South Africa is a large middle income country with sizable revenues and limited need for significant external financing; it has substantial public and private capability in a number of technical areas. Bank assistance to South Africa has been limited to technical assistance for the current period. In the African region, this makes South Africa a unique client for the World Bank (WB). The mechanism underlying dialogue and project work in this area has been grants obtained from the Global Environment Facility (GEF). The World Bank is the Implementing Agency for the GEF.
In the years that have passed since the end of apartheid South Africa has transformed into a stable and robust economy. Cautious fiscal management and a supporting global environment have helped to attain a 4% average annual economic growth rate in the recent decade. The South African Government (1996) had introduced the Growth, Employment and Redistribution strategy (GEAR). The macroeconomic initiative is based on tight fiscal discipline, attracting foreign direct investment, expansion of private investment, promotion of higher domestic saving, and industrial competitiveness. Moving away from this broad strategic account on poverty reduction, the Reconstruction and Development Program (RDP) has been implemented to address sector specific programs through a wide range of government departments and agencies at all buearocratic levels. The gains from economic growth have not been distributed equitably, post-apartheid social structures still exist. Reducing poverty and inequality are critical agenda items challenging the existing government.
In an effort to address the issues of poverty and inequality the South African government (2006) launched the Accelerated and Shared Growth Initiative for South Africa (ASGISA). As a focused set of policies and directives, ASGISA will help to chanel increased and shared growth in conjunction with existing programs. Access to services and education have...