Economy of South Africa

Development of real GDP per capita in countries in Southern Africa

The following table shows the main economic indicators in 1980–2022. Inflation under 5% is in green.[49]

Year	GDP (in bn. US$ PPP)	GDP per capita (in US$PPP)	GDP (in billion US$ nominal)	GDP per capita (in US$ nominal)	GDP growth (real)	Inflation rate (in Percent)	Unemployment (in Percent)	Government debt (in % of GDP)
1980	148.6	5,110	89.4	3,075	6.6%	14.2%	9.2%	n/a
1981	171.4	5,745	93.2	3,123	5.4%	15.3%	9.8%	n/a
1982	181.3	5,922	85.9	2,806	−0.4%	13.7%	10.8%	n/a
1983	184.9	5,886	96.2	3,063	−1.8%	12.8%	12.5%	n/a
1984	201.3	6,250	84.8	2,634	5.1%	11.3%	13.7%	n/a
1985	205.2	6,221	64.5	1,955	−1.2%	16.6%	15.5%	n/a
1986	209.3	6,207	73.4	2,176	0.0%	18.1%	16.0%	n/a
1987	219.0	6,356	96.5	2,801	2.1%	16.5%	16.6%	n/a
1988	236.3	6,712	104.0	2,955	4.2%	12.8%	17.2%	n/a
1989	251.4	6,990	108.1	3,004	2.4%	14.6%	17.8%	n/a
1990	260.0	7,067	126.0	3,426	−0.3%	14.4%	18.8%	n/a
1991	266.1	7,059	135.2	3,588	−1.0%	15.2%	20.2%	n/a
1992	266.3	6,890	147	3,803	−2.1%	14.0%	21.2%	n/a
1993	276.0	6,966	147.2	3,716	1.2%	9.7%	22.2%	n/a
1994	290.9	7,172	153.6	3,786	3.2%	8.8%	22.9%	n/a
1995	306.2	7,391	171.7	4,145	3.1%	8.8%	16.5%	n/a
1996	325.2	7,705	163.3	3,870	4.3%	7.3%	20.3%	n/a
1997	339.4	7,908	169	3,938	2.6%	8.6%	22.0%	n/a
1998	345.0	7,916	152.9	3,508	0.5%	7.0%	26.1%	n/a
1999	358.2	8,099	151.4	3,424	2.4%	5.1%	23.3%	n/a
2000	381.7	8,502	151.9	3,382	4.2%	5.3%	23.0%	37.9%
2001	400.9	8,767	135.5	2,964	2.7%	5.7%	26.0%	38.0%
2002	422.2	9,107	129.4	2,791	3.7%	9.0%	27.8%	31.8%
2003	443.2	9,469	197.0	4,209	2.9%	5.9%	27.7%	31.5%
2004	475.8	10,058	256.2	5,415	4.6%	1.4%	25.2%	30.7%
2005	516.6	10,795	288.7	6,033	5.3%	3.4%	24.7%	29.6%
2006	562.4	11,610	304.1	6,276	5.6%	4.7%	23.6%	28.0%
2007	608.6	12,398	332.6	6,776	5.4%	7.1%	23.0%	24.3%
2008	640.1	12,854	316.5	6,356	3.2%	11.0%	22.5%	24.0%
2009	634.3	12,548	331.2	6,552	−1.5%	7.2%	23.7%	27.0%
2010	661.4	12,885	417.3	8,130	3.0%	4.2%	24.9%	31.2%
2011	696.5	13,362	458.7	8,799	3.2%	5.0%	24.8%	34.7%
2012	698.2	13,191	434.4	8,207	2.4%	5.6%	24.9%	37.4%
2013	730.5	13,591	400.9	7,458	2.5%	5.7%	24.7%	40.4%
2014	741.9	13,595	381.2	6,985	1.4%	6.1%	25.1%	43.3%
2015	758.9	13,697	346.7	6,257	1.3%	4.6%	25.4%	45.2%
2016	772.8	13,738	323.5	5,751	0.7%	6.3%	26.7%	47.1%
2017	790.2	13,839	381.3	6,678	1.2%	5.3%	27.5%	48.6%
2018	821.4	14,178	404	6,973	1.5%	4.6%	27.1%	51.7%
2019	838.6	14,271	388.4	6,609	0.3%	4.1%	28.7%	56.2%
2020	794.9	13,332	337.5	5,661	−6.3%	3.3%	29.2%	69.0%
2021	868.6	14,442	418.9	6,965	4.9%	4.6%	34.3%	69.0%
2022	949.8	15,556	405.7	6,694	2.1%	6.7%	34.6%	68.0%

This is a chart of the trend of South Africa's gross domestic product (GDP) at market prices estimated by the International Monetary Fund:[50]

In 2019, the country was the world's largest producer of platinum;[58] the world's largest producer of chromium;[59] the world's largest producer of manganese;[60] the 2nd largest world producer of titanium;[61] the world's 11th largest producer of gold;[62] the 3rd worldwide producer of vanadium;[63] the 6th largest world producer of iron ore;[64] the 11th largest world producer of cobalt;[65] and the 15th largest world producer of phosphate.[66] It was the world's 12th largest producer of uranium in 2018.[67]

Mining has been the main driving force behind the history and development of Africa's most advanced economy. Large-scale and profitable mining started with the discovery of a diamond on the banks of the Orange River in 1867 by Erasmus Jacobs and the subsequent discovery and exploitation of the Kimberley pipes a few years later. Gold rushes to Pilgrim's Rest and Barberton were precursors to the biggest discovery of all, the Main Reef/Main Reef Leader on Gerhardus Oosthuizen's farm Langlaagte, Portion C, in 1886, the Witwatersrand Gold Rush and the subsequent rapid development of the goldfield there, the biggest of them all.

South Africa is one of the world's leading mining and mineral-processing countries.[68] Though mining's contribution to the national GDP has fallen from 21% in 1970 to 6% in 2011, it still represents almost 60% of exports.[69] The mining sector accounts for up to 9% of value added.[70]

In 2008, South Africa's estimated share of world platinum production amounted to 77%; kyanite and other materials, 55%; chromium, 45%; palladium, 39%; vermiculite, 39%; vanadium, 38%; zirconium, 30%; manganese, 21%; rutile, 20%; ilmenite, 19%; gold, 11%; fluorspar, 6%; aluminium, 2%; antimony, 2%; iron ore, 2%; nickel, 2%; and phosphate rock, 1%.[68] South Africa also accounted for nearly 5% of the world's polished diamond production by value.[68] The country's estimated share of world reserves of platinum group metals amounted to 89%; hafnium, 46%; zirconium, 27%; vanadium, 23%; manganese, 19%; rutile, 18%; fluorspar, 18%; gold, 13%; phosphate rock, 10%; ilmenite, 9%; and nickel, 5%.[68] It is also the world's third largest coal exporter.[71]

The mining sector has a mix of privately owned and state-controlled mines, the latter including African Exploration Mining and Finance Corporation.[72]

Workers planting on a farm in the central area of Mpumalanga

Farm workers

In 2018, South Africa produced 19.3 million tonnes of sugarcane (14th largest producer in the world), 12.5 million tonnes of maize (12th largest producer in the world) 1.9 million tons of grape (11th largest producer in the world), 1.7 million tons of orange (11th largest producer in the world) and 397 thousand tons of pear (7th largest producer in the world). In addition, in the same year, it produced 2.4 million tons of potato, 1.8 million tons of wheat, 1.5 million tons of soy, 862 thousand tons of sunflower seed, 829 thousand tons of apple, 726 thousand tons of onion, 537 thousand tons of tomato, 474 thousand tons of lemon, 445 thousand tons of grapefruit, 444 thousand tons of banana, 421 thousand tons of barley, in addition to smaller productions of other agricultural products, such as avocado, pineapple, peach, tangerine, pumpkin, cabbage, carrot, rapeseed, sorghum etc.[73]

The agricultural industry contributes around 5% of formal employment, relatively low compared to other parts of Africa, as well as providing work for casual labourers and contributing around 2.8% of GDP for the nation.[5][74] However, due to the aridity of the land, only 13.5% can be used for crop production, and only 3% is considered high potential land.[75] The sector continues to face problems, with increased foreign competition and crime being two of the major challenges for the industry. The government has been accused of either putting in too much effort,[76] or not enough effort,[77] to tackle the problem of farm attacks as opposed to other forms of violent crime.

Maize production, which contributes to a 36% majority of the gross value of South Africa's field crops, has also experienced negative effects due to climate change.[78] The estimated value of loss, which takes into consideration scenarios with and without the carbon dioxide fertilization effect,[79] ranges between tens and hundreds of millions of Rands.[80]

According to FAOSTAT, South Africa is one of world's largest producers of: chicory roots (4th); grapefruit (4th); cereals (5th); green maize and maize (7th); castor oil seed (9th); pears (9th); sisal (10th); fibre crops (10th).[81] In the first quarter of 2010, the agricultural sector earned export revenues for R10.1 billion and used R8.4 billion to pay for imported agricultural products, therefore earning a positive trade balance of R1.7 billion.[82]

The most important agricultural exports of South Africa include: edible fruit and nuts, beverages, preserved food, tobacco, cereals, wool not carded or combed, miscellaneous food, sugar, meat, milling products, malt and starch.[82] These products accounted for over 80% of agricultural export revenue in the first quarter of 2010.[82] The most important agricultural imports, which accounted for over 60% of agricultural import value during the same period, include: cereals, meat, soya-bean oil cake, beverages, soya-bean oil and its fractions, tobacco, palm oil and its fractions, miscellaneous food, spices, coffee, tea, and preserved food.[82]

The dairy industry consists of around 4,300 milk producers providing employment for 60,000 farm workers and contributing to the livelihoods of around 40,000 others.[83]

The food sub-sector is the largest employer within the agro-processing sector – contributing 1.4% to total employment, and 11.5% within the manufacturing sector.[84] In 2006, the agro-processing sector represented 24.7% of the total manufacturing output.[84] Although the economy as a whole gained 975,941 jobs between 1995 and 2006, the agro-processing sector lost 45,977 jobs.[84] The competitive pressures from abroad, particularly from China and India, played a role in the decline of exports for the food, textiles and paper sub-sectors, as firms in these sectors increasingly compete with lower cost producers.[84] Increased exports from the beverages, tobacco, wood and leather sub-sectors over the period are probably due to the presence of large dominant firms within these sectors in South Africa, that have managed to remain competitive.[84]

The manufacturing industry's contribution to the economy is relatively small, providing just 13.3% of jobs and 15% of GDP. There are growing sectors of manufacturing, however, such as in the Space industry. Labour costs are low, but not nearly as low as in most other emerging markets, and the cost of the transport, communications and general living is much higher.[85]

The South African automotive industry accounts for about 10% of South Africa's manufacturing exports, contributes 7.5% to the country's GDP and employs around 36,000 people. Annual production in 2007 was 535,000 vehicles, out of a global production of 73 million units in the same year. Vehicle exports were in the region of 170,000 units in 2007, exported mainly to Japan (about 29% of the value of total exports), Australia (20%), the UK (12%) and the US (11%). South Africa also exported ZAR 30.3 billion worth of auto components in 2006.[86]

BMW, Ford, Volkswagen, Daimler-Chrysler, General Motors, Nissan and Toyota all have production plants in South Africa. Large component manufacturers with bases in the country are Arvin Exhaust, Bloxwitch, Corning and Senior Flexonics. There are also about 200 automotive component manufacturers in South Africa, and more than 150 others that supply the industry on a non-exclusive basis. The industry is concentrated in two provinces, the Eastern Cape and Gauteng.[86] Companies producing in South Africa can take advantage of the low production costs and the access to new markets as a result of trade agreements with the European Union and the Southern African Development Community.[86]

After a steep decline of 10.4% in 2009, the manufacturing sector performed well in 2010, growing by 5%, though this rebound was primarily limited to the automotive, basic chemicals, iron and steel and food and beverages industries.[87] The performance of this sector remains curtailed by the low demand in South Africa's main export markets in the developed world.[87] There is growth in some areas, such as the Space industry in South Africa, which is expected to see an increase in Space industry jobs, and jobs in supporting technology and manufacturing sectors.

The domestic telecommunications infrastructure provides modern and efficient service to urban and rural areas. This includes cellular and internet services from 5G to Gigabit Broadband.

In 1997, Telkom, the South African telecommunications parastatal, was partly privatised and entered into a strategic equity partnership with a consortium of SBC (AT&T), in exchange for a monopoly to provide certain services for 5 years. Telkom assumed an obligation to facilitate network modernisation and expansion into the unserved areas. A Second Network Operator, Neotel was to be licensed to compete with Telkom across its spectrum of services in 2002. Licensing officially began in late 2005.

Five mobile-phone companies provide service to over 50 million subscribers, with South Africa considered to have the 4th most advanced mobile telecommunications network worldwide. The five major cellular providers are Vodacom, MTN, Cell C(Vodacom), Telkom Mobile(8.ta) and Rain, with Neotel owned by Liquid Telecoms not offering mobile service anymore.

South African companies which provide services related to the Space industry, also increasing, and with the correct government legislation and support, this sector is expected to grow in South Africa.

Over the last few decades, South Africa and particularly the Cape Town region has established itself as a successful call centre and business process outsourcing destination. With a highly talented pool of productive labour and with Cape Town sharing cultural affinity with Britain, large overseas firms such as Lufthansa, Amazon.com, ASDA, The Carphone Warehouse, Delta Airlines and many more have established inbound call centres within Cape Town as a means of utilising Cape Town's low labour costs and talented labour force.[88]

South Africa is a popular tourist destination, with around 860,000 arrivals per month (March 2008) of which around 210,000 is from outside the African continent.[89] In 2012 South Africa received 9.2 million international arrivals.[90] In August 2017 3.5 million travellers came to South Africa.[91] According to the World Travel & Tourism Council, travel and tourism directly contributed ZAR102 billion to South African GDP in 2012 and supports 10.3% of jobs in the country.[92] Among the main attractions are the diverse and picturesque landscape, the game reserves and the highly regarded local wines.

The country's borders were reopened on 1 October 2020, with some exceptions to tourists travelling from specific European countries and the US, due to high levels of COVID-19 activity taking place there.

Johannesburg

South Africa has a sophisticated financial structure, with the JSE Limited, the largest stock exchange on the African continent, ranking 17th in the world in terms of total market capitalisation, which is $1,005 Trillion as of August 2020.[93][94]

The banking industry, overseen by the South African Reserve Bank, is dominated by four local players: Nedbank, ABSA, Standard Bank and First Rand.[95] These banks provide both retail and investment banking services as the sector has become highly competitive with the re-entry of many experienced foreign banks, which returned to the market in the mid-1990s, having left in the late 1980s.[95] Banks operating in South Africa, when left short of liquidity, need to borrow from the SARB at a fluctuating repo rate, which, in turn, allows the central bank to monitor liquidity positions.[95]

South Africa's informal sector contributes 8% of the country's GDP and supports 27% of all working people. The South African Local Economic Development Network values the informal economy at 28% of SA's GDP.[96] Given the relevance of this input, there is a constant interest in developing actions on an inclusive urban planning for the working poor.[97]

South Africa has been riven by arguments over whether the state should take over mineral resources.[99] A study commissioned by the African National Congress recommended against the policy, saying nationalisation would be an "economic disaster."[99] However, the ANC Youth Employment supporters disagree and state that it will give the government direct control over the mining sector which is also in alignment with the Freedom Charter signed in 1995.[100]

The government aimed to transfer 30% of the 82 million hectares estimated to be in the hands of white farmers by Gugile Nkwinti, Minister of Rural Development and Land Reform, amounting to 24.5 million hectares, to black farmers by 2014. 6.7 million hectares had been transferred by early 2012 via redistribution and restitution.[101]

The land reform program has been criticised both by farmers' groups and by landless workers, the latter alleging that the pace of change has not been fast enough, and the former alleging anti white racist treatment with threats of genocide, voiced openly on multiple occasions by the ANC, including the former president Zuma, and expressing concerns that a similar situation to Zimbabwe's land reform policy may develop,[102] a fear exacerbated by comments made by former deputy president Phumzile Mlambo-Ngcuka.[103][104]

There has been a large degree of human capital flight from South Africa in recent years.[117][118] South Africa's Bureau of Statistics estimates that between 1 million and 1.6 million people in skilled, professional, and managerial occupations have emigrated overseas between 1994 and 2004 and that, for every emigrant, 10 unskilled people lose their jobs.[117] There are a range of causes cited for the migration of skilled South Africans.

In mid-1998, the Southern African Migration Project (SAMP) undertook a study to examine and assess the range of factors that contribute to skilled South Africans’ desire to leave the country: over two-thirds of the sample said that they had given the idea of emigration some thought while 38% said they had given it a "great deal of thought". Among the reasons cited for wishing to leave the country was the declining quality of life and high levels of crime. Furthermore, the government's affirmative action policy was identified as another factor influencing the emigration of skilled White South Africans. The results of the survey indicate that skilled Whites are strongly opposed to this policy and the arguments advanced in support of it, due to the negative impact it has had on South Africa.[118]

However, flight of human capital in South Africa should not be attributed solely to regional factors. For example, the demand for skilled labourers in the UK, US, Canada, New Zealand, and Australia has led to active recruitment programs by those countries in South Africa. These countries accounted for 75% (by volume) of recent skilled emigration with the UK receiving approximately half of annual skilled South African emigration from 1990 to 1996.[118] It has been suggested that the role of domestic socio-political variables may be negligible.[118] The health sector has been hit particularly hard.[119]

A widespread skills drain in South Africa and in the developing world in general is generally considered to be a cause for concern.[120]

For the medical sector, the loss of returns from investment for all doctors emigrating is $1.41bn for South Africa. The benefit to destination countries is huge: $2.7bn for the United Kingdom alone.[121]

In a case of reverse brain drain a net 359,000 high-skilled South Africans have returned to South Africa from foreign work assignments over a five-year period from 2008 to 2013. This was catalysed by the global financial crisis of 2007–8 and perceptions of higher quality of life in South Africa relative to the countries from which they first emigrated to. It is estimated that around 37% of those returning are professionals such as lawyers, doctors, engineers and accountants.[122]

Refugees from poorer neighbouring countries include many immigrants from the Democratic Republic of the Congo, Mozambique, Zimbabwe, Malawi and others, representing a large portion of the informal sector. With high unemployment levels amongst poorer South Africans, xenophobia is prevalent and many South Africans feel resentful of immigrants who are seen to be depriving the native population of jobs, a feeling which has been given credibility by the fact that many South African employers have employed migrants from other countries for lower pay than South African citizens, especially in the construction, tourism, agriculture and domestic service industries. Illegal immigrants are also heavily involved in informal trading.[123] However, many immigrants to South Africa continue to live in poor conditions, and the South African immigration policy has become increasingly restrictive since 1994.[124]

Since 2007 the South African unions representing public sector workers recurrently went on strike, demanding pay rises significantly above inflation, in a practice that some experts argue is suppressing job growth, harming millions of South Africans who are out of a job.[114]

In August and September 2010, South African unions organised a crippling four-week national strike involving 1.3 million public sector workers, demanding an 8.6% wage increase. The strike ended after the government had raised its 5.2% wage increase to 7.5%. The deal swelled state spending by about 1%.[125]

Protesters sought to block hospitals, and South African media have reported numerous acts of violence against health and education staff who insisted on going to work. Volunteers and army medics were called in to help at hospitals, and some patients were moved to private medical facilities.[125]

There is a persistent wage differential between unionised and non-unionised workers in South Africa, suggesting that unions are keeping wages higher for their members, thereby posing additional challenges to the unemployment problem.[109]

In July 2014, amidst a national strike by 220,000 metalworkers, General Motors temporarily shut down its vehicle assembly plant, frustrating its plans to build 50,000 cars a year in the country. "The ongoing labour disruptions are harming the South African economy and are affecting the country's image around the globe," the company said in a statement at the time.[126]

The end of apartheid in 1994 left behind a skewed racial economic hierarchy that placed minority whites at the top. Since then, the African National Congress government created the Black Economic Empowerment (BEE) policy, designed to increase the participation of blacks, Coloreds, and Indians in the economy. However, BEE has faced criticism for not doing enough to accomplish this goal and only benefiting a small number of people to a great extent. This was acknowledged in 2010 by Deputy President Kgalema Motlanthe, at the first meeting of the BEE Advisory Council, when he said, "The story of black economic empowerment in the last 15 years has been a story dominated by a few individuals benefiting a lot." A 2010 report from the OECD concluded that the "relative improvement in poverty levels," since the end of apartheid, has actually been driven by social assistance grants and not the labour market.[127]

As of 2014, roughly ten percent of the Top 100 companies on the Johannesburg Stock Exchange were directly held by black investors through Black Economic Empowerment schemes. Black Economic Empowerment policies have been credited with creating a class of Black South Africans with a level of wealth on the same order of magnitude as very rich White South Africans.[24]^: 2

Black Economic Empowerment—its purpose the "economic empowerment of all black people, including women, workers, youth, people with disabilities and people living in rural areas"—requires the Minister of Trade and Industry to develop and publish Codes of Good Practice, aimed at setting guidelines for the process of BEE in the whole economy.[128] A scorecard is used by the department to measure compliance with the BEE requirements, and is used for public procurement, public-private partnerships, sale of state-owned enterprises, when licenses are applied for, and for any other relevant economic activity.[128]

The government's Black Economic Empowerment policies have drawn criticism from the Development Bank of Southern Africa for focusing "almost exclusively on promoting individual ownership by black people (which) does little to address broader economic disparities, though the rich may become more diverse." The System has also been criticised for placing lesser educated people in more important positions in the workplace and their failure to perform to the standards required has had an immense impact on the economy. Another criticism also includes that the system goes against the constitution's preaching of equality by having preference over people, not on merit, but for their skin colour and is considered the opposite of what many people fought for during the Apartheid era.[129] Official affirmative action policies have seen a rise in black economic wealth and an emerging black middle class.[130] An increasing number of black candidates who are supposed to be beneficiaries of affirmative action are dissociating themselves from it, largely because of the perception that the appointments are not based on merit.[131] The policy has also been criticised for having a negative impact on employment levels as it is viewed as being more of an additional burden for employees than as a transformative agent for the unemployed.[24]^: 2 Particularity in an economy where a major cause of inequality has been a growing disparity of income within the majority black population divided along lines of employment.[24]^: 12

South Africans in general, regardless of race, hold what would be considered "traditional" stances on gender roles for men and women. The majority of the workforce is composed of males, while the majority of women do not participate.[132] This viewpoint on males as "breadwinners" is very much in line with traditional African values across the continent. Additionally, females face a problem in terms of earnings, with 77% of women earning the same as their male counterparts.[133] However, more women are becoming part of the agricultural workforce (55%) as of 2012, marking a move towards modernisation for women's participation in the economy.[134]

South African legislation is strongly geared to promoting gender equality in the workplace. This is characterised by several comprehensive government programs and organisations that provide resources and services to females, both adult and adolescent. Such initiatives include the Employment Equity Act, No. 55 of 1988 (aimed at promoting women's participation in mainly private sector jobs).[135] UNFPA South Africa is one such promoter of these policies and programs.[136] Internally, the South African government has founded the Commission for Gender Equality.[137] The commissions main focus is on securing adequate education and job training for women who are disenfranchised or otherwise at a disadvantage when attempting to enter the workforce.

Not uncommon in Africa, gender equality seems to be a very cogent problem in the South African workforce. According to Bain & Company, around 31% of companies have no form of female leadership, either in management or executive positions.[138] 22% of board directors are women, however, only 7% were designated as "executives", lower than the global average of 12%.[139] Additionally, the eNPE (Employee Net Promoter Score) for women is a net negative (- 4) as compared to men (8), according to a survey conducted of 1000 participants.[140] This indicated a low level of actual economic promotion for women, despite public and international initiative towards the contrary.

Scheduled rolling blackouts are a part of daily life. Electricity theft is widespread. After years of sub-standard maintenance and the South African government's inability to manage strategic resources, the state-owned power supplier Eskom started experiencing deficiency in capacity in the electrical generating and reticulation infrastructure in 2007. Such lack led to inability to meet the routine demands of industry and consumers, resulting in countrywide rolling blackouts. Initially, the lack of capacity was triggered by a failure at Koeberg nuclear power station, but a general lack of capacity due to increased demand and lack of government planning soon came to light. The supplier and the South African government has been widely criticised for failing to adequately plan for and construct sufficient electrical generating capacity,[141] although ultimately the government has admitted that it was at fault for refusing to approve funding for investment in infrastructure.[142]

The margin between national demand and available capacity is still low or negative (particularly in peak hours), and power stations are under strain, such that surges in demand, which are common during winter, or drops in supply, often a result of a lack of coal for power plants, result in another phase of rolling blackouts.[143] The government and Eskom are currently planning new power stations, at cost to the South African consumer. The power utility plans to have 20,000 megawatts of nuclear power in its grid by 2025.[144][145]

Some predictions show surface water supply could decrease by 60% by the year 2070 in parts of the Western Cape.[146]

The South African government planned to spend R69 billion on water infrastructure between 2008 and 2015.[147] This involves building new dams and ancillary infrastructure, and repairing existing infrastructure.[147] South Africa has an estimated total water capacity of 38 billion cubic metres, but will need 65 billion by 2025 if the economy is to keep on growing.[147] The massive urban migration has placed further strain on the country's ageing water infrastructure and created a large backlog.[147]

As part of an international attempt to modernize infrastructure, South Africa has faced increasing pressure to invest government funds into its water and electricity sectors. At current, these sectors are underfunded by approximately US$464 billion (This is according to the G20 GI Hub).

The top rate of personal income tax rate in South Africa is 45%; the corporate tax rate is 27%.[162] Other taxes include a value-added tax and a capital gains tax, with the overall tax burden amounting to 23.4% of total domestic income.[162]

South Africa has about three times as many recipients of social benefits as it has income tax-payers, an extremely high ratio by international standards.[44] After 1994 resources have been rapidly reallocated to black households: while approximately 40% of aggregate social spending was directed to whites and 43% to blacks in the mid-1980s, by the late 1990s fully 80% of total social spending was assigned to blacks and less than 10% to whites.[163] At present, blacks contribute some 50% of total government transfers, while receiving roughly 80%.[164]

The Unemployment Insurance Fund is financed out of premiums, contributions and benefits depend on earnings, and focuses on insuring workers against the risk of income loss.[165]

Social assistance grants are non-contributory, income-tested benefits provided by the state to the poor, and are financed out of general tax revenues without any links between contributions and benefits.[165] They are provided in the form of: grants for older persons; disability grants; war veterans grants; care dependency grants; foster child grants; child support grants; grant-in-aid; social relief of distress.[166]

The state old age pension, received by over 80% of the elderly,[167] is a non-contributory pension and pays more than twice median per capita Black income, thus representing an important source of income for a third of all Black households in the country.[168] It pays a maximum of R1,780 (as of July 2019)[169] to people who reach pension age without access to private pensions.[168]

The child support grant provides R420 per month, per child (as of July 2019)[170] for every child in the household younger than 18,[170] and benefited 9.1 million children by April 2009.[167]

The war veterans grant is provided to former soldiers who fought in the Second World War or the Korean War, and pays a maximum amount of R1,800 per month (as of July 2019).[171]