upswing so that hopes for increasingly positive developments - emanating from South Africa - included the rest of sub-Saharan Africa. These hopes have now been replaced by an Afro-pessimism. South Africa has not had the dynamic economic development that was hoped for after 1994. Economic growth rates have fallen clearly below expectations, the anticipated flow of foreign direct investment has not been achieved, important industries such as mining and manufacturing have stagnated, and especially gold mining has registered dramatic losses, and agricultural production has fluctuated strongly. Labour market expectations have also proven to be totally unrealistic. Trade liberalisation and rationalisation and modernisation brought on by increased international competition have led to the loss of more than a half a million jobs in the formal sector since the end of apartheid.