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Economic Commission for Africa

Lessons for PRSP from Poverty Reduction Strategies in South Africa

Nina Hunter, Julian May and Vishnu Padayachee1
Contact: huntern@nu.ac.za

3-5 December 2003
Addis Ababa, Ethiopia

SARPN acknowledges the copyright of the UNECA for this report.
It was downloaded from the ECA website: www.uneca.org
This report was presented at the Third Meeting of the African Learning Group on the Poverty Reduction Strategy Papers, organised by the ECA.
The full set of reports can be accessed at www.uneca.org/prsp
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Introduction

In September 1999 the World Bank and the International Monetary Fund (IMF) introduced a new approach designed to focus loan operations on poverty reduction. The revised framework for development assistance offers lowinterest loans and debt relief to 42 of the poorest countries in the world through a new loan facility, as well as opportunities for concessional support to a further 38 countries. However, to gain access to these facilities, some national governments have to qualify for Highly Indebted Poor Country (HIPC) status and all are required to write a Poverty Reduction Strategy Paper.

In some countries, the PRSP has also been referred to as a Poverty Reduction Strategy Process. This occasional renaming of PRSP is significant in that the designers of the approach expect that PRSPs are to be country-driven, locally owned and based on broad participatory processes for their design, implementation and monitoring. The expectation is that governments will design and direct poverty reduction strategies for their countries in consultation with local government, civil society and communities.

South Africa offers an interesting counter-factual that may assist in the analysis and implementation of PRSP in other African countries. South Africa has introduced many of the reforms expected of a PRSP, but is neither a highly indebted country, nor has prepared a PRSP. Indeed, the South African Government has moved away from a broad strategic statement on poverty reduction, the Reconstruction and Development Program (RDP) towards sector specific programs governed by a macroeconomic strategy of structural adjustment (the Growth, Employment and Redistribution strategy, or GEAR). At the same time, despite its status as a middle income country, South Africa displays many of the socio-economic indicators of countries characterised as low income, and high inequality remains a intransigent problem.

This paper will first provide a brief overview of different interpretations of the PRSP process. The paper will then review the context of poverty in South Africa before presenting recent evidence on the extent, distribution and nature of poverty in South Africa since the transition to democracy in 1994. The paper will then describe the components of South Africa’s approach to poverty reduction that resemble PRSP activities. The paper concludes by reflecting on this experience in terms of the objectives that PRSP claims to advance, namely a country-driven sustainable reduction in poverty.


Footnote:
  1. Respectively Research Fellow, Associate Professor and Professor, School of Development Studies, University of Natal, South Africa. The views expressed in this paper are those of the authors and do not necessarily reflect the views of the Economic Commission for Africa or any of its officers.


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