Wednesday 11 December 2013

South Africa post Mandela -

Hardly the disaster people in the media are desperate to point out.

Growth under Aparthied, consolidation, then lots more growth again - I'd be a buyer of shares on this chart were it a stock:


Sebastian Weetabix said...

I might buy shares but I wouldn't live there. Especially I wouldn't be a white farmer. First they take most of your weapons away, leaving you with a shotgun and pistol - nothing with real stopping power, when faced with a murderous mob. Then they limit the amount of ammo you can have. Then they stop you forming a commando for mutual defence with other beleaguered farmers. Then, of course, the authorities look the other way when the mob comes to kill you (usually on a Sunday because the young and able-bodied will mostly go to Church; it's easy to take the farm when only a few infirm old codgers are there). But before the mob kills you, first they rape your wife and any other available females. Then the corrupt Police don't catch anyone. And lo, it comes to pass that farm production keeps dropping and poverty increases. Even worse, you're trapped. Who the hell would buy the land from you? There's a reason they all cheered Mugabe the other day. They like his ideas on land 'reform'.

Nice white liberals like to think the handover of power in South Africa was bloodless. It wasn't. Upwards of 25,000 black Africans were killed in a de facto civil war between the ANC and Inkatha et al, leading to a de-facto one party state. (Not Mandela's fault, he couldn't have stopped it. He couldn't even stop his wife making sure her opponents in Soweto were necklaced.)

Since then about 3,000 white farmers have been murdered. The murder rate for that occupation is about 250 times the murder rate in Europe.

Equally I wouldn't want to be a poor black guy living in a township. The government is corrupt and incompetent and services are declining. What little money I have is losing its value and my wages, if I have a job, are pushed down by the huge influx of immigrants from the rest of Africa. On the plus side the murder rate is only about 50 times the European average.

I don't expect to see any of this on the BBC. Still, Cape Town is still very nice and if you live on a gated estate with a private army things are OK. For the moment.

Blue Eyes said...

I like your graph, it tallies with my limited experience.

One of the more interesting things I have done recently was to visit a dirt-poor African country. It wasn't even a developing country because if anything it was obviously going backwards. Interesting not because I came back wearing fisherman's trousers and braided hair chanting student mantras, but because it puts things into perspective. In poor Central/SE Africa the nearest major market is South Africa. That means if you want a car or computer or even high street clothing you get it via South Africa - either by getting the bus there (several days in either direction) or by getting it shipped in from there.

From the two Brits I know who have been to SA, things are very different when people realise you are not a white South African. White SAs have to live carefully behind compound gates. White anyone else can wander around carefree. Stupid generalisation, obviously, but both of my sample of two (i.e. 100%) said the same thing.

So yes while I'm sure it is tough to be a former white Apartheid cheerleader land-owner (what goes up must come down, eh?) I would rather be a poor black South African than a poor black Mozambiquan or Congoan.

hovis said...

A SA colleague, has the view that Mandela was no saint but did well by defusing the potential for immediate bloodlettng, also by not serving more than one term he joins literally a handful of African leaders.

For the moment things will continue to as it - there is too much money being made for it not to.

However in the medium term he see's first racial conflict, once that bloodletting has plateaued it turning in to tribal - thnk Xhosa / zulu etc etc.

As has been said elsewhere the best things outh africans can do in the memory of Mandela is not vote for the ANC.

I'm certainly not bullish long term. From personal experience I was in Joberg last year seeing one of the large banks - the chap leading their side was Kenyan, he was not happy at the likely trajectory he saw.

Ryan said...

I was wondering where the World Bank got its figures from 2000-2010. The graph implies a growth rate in excess of 7%p.a.

Most graphs I have seen show GDP at 3% over the same period.

Taking a closer look that World Bank graph isn't adjusted for inflation (inflation running about 6% in SA) and is not adjusted for population (population growth of 20% over the same period).

You've got to be very careful what you are looking at with GDP figures.

The news pundits are right. GDP per capita (PPP) for South Africa has been very poor since the end of apartheid, more or less flatlining. Very poor performance when compared to most developing countries.

However, you are also right because a nation with relatively high inflation and high population growth can give exciting investment opportunities.

john miller said...

Are they still turning the power off at 4pm for 4 hours every other day?

Except for Cape Town, where foreigners might notice.

I thought that would slow down the rate of increase of GDP, but perhaps not. As G. Brown (COTP) proved GDP is for the fairies anyway.

CityUnslicker said...

Fair comment Ryan. I was searching for good PP numbers, couldnot find them and so this was the best available..

South Africa though is different to Africa, they are more second world than third world. the neightbours who are growing fast are from a zero base. South Africa is a lot further on than that in its development. Which is an extended way of saying GDP does matter too, not just PPP.