Throughout recent history, South Africa has stood out as the most powerful consumer base in Africa's southern region. In spite of the recent decline in economic activity there, the demographic and macroeconomic ingredients are still in place for moderate but sustained growth in private sector consumption.
Domestic consumption held its own this year, but South Africa has felt the brunt of the global economic downturn. Growth in the retail sector fell back from a seasonally adjusted and annualized rate of 41/2 per cent in the fourth quarter of 2000 to about 3 percent during the first half of 2001.
During the first three quarters of 2001, the pace of economic expansion slowed, reducing household consumption and ultimately industrial consumption. The demand for durable goods softened toward mid-year. However, auto sales proved immune to the slowdown through much of the first half of 2001 before dropping off.
A recent central bank report says: "Domestic demand for motor cars by private individuals, car rental companies and the business sector strengthened perceptibly. Exports of motor vehicles were lively regardless of slower world economic growth. Easier access to information through the Internet is allegedly contributing to the vibrancy of the motor trade, especially of trading in the used-car market."
A DEMOGRAPHIC POWERHOUSE By regional standards, South Africa is a demographic powerhouse, accounting for about 89 percent of the total population of the southern region. According to statistics released by the Population Reference Bureau, the national population stood at 43.6 million in 2001.
Contrary to the trend in most sub-Saharan African nations, South Africa's population will decline over the next few decades. The projected population for the year 2025 is 35.1 million people, or about 20 percent fewer people than today. By the year 2050 South Africa's population is expected to be 32.5 million people, or 26 percent fewer than in 2001.
Favorable climatic conditions have made it possible for nearly half of the nation's population to make a living in rural areas, although much of the nation's wealth is concentrated in major cities. Currently 54 percent of South Africa's population lives in urban areas and the population density per square mile is 92. In the year 2050, South Africa's population density should drop to about 69 people per square mile.
Working age adults account for almost 60 percent of the populace. According to The World Factbook...