SA has silver lining, according to race institute study

South Africa’s successes since 1994 are often overlooked in our morbid fascination with failure. File picture: Ian Landsberg

South Africa’s successes since 1994 are often overlooked in our morbid fascination with failure. File picture: Ian Landsberg

Published Feb 12, 2017

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Cape Town - South Africa has its challenges, but habitual pessimism – and shebeen or dinner table talk about the country going to the dogs – is wrong on the facts.

This is the gist of a compelling summary of gains and achievements since 1994 by think tank, the Institute of Race Relations.

The IRR is no slouch when it comes to drilling down in the data to reveal what South Africa is doing wrong and to suggest what the correctives are, but it makes the point that a candid examination of our condition is the essential foundation of any effort to review or change policy.

South Africa’s successes since 1994 are often overlooked in our morbid fascination with failure.

These significant gains – in the economy, the world of work, living standards, education, health, and crime – are spelled out in its report, “The Silver Lining”.

It shows that, “compared to the economic catastrophe of the 1980s and early 1990s, GDP growth recovered in the aftermath of the 1994 election and rose steadily to average levels in excess of five percent between 2004 and 2007”. Real per capita gross domestic product “increased from below R45 000 per head in 1994 to above R55 000 in 2015” and real GDP itself “almost doubled from R1.6-million in 1994 to R3m in 2015”.

Average after-tax per capita income levels increased from under R25 000 per head in 1994 to just under R35 000 per head in 2015.

“When the economy recorded its fastest growth rates (between 2004 and 2007), per capita income levels increased at between three percent and five percent per annum – the best such performance after 1994.

The report shows bond yields (a measure of the government’s borrowing costs) were “cut in half from the levels recorded in the latter days of apartheid as confidence in South Africa recovered”. As they fell, it became cheaper for the government to access funding.

The budget deficit recovered from levels below - six percent of GDP in the run-up to the democratic transition, with surpluses being recorded in the mid-2000s.

The institute notes: “The picture changed after 2007, but the successes recorded between 1994 and 2007 were remarkable and stand as one of the post-1994 government’s most impressive economic policy achievements.”

Weekend Argus

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