formal sector jobs.>?
Those expectations,
too, were not fulfilled. The government was not
able to apply the new policy effectively, due to a lack of administrative
skills and also because it could not overcome trade union protection of the
high level of unskilled and semi-skilled wages. The result was that in-
vestors preferred capital-intensive projects in South Africa or placed their
capital elsewhere. Furthermore,
the global financial crisis that started in
Southeast Asia had serious spillover effects in South Africa; there was a
general decline in investment in countries like South Africa, and Malaysia,
which had invested heavily in South Africa before the crisis, ceased to do
so. The annual growth rate of the GOP actually declined from 3.2 percent
in 1996, to 1.9 percent in 1997, to near zero in 1998; and early in 1999 the
economy was in recession again. The dollar value of the rand dropped by
17 percent in 1998; unemployment continued to increase; public services
continued to deteriorate; more professional people emigrated; and Anglo
American and South African breweries transferred
their headquarters
to London.S" According to the World Competitiveness Yearbook of the
Swiss Institute for Management Development, South Africa ranked forty-