Macroeconomic/Financial Profile of South AfricaAny attempt to explain the recent economic history of South Africa must begin with a discussion of the 'apartheid. From the mid-20th century until 1990, the National Party (NP) government engaged in the systematic oppression of non-white South Africans, in what became known as the apartheid system. To understand the net economic consequences of apartheid, consider the graph in the lower right corner of Figure 1 which shows real GDP per capita in constant PPP US dollars from 1980 to 2008. Looking at the graph, we see that despite a few rare After growth spurts, the South African economy generally experienced negative growth in per capita income between 1980 and 1993. A 1997 Economist Intelligence Unit (EIU) report provides a possible explanation for this trend. From the mid-1970s until the early 1990s, the South African economy experienced an almost continuous decline in domestic investment. This, coupled with the government's conservative fiscal policies, has forced the economy to rely increasingly on private consumption to propel growth. However, private consumption has been unable to achieve this due to high interest rates, high levels of personal debt and negligible employment growth. Although true, the above explanation does not discuss the root cause of South Africa's economic struggle during this period, namely apartheid. . In the mid-1980s, growing international opposition to apartheid led the United States, among other countries, to become involved in a divestment campaign against South Africa (Knight 1990). U.S. involvement included passage of the Comprehensive Anti-Apartheid Act in 1986, which limited investment...... middle of paper ...... for unemployment, according to an EIU report As of 2008, recent growth in the manufacturing and service sectors has increased demand for skilled workers, while declines in the agriculture and mining sectors have led to a decrease in demand for unskilled labor . As a result, South Africa is left with a large amount of unskilled labor. As I have shown above, South Africa's economic performance in recent decades can largely be explained in the context of South Africa's political transition away from apartheid. In the years following the end of apartheid, the ANC's reform policies were largely successful in boosting economic growth, promoting stability, and overseeing the transformation of the South African economy from a traditionally focused on mining and agriculture towards a modern economy, in which manufacturing and financial services contribute a greater share of GDP.