Newsletter 03/10

The standard reference work on South Africa by Georges Lory (Éditions Karthala)

Few in France know more about South Africa than Georges Lory, who has studied the country and its changes over more than three decades.

Among his other claims to fame, he translated into French the works of Nadine Gordimer, winner of the Nobel Prize for Literature.

He spent a year in South Africa as a researcher at Stellenbosch University in 1974, and was cultural advisor at the French Embassy from 1990 to 1994. He is currently living in South Africa once again, as delegate general for the Alliance Française network in the region.

In his 242-page work, a pleasure to consult, he sets out, chapter by chapter, the historical, geographic, cultural, economic and social keys to this multi-faceted country which will be hosting the FIFA World Cup in June 2010.

Economic and social data for South Africa on the eve of the FIFA World Cup.

The greatest challenge facing South Africa is the inequality that still exists between its citizens despite the gradual creation of a middle class among the black population disadvantaged under apartheid.

South Africa's economic success, achieved through sustained growth up to 2007, has made the country the leading economic power on the African continent, the powerhouse of Africa.

Since it came to power, the ANC government has pursued an orthodox economic policy inspired by free market principles, and in particular a policy of budget restraint, approved by the IMF, that has brought the main macro-economic factors back into balance (slowing inflation, government debt and budget deficit under control). One major question that remains unsolved, however, is unemployment, which affects over 28% of the black population.

The theoretically favourable economic situation has masked the country's structural weaknesses, which have been exacerbated by the global economic crisis. The government has accordingly struggled to implement programmes capable of meeting needs as regards access to basic services, infrastructure, the fight against AIDS, reducing inequality and training the workforce.

The unemployment rate remains structurally high, despite strong GDP growth over the past ten years and the creation of close on 2 million jobs. Job insecurity and low wages are on the rise, adding further to the inequalities inherited from apartheid.

The new government has been addressing this issue vigorously since coming to power in 2009.

This new health policy must, of course, be pursued for the long term.

South Africa is also faced with high levels of violence and criminality, brought about by disparities and poverty.

To combat inequalities, in 2004 the government of former President Mbeki launched a vast programme of infrastructure building, public investment, social spending and training.

In 2008, South Africa fell prey to a major energy crisis and saw inflation running at over 10%. The country was initially cushioned from the financial crisis thanks to the more restrictive regulation imposed on South African financial markets. As a result of falling global demand, however, the country dipped into a shallow recession in 2009.

Following his election as president on 6 May 2009, Jacob Zuma made his state of the nation speech on 12 February this year in which he promised his fellow citizens "better education, better roads, a better health service, falling crime and more jobs," while warning that these promises would take years to be fulfilled.

In a speech to the parliament on 17 February this year, the Finance Minister spoke of the structural challenge posed by South Africa's economy, pointing out that one adult in four is unemployed, that half the country's young people are without jobs and that wage inequality remains one of the highest in the world.

He called accordingly for a far-reaching economic transformation. He invited his fellow citizens to devote the same extraordinary efforts to meeting these social and economic challenges as they had to ensuring the completion of sports stadia in time for the opening of that magnificent festival of sport, the 2010 FIFA World Cup. South Africa's president, for his part, added that the World Cup must be not just a sporting event but also an opportunity for developing the country.

South Africa: key figures

- Literacy rate: 88% in 2008 (UNDP, 2009)

- Population: 48.8 million (IMF, 2008)

- Inequality and the heritage of apartheid (Gini index, world ranking): 0.578 (121st out of 125)

- Percentage of the population living on less than 2 USD a day: 34.1% (WB, 2007)

- Currency: South African rand (ZAR) (1 euro = 11.1 ZAR in December 2009 compared to 13.1411 at 30 January 2009)

- GDP (current USD): 227.3 billion in 2009, 280 billion in 2008, 283 billion in 2007 and 255 billion in 2006 (IMF)

- GDP growth: 2009: -1.8%; 2008: 3.1%; 2007: 5.1%; 2006: 5.4%; 2001-2007: 4.2% (IMF)

- GDP per capita (in current USD): 2007: 5,900 (IMF) (ranked MIC: middle-income country)

- Unemployment rate in 2009: 24.50% (28.8% for blacks, 4.8% for whites, 21.6% for mixed races and 12.7% for Indians and Asians)

- Inflation rate: over 6% in 2009, 11.8% in 2008: 7.1% en 2007

- Sectors of activity as % of GDP in 2007: agriculture: 2.8%; industry and mining: 31.2% and services: 66% (IMF)

- South Africa is the world's largest producer and exporter of gold and platinum, as well as the world's 5th largest diamond producer. It has 60% of world coal reserves.

- Government debt: (as % of GDP): 25% in 2008, 30.2% in 2009

- Budget deficit: (as % of GDP): -1.2% in 2008

- Balance of trade: -3.2 billion USD in 2008, -5.7 billion USD in 2007)