South Africa, Post-Apartheid

By Kimball, J. R. | Real Estate Issues, August 1997 | Go to article overview

South Africa, Post-Apartheid


Kimball, J. R., Real Estate Issues


South Africa . . . a.k.a., "The Dark Continent." The name calls to mind safaris, wars, apartheid, violence, and mystery. Whether sought out or accidentally encountered, the public's image of South Africa has and continues to be shaped by what we have been exposed to by the media. Thus, when offered the opportunity to visit South Africa and experience first-hand what had heretofore always been a dream, I jumped at the chance. Following is a brief overview of a visit made in the Fall of 1996 as a team member of the Citizens Ambassador Real Estate Development Delegation of the People to People Program.

Background

Pre-trip, my delegation's knowledge included some recollections about South Africa's history; information that was soon to expand by volumes! We had recollections of frontier wars, (nine dating back to 1779); abuses associated with apartheid; international sanctions levied against South Africa for its human rights violations; and of course, the imprisonment of Nelson Mandela for his efforts to gain equal rights for all South Africans.

Discrimination was selectively applied under apartheid. Whites were the ruling minority class; the mixed races were called "colored"; and blacks were the majority class who had no political or social standing. Although not as numerous as Afrikaners, the English-speaking community has dominated industry and commerce.

Following is an attempt to relate some facts2 and a observations on the real estate market as it is emerging under the new open society created post-apartheid. The Government

Characterized as a multi-party democracy, South Africa achieved a transition from minority to majority rule in April of 1994, without upheaval. The African National Congress (ANC), obtained a large majority of the votes, with its candidate, Nelson Mandela, being elected President of the party. About 65 percent of the estimated potential electorate voted in a fully-democratic election; there was no formal census of eligible voters. In terms of the interim constitution, Mandela presides over what is termed the "Government of National Unity" (GNU). His cabinet includes representatives of two major rival parties: the National Party (NP), headed by Deputy President FW de Klerk; and the Inkatha Freedom Party (IFP), (the predominantly Zulu party), led by Chief Mangosuthu Buthelezi.

The current governing body consists of 400 Parliament members and 90 Senators. Most all are black, in contrast to the previous structure that was almost exclusively white. Critical issues facing the Government of National Unity, include: urbanization, which has created massive informal shanty towns surrounding established cities; legal and illegal immigration; land reforms; job training; a Truth and Reconciliation Commission3; and the redistribution of wealth and resources.

The GNU has established a Reconstruction and Development Program (RDP). It is charged with correcting decades of racial discrimination, found especially in education, housing, job training, and welfare services. The RDP is also attempting to stimulate a weakened economy and generate jobs. Classified as a middle-income country, South Africa's per capita GDP is estimated at approximately $2,900. Unemployment is generally estimated at 40 percent of the population eligible to work. Over 50 percent of the black population is classified as living in poverty.

Apartheid created inequities in ownership, employment, and skills, thus making for a very skewed economy in terms of individual income, skills, productivity, and employment. The low growth rate of the GDP, 3.4 percent, compared to a population growth rate of an estimated 2.4 percent, indicates little change in per capita income or employment.

The job of the RDP is to focus on: job skills; education; health care for all; housing for the backlog of an estimated 2.5 million people; access to clean water supplies and affordable sanitation facilities; a mass electrification program; and better transportation.

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