1 - Political Status

  South Africa is a republic with a presidential regime.
The National Assembly is made up of 400 deputies elected by general election.
The President is elected for a five year term of office by the National Assembly from among its members.
The National Council for the Provinces (90 members - 10 per region) are elected by the regional assemblies. The government is elected by the Assembly.
Each party which has at least 80 seats appoints deputy presidents, each party which has at least 20 seats obtains a ministerial post.

The President is Thabo Mbeki, who was elected on 16th June 1999 to take over from Nelson Mandela.
His Vice President is Jacob Zuma.

Pretoria is the seat of the government. Cape Town is the seat of the Parliament.

Historical outline
1652 : Arrival of the first Dutch settlers, the Boers.
1795-1806 : Arrival of the first English settlers
1899-1902 : English expansionism provokes the Boer War which ended in an English victory
1910 : The union of the four provinces : the Cape, Transvaal, the Orange Free State and Natal to create the South African Union
1912 : Creation of the African National Congress Bantu party (ANC), the first party to oppose the racial situation
1948 : The first laws are passed to separate racial groups. Dr Malan unites the Afrikaaners in a nationalist party, he is elected Prime Minister and sets up the apartheid system.
1961 : Referendum and proclamation of a Republic.
1965 : Imprisonment of Nelson Mandela, the black leader of the ANC.
1971 : Bantu Homelands Constitution Act which increased the segregation policies.
1976 : Massacre in Soweto.
1978 : Pieter Botha comes to power.
1989 : Frederik De Klerk is elected President and requests the freedom of Mandela on 13th February 1990 1990 : Nelson Mandela is freed and renounces the armed struggle on behalf of the ANC : apartheid is abolished
1991 : All the apartheid laws are repealed
1992 : Referendum among the white population, who agree to share political power with the black population
1993 : Nobel Peace Prize for Nelson Mandela and Frederik De Klerk. Parliament abolishes apartheid.
1994 : Elections won by Nelson Mandela, with Frederik De Klerk, as his vice-président.
1995 : Municipal elections won by the ANC
8th May 1996 : Adoption of a new constitution, progressively put into effect from 1997 to 1999.

2 - Geographical Situation

Two and a half times the size of France, South Africa stretches over 1,227,200 sq. kms.
It covers all the southern tip of the African continent and has two coastlines, to the west the Atlantic Ocean and to the east the Indian Ocean.
It is divided into 9 regions.
South Africa is a huge high plateau (Highveld) with a mountain chain, the Drakensberg going down its eastern flank
The country of Lesotho is inside South African territory on the east.
The coastal plains circle round from Namibia through the Cape and Durban and up to Mozambique.
The north eastern coast is full of lagoons and marshlands.
The biggest of the rivers flowing into the Atlantic is the Orange River (1860 kms) which has its source in Lesotho and crosses a large part of the country.
Rivers, tropical forest and savannah plateau dominate the steppe.
There are succulent plants and a very leafy vegetation, game reserves, lakes and beautiful sandy beaches. There are 872 kms of coast on the Atlantic Ocean and 2082 kms on the Indian Ocean, meeting at the Cape of Good Hope. Marion Island and Prince Edward Island are in the Indian Ocean.
The 4 provinces:
- The Cape, which is 641,379 sq. kms.
- Natal which is 91,355 km².
- The Transvaal which is 262,499 km².
- The Orange Free State which is 121,000 km².

3 - Economy

  With a gross domestic product of 136 billion dollars, South Africa is the richest country on the African continent.
The economy is having to face up to the problems caused by the exclusion of the black population from the life of the country for over a century.

The recovery in the market value of minerals and an up-surge in domestic expenditure would seem to indicate that South Africa was returning to a relatively comfortable growth rate, even if the flood damage at the beginning of 2000 has slowed down the initial movement. The stability of the rand has added to this newfound confidence. The government has managed to reduce its budgetary deficit and to control inflation, but the country does not have the means to finance its developement.

This economic improvement cannot however dissimulate the serious social structural problems.
They initially stem from the tensions brought about from a very high unemployment rate (30-40%), which is also very unequally distributed : the black community is still paying for the years of little or no education under apartheid. This inadequacy of the education system together with the recent brain drain has created a shortage of qualified labour. (The immigration services count 82,000 departures between 1989 and 1997, but more realistic figures estimate 233,000.) The very high level of unemployment feeds a recurring state of insecurity which dissuades foreign investors and limits the developement of tourism.

However it must be said that the level of developement in South Africa is way above that of the rest of the continent.

The recent re-election of the ANC to power with a comfortable majority has contributed to reassuring the business sector. The government will now have to deal with the challenge of continuing reforms to liberalize the economy which are necessary to encourage direct foreign investment while at the same time avoiding adding to the social tensions which could become explosive.

The most serious problem of all is the AIDS epidemic which has already infected 10% of the population, 33% of the labour source could be contamined by 2006.

The potential of the consumer market is enormous, but its developement will depend on the speed at which a financially solvent middle class can evolve. For the moment it is totally limited by the high level of unemployment.

During the 1980s more than 700 foreign companies left South Africa, but since 1992 and a new economic policy, 1500 have been set up, investing between 1994 and 1998 5.25 billion dollars : 33% coming from Asia, 28% from the USA, 16% from the UK, 15% from the rest of Europe and 8% from Japan. (France is 4th on the list of investors.)

Economic statistics

	1997	1998	1999	2000
Economic growth (%)	2.5	0.5	0.8	3
inflation (%)	8.6	6.9	6.0	4.5
public balance/GDP (%)	-4.0	-3.5	-3.0	-3.5
exports (billion $)	31.2	29.1	30.3	33.4

imports (billion $)	28.9	27.3	27.3	30.8
balance of trade(billion $)	2.3	1.8	3.0	2.6
current balance/GDP (%)	-1.2	-1.3	-0.3	-1.3
external debt (billion $)	14.5	14.8	13.7	12.5

General statistics :

GNP 1999	124.02 billion $
GNP per capita	2940 dollars
Purchasing power parity (PPP)	5800 dollars
Growth GNP 1990-1997	-0.2% per capita per annum
Households with PPP +$30000pa	875 000 = 11%
Households with PPP +$15000pa	2 540 000 = 32%
Households with PPP -$5000 pa	2 380 000 = 30%
Foreign aid 1998	1.48 billion $
Foreign investment 1999	1.38 billion $
Tourist revenue 1998	2.738 billion $

The division of the economic activity by sector :

agriculture, forests and fishing : 4.5%
mining : 7.8%
primary sector : 12.3%
secondary sector : 30.8%
tertiary sector : 56.9%

Division of the GDP by activity sector :
agriculture : 4%
industry : 18.9%
mining : 12.8%
services : 64.3%

The South African authorities rely on different strategies to encourage investors to come to the country. The Spatial Development Initiatives (SDI) and the Industrial Development Zones (IDZ) use fiscal exemptions and apply customs franchise in the priority developement zones.
The success of these zones however remains questionable and the government is now looking for a way to encourage direct foreign investment by speeding up the privatization process and setting up partnerships between the public and the private sectors.
Foreign investors benefit from a legal security in South Africa which is equivalent to that in any industrialized country.
Investors, discouraged by corruption and the lack of qualified labour are not banging on the door. Direct foreign investment dropped by 43% last year, falling to 3.6 billion francs compared to 6,3 billion in 1999.

External Trade
Customs regulations should go through some extensive changes in the near future. In order to conform to WTO standards, substantial reductions in the customs rates have been taking place over the last 5 years. Conforming with the free-exchange agreement signed with the European Union in October 1999, 86% of goods imported from the EU should be exempted from customs duties.

External trade reflects a developing country :
- imports are mainly professional equipment and finished products
- exports are mainly raw materials and goods which have gone through first-stage processing.

South African trade is mainly done with industrialized countries. 44% of exports and 69% of imports are done with Europe, the USA and Japan, while Africa only accounts for 9% of the exports and 3% of the imports.

4 - Agriculture

Agriculture
(in millions of tons, head, m³ for timber)

Production	1996	1997	1998	1999	Rating
Millet	0.013	0.013	0.012	0.011
wood	32.376	33.171	33.171	-	19
wheat	2.712	2.429	1.788	1.500
sugar cane	20.951	22.155	22.930	22.124	13
cotton	0.040	0.025	0.034	-
maize	10.171	10.136	7.693	7.008	13
oranges	0.890	0.962	0.993	0.980	11
barley	0.176	0.182	0.146	0.140
potatoes	1.592	1.579	1.552	1.645	28
rice	0.003	0.003	0.003	0.003
tea	0.009	0.008	0.009	0.011	19
wine	0.845	0.811	0.770	0.878	6
cattle	13.389	13.667	13.772	13.565	19
sheep	28.934	29.187	29.345	28.680	10
pigs	1.603	1.617	1.641	1.531
fishing	0.439	0.514	-	-	29

Agriculture does not represent a big slice of the South African economy, only 4.5% of the GDP, but the social importance is considerable, there is still 50% of the population living in the countryside.

The tragic events which took place in Zimbabwe a year ago have shown the urgency for agrarian reform. The black population were in fact expropriated from their lands by the thousands during the apartheid regime when the authorities only granted 13% of the land to the black people. Today 55,000 white farmers own nearly all the farmland. It is rare that farms are invaded, but acts of violence are multiplying. In 1999 816 criminal attacks and 138 murders were recorded, the land owners are barricading themselves in. The aim of these attacks is maybe to force the farmers to share or leave their lands or they could be acts of revenge for bad treatment in earlier days.

Worried about this escalation of violence in the countryside, the authorities have promised to speed up the movement of reform but in spite of the programme to restituate and redistribute land, less than 1% of the farmland has changed hands since 1994.

Large quantities of wine, wool and oranges are exported. The national wine production employs 350,000 people and earns 1.5 billion rand in income. South Africa is the world's sixth biggest producer. The proportion of vintage wines doubled between 1993 and 1999, exports increased fivefold and presently represent 22% of the total production. Europe is the main customer, buying more than three quarters of South African exported wine.
Foreign investors have begun to be interested in the wine-growing potential in South Africa and have about a 5% share of the production.

 5 - Industry

South Africa has the biggest and most diversified mineral regions in the world. The country contains a large part of the world reserves of platinum (90%), manganese (81%), chromium (68%) and vanadium (45%). Five million people live from the mining sector which employs 3.8% of the country's labour force and contributes 8% to the national income and 42% of SA's exports.

The principal wealth of the country is gold - it makes up a quarter of the exports and 24% of the world production.

The South African group De Beers controls nearly all the diamond stocks in the world. Their sales are booming, going from 3.6 billion dollars in 1998 to 5.5 billion in 1999 (+52%) and for the first six months of 2000 the group has announced that the sale of uncut diamonds had already reached 3.5 billion dollars compared with 2.45 billion during the first six months of 1999 - an increase of 44%.
Nearly 35 million carats are mined every year throughout the world, that is 7 tons of precious stones. Nine of their mines are in South Africa.

The Witwatersrand formations are famous for gold, but also for silver, cobalt and uranium.
Platinum, chromium and vanadium are extracted from the igneous rock in the Bushved.
Copper, asbestos, manganese, nickel, phosphate, silicum, zinc and zirconium are mined in Northern Transvaal.

Although there is no petrol, there is plenty of coal, enough to cover 80% of the country's needs. Its mining costs are the lowest in the world.
The country is also rich in natural gas and uranium.

The mining sector saw its profits drop with the fall in world market prices in 1998 and 1999, but they have been going up again in 2000.

Mining statistics

(in millions of tons, uranium, gold and silver in tons, diamonds in thousands of carats)

Production	1999	World rating
silver	164	15
coal	210.592	5
copper	0.149	10
diamonds	4380 (1997)	4
iron	32.961 (1997)	9
natural gas	1.4	-
lignite	17.908	18
nickel	0.038	9
gold	408	1
phosphates	3.000	8
lead	0.097	7
uranium	962 (1998)	9

South Africa has the only diversified industrial sector in sub-saharian Africa, essentially turned towards its domestic market. Its main sectors are automobiles, chemicals and textiles. The automobile industry is doing well with a turnover of 35 billion francs. Exhaust pipes, wheels, leather seats and other spare parts, as well as assembled cars find a good market abroad. The exportation of assembled vehicles has doubled over the last two years, it represents a quarter of the national production (355,000 vehicles per annum) and 4% of the country's total exports.

The country has launched out on the building of nuclear power stations (Koeberg). Big dams and hydraulic complexes are situated on the Orange River : in Lesotho the Highlands dam and in the Vaal the Karika. In 1997 207.744 billion kWh of electricity were produced.