South Africa Economy

The Clinton Administration is stepping for the first time into the uncertain but potentially lucrative business of trying to guide the economic resurgence of a newly democratic South Africa. But the job of redrawing the nation's economy in a way that ensures that the transition to democracy translates into fundamental improvements in living standards for all South Africans is easier said than done.

This dusty ranching town looks and feels a lot like Texas. The biggest happening within miles is the weekly cattle auction. The landscape is flat, dry savannah. Late last century, the town served as the capital of a maverick white republic whose flag featured a single star. But when William Langeveldt moved back home to Vryburg a few years ago after living in the United States, he was reminded of an American town during the civil rights struggle. "Vryburg is the Birmingham, Ala.

A lot of misconceptions about South Africa's economy are surfacing during Nelson Mandela's U.S. tour. While the South African leader is acclaimed by crowds everywhere, he encounters misgivings from U.S. business people when he talks about his country's economic future. Americans hear him speak of a "mixed economy" with some state ownership--as he did Tuesday addressing a joint session of Congress--and think that he is out to bring Socialism to a free-enterprise system.

Njongonkulu Ndungane is the Anglican archbishop for southern Africa. On first meeting, he is not likely to hold your hand and whisper a joke. Speaking over lunch, he won't insist on saying grace. And, most obviously, his is not a household name the world over. In short, Ndungane is not Desmond Tutu, his Nobel laureate predecessor who turned Bishopscourt, the archbishop's residence in Cape Town, into a renowned address.

U.S. companies will lose out on investment opportunities in the new South Africa--deals that their Japanese and European counterparts will seize--unless American business becomes more aggressive, South Africa's U.S. ambassador said Tuesday in Los Angeles. Although U.S.

In the three weeks since President Nelson Mandela's inauguration, a host of international organizations has rushed to embrace South Africa. The country's new flag flies in Addis Ababa, Ethiopia, at the headquarters of the Organization of African Unity, once one of apartheid's bitterest enemies. On Wednesday, South Africa rejoined the British Commonwealth, more than three decades after it stormed out because of Commonwealth objections to its racist political system.

At first it seemed quixotic. But today, billions of dollars in California pension funds have been pulled out of South Africa. And as Nelson Mandela concluded his U.S. tour, people who set out to force California to pull its money out of South Africa were basking in the belief that they played a part in freeing the anti-apartheid leader. "It's an affirmation of our work," Pedro Noguera said of Mandela's visit.

South Africans may not know it, but when the country awakes today, it is likely to be a poorer place. Unprecedented aid from the central banks of Britain and the United States failed to stem a collapse in the value of the country's currency on world foreign exchange markets last week. The rand crashed 8% against the dollar in 24 hours--crushed in a monthlong attack after a worldwide emerging market crisis made it an easy target for currency speculators.

The Clinton Administration, determined to prevent the failure of South Africa's experiment in multiracial democracy, will try to persuade American businesses, pension funds and other institutions to pour billions of dollars into the country's fragile economy after next month's elections, officials said Tuesday. The White House decided to build its South Africa policy around private investment because the U.S.

The giant Anglo American Corp., hit hardest in a three-week-old strike by South Africa's black miners, and the National Union of Mineworkers resumed negotiations Friday following the company's dismissal of nearly a quarter of its work force in the pay dispute. The two sides, both bruised in the strike, indicated they had made some progress in an effort to break the prolonged deadlock over wages, the main issue in the often violent dispute, and planned formal bargaining talks for Sunday.

What do you wish for when the money in your wallet has lost nearly a quarter of its value in the past several weeks and experts warn that the squeeze is not over? A weekend. South Africans of all colors, means and political persuasions--even those with no interest in things religious--were basking Sunday in the Day of the Lord, perhaps more appropriately known in recent weeks as the Day of the Merciful Currency Gods.

South Africans may not know it, but when the country awakes today, it is likely to be a poorer place. Unprecedented aid from the central banks of Britain and the United States failed to stem a collapse in the value of the country's currency on world foreign exchange markets last week. The rand crashed 8% against the dollar in 24 hours--crushed in a monthlong attack after a worldwide emerging market crisis made it an easy target for currency speculators.

Back in 1895, mining magnate Barney Barnato deemed that a place as prosperous as Johannesburg--then a booming gold-rush town--needed a world-class hotel to flaunt its success. Barnato bought a block of land at Eloff and Commissioner streets, and although his untimely death and the Boer War delayed plans, the luxury Carlton Hotel opened its doors a decade later.

The bumpy dirt road weaving through the sugar cane fields here to Peter Watson's crocodile farm is well traveled by motorists seeking a close encounter with Africa's wild side. Thank goodness for that, Watson says. Crocodile tourism is keeping his commercial farm afloat these days. "I haven't sold a crocodile skin since October," he says. "A large amount of our skins end up in the [Far] East, and the market has dropped off entirely."

Things have never been so good--and so bad--for South Africa's notoriously exploited gold miners. The good news is that more of them are surviving each day's work. Preliminary data show fatalities and injuries per 1,000 laborers dropping last year to one of the lowest levels, due in great measure to a new mine safety act that outlaws deadly conditions of the apartheid era.

South Africa Growth at 7-Year High: The country's economy grew by 3.3% in 1995, compared with 2.7% in 1994, the Central Statistical Service said. But the pace of growth in gross domestic product slowed somewhat in the fourth quarter as manufacturing started to run up against capacity constraints. Most economists said the recovery should regain momentum this year, buoyed by a strong rebound in agriculture after parched farms received the best rains in years. Annualized GDP growth dipped to 2.

In one of the larger strikes in South African history, several million blacks stayed home from work Monday, shutting down factories and crippling businesses to protest a new sales tax and the lack of a black say in government economic policy. "A referendum was held in the streets of our country today," declared Jay Naidoo, leader of the Congress of South African Trade Unions, a 1.2-million-member labor federation and key strike organizer.

Now that South Africa, in its first multiracial election, has given the world an example of political courage and maturity, the hard work of fixing the economy will begin. New President Nelson Mandela's government starts with some advantages--but formidable obstacles too. Mandela inherits an economy that, however richly ornamented with gleaming cities and comfortable suburbs for some, remains a Third World economy for most of South Africa's 39 million people.

President Nelson Mandela sounded grateful, to say the least, when he delivered a brief speech of welcome at a conference for potential foreign investors in a hotel ballroom here this week. Mandela repeatedly and effusively thanked the 200 or so business leaders, bankers and financial analysts "from the bottom of our hearts" for attending the session.

When leaders of 12 southern African nations gathered on a stage here Monday to open a regional summit, Nelson Mandela stood out--and not just because South Africa's leader alone wore a colorful batik shirt instead of a somber suit and tie. His country's $120-billion gross domestic product is four times the combined total of the 11 other countries of the Southern African Development Community.