South African economy has fared well both within the African continent and the world in general. This is following the end of a 12 year sanction placed on the country by the United Nations in 1996. The economy of the country has grown to be the best on the African continent and one of the fastest growing in the world.
Economy of South Africa: Growth
The success of the economy of South Africa is tied to its wide economic approach. The country depends on more than a single structure for revenue generation. However, the earliest major driver of South African economy is its natural resources such as diamond, platinum, gold, chromium and iron. The natural deposits in the country have always been important contributors to its economy.
SA economy however has other sectors that are critical to its progress. Such include real estate, transport and communication as well as construction and manufacturing. These sectors have brought significant positive impact on the economy. They have also helped the country move from solid minerals alone, which used to be its traditional revenue generator.
With a population of over fifty million, South Africa has been able to achieve more success stories than unsuccessful ones in its economic journey over the last ten years. To this end, the country is able to contribute over 20 percent of Africa’s entire Gross Domestic Product. This has made it an economic force in the continent.
SA Economy: Lapses
The economic growth of South Africa was affected in 2015 as a result of drought and electricity crisis, which impact is still being felt.
While most South African Economy news tends to place emphasis on its growth, the growth has however not translated into much positive impact in the lives of the people. This is as a result of the exceeding corruption associated with the present government of the country.
Corruption has since 2008 continued to take center stage in South Africa. The impact of this is that people now have less trust in the transparency of public sectors and leaders. This is even more critical in the center. Corruption cases in South Africa have become even more pronounced with the case of Jacob Zuma’s involvement in the Nkandla loot. These cases of corruption are believed by many to be the major reason why the economic change in the country has not brought much change in the lives of the people.
Amidst its economic progress, the poverty rate of South Africa is still very high. There are over 12 million of its over fifty million population living in extreme poverty. The overall poverty level in the country is even much higher.
More depressing for South Africa is the problem of unemployment which has increased the rate of crime in the country. Some quarters have placed the unemployment rate of South Africa to as high as 40 percent. Others have even argued that it could be higher.
Whatever be the case, the employment rate of South Africa is serious enough to get youths rise up against foreigners. These youths want foreigners to leave the country so that they can have the little available jobs. This is a bad omen for a country with an economy as good as South Africa’s.
South African Gross Domestic Product (GDP)
With a vibrant economy, the GDP of South Africa is at 301 billion US Dollars. This however falls far short of the 416 billion US Dollars it achieved in 2011 and 350 billion US dollar it returned in 2015. Since 2010, South African GDP has not gone as low as it has between 2015 and 2016.
Although the South African GDP has gone lower than it has in 2015 by over 14 percent, it has still managed to stay ahead of Nigeria which is its greatest continental competitor and has its GDP at 296 billion US Dollars.
At 2015, the per capita income of South Africa was 13,215 US Dollar, which should naturally impact the lives of the people.
The major contributors to South Africa’s GDP are the service sectors such as finance sector, business and real estate. While government services have their own contributions, private services are the major contributing forces. Other important contributors to South African GDP include manufacturing, mining, and agricultural sectors.
South African Economy: The Future
Although the South African economy is looking good at the moment, there may be danger ahead. This is mostly as a result of the growth of unemployment, poverty, crime and corruption. If these are however checked, and there is a better utilization of the revenue generated, then the rosy ride to better economy may as well continue, all things being equal.