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Vol 37 No 7

Published 29th March 1996


South Africa

Banker is as banker does

Foreign money is flooding in but Finance Minister Chris Liebenberg's low risk strategy is yet to cut unemployment

There are two sets of statistics on South Africa's economy. One tells an economic story only marginally less miraculous than that of the political transition: foreigners investing a record US$1,700 million in gilts and equities last year; an economy forecast to grow by some four per cent this year; estimated inflation down to 7.5 per cent; manufacturing output up by over eight per cent; tourism growing faster than anywhere else in the world. The other statistics are more sobering: twelve million people living in dire poverty; five million more people struggling on the poverty line; 6.7 million people (40 per cent of the workforce) unemployed by the year 2000, even if the economy grows by three per cent; a forecast public deficit of 5-6 percent in 1996; savings falling from 25 per cent of gross domestic product over the past decade to 17 per cent.

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