Answer to Question #181031 in Microeconomics for Bridget

Question

Describe the main characteristics of the South African economy

Answer 1

South Africa has the second largest economy in the African continent after Nigeria. Its GDP is relatively high compared to other countries in the sub Saharan Africa; it stands at US $ 11,750. However, the country is faced with high levels of income inequality, poverty and unemployment. The county does not have a thriving informal economy unlike other countries in Africa; only 15 % of the jobs in the country are in the informal sector. South Africa's main international trading partners include Germany, China, Japan , United Kingdom and the United States. The Agricultural sector provides for 10% of formal employment which is low compared to other African countries. The sector contributes to 2.6% of GDP for the country. In 2013, South Africa was ranked top in Africa in terms of economic potential, infrastructure, foreign direct investment and labor environment. It is also ranked at number 58 of the safest tax havens worldwide.