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South Africa Election and Development Policy Karol Boudreaux Senior Research Fellow kboudrea@gmu.edu

South Africa Election and Development Policy Karol Boudreaux Senior Research Fellow kboudrea@gmu.edu “ Rwanda is our nightmare, South Africa is our dream” - Wole Soyinka. Background. Brief History Legacies of discrimination Native Lands Act of 1913 Native Consolidation Act of 1945

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South Africa Election and Development Policy Karol Boudreaux Senior Research Fellow kboudrea@gmu.edu

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  1. South Africa Election and Development Policy Karol Boudreaux Senior Research Fellow kboudrea@gmu.edu “Rwanda is our nightmare, South Africa is our dream”- Wole Soyinka

  2. Background • Brief History • Legacies of discrimination • Native Lands Act of 1913 • Native Consolidation Act of 1945 • Bantu Affairs Act of 1971 • 1990-1992 negotiations to end apartheid • 1994 – Present • Peaceful elections in 1994, 1999, 2004 • Economic Growth between 3-5 percent per annum • Unique International Opportunities

  3. Background Cont. • Importance of the Election • Change in ANC political hegemony • The Need for Reform • Increase opportunities for all South Africans • Frustration with misaligned foreign policy

  4. A South Africansuccess story? Michael Jwambi

  5. Poverty in South Africa • At a R322 ($56) a month poverty line: • 56% of Africans are poor • 95% of poor are Africans • Poverty rates for colored = 34% • <10% for whites & Indians • Women-headed households are poorer • Rural households are poorer Source: Bhorat, H. & van der Westhuizen, C. 2008, “Economic growth, poverty and inequality in South Africa: the First Decade of Democracy,” paper commissioned for the Fifteen Year Review.

  6. Key Contenders • African National Congress (ANC) • Jacob Zuma • Congress of the People (COPE) • Mvume Dandala • Democratic Alliance (DA) • Hellen Ziller

  7. ANC priority areas: • Education • Crime • Jobs • Health • Rural Development

  8. Unemployment Comparison Source: Constructed by authors from Labor Force Survey data obtainable from www.statssa.gov.za and from US Bureau of Labor Statistics data obtainable from www.bls.labor.gov/data/

  9. What explains high unemployment? • Legacies of apartheid • Lots of supply • Limited demand for low-skilled workers • High search costs • High formal sector wage rates • Some labor regulation rigidity (firing)

  10. Education • Shared responsibility • Large work force • 96% public, 4% independent • Generally poor outcomes for learners • Infrastructure backlogs significant • Split department? “A South African boy gazes through a school fence in Cape Town.” LA Times, March 24,2009

  11. Crime

  12. Crime in South Africa • Trending down? • 50 murders/day each & every day • Highest sexual violence rate outside war zone • Costs to businesses/citizens: • Loss of property, work disruptions • Spend to protect • Limit hiring; limits self-employment

  13. Running Nomzano Butchery • Vicky & Tam Mangoliso run the butchery • Vendors hesitant to drive in – buy from a middleman • Customers don’t want to shop in the later evening hours • Expenses related to crime prevention

  14. Competition spurs violence • Anti-Foreigner Violence • Manifestation of underlying problems Jerome Delay / AP

  15. Policy Recommendations • Creating Jobs • Create special economic zones to encourage business development, job creation, and skills training • Create a two-tiered minimum wage structure • Encouraging Educational Entrepreneurship • Encourage the entry of more private-sector educational entrepreneurs • Modify teacher certification requirements • Increasing Security for All South Africans • Encourage crime reporting and community involvement • Improve “customer satisfaction” levels with the police

  16. South Africa and the World since 1994 • Unique International Opportunities • Leading voice for democratic governance in Africa • Sole African representative to International Forums • Permanent seat on UN Security Council • Influential trading partner • Host to big sporting events • But…

  17. Confusing regional trading

  18. Case Study • Zambia • Member of SADC and COMESA • SADC rules- dismantle all trade barriers • COMESA rules- common external tariff • Committed to free trade and maintaining trade barriers with South Africa

  19. Good Governance? United Nations SC votes False Dichotomy Failed Elections Zimbabwe and Kenya An inconsistent voice? UN Photo by Devra Berkowitz Joao Silva for The New York Times

  20. Policy Recommendations • Expanding African Economic Integration • Reduce the multiplicity of memberships and barriers to trade • Good Governance • Adopt a principled approach to foreign policy • Work towards a more robust strategy for monitoring elections • Focus on Public and Cultural Diplomacy • Expand educational, cultural, and professional exchanges throughout the continent • Expand civil society initiatives

  21. Expanding opportunity SA Finance Minister, Trevor Manuel, on 3.18.09: "We must diversify. But that is up to the entrepreneurs. Unfortunately governments are bad at producing entrepreneurs.” http://www.moneyweb.co.za/mw/view/mw/en/page1408?oid=281500&sn=Detail

  22. Questions and Answers Please visit: http://mercatus.org/enterpriseafrica/ to read the Mercatus Policy Series South Africa Country Brief

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