South Africa, which is the southernmost country on the continent, has recorded a GDP PPP of $13,225.437, which means it cannot be considered as the richest country on the continent. But when we speak of it in the GDP sense, then it can be considered to be one of the richest countries in Africa as it records a total GDP of $294.841 billion which is much larger than most African countries. Bordered by Namibia, Zimbabwe, Botswana, Swaziland, Lesotho and Mozambique, South Africa is the 25th largest country by surface area in the world.
The country is known for its diverse economy and that it has strongly dealt with various economic recessions in the past, yet there are many key factors which led to its economic growth. Tourism being one of the highest contributors towards revenue generation of the country, which was boosted after the country hosted the World Cup and thus further helped in increasing foreign investment within the country. Mining, manufacturing and wholesale trade are some other key contributors towards the country’s GDP. Mining dates back to 1867 when the country discovered diamonds for the first time. Since then, South Africa has diversified into becoming one of the world’s largest producer of various natural resources, such as chrome, manganese, platinum, and vanadium. It is home to some well-known mining companies such as De Beers and Anglo- American. Beyond natural resources, the country’s economy has grown with the exporting of machinery and equipment to different parts of the world, thus making Germany, US, Japan and China its biggest trade partners.
It is said that South Africa is a dual economy, due to its past history of oppression. Due to South Africa’s former Apartheid policies, the country ranks number one in terms of world’s highest inequality rates. More than quarter of the population is unemployed and below the poverty line.
Today, most of the big international companies have their regional or African headquarters in the country, with Johannesburg being the hub. Durban boasts of being home to the largest port on the continent. While Cape Town is the tourism capital of the country and also is well known for its agricultural and wine exports. Lastly, Port Elizabeth is the center of the automotive manufacturing industry in the country.
Another major contributor towards South Africa’s economic development is its membership under BRICS. Exclusive and lucrative trade agreements with the other BRICS countries have helped the country to grow and become wealthier. Especially its trade relations with China, and the increased demand from the Chinese for commodity exports.
Today the policies of the South African government are very modern and well prepared, which continues to attract many foreign investors.
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