The 2009 Development Indicators publication is the third edition of a report that was first published in 2007 as a mid-term review document by the Policy Unit (PCAS) in the Presidency in collaboration with the Clusters of Directors-General. Approved by Cabinet, the indicators provide a framework to present aggregate data on progress in human development. In this regard South Africa joins a few countries in the world that publish similar indicators on a regular basis.
The following highlights are presented for the 76 indicators that are clustered into ten broad themes:
1. Economic growth and transformation
* The deterioration in global economic conditions is adversely affecting South Africa, as real Gross Domestic Product (GDP) growth for the whole of 2008 slowed to 3.1% compared to an average of over 5% in the previous three years. Annualised quarter-on-quarter figures for the first and second quarters of 2009 were -6.4% and -3.0% respectively. Combined with negative growth in the last quarter of 2008, this is the first time in more than 15 years that South Africa has experienced three consecutive quarters of negative growth.
* Foreign direct investment increased from R18.127 billion in 2007 to R103.497 billion in 2008.
* Gross fixed capital formation increased from 20.6% of GDP in 2007 to 23.2% of GDP in 2008. Annualised quarter to quarter growth in gross fixed capital formation slowed markedly to 3% in the fourth quarter of 2008 and to 2.6% in the first quarter of 2009 following three years of double digit growth. This is broadly in line with the decline in economic activity in the South African economy.
* The average real interest rate for the period 1994 to 1999 was 11.2% compared to the period 2000 to 2008 when it was about 7.4%.
* Consumer Price Index (CPI) inflation reached 11.5% in 2008, although a decline is noted in the course of 2009.
* The bond points spread increased from 93 in 2006 to 339 basis points in 2008 indicating a rise in perceptions of risk among investors, and more expensive borrowing for government.
* The repatriation of dividends, amongst other factors, was responsible for the high current account deficit, which experienced a slight deterioration from -7.3% of GDP in 2007 to -7.4% of GDP in 2008.
* Since 2004 R&D expenditure has increased significantly to reach R16.5 billion or 0.95% of GDP by 2006/07. Whilst the 2008 target of 1% is attainable, the biggest risks to achieving our R&D objectives is the low proportion of high school science and maths passes and graduates form Science Engineering and Technology (SET) disciplines, as well as the impact of the economic slowdown on planned R&D investment, particularly in the business sector.
* The negative impact of the global slowdown is already being felt on the government budget as well as government debt as a percentage of GDP. The medium term budget balance as a percentage of GDP is projected to be a deficit of over 6% in 2009/10.
* Whilst there is progress in transforming the economy to be broadly representative, the value and number of empowerment transactions and representation of previously disadvantaged individuals at management levels is progressing at a slow pace.
* Generally the country is doing well in global economic rankings, although it is clear that in some sub-indices, especially labour force skills, other countries are advancing faster than South Africa.
2. Employment
* Positive gains attained during an increase in employment from 11.3 million in March 2003 to 13.6 million in March 2009 and the attendant decline in unemployment rate from 31.2% to 23.5% over the same period, are beginning to be eroded by the current economic slowdown. The country has witnessed massive job losses in the recent months. 267 000 jobs were lost in the second quarter of 2009.
* However, the massive public sector-led construction package and expansion of public works projects is assisting in what would have been an even greater unemployment challenge.
* Over a 5 year period up to March 2009, the Expanded Public Works (EPWP) programme exceeded its target by creating a cumulative total of 1.65 million work opportunities, and its second phase is planned to create a cumulative total of 4 million work opportunities.
3. Poverty and inequality
* More than 13 million people now receive social grants, compared to 7.87 million in 2004/05.
* The mean per capita income analysis shows an improvement in the incomes of the poorest 10% of the population rising from R783 per month in 1993 to R1041 per month in 2008 (in 2008 Rand).
* Using the Living Standard Measure (LSM), between 2000/01 and 2007/08 there was a significant decrease in the proportion of people in lower categories (LSMs 1-3) and an increase in the size of the middle bands (LSMs 4-6).
* Income inequality in South Africa was not reduced even during the years of economic growth: while income of all sectors has improved, that of the richer segment of the society seems to have improved at a faster rate.
* Using various income poverty measures, the number of people living in poverty has declined especially between 1999 and 2007, although the rate of this decline is slow. It seems that the decline itself may have slowed down further during 2008.
In short, these figures indicate that since 1994 significant improvements were made with regard to reducing poverty. Both the distribution of social grants as well as an improvement in the labour market, have significantly improved the income levels of especially the poor. However these were not enough to dent income inequality. The current economic slow-down is likely to lead to deterioration in the poverty indicators.
4. Household and community assets
* In March 2009, the subsidised housing programme reached a cumulative total of 2.8 million units completed or under construction.
* Access to water infrastructure above or equal to the Reconstruction and Development Programme (RDP) standard increased from 61.7% in 1994 to 91.8% in March 2009.
* The number of households with access to sanitation increased from 50% in 1994 to 77% (10 million) in March 2009, although complete eradication of the bucket system remains a challenge in a handful of municipalities.
* Only about 5% of the land restitution claims remain unresolved. They are mainly rural based and quite complex in nature.
* The goal of distributing 30% of the country’s agricultural land by 2014 remains a challenge.
5. Health
* There is lack of consensus about the calculation of life expectancy in South Africa due to lack of reliable data especially for the period before 2000. There is however a pattern of increasing mortality, especially among the young. Most calculations suggest a stabilisation of the trend in recent years.
* Infant and child mortality data from different sources show an increase, mostly attributed to the impact of HIV and AIDS.
* There is a decrease in the number of children suffering from severe malnutrition, from 89 000 in 2001 to 26 000 in 2008 and some studies attribute this to improved nutritional status of children when their caregiver receives a support grant.
* National immunisation coverage of 88% was achieved in 2008 against the 90% target, and delivery of 3 new vaccines is planned with the aim of reducing child mortality especially in the 18 selected most deprived districts countrywide.
* HIV and AIDS remain a challenge despite the findings of the 2007 antenatal survey which reflected a 1% reduction in HIV prevalence between 2006 and 2007, and a 2% reduction between 2005 and 2007.
* Despite the lack of reliable data on community prevalence of tuberculosis and multi-drug resistant and extensively drug resistant strains, the tuberculosis cure rate increased from 50% in 2001 to 63% in 2007.
* The number of malaria cases has dropped markedly over time.
6. Education
* Whilst acknowledging variations between districts and provinces, the average learner-to-educator ratio in 2008 is 31:1 in ordinary public schools down from 34:1 in 1999, which means that it has stabilised around the set target of 32:1.
* In 2008 the overall gender parity index (GPI) for school access was at 1.01, which is a level within the acceptable ranges of between 0.97 and 1.03.
* In 2008 the percentage National Senior Certificate Examination pass rate was 62.2% compared with the 2007 pass rate of 65.2%, representing a 3% drop.
* In 2008 the distinction between higher grade and standard grade mathematics was phased out, and mathematics literacy and mathematics were introduced. As a baseline, 136 184 mathematics passes and 210 134 mathematics literacy passes were recorded in 2008.
* Despite the evident increase in the percentage of graduating students that are qualifying in the Science, Engineering and Technology disciplines (from 25.5% in 1995 to 28.8% in 2007), the number (36 429) remains very low compared to the enormity of the scientific skills shortages in South Africa.
7. Social cohesion
* We present data on voter participation since the 1994 elections. During the April 2009 elections 84.1% of the voting age population registered to vote compared to 75.4% in 2004. Of the registered voters, 77.3% turned out to vote in 2009 compared to 76.7% in 2004. This is an indication of high public interest in the recently held elections.
* During periods of national elections, surveys show greater levels of public confidence in government institutions and in the future of the country. The general decline in public opinion on issues of race relations, confidence in the future for all races and in the country’s direction as well as pride in the country, may have been influenced by specific incidents during the survey periods.
8. Safety and security
* The data is available up to the end of the 2008/09 financial year. Trend-wise, though the crime levels in general have continued to decline, they nevertheless continue to be unacceptably high. Most notably five of the seven subcategories of contact crime have continued to decline.
* What is however worrisome is the increase in the incidents of the so-called trio-crimes, namely, carjacking, robberies at business premises as well as robberies at non-residential premises. Another disturbing trend of the recent data is the rise in the number of sexual offences, but this is at least in part a result of the reclassification of some offences.
* To intensify its efforts to create safer communities, government has commenced with several mutually reinforcing initiatives to improve the capacity of the state to fight crime through the revamp of the criminal justice system.
9. International relations
* South Africa remains a significant actor and a major contributor in peacekeeping operations. The recent announcement of the termination of South Africa’s participation in the African Union Special Task Force in Burundi and the eventual withdrawal of our troops is an indication of the success of such peacekeeping efforts.
* Whilst we have seen an increase in the number of democratically elected governments on the African continent over the years, this improvement has been negatively affected by unlawful removal of incumbents in some few countries in the recent period.
* The positive performance of African economies over the past few years is beginning to be affected adversely by the deterioration in the global economy, but less so than highly industrialised countries.
* With regard to tourism, in 2008, foreign arrivals reached an all-time high of 9.6 million. This 5.5% increase from the previous year exceeds the global growth rate of 1.3%. Good performance of the tourism sector should be boosted further by various international sporting events in 2009 and 2010, particularly South Africa’s hosting of the 2010 FIFA World Cup.
10. Good governance
* Revenue collection has been increasing over the years due SARS’ efficient system of tax collection and the relatively high growth rate in the economy. The economic slowdown is expected to reduce revenue collection below expected levels in the current financial year.
* The prevalence of qualified audit opinions has not improved significantly over the years, particularly for municipalities.
* The 2008 Corruption Index results show a setback in perception regarding the fight against corruption in South Africa. This perception is in part informed by the number of corruption incidents that government exposes to the public as a way of raising public awareness about the fight against corruption.
* In the 2008 Budget Index, South Africa is ranked among the top five countries globally that provide extensive budgetary information to its citizens.
* In the 2009 Doing Business Index we are ranked number 32 globally, which is an improvement on previous years.
* Data on environmental indicators is limited, and the available estimates show that South Africa’s greenhouse emissions have been increasing; possibly attributable to higher economic growth.
This 2009 publication of the Development Indicators is significant because the data will also serve as a baseline for the 2009/14 electoral mandate period.
As we continue to publish these indicators on an annual basis, we encourage the readers to examine them against other research done independently of government and provide us with feedback in order to enhance future publications.
Enquiries:
Joel Netshitenzhe
Head: PCAS
Cell: 082 900 0083
Issued by: The Presidency
25 September 2009
