Business Cycles 1974-1981 | 1981-1989 | 1989-1996 | 1997-2007 | 2007-2013 | 2013 to date
The SA economy underwent key structural changes from the early-1990s. Firstly, an aggressive trade liberalisation policy was implemented to comply with the 1994 GATT. This exposed SA industry to the winds of international competition. Secondly, the seminal political transition created a new economy where previously disadvantaged individuals obtained access to credit, employment and ownership and also opportunities to participate in the broader economic policy-making process. Thirdly, SA’s financial integration with the world economy received a strong boost with the scrapping of the financial rand mechanism and the relaxation of exchange controls. Initially, capital inflows were slow; however, this changed in time and SA became a favoured beneficiary of international portfolio capital, including some inward direct investment. These structural changes were slow to permeate the economy and, as noted, the first post-apartheid economic expansion remained closely related to those of the 1980s. However, closer inspection of both the 1997-99 economic downturn and the 1999-2007 economic expansion provides some indication of the underlying structural changes taking hold in the SA economy.
For a narrative of the 1997-2007 peak-to-peak business cycle …