The South African Economy: Coping with the Legacy of Apartheid

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Case Details:

Case Code : ECON018
Case Length : 19 Pages
Period : 1994-2007
Pub Date : 2007
Teaching Note :Not Available
Organization : -
Industry : -
Countries : South Africa

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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The South African Economy in the Apartheid Era

Apartheid was a system of racial segregation. The NP government devised apartheid as a means for the white minority to control the economic and social system of South Africa. In the apartheid era, the government excluded the blacks from the mainstream economy, with development efforts largely concentrated on the whites. The early 1950s saw a spate of repressive laws being passed.

Among them, the Population Registration Act (calling for the classification of the population on the basis of race), the Group Areas Act (leading to the creation of separate residential areas for each race), the Bantu Building Workers Act (resulting in blacks being prohibited from performing skilled work in urban areas excepting designated sections), Prevention of Illegal Squatting Act (removing blacks from public and private lands and establishment of resettlement camps), Pass Laws (restricting the movement of blacks), and the Reservation of Separate Amenities Act (prohibiting non-whites from using public amenities such as buses, beaches, post offices, restrooms, etc., meant for whites) resulted in the complete subjugation of non-whites...

The Economy in the Post-Apartheid Era

In 1994, the ANC was elected to power. With political control going out of the hands of the white minority, the deprived sections of the population were hopeful that their problems would finally start being addressed. The government was faced with huge disparities in income and living conditions between the population groups...

The Policy Initiatives

In 1994, the government introduced the Reconstruction and Development Programme (RDP), which primarily aimed to reduce poverty and improve the living conditions of the poor. "Attacking poverty and deprivation will be the first priority of the democratic Government" - declared the white paper on RDP. The document added - "Our income distribution is racially distorted and ranks as one of the most unequal in the world. Women are still subject to innumerable forms of discrimination and bias. Rural people are marginalized. Throughout, a combination of lavish wealth and abject poverty characterizes our society."...

Excerpts Contd...>>


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