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Ethan Smith, a South African native who currently [May 2025] lives in San Francisco, has completed a study of his home country government's economic policies as compared to the MIEPA list of policies as outlined above. The study on South Africa is shown below. The ratings herein are based on the following rating scale:
RATING SCALE
5.0 Perfect Facilitation of Wealth Creation
4.0 Midway between Perfect and Neutral
3.0 Neutral Effect on Wealth Creation
2.0 Midway between Neutral and Obstructionist
1.0 Perfectly Obstructionist to Wealth Creation
[Rating scale copyright Mike P. McKeever, 2025. Used herein with permission]
To read a disclaimer about the analysis in this file, scroll to the bottom of the file.
South Africa
Comparison of South Africa's economic policies to MIEPA criteria as prepared by native student of South Africa, Mr. Ethan Smith, studying in the US in May of 2025.
RATING SUMMARY
POLICY NUMBER RAW SCORE ADJUSTED SCORE POSSIBLE PERCENTAGE
1 5.0 15.0 15.0 100 %
2 5.0 15.0 15.0 100
3 1.0 3.0 15.0 20
4 3.0 9.0 15.0 60
5 4.0 12.0 15.0 80
6 5.0 15.0 15.0 100
7 4.0 12.0 15.0 80
8 3.5 10.5 15.0 70
9 1.0 3.0 15.0 20
10 4.0 12.0 15.0 80
11 4.5 13.5 15.0 90
12 1.0 2.0 10.0 20
13 5.0 10.0 10.0 100
14 5.0 10.0 10.0 100
15 3.0 6.0 6.0 60
16 4.0 8.0 10.0 80
17 2.0 4.0 10.0 40
18 2.0 4.0 10.0 40
19 2.0 4.0 10.0 40
20 1.0 2.0 10.0 20
21 4.0 8.0 10.0 80
22 5.0 10.0 10.0 100
23 4.0 8.0 10.0 80
24 2.5 5.0 10.0 50
25 4.0 8.0 10.0 80
26 1.0 2.0 10.0 20
27 5.0 10.0 10.0 100
28 3.5 7.0 10.0 70
29 4.0 4.0 5.0 80
30 3.5 3.5 5.0 70
31 3.5 3.5 5.0 70
32 4.0 4.0 5.0 100
33 5.0 5.0 5.0 100
34 4.0 4.0 5.0 80
TOTAL 120.0 252.0 375.0 67.2%
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INDIVIDUAL POLICIES
South Africans are free from government control in terms of opening businesses and wealth; however wealth creating opportunities are rare with the majority of the South African youth being unemployed and South Africa having the highest Gini coefficient in the world.
https://data.worldbank.org/indicator/SI.POV.GINI?locations=ZA
2. Freedom of speech: 5.0
South Africans have the right to say whatever they please with the exclusion of hate speech and threats similar to the United States of America; however its called freedom of expression in South Africa
https://www.gov.za/blog/advancing-freedom-expression
3. Effective Police Force: 1.0
The South African police force is potentially the worst one in the world with bribes being very common and somewhat cheap as they range from food items to amounts of money that range from R1 to as high as they can negotiate out of you
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4. Private Property: 3.0
Recently South Africa has introduced a land expropriation without compensation bill that has caused controversy throughout wide spread communities local and international. South Africa has similar property laws to the United States with 1 property deed being valid at all levels to prove ownership of land. The land expropriation bill allows the government to expropriate land for public interests only; this includes land that is not being used with no intention to develop it, make money from it and or if it poses a risk to the people.
https://en.wikipedia.org/wiki/South_African_property_law
https://www.bbc.com/news/articles/cvg9w4n6gp5o
5. Commercial Banks: 4.5
The banks in South Africa are regulated by the South African Reserve Bank (SARB) under the leadership of the minister of finance. The top few banks in South Africa are doing well and investor confidence is high in these commercial banks. The largest of these banks in assets is standard bank with 3.1 trillion rand in assets 170 billion dollars. All of the major banks will provide anyone who qualifies for a loan the loan that they are looking for.
https://resourcehub.bakermckenzie.com/en/resources/global-financial-services-regulatory-guide/europe-middle-east-and-africa/south-africa/topics/who-regulates-banking-and-financial-services-in-your-jurisdiction#:~:text=The%20Prudential%20Authority%2C%20operating%20within,banks)%20in%20the%20payment%20system.
https://techpoint.africa/guide/largest-banks-in-south-africa/
6. Communication: 5.0
In South Africa communication is prevalent with South Africa having the same percentage of its population having access to a cellular device as the United States standing at an astounding 89% of their respective populations. The South Africa government also has its own news network and newspapers are still popular in the country; they have remained accessible to the masses at a price of ZAR 35 (USD 1.86).
https://www.pewresearch.org/global/2015/04/15/cell-phones-in-africa-communication-lifeline/#:~:text=Today%2C%20cell%20phones%20are%20as,including%2034%25%20of%20South%20Africans.
https://www.pnp.co.za/sunday-times-newspaper/p/000000000000249455_EA
7. Transportation: 4.0
The transportation in South Africa is run by a public company called Transnet and they control the railroads that are responsible for the transportation of majority of the natural resources that South Africa exports as well as them being responsible for the commute trains that run such as the Gautrain and the blue train (a luxury option) air travel in South Africa is also stable however it is expensive relative to the wages of a South African. There is public transport in most of the country however rural areas have less access to it and use taxis (privately owned small buses) to travel
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https://www.britannica.com/place/South-Africa/Transportation-and-telecommunications
8. Education: 3.5
The reason that I've given South Africa a 3.5 for education is due to the lax standards that the country has with the minimum grades to receive a matric certificate (graduate high school) being 40% in their home language, 50% in 4 other subjects, 30% for 1 other subject and pass at least 6 out of the 7 required classes. Education is compulsory in South Africa and that's lead to a literacy rate of 90% and South Africa has the top university in Africa with that being the public university, University of Cape Town (UCT)
https://www.statista.com/statistics/572836/literacy-rate-in-south-africa/#:~:text=Literacy%20rate%20in%20South%20Africa%202021&text=As%20of%202021%2C%20South%20Africa's,Africans%20could%20read%20and%20write.&text=The%20literacy%20rate%20measures%20the,who%20can%20read%20and%20write.
https://www.usnews.com/education/best-global-universities/africa
https://www.timeslive.co.za/news/south-africa/2025-01-14-matric-2024-basic-education-deputy-minister-clarifies-30-pass-mark/
9. Social mobility: 1.0
With the majority of the population living below the poverty line for the country, education is the most likely way for people to climb the socioeconomic ladder, however government spending on education has decreased in recent years leading to protests amongst university students claiming that education is a right and south therefore be covered by the government. Along with South Africa having high corruption in government leading me to believe that public positions are not solely based on merit and achievement rather through connections. South Africa is also facing high unemployment as a whole and youth unemployment of 49.14% making it even harder for young underprivileged South Africans to create wealth.
https://www.iea-world.org/south-africas-higher-education-funding-conundrum-could-the-current-funding-system-hamper-social-mobility-and-university-performance/
https://databankfiles.worldbank.org/public/ddpext_download/poverty/33EF03BB-9722-4AE2-ABC7-AA2972D68AFE/Global_POVEQ_ZAF.pdf
https://www.ganintegrity.com/country-profiles/south-africa/
10. Freedom from Outside Control : 4.0
South Africa won its independence from Great Britain in 1910 and all citizens were free from government mandated restrictions placed by the apartheid government in 1990 with Nelson Mandela. The citizens of South Africa do not feel any third party governments enforcing their own agenda on the country.
https://en.wikipedia.org/wiki/Union_of_South_Africa#:~:text=The%20stated%20reasons%20were%20that,interference%20from%20other%20European%20powers.
https://en.wikipedia.org/wiki/Presidency_of_Nelson_Mandela#:~:text=The%20presidency%20of%20Nelson%20Mandela,ended%20on%2014%20June%201999.
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11. Foreign Currency Transactions : 4.5
Any currency will be accepted in South Africa as long as it's being used to trade for South African Rand as that is the only currency that will be accepted country wide at retailers; however in informal markets currencies that are not the South African Rand may be accepted.
https://www.resbank.co.za/en/home/what-we-do/financial-surveillance/FinSurvFAQ#:~:text=Visitors%20to%20South%20Africa%20are,rand%20back%20into%20foreign%20currency.
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12. Border Control : 1.0
The South African border is not difficult to get through leading to many people illegally immigrating to South Africa this has resulted in a rise in xenophobia and a demand from the people to tighten up border security.
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13. Currency : 5.0
I've given South Africa a score of 5.0 because its currency is the only currency in circulation allowing for a more prosperous engagement with commerce. The Rand is also the only approved currency in South Africa.
https://wild-wings-safaris.com/frequently-asked-questions/what-currency-should-i-bring#:~:text=The%20currency%20in%20South%20Africa,for%20tipping%20and%20small%20purchases.
14. Culture, Language and Homogeneity : 5.0
I've given South Africa a 5.0 for its culture, language and homogeneity as South Africa has rebranded to become an all inclusive country, a place for all going by the rainbow nation boasting 12 official languages. English, Afrikaans, IsiZulu, IsiXhosa, IsiNdebele, Sesotho, Setswana, SiSwati, Tshivenda, Xitsonga and South African Sign Language (SASL). The reason that I've given south Africa such a high score despite homogeny being the measure of this statistic I believe that south Africa has gained more through rebranding at the rainbow nation and with 12 official languages multilingually is a common trait amongst most South Africans
https://zuidafrika.nl/arts-culture/languages/#:~:text=South%20Africa%20has%20eleven%20official,of%20official%20business%20and%20commerce.
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15. Political Effectiveness: 3.0
The South African government has not been effective in solving the problems of the citizens but have made great strides since apartheid and so I've given them the neutral score of 3.0. With the majority of the country living in poverty there is more the government could be doing to manage and promote growth and businesses in rural areas.
https://www.statista.com/statistics/264627/ranking-of-the-20-countries-with-the-biggest-inequality-in-income-distribution/#:~:text=South%20Africa%20had%20the%20highest,neighbor%20Namibia%20followed%20in%20second.
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16. Institutional Stability: 4.0
South Africa has received a score of 4.0 for the high poverty and low distribution of wealth leading South Africa to be the most unequal country in the world however the South African government is working towards solutions such as the black economic empowerment act putting people of color in high paying jobs and reversing the effects of apartheid. The current South African government The ANC party has been in power for 31 years.
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https://carnegieendowment.org/research/2021/03/south-africa-when-strong-institutions-and-massive-inequalities-collide?lang=en
17. Honest Government: 2.0
The South African government is open and honest about statistics however government corruption in the country is one of its biggest challenges and will be moving forward and currently there is an investigation into state owned enterprises for $7 billion.
https://apnews.com/article/south-africa-corruption-graft-investigations-6efc1cab8446c882758943382d6bdd3b
18. Common Law: 2.0
South Africa has inherited its common law practices from its earlier colonists the British and has integrated these with some laws that the Dutch brought along with them when they also settled in South Africa after apartheid. Due to the high disparity in wealth often wealthy people are treated better by the justice system and also have access to better legal services.
https://en.wikipedia.org/wiki/Law_of_South_Africa
19. Central Bank: 2.0
The South African Reserve Bank is the central bank of South Africa supplying money to the banks and government while its main job is to use monetary policy to protect the value of the rand and keep inflation within the target range. SARS is an independent agency from the government however the government does appoint the head of SARS, therefore South Africa is receiving a score of 2.0 for its reserve bank not being independent of the government.
https://www.resbank.co.za/en/home
20) Domestic Budget Management: 1.0
Revenue = US$ 109.7 billion
Expenditure = US$ 128.4 billion
South Africa's expenditure is almost 20 Billion over budget and the government should work to be stricter and cut expenses where necessary to cure expenses down as to contribute to paying off debt
https://en.wikipedia.org/wiki/National_Budget_of_South_Africa
21) Government Debt: 4.0
South Africa has received a score of 4.0 in this category because government debt has been risen by 16%from Q1-Q3 of 2024 and government debt is 72.80% of the countries total GDP
https://tradingeconomics.com/south-africa/government-debt
22) Economic Statistics and Accuracy: 5.0
Statistics South Africa is the South African government website that freely provides all economic information to the public for free. Statistics South Africa is often used by South African news outlets and its data has been proven to be correct through some comparisons to other websites.
https://www.statssa.gov.za/?p=18006
23) Protection of Health and Safety: 4.0
South Africa has received a score of 4.0 for having free public health care available to anyone and having clinics and pharmacies in communities around the country however the clinics in poorer communities and settlements both formal and informal don't have proper access to healthcare and or the healthcare they do have access to is understaffed and don't have access to the best facilities the country has to offer. There's even a website boasting about south Africa's clean drinking water and warning travelers about the high crime rates
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https://zuidafrika.nl/tourism/health-and-safety/
24) High Wage Policy: 2.5
South Africa's minimum wage has increased from ZAR 27.58 ($1.49) to ZAR 28.79 (1.56) per hour however South Africa currently has a Gini coefficient of 0.63 the highest in the world
https://www.shrm.org/topics-tools/employment-law-compliance/south-africa-national-minimum-wage-will-increase-on-march-1#:~:text=The%20national%20minimum%20wage%20will,hour%20worked%2C%20effective%20March%201.
https://worldpopulationreview.com/country-rankings/gini-coefficient-by-country
25) Environmental policy: 4.0
South Africa has received a 4.0 for being a part of the Paris agreement and making strides to become carbon neutral by the year 2050. As well as increasing the carbon tax per ton of carbon dioxide emissions by 20% from ZAR 120 per ton to ZAR 144. The South African government is also issuing more compliance notices in recent years.
https://practiceguides.chambers.com/practice-guides/environmental-law-2024/south-africa/trends-and-developments
26) strong army: 1.0
South Africa received a score of 1.0 in terms of military strength as South Africa was ranked 40th in the world in terms of military strength with 71,235 active military members 29,350 on reserve 252 combat tanks 182 air force vehicles and 49 naval vessels. For comparison the United States of America has 1,328,000 active military members 18.64 times more on duty military members, 799,500 reserve members 27.24 times more than South Africa, 4640 combat tanks 18.41 times more 13,043 air force vehicles 71.66 times more than South Africa and 440 naval vehicles 8.98 times more than South Africa. For these reasons I believe that South Africa is not safe from invasion.
https://businesstech.co.za/news/government/806980/south-africas-military-strength-vs-the-world-in-2025/
27) foreign trade impact: 5.0
South Africa has received a 5.0 for its recent turn around and currently being in a trade surplus of ZAR 14.6 billion ZAR 2 billion more than the previous month of October 2024 and having its greatest trade surplus in over 2 years of ZAR 34.7 billion. South Africa's net exports of goods and services came to 32.75% of GDP in 2023 and this is exactly on par with where they should be looking to be as they are not too reliant on trade but they are taking full advantage of the free market.
https://tradingeconomics.com/south-africa/balance-of-trade#:~:text=South%20Africa%20posted%20a%20trade,machinery% 20 &%20electronics%20(+16%25).
28) protection of foreign currency earning companies:3.0
South Africa is the most diverse and largest economy in sub Saharan Africa and has no restrictions on international corporations however i gave them a score of 3 as it is neutral and multinational companies are just held to the companies act (the same set of laws all companies are required to follow)
https://www.state.gov/reports/2024-investment-climate-statements/south-africa/
29) management of foreign currencies: 4.0
South Africa received a score of 4.0 in this area due to recent trends of growing foreign reserves showing a 7.67% growth from January of 2024 to January of 2025, with foreign reserves climbing for the majority of the year and never dropping below the recorded amount in January of 61.2 billion USD. with only 3 months of negative growth in 2024 and the largest growth of 4.5% in November of 2024
https://tradingeconomics.com/south-africa/foreign-exchange-reserves#:~:text=Foreign%20Exchange%20Reserves%20in%20South%20Africa%20increased%20to%2065876%20USD,Million%20in%20December%20of%202024.
30) Layers of Collective Action: 3.5
The South African government operates at 3 levels the municipal level then above them the provincial level and above them the national level of government led by the president called the executive branch. All 3 of these levels of government work together and follow the orders given to them from the executive branch.
https://www.pa.org.za/info/structure-government
31) Pro business climate: 3.5
South Africa offers a lower tax rate to small businesses that turn over less than ZAR 1,000,000 a year allowing them to be taxed between 0%-3% based on turnover. South Africa also has the small medium and micro enterprises (SMME) program for companies that qualify
https://taxsummaries.pwc.com/south-africa/corporate/taxes-on-corporate-income
32) Government enterprises: 4.0
The South African government is nationalistic controlling approximately 100 State Owned Enterprises ranging from economic services and infrastructure development, social services, government administration, justice and protection services and financial and administrative service. The biggest of them being Eskom (the main provider of electricity to the country) Telkom SA (the national telecommunications company) South African Airways (the national airline) and Transnet (a government owned railway company). State owned enterprises contribute 16.94% of South Africa's GDP in 2020. The South African government also uses state owned enterprises as competitors in the market to bring down prices in non competitive markets
https://tradingeconomics.com/south-africa/credit-to-government-and-state-owned-enterprises-to-gdp-percent-wb-data.html
https://en.wikipedia.org/wiki/State-owned_enterprises_of_South_Africa
https://nationalgovernment.co.za/units/type/6/public-entity
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33) International security agreements: 5.0
The following partnership agreements have aided in creating a peaceful geopolitical environment for the southern countries involved in SADC. South Africa is a part of the Southern African Customs Union (SACU) allowing them free trade with Botswana, Lesotho, Namibia and eSwatini. South Africa is a part of the South African development community (SADC) allowing them free trade with Botswana, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, South Africa, Swaziland, Tanzania, Zambia and Zimbabwe. South Africa als has free trade agreements with the European Free Trade Association, the United Kingdom ,Mercosur. SADC is also linked to the Eastern African Community (EAC) and is a member of the African Free Trade Area (AfCFTA). The free trade agreement with AfCFTA encourages multinational companies to export more South African goods and services.
https://www.giz.de/en/worldwide/121295.html
https://www.trade.gov/country-commercial-guides/south-africa-trade-agreements
34) Protection of domestic enterprises from government mandatory cost: 4.0
The American tax code may seem better for all businesses as they pay a flat fee of 21% however South Africa has a more encouraging tax code for smaller businesses. The South African government has a very hands off approach when it comes to intervening within the market (free market). The South African revenue services (SARS) taxes corporations with a progressive tax model charging 0% on the first ZAR 95,750 and up to Zar 57,689 +27% on taxable income above ZAR 550,000. Corporations are also required to pay into the Unemployment Insurance fund (UIF) the employer must pay a total of 2% of the employees salary to the UIF (1% paid by the employer and 1% paid by the employees). The corporate tax rate in the United States sits at a flat fee of 21% from the first dollar.
https://taxpolicycenter.org/briefing-book/how-does-corporate-income-tax-work
https://taxsummaries.pwc.com/south-africa/corporate/taxes-on-corporate-income
https://www.sars.gov.za/types-of-tax/unemployment-insurance-fund/#:~:text=All%20 employees%2C%20as%20we%20 as,of%20the%20skills%20development%20levy.
DISCLAIMER
All the information and conclusions in each country analysis are solely the responsibility of the individual student and have not been verified, corrected, checked for copyright infringement or evaluated in any way by MIEPA or Mike P. McKeever. You are solely responsible for the results of any use you make of the information and conclusions in these studies. Use them at your own risk as interesting supplemental information only instead of seasoned judgements about the policy factors contained herein. Each student has granted permission for his or her work to be displayed here under his or her own name or wishes to remain anonymous and have either created a pen name or used no name at all; if you wish to contact them for any reason, forward your request to MIEPA and the student will be notified of your interest.To learn more about other countries, click to other files here:
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