History in the new South Africa: an introduction - Det danske ...

gold price rose over $800 in 1980/1. Fixed investment dropped from more than 25% of GDP
in the 1970s to about 18% in the mid-1980s and productivity growth in manufacturing from
2.3% per annum in the 1960s to 0.5% in the 1970s and -2.9% during the first half of the
1980s. despite slower growth overall, some sectors prospered while others declined.
Macroeconomic policy favoured mining exports, but raised manufacturing import costs and
lowered profitability. Financial institutions enjoyed a short-term profit boom as mergers and
acquisitions rose and foreign corporations disinvested. Ownership concentration, and the
economic power of white big business, increased: by 1990, six conglomerates centred on
mining and finance controlled companies with 80% of the market capitalisation on the
Johannesburg Stock Exchange.
An international anti-apartheid campaign calling for trade sanctions and disinvestment gained
momentum as political upheaval increased during the early 1980s. In 1985 international
creditors recalled South African public sector debt after the government declared a state of
emergency. The capital outflows required for debt repayment further tightened the balance of
payments constraint on growth, since investment depended on imports of capital equipment
and intermediate goods. These economic pressures helped to shift South African business by
1989 to support democratisation, as they realised that higher growth depended on access to
international capital flows which in turn depended on an acceptable political settlement
ending apartheid.
The crisis re-shaped the black class structure and civil society as well. Extreme inequality
between races which was characteristic of the ‘grand apartheid’ period from 1948 to the end
of the 1960s was moderated during the 1970s, as more blacks with education and skills found
work: employment in the services sectors grew, and technical and white-collar occupations
increased their share of the labour force in all sectors. The number of Africans in ‘middle
class’ occupations grew at more than 6% per annum, nearly trebling between 1970 and 1987
when 19% of employed Africans were in middle class jobs and Africans comprised nearly
25% of the middle class, with Coloureds and Indians another 18%. But there was increased
class differentiation and inequality within race groups after 1975, as layoffs rose and job
creation amongst low-skill blacks was non-existent. African unemployment was unofficially
estimated at 11.8% in 1970 and 20.8% in 1980, with job losses primarily amongst unskilled
African workers in manufacturing and construction.
The growing urban black professional middle class organised politically and socially through
professional and business bodies, media and cultural associations, while a powerful trade
union movement emerged, organising semi-skilled and unskilled black workers both in the
workplace and outside it, working with community organisations and women’s and students’
groups. The exiled nationalist movement, the ANC, provided strategic focus to support
internal political opposition, while also mounting low-key armed struggle and leading
international boycott pressures. As the 1980s proceeded, both black organisations and white
power holders outside the state came increasingly recognised their common interest in
establishing non-racial democracy. In 1989, black trade unions and white big business
campaigned together for the first time against state repression in industrial relations, which
was a major step not only towards non-racial democracy but also a transition via negotiations,
instead of the handover of power by a defeated apartheid state.
The form of the transition reflected the prevailing balance of class power at the time and
defined the possibilities and limits of the negotiated outcome. The start of formal political
negotiations gave impetus to an already-lively debate about post-apartheid economic policy,
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