<P> South Africa held its first multi-racial elections in 1994, leaving the newly elected African National Congress (ANC) government the daunting task of trying to restore order to an economy harmed by sanctions, while also integrating the previously disadvantaged segment of the population into it . The 1994 government inherited an economy wracked by long years of internal conflict and external sanctions . </P> <P> The government refrained from resorting to economic populism . Inflation was brought down, public finances were stabilised, and some foreign capital was attracted . However, growth was still subpar . At the start of 2000, then President Thabo Mbeki vowed to promote economic growth and foreign investment by relaxing restrictive labour laws, stepping up the pace of privatisation, raising governmental spending and cutting interest rates sharply from 1998 levels . His policies faced strong opposition from organised labour . From 2004 onward economic growth picked up significantly; both employment and capital formation increased . </P> <P> In April 2009, amid fears that South Africa would soon join much of the rest of the world in the late - 2000s recession, Reserve Bank Governor Tito Mboweni and Finance Minister Trevor Manuel differed on the matter: whereas Manuel foresaw a quarter of economic growth, Mboweni predicted further decline: "technically," he said, "that's a recession ." In 2009 the Nobel - Prize - winning economist Joseph Stiglitz warned South Africa that inflation targeting should be a secondary concern amid the global financial crisis of 2007--2009 . </P> <P> South Africa, unlike other emerging markets, has struggled through the late 2000s recession, and the recovery has been largely led by private and public consumption growth, while export volumes and private investment have yet to fully recover . The long - term potential growth rate of South Africa under the current policy environment has been estimated at 3.5% . Per capita GDP growth has proved mediocre, though improving, growing by 1.6% a year from 1994 to 2009, and by 2.2% over the 2000--09 decade, compared to world growth of 3.1% over the same period . </P>

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