The worldwide financial and economic crisis of 2008 had a significant impact on South Africa’s economy. South Africa’s economy has been in a recession for 9 months, dating back to the fourth quarter of 2008. GDP decreased by 1.8% in 2009. The country, on the other hand, managed to re-establish growth in the following months, with GDP increasing by 3.1% in 2011.
The Government of South Africa considers the volatility of pricing on global markets, as well as the rise in demand for raw resources, food, and industrial goods, in terms of potential economic advantages. South African Finance Minister Pravin Gordon remarked in his 2012 budget address that South Africa, as one of the key producing countries, should take advantage of the current market position, including in terms of boosting production and creating new jobs. According to the minister, achieving these targets will necessitate the creation of proper business conditions and incentives.
South Africa (the Republic of South Africa) is one of Africa’s largest countries, with established industry that sets it apart from its neighbours. It covers an area of 1219912 km at the southernmost section of the African continent. South Africa shares land borders with five countries: Zimbabwe, Namibia, and Botswana on the north, and Mozambique and Swaziland on the east. There is an island – the small state of Lesotho — on the South African territory. South Africa has a population of more than 56 million people, with just about 23 million of them working.
The legacy of the apartheid system is linked to the problem of income disparity in South Africa. As a result, actions to help the black population’s economic empowerment (Black Economic Empowerment) become more prominent. This initiative aims to reduce economic disparities between ethnic groups in the country, which are caused by disparities in income, employment, and skills.
The program’s main goals are to:
- expand the number of black private-sector owners and managers, particularly in important industries and services;
- reducing gender imbalance among the black population;
- raising the number of blacks in top management positions in businesses;
- expanding the engagement of black individuals in public organizations, trade unions, and other organizations;
- Increasing the number of black land, real estate, and other production facilities owners;
- improving infrastructure and education access;
- professional development of black workers;
- reducing the disparity between and between ethnic groups.
The program’s principal purpose is to eliminate racial prejudice from South Africa’s economy. The topic of income inequality was identified in Finance Minister Pravin Gordon’s budget statement on February 22, 2012.
In many aspects, the Republic of South Africa is a one-of-a-kind country that mixes the characteristics and traditions of many different peoples and ethnic groupings. The following are some of the elements that influence South Africa’s position in respect to contemporary global governance issues:
- a developing economy in which primary sector products account for 60% of exports;
- a difficult social situation exacerbated by the apartheid legacy, economic inequality, the mixed ethnic composition of the population, and illegal migration;
- implementation of large-scale infrastructure projects aimed at creating transportation networks as well as for social needs;
- regional leadership