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The existence of definite inequalities between the different regions is a characteristic of the South African economy. These inequalities are mainly attributable to the ethnic divisions that formed the basis of regional development policy during the previous political dispensation. Ethnic groupings were localised in particular regions in which so-called “homelands” were allocated to each group. Any particular group had to facilitate its social, political and economic development within the homeland allocated to it. This enforced segregation or separation and industrial decentralization placed whole communities in areas where their economic existence was threatened by disadvantageous results like poverty, underfeeding, overpopulation, crime, etc. Close to half of the black population were forced to remain in the homelands where the per capita income was less that a quarter of the national average.
Identify the so-called former independent and self-governing states that existed under the previous dispensation and indicate the ethnic groups that had to find their political, social and economic refuge in each “homeland”.
The results of the above-mentioned regional development policy was stagnation of economic growth, a considerable decrease in investments and considerable lowering of real income over a number of decades. The economy was mainly dependent on exportation of minerals and the manufacturing sector was unable to provide the required employment opportunities that would supply the needs of the population. Because of the apartheid policies, there was very little economic co-operation with other African states and South Africa found itself in a situation of isolation.
The following was suggested to achieve and extend regional and international co-operation against this background, and in accordance with RDP objectives for a strong, dynamic and balanced economy:
a) Elimination of poverty , low wages and the extreme inequalities in wages and prosperity that resulted from the policies of the previous government;
b) Easing of economic imbalances and unequal development opportunities within and among the different South African regions;
c) Development of a progressive and balanced regional policy based on the principles of equity and mutual benefit; and
d) Integration into the international economy in such a way that viable and effective local manufacturing capacity and increased potential for exportation of manufactured goods would be sustained.
Sustainable growth and development are only possible if the above principles are incorporated in policy and budget structures. The democratic government will play a leading role in this and it is expected that a dynamic balance between government initiatives, the private sector and community development will be consistently pursued. Broadly representative institutions that will plan strategies for job creation and community development must be established to assist growth in local economies. Examples would include the raising of community development funds in the private sector, investment strategies, training, small business enterprises, agricultural development, etc. If necessary, the government could make subsidies available for job creation and development projects. The ultimate goal is that projects must eventually be individually sustainable.
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