SOUTH AFRICAN MANUFACTURING IN AN AFRICAN CONTEXT

Abstract

South Africa is a case of an African economy where significant macro-economic reform, including trade liberalisation, has taken place over the past six years. Despite this, the country has yet to experience significant private sector growth and job creation. Average GDP growth between 1994 and 2001 was 2.7 per cent, below the average of 3.3 per cent during the 1970s and well below the estimated 6 per cent required to significantly address unemployment. During the period 1990 to 1999 the growth in gross fixed capital formation was only 1.4 per cent per annum, with investment growth only beginning to register annual growth rates in excess of 4 per cent per annum over recent years. This low GDP and investment growth is consistent with the decline in employment in manufacturing since 1994. Firm-level data may be useful to identify enterprise-level constraints underlying the weak performance. The purpose of this paper is to discuss the results of a firm-level survey of manufacturing firms in South Africa in the context of the results from eight other manufacturing surveys elsewhere in Africa. The survey was based on the RPED format and was conducted over a two-year period amongst 135 manufacturing firms (out of 474 in the population) in the North West Province region of South Africa. The paper is structured as follows. In section two the RPED in eight other African countries is described. In section three the South African survey is described and in section four the results are compared to those from the eight other surveys in Africa. Section five concludes.

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