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South Africa as a hegemonic stabiliser for Africa? Using hegemonic stability theory to understand South Africa’s relationship with Africa.

The transformation of South Africa from apartheid pariah of the world to a free democracy welcomed by all has undeniably changed the dynamics of African relations. After years of poverty and decay in Africa, South Africa’s return to the fold has been heralded as a new hope for Africa. With its peaceful transition, South Africa is seen as being able to accomplish miracles. One such expectation is that South Africa serve as an example and will lead Africa out of poverty and underdevelopment. South Africa is economically more advanced than most of Africa and it is this that much of the hope is pegged on. A theory used to describe the role of a dominant country in creating and maintaining an international system already exists, known as hegemonic stability theory. This theory in many ways matches the expectations of South Africa – South Africa being the dominant power who will create a stable system in Africa. This essay will use hegemonic stability theory to analyse South Africa’s position, and its current actions and initiatives in Africa. The theory can provide insight into whether such expectations of South Africa are justified, and whether South Africa is indeed taking the course of action that will lead to a prosperous, stable Africa.

South Africa already has taken a leading role in Africa – being instrumental in the creation of the New Partnership for Africa’s Development (NEPAD), and the transformation of the Organisation for African Unity (OAU) to the African Union (AU). South African businesses have taken an active interest in Africa, and trade and investment is increasing. Hegemonic stability theory provides a strong framework for analysing South Africa’s actions, both in terms of providing the characteristics shown by previous hegemons and the actions that are necessary for a stable international system.

There is a debate over whether South Africa is, or should act as a hegemon. Perceptions of a hegemon in Africa have been strongly influenced by America’s recent actions and South Africa’s actions under apartheid – perceptions of unilateralism, bullying, arrogance and undermining of other governments. However, the role of a hegemon envisaged by hegemonic stability theory is a beneficial one, not a destructive, self-serving one. In an international context, South Africa is relatively small and is in no way hegemonic, however in the African context, South Africa is a relatively large, well developed country and has a large degree of hegemonic power. Hegemonic stability theory has almost exclusively been used to analyse the role of major world powers, particularly that of America in the past century, however in this situation it will be applied to a regional situation. This depends of the relative hegemony of South Africa to Africa, and not to the international system.

Of the actions required by a hegemon in terms of this theory, three particular areas of focus are apparent – a stable political environment, a stable monetary system and an open trading system. South Africa has been active in all three areas in Africa, with several large-scale, ambitious initiatives already underway. As it has been only 11 years since the democratic elections in South Africa, most of these initiatives are still in their infancy, but South Africa’s role in the formation and the objectives of these initiatives provide strong evidence of what South Africa’s intentions are.

Hegemonic stability theory

The basic premise of hegemonic stability theory is that for a stable international system to exist, a single dominant state is required to maintain and regulate the system. Charles Kindleberger is considered the main founder of the theory after arguing that one of the causes of the Great Depression was the lack of leadership in the international arena[1]. However hegemonic stability theory does not refer to a single clear theory, but rather a collection of differing views, as Robert Gilpin observes, and the name of ‘hegemonic stability theory’ was given by Robert Keohane to refer to this group of theories[2]. The various theories maintain the central proposition that a powerful country facilitates the creation and maintenance of an international system. The differences are more over the interpretation or viewpoint taken – Kindleberger talks of leadership and responsibility, Keohane talks of facilitating cooperation, while Gilpin speaks of economic liberalism. Since this paper aims to determine whether South Africa can fill the role of a hegemonic stabiliser and not to discuss the merits of the theory, an analysis and critique of the various theories is inappropriate. I will instead use a synthesis of the different theories, drawing largely from Keohane who offers the clearest definition and structure to work with, but with some important differences.

The first, most obvious difference is that hegemonic stability theory has traditionally been used to analyse interactions at a global level, with the world’s most dominant country being the hegemon. Modern analysis has almost exclusively been applied to the United States of America and its position in the world system. I will instead be using the theory to study a regional system – that of South Africa in relation to Africa. One might question whether a subordinate system is necessary or can exist under an established international system, however there are two main reasons why I believe it is relevant to Africa. Firstly Africa has traditionally been marginalised rather than incorporated in the international system, and secondly trade and investment in and amongst African countries has been limited. A subsidiary system in Africa could encourage regional cooperation and assist in its integration with the international system.

The second way in which I will differ from Keohane is that he is in fact a critic of hegemonic stability theory and disagrees that a hegemon is necessary for cooperation[3], but I would argue that in Africa a hegemon is essential. Keohane himself admits that cooperation without a hegemon is more difficult[4]. In Africa, where there is little or no infrastructure of cooperation (particular in the area of interregional trade and investment), without a hegemon with experience in these areas, cooperation may be impossible or will take a century to develop. Due to the existence of an established international system and the marginal position of Africa in this system, only an African based regional hegemon could create such cooperation. Furthermore Africa is the poorest continent in the world and many African countries do not have sufficient resources or capacity to invest in cooperation. I will argue that only South Africa has the capacity to fill the role of such a hegemon.

Keohane’s work is useful to this essay, because he defines what qualities are needed in a hegemon, and more importantly, describes how a hegemon functions through the creation of regimes. A regime is a set “of implicit or explicit principles, norms, rules and decision-making procedures around which actors’ expectations converge in a given area of international relations.”[5] By combining regime theory and hegemonic stability theory, Keohane argued that a hegemon creates international regimes that regulate the international system and can perpetuate the system after the hegemon loses its power. In his analysis of America, he identified 3 key areas that the US focused on after the Second World War – a stable international monetary system, provision of an open market for goods, and access to oil at stable prices[6]. Each of these three areas can be mapped to a regime or group of regimes, i.e. a financial regime, a trade regime and an oil price regime. Since the US was unable to create this third regime and international oil prices are now in effect controlled by the Organization of the Petroleum Exporting Countries (OPEC), I will instead have as a third regime a political regime. With the successful implementation of the European Union, international political regimes have gained in stature. In Africa, with its poor history of governance, a regime that can encourage or enforce political stability would be a critical component. Of the other two regimes, Africa is lacking in both areas – trade and finance. A trade regime is essential to developing intra-African trade and sustaining beneficial trading relations with the rest of the world – particularly in light of the growing strength of regional trade blocs. And a financial regime is essential to encourage international capital and to create local capital, and also to effectively channel and manage such investment. The trade and finance regimes also fit into Kindleberger’s requirements of a hegemon providing “a market for distress goods” (trade regime), “a steady … flow of capital, and … liquidity”[7] (finance regime).

South Africa as a hegemon

The first question to be answered is whether South Africa is indeed hegemonic. If South Africa is not a hegemon, then this essay becomes an analysis of cooperation amongst states, rather than hegemonic stability.

A basic definition of a hegemon is ‘a global or regional leader in military, political, economic and often cultural affairs’[8] Implicit in this definition is that a hegemon must lead in most or all aspects of society, and in essence is the dominant state in the region. Keohane provides more specific characteristics of a hegemon, in that they must have “control over raw materials, control over sources of capital, control over markets, and competitive advantages in the production of highly valued goods.”[9] To effectively analyse South Africa’s position in relation to Africa, we must identify the main contenders for hegemony. The first and foremost challenger is Nigeria, who has the largest population in Africa, as well as the second largest economy in sub-Saharan Africa. Next would be Egypt, with the second largest economy (at purchasing power parity rates) in Africa as a whole. In terms of land area, Algeria is the largest in Africa and Sudan the largest in sub-Saharan Africa. Lastly is Botswana with the fourth highest gross domestic product (GDP) per capita (at purchasing power parity rates) in sub-Saharan Africa. The two island countries of Mauritius and Seychelles have generally very high rankings in economic and social measures, however being island nations with populations of only 1.2 million and 84 000 respectively, they are not significant rivals to South Africa and will not be considered. Table 1.1 provides a range of data for the countries identified above.

Looking at the basic data, South Africa is positioned well in Africa. South Africa has the 5^th largest population in Africa and the 8^th largest land area. Although South Africa is not the largest or most populous nation, it is still one of only 10 countries to have a population of over 30 million and one of only 11 to have a land area larger than 1 million square kilometres. Additionally, South Africa’s land area does not comprise vast areas of uninhabitable desert as many large African states do, for example Algeria, Libya and Mali. Economically South Africa is in a different league to the rest of Africa. Its GDP is more than two and half times that of Algeria, its nearest rival, and contributes 40% of the total GDP of sub-Saharan Africa. Although not at the level of developed countries, South Africa’s GDP per capita is much higher than most other countries in Africa. South Africa is well urbanised and comparatively literate. While in numbers its military is relatively small, its military expenditure is

Indicator	Year	South Africa	Nigeria	Egypt	Algeria	Sudan	Botswana
Population (millions)	2004	45.5	128.7	72.6	32.4	35.5	1.8
Land Area (thousand km2)	2003	1 221	911	995	2 382	2 376	567
GDP (current US$ millions)	2004	212 777	72 053	78 796	84 649	21 098	8 974
GDP per capita (PPP current US$)	2004	11 192	1 154	4 211	6 603	1 949	9 945
Urban population (% of total)	2004	57%	47%	42%	59%	40%	52%
Adult literacy rate (% of people over age 15)	2002	86%	67%	47% (1990)	69%	60%	79%
Military personnel	2004	55 000	160 000	798 000	318 000	121 000	10 000
Military expenditure (current US$ millions)	2003	2 596	595	2 021	2 206	391	299
Imports of goods and services (current US$ millions)	2004	57 592	26 820	22 810	21 808	4 470	2 893
Exports of goods and services (current US$ millions)	2004	56 533	39 372	22 518	34 067	3 799	3 570
Total imports and exports (current US$ millions)	2004	114 125	66 192	45 328	55 875	8 269	6 463
High-technology exports (current US$ millions)	2003	908.3	8.6	9.3	11.7	0	unavailable
High-technology exports (% of manufactured exports)	2003	4.96%	1.72%	0.50%	2.25%	0.01%	unavailable
Gross fixed capital formation (current US$ millions)	2004	35 004	16 066	12 932	21 136	4 215	2 207
Gross domestic savings (current US$ millions)	2004	36 544	28 618	12 802	39 762	3 549	3 426
Foreign direct investment, net inflows (% of GDP)	2004	0.27%	2.60%	1.59%	1.04%	7.16%	0.52%
Foreign direct investment, net outflows (% of GDP)	2004	0.74%	unavailable	0.20%	unavailable	0.00%	unavailable
Market capitalization of listed companies (current US$ millions)	2004	455 536	14 464	38 516	0	0	2 548
Listed domestic companies	2004	403	207	792	0	0	18
Electricity production (million kWh)	2003	229 148	20 183	91 932	29 571	3 354	unavailable
Electric power consumption (million kWh)	2003	206 399	13 444	80 336	25 373	2 832	unavailable
Rail lines (total route-km)	2004	20 047	3 505	5 150	3 572	5 478	888
Roads, total network (km)	1999	362 099	194 394	64 000	104 000	11 900	10 217
Roads, paved (% of total roads)	1999	20%	31%	78%	69%	36%	56%
Fixed line and mobile phone subscribers (per 1,000 people)	2003	473	32	204	114	42	370
Personal computers (per 1,000 people)	2004	82	7	32	9	17	45
Internet users (per 1,000 people)	2004	78	14	54	26	32	34
Secure Internet servers (per 1 million people)	2004	20	0.1	0.4	0.1	0	0.6

high, thereby giving South Africa a high expenditure per soldier and therefore theoretically better trained and equipped soldiers. In trade terms South Africa is also head and shoulders above most countries in Africa, its total trade is almost double that of Nigeria (who is an oil exporting nation). In 2004 South Africa accounted for almost 20% of exports and 27% of imports for the African continent[10]. As required by Keohane, South Africa also exports a higher portion of high-technology goods, indicating a comparative advantage in these goods.

In terms of the availability and mobilisation of sources of capital, South Africa once again dwarfs Africa. The relatively high gross fixed capital formation and domestic savings amounts indicate South Africa both has capital available and is capable of handling large amounts. The foreign direct investment (FDI) statistics demonstrate that South Africa is becoming a net exporter of investment capital – indeed South Africa has become the largest single foreign direct investor into the rest of Africa[11]. Moody’s credit ratings agency has rated South African government bonds as Baa1 (medium grade investment), only Botswana has a higher rating of A2 (upper-medium-grade investment)[12]. South Africa also has a world class stock exchange and bond market. The Johannesburg Securities Exchange (JSE) is a public company using advanced electronic scrip and trading software based on the London Stock Exchange systems. In terms of market capitalisation, it is the 16^th largest exchange in the world[13]. The Bond Exchange of South Africa (BESA) has a market capitalisation of over R700 billion and is one of the most liquid emerging bond markets[14]. Derivative markets are well established, with the JSE and BESA allowing the trading of a variety of derivative financial instruments, including futures, options, warrants and swaps.

South Africa also leads in both basic infrastructure, and information and communication infrastructure. South Africa’s electricity production and consumption is more than double that of Egypt, which can be extrapolated to indicate the high level of industrialisation of South Africa relative to the rest of Africa. Its road and rail networks are larger than its rivals, and more people have access to telephones. There is also far greater penetration of computers and the internet.[15]

All the above statistics point to South Africa’s leadership and dominance in almost every sphere. Although relatively wealthy, Botswana lacks both the population and size to effectively compete as a hegemon; and the Sudan has a relatively small economy, has an authoritarian government and has lost credibility internationally with the recent events in the Darfur region. Algeria and Egypt are often considered to be more Arab than African, as evidenced by the generally accepted split between ‘sub-Saharan Africa’ and ‘North Africa’, and with their proximity to the lucrative European market, it could be questioned whether they have a committed interest in developing Africa. All that being said, Algeria is one of the main rivals to South Africa and has played a role, but not a pivotal role, in many of the initiatives mentioned later. However Algeria is still nowhere close to the development level and does not possess the same level of international recognition as that of South Africa. Nigeria is probably the closest rival to South Africa for hegemony, and were it not for South Africa they would probably hold this position. However Nigeria has only recently emerged from a long period of military rule and has a high level of poverty. Their economy is dominated by the oil industry which provides 20% of GDP, 95% of foreign exchange earnings, and about 65% of budgetary revenues[16]. In many ways Nigeria is faced with too many of their own problems to dedicate as much time and resources to African development as South Africa can. Nigeria however is a key player in Africa and has the support and influence of several Africa countries, South Africa therefore works closely with Nigeria. So while Nigeria has the size, support and influence that might be required by a hegemon, it does not have the economic strength to effectively compete with South Africa.

Using Keohane’s criteria for hegemony makes the distinction between South Africa and Nigeria more apparent. South Africa has clear dominance in both control over sources of capital and markets, and produces a higher portion high technology or high value goods. Nigeria’s one potential advantage over South Africa is that Nigeria has large oil reserves, while South Africa does not. Oil is a key raw material and control over it would give significant benefits. However one could ask whether Nigeria controls oil or whether its oil controls Nigeria. In less developed countries, oil is often considered a curse rather than a blessing, being associated with high levels of corruption and dependency. Nigeria is overly dependent on its oil and uses it primarily for export rather than for production. South Africa on the other hand has large deposits of other minerals, in particular gold and platinum which are key raw materials in the production of high technology, high value goods. Although South Africa is also dependent on exports of raw gold and platinum for revenue, it is not as dependent as Nigeria. South Africa alone is therefore in a position to act as an effective hegemon in Africa.

Does South Africa want to be a hegemon?

Having the size and capacity to be a hegemon is however not sufficient. The willingness to act as a hegemon is crucial. Kindleberger’s argument for the Great Depression was not that there was no hegemon in the world, it was that America was unwilling to act as a hegemon.[17] Academically and politically there has been much debate over South Africa’s role and relationship with Africa. Different labels and concepts to that of hegemon have been considered, such as partner[18] or pivotal state[19]. In government the word “hegemony” is avoided wherever possible and efforts are made to avoid the perception of South Africa being a hegemon. The reasons for the suspicion and distrust of hegemony are deep seated. With Africa’s history of colonialism, Cold War proxy wars, and International Monetary Fund (IMF) and World Bank advisors, there is a strong suspicion and resentment of anyone seen to be either imposing their will or their ideals. Many in Africa fear that South Africa will come in, take over and run things their way, following the agenda and ideals of the Western world and bleeding their countries dry[20]. The unilateral, pre-emptive posture of the United States in recent years has provided a very negative example of hegemony that has reinforced these fears. The South African government is sensitive to these concerns, and tries to work within multilateral organisations as far as possible. South Africa’s support of the African Union (AU) and the Southern African Development Community (SADC), and most significantly its policy of ‘quiet diplomacy’ are examples of how the government is trying to avoid the stereotype of an oppressive, dictatorial, unilateral hegemon.

Most of these negative stereotypes are drawn from experiences with the former colonial powers, the international financial institutions and with contemporary America, but South Africa’s relationship to Africa is different in one significant way – South Africa is part of Africa and not on some distant continent. Instability and poverty in neighbouring countries directly affect South Africa in terms of security and refugees. As Alfred Nzo told SADC, “We cannot be an island of prosperity surrounded by a sea of poverty.”[21] South Africa undoubtedly has aspirations of playing a key role in transforming Africa – President Mbeki’s dream and goal of an African Renaissance is an example of South Africa’s willingness and drive towards transforming Africa. South Africa’s policy is explicitly stated in the foreign policy discussion document of 1996:

“South Africa should assume a leadership role in Africa in all those areas where a constructive contribution could be made without politically antagonising the Country’s African partners.”[22]

Note how this mirrors Kindleberger’s concept of leadership. South Africa is in essence trying to focus on the positive leadership and responsibility aspects of hegemony and avoid at all costs the negative connotations of dominance and dictatorship. This also fits in with Keohane’s observation that:

“American leaders did not construct hegemonic regimes simply by commanding their weaker partners to behave in prescribed ways. On the contrary, they had to search for mutual interests with their partners, and they had to make some adjustments themselves in addition to demanding that others conform to their design.”[23]

Will Africa listen?

As mentioned above, there is a fair amount of suspicion and resentment of South Africa’s position from other African states. Some in Africa do not even consider South Africa to be African – a spokesman for Zimbabwe declared that “South Africa is not Africa and Africa is not South Africa”[24] and a Nigerian spokesman has called Mandela “the black president of a white state”[25]. South Africa’s failure to win the 2004 Olympic bid and the 2006 Soccer World Cup bid, in part due to a lack of African support, speak volumes of the mistrust Africa feels towards South Africa. Posturing and competition over which African countries could receive seats in a reformed United Nations Security Council has seen the rivalry with South Africa increase. For many years under apartheid, the South African government and therefore South Africa was the antithesis of everything African. With South Africa’s far more developed economy and liberal economic policies, this view has persisted, with South Africa being seen as too western, rather than African.

Coupled with this suspicion, resentment and almost jealousy of South Africa, is a suspicion of western liberal economic ideals. Many countries and people in Africa have historically lent towards Marxism and socialism. Liberalism and neo-liberalism have become synonymous with the policies of the IMF and the World Bank, particularly their structural adjustment programmes. Irrespective of their intentions or the success of implementation, these policies and thereby liberalism have become associated with austerity, poverty and high debt levels by many in Africa. Combined with this is the resentment of being told what to do by outsiders.

With these very negative perceptions of both South Africa and liberalism abounding in Africa, one wonders if there is indeed any chance of South Africa succeeding as a hegemonic stabiliser. This appears to be an obvious failure of Gilpin’s requirement that “support of a liberal system must exist among the major economic powers … the hegemon can encourage but cannot compel other powerful states to follow the rules of an open world economy.” However if you replaced the politically sensitive word “liberal” with “openness and cooperation”, most Africans would tell you that is what they have been working for long before South Africa become democratic. The Organisation of African Unity (OAU) was formed in 1963 primarily for this purpose. The charter of the OAU defined as one of its purposes to “promote international co-operation” and identified 6 areas of cooperation that were required to meet its purpose: politics, economics, education, health, science and defence[26]. The Lagos Plan of Action adopted by the OAU in 1980 speaks of the “economic integration of the African region” and “economic co-operation on sub-regional, regional and continental bases in Africa.”[27] So in actual fact, if South Africa pursues policies aimed at cooperation and regional integration, it will share a common interest with the other African states. South Africa’s difficulty with Africa is about convincing Africa of its intentions and its commitment to Africa, and not about whether the actions of a hegemon under hegemonic stability theory would be beneficial to Africa.

Which leads to the topic that will be discussed next – what are South Africa’s intentions towards Africa? Is South Africa playing the beneficial role of hegemonic stabiliser?

South African business in Africa

In order to explore South Africa’s intentions towards Africa, we need to identify its interests. Ignoring any sense of obligation created by support of the anti-apartheid struggle or any altruistic feelings of African brotherhood, South Africa’s primary interest in Africa is money. Whether the interest is in expanding our markets or protecting our own economy from the refugees and destabilising effects of unstable, poverty stricken neighbours, economic considerations are a key factor in South African policy.

Africa is South Africa’s closest and best potential market. Although a hegemon within Africa, South Africa is barely a middle power in the rest of the world. South Africa has limited ability to compete in the established markets of the developed world and faces stiff competition from the Asian economies. Additionally, as highlighted by Neuma Grobbelaar, with the opening up of the South African economy, local firms face stiffer competition at home and therefore see Africa as a market where they have the advantage over the local firms[28]. South Africa has the advantage in Africa, from proximity and from an understanding of the culture. This view is shared by South African business, as shown in an opinion survey in 1997 in which 62% of companies thought that Africa was their best option for foreign investment[29]. As mentioned earlier, South Africa is now the single largest provider of FDI to Africa.

The South African government has supported South African investment into Africa, both in rhetoric and policy. After an African Renaissance speech in 1998, when answering a question about what role South Africa would play in developing Africa, Thabo Mbeki specifically spoke of the role of South African business[30]. More recently, from 2003 the limit in terms of exchange control regulation for foreign investment of South African funds was $1 billion for destinations outside of Africa and $2 billion for investments into Africa[31]. Furthermore in the 2006 budget, the threshold for foreign direct investment into Africa was lowered from 50% to 25%[32]. The government has done much to steer South African companies’ investments in Africa, rather than the rest of the world, and South African companies have been only too keen to invest in Africa.

In 2003 there were more than 30 major South African companies in Africa[33]. MTN has provided a vital telecommunications network in Nigeria, Eskom has invested in and upgraded electricity networks, and retailers are providing everyday consumer goods. Africa is now South Africa’s third largest export market by continent[34]. International companies have also invested into Africa through South Africa, seeing South Africa as a springboard into the continent[35]. This investment is providing jobs, growth and infrastructure to African nations.

Unfortunately the picture is not entirely a rosy one. South Africa’s balance of trade with Africa weighs very heavily in South Africa’s favour – a R30 billion surplus in 2005[36]. South Africa is currently exporting goods and services to Africa and not importing goods back. Currently this surplus is financed in part by South African investment capital flows to Africa, however this is an unsustainable position as it will over the long term weaken the currencies of the African nations and deplete their foreign reserves – giving legitimacy to the fear that South Africa will bleed African countries dry. The other fear is the ‘South Africanisation’ of Africa, whereby South Africa will impose their culture onto African societies. South African companies will naturally sell mostly South African goods and impose their South African business values, practices and policies. This is a very pessimistic outlook, derived from Africa’s past experiences with multinationals and fuelled by current anti-globalisation protests.

Looking at the profile of major South Africa corporations in Africa, the possibility of a different non-extractive future comes to light. The profiles of companies investing in Africa generally cover a broad spectrum, as was shown in Mozambique[37]. South Africa has significant mining (e.g. Anglogold Ashanti and De Beers) and manufacturing (e.g. SABMiller and Nampak) interests in Africa, but also has increasingly becoming involved in the retail and service sectors. ABSA, Alexander Forbes and Standard Bank provide financial services; Multichoice, MTN and Vodacom provide information and telecommunication services; Group 5 and Murray & Roberts provide construction; and Massmart and Shoprite provide retail services[38]. Although these companies go into Africa with South African ideas, to succeed they have to cater for and market to the local consumers. As the service sector is geared to selling a service to people, they are especially sensitive to local wants and desires. These companies may South Africanise Africa, but they will in turn be Africanised by their host countries. The other key feature of these companies is that many of them have a direct stake in improving local markets and in turn provide services that will improve the local economy. The banks, for example, will do well if the local economy does well and will at the same time provide vital banking and financing services. Retailers will at first source perishables from local markets and then will increasingly source other products from local markets due to reduced transport costs. Make no mistake, there is little or no altruism in these businesses, their primary aim is to make profits. The oft quoted Roger Pardoe put it very bluntly, “[We are] not investing in Africa for altruism. We’re investing in Africa to make some money.”[39] Success in Africa and the success of Africa is for many South African companies the best prospect for profits and growth.

Grobbelaar identifies some key benefits that South African investment has given to Mozambique –

• “Showcasing the ability … to absorb and respond to the demands and requirements of large investors”;
• “A more consistent supply of goods and greater price stability” and “higher consumer awareness”; and
• “Setting new standards in labour and business best practice”.

The other two key findings that she makes are that –

• “The impact of South African investment on economic policy, industrialisation, transfer of technology and the regulatory framework has generally been benevolent and positive”; and
• “Almost all the South African investors interviewed indicated that they would maintain or expand their operations in Mozambique in the near future.”[40]

In essence South African businesses are making a long-term investment into Africa. South Africa’s intentions towards Africa may therefore be defined as supporting a long-term investment strategy. The policies which support this goal are the promotion of regional cooperation and integration, and the creation of standardised regulatory frameworks – everything that is required of a hegemonic stabiliser. Of particular note is the “greater price stability” and “setting new standards in … best practice” effects created by South African business, both of which are associated with hegemonic stability. With generally deficient local regulatory environments in many African countries, South African companies will attempt to promote and lobby for the export of South African regulations – the environment with which they are most familiar and comfortable. In essence they will attempt to create regimes in Africa in which they can operate. These regimes can either be created through the actions of the companies or through the efforts of the South African government.

Political regimes

The area in which the government has been the most active, and arguably has made the most progress, has been in the area of political stability. This matches the principle requirement of business, in that investors will be wary of making long term commitments in politically unstable countries. To begin with, South Africa has been very involved in conflict resolution in Africa, usually involving its senior members of government in brokering peace agreements. Most successful of these efforts to date was the peacemaking process in Burundi, involving initially former President Nelson Mandela and from 2000 Deputy President Jacob Zuma. South Africa’s role included being a neutral broker in continuous rounds of negotiation, as well as providing troops to a peacekeeping force[41]. South Africa has more recently played a key role in peace-talks in the Ivory Coast and the Democratic Republic of Congo (DRC), often hosting talks locally between the various factions. President Mbeki himself has frequently played the role of chief mediator in these conflicts[42].

But more importantly, South Africa has been working hard in implementing and improving structures that contribute towards political stability and conflict prevention. First and foremost of these would be the African Union (AU) and its initiatives. Although the African Union existed for many years prior to the democratisation of South Africa in the form of the OAU, South Africa has devoted significant resources to the transformation of the OAU into the AU and also to the operations of the AU. The African Union was officially formed at a summit in Durban, South Africa in 2002 and South Africa took the position of its first chairman. President Mbeki, in his address at the launch, highlighted the tasks of “political, economic and social integration”, the mobilisation of civil society, and working towards “peace, security and stability for the people of this continent.”[43] These tasks reflect the goal of a political regime aimed at promoting political stability. South Africa also used its chairmanship to promote the NEPAD initiative. South Africa was instrumental in the formation of NEPAD and more importantly has tirelessly promoted it internationally. This is one area where South Africa has used its status as hegemon to achieve its goals – because South Africa is seen as a leader morally, politically and economically in Africa by the international community, they are taken seriously internationally and are able to ‘punch above their weight’. South Africa has been invited to several of the Group of Eight (G8) summits, including the most recent summit in St Petersburg, and is a member of the Group of Twenty (G20) forum of finance ministers and central bank governors. Finance Minister Trevor Manuel is a governor of the World Bank and chaired the annual meeting of the IMF and World Bank in 2000[44]. By using these platforms, South Africa has increased awareness of African issues and initiatives.

South Africa’s support for the African Union can be measured in its financial contributions. South Africa is one of five countries that contribute the bulk of AU funding, calculated at 8.25% of the AU annual budget[45] – this amounted to approximately $4.3 million (at current dollar exchange rate) in 2004/5[46]. But over and above this amount South Africa contributed $150 million in 2004 to peacekeeping operations[47], and $200 million in 2005 for peace-keeping operations, institutions of the African Union and the Pan African Parliament[48]. South Africa is also currently the host of the Pan African Parliament – an institution that only has consultative and advisory powers at the moment, but it is aimed at having full legislative powers in the future[49].

The primary African Union programme aimed at implementing the ‘principles, norms, rules and decision-making procedures’ of political governance is the African Peer Review Mechanism (APRM). The mandate of the APRM (below) very closely matches the definition of a regime given earlier:

“The mandate of the African Peer Review Mechanism is to ensure that the policies and practices of participating states conform to the agreed political, economic and corporate governance values, codes and standards contained in the Declaration on Democracy, Political, Economic and Corporate Governance. The APRM is the mutually agreed instrument for self-monitoring by the participating member governments.”[50]

However membership to the APRM is voluntary and no direct sanctions or penalties are imposed for non-compliance. To date only 23 out of the 53 AU states have joined, and reviews have only been completed for Ghana and Kenya. Time will only tell if this infant regime will survive to adulthood. South Africa has given its full support to the APRM programme, it is one of the 23 members and its review is currently being finalised. South Africa has also tirelessly promoted this programme, both within Africa and internationally.

Regionally, South Africa supports and plays a significant role in the Southern African Development Community (SADC). SADC includes among its objectives to “evolve common political values, systems and institutions”[51], once again mirroring the needs of a political regime. One of its most significant initiatives is the standardisation of the “Principles and Guidelines Governing Democratic Elections”[52], which commits the member states to democratic processes – an arguably vital chain in political stability. This initiative has been marred somewhat by events in Zimbabwe, in what many international observers consider flawed elections. South Africa has been harshly criticised for not taking a stronger position on Zimbabwe and not forcing SADC to act. Many might argue that this is a critical failure of South Africa in its role of hegemonic stabiliser, however if South Africa did take a stronger position, the backlash from Zimbabwe and other African states could destroy any consensus South Africa might have. The failure to act against one delinquent state should be seen in the context of the potential breakdown of relations between South Africa and the rest of Africa.

Financial regimes

One area where South Africa is leagues ahead of the rest of Africa is in its financial infrastructure. South Africa is the only African country that is a member of the Bank for International Settlements (BIS)[53], an international financial organisation aimed at fostering cooperation between central banks. The BIS has defined a set of banking supervisor best practices, known as the Basel Accords, aimed at promoting financial stability in the banking system. As South Africa is a member of BIS, the South African banking regulator subscribes to the Basel II regulatory capital frameworks set by the Basel Committee. Secondly, the South African Rand is one of only 15 currencies worldwide to be traded on the Continuous Linked Settlements (CLS) foreign exchange trading system – the most advanced trading system available that eliminates settlement risk and improves liquidity[54]. Furthermore, as mentioned earlier, South Africa’s stock exchange and bond market are world class. South Africa’s leadership in these areas is not only confirmation of its position as regional hegemon, but are important in the context of the global financial system. Africa exists in an already well established international financial regime – the principles, norms, rules and decision-making procedures of international financial transactions have been developed over many years by the global financial players. For South Africa to establish a financial regime in Africa, it would have to conform to these pre-existing standards for it to be accepted into the international system. Since South Africa already complies with international best practice for banking, foreign exchange, and share and bond trading, the rollout of this financial regime in Africa is made much easier – both from the support of the international community and the increased likelihood of acceptance by the African countries.

The rollout of the financial regime by South Africa has already begun. The South African banks investing into Africa (Standard Bank and ABSA) take the banking best practices with them to the counties they invest in, providing the example and benchmark for those countries. The Bond Exchange of South Africa has stated an interest in being involved in the development of bond exchanges in Africa, using South African lessons and ideas to improve the African markets[55]. More ambitiously, the JSE is pursuing the goal of a Pan-African Board[56] – they have the technology, structures and the capacity available. A stock exchange is a vital source of equity finance for companies – by providing the service to other African countries, the JSE will be giving local companies a source of investment which will hopefully lead to the development of non-South African industries. This initiative of the JSE has the full support of the government, with restrictions being lifted in the 2004 budget. In the words of Trevor Manuel “we propose to develop a policy framework during 2004 to promote South Africa as a regional financial centre able to cater more fully for the needs of the African continent. It is envisaged that inward listings by African companies, institutions and governments should be encouraged”[57]. The concept of South Africa being a financial centre to Africa was spelt out by the Director General of the National Treasury – Lesetja Kganyago. He identified the six pillars of this policy as follows:

• “Opening South Africa’s markets to African and global issuers;
• Global lowest trading costs and trading risk;
• Global leadership in investor protection;
• Developing key new markets;
• A world-class pool of financial talent;
• A global hub for financial business process outsourcing.”[58]

He also highlights a key point, that “Africa’s economies cannot wait the slow maturing of national financial markets … Only a regional financial centre will be in a position to provide these services in the foreseeable future.”

Large scale initiatives aimed at financial cooperation and integration, first at a regional and then at a continental level are already underway. It has long been a goal of Africa to have a single African currency. At a continental level, the Association of African Central Banks (AACB) was established in 1966 for the purposes of, amongst other things, promoting “co-operation in the monetary, banking, financial and related spheres …, [formulating] guidelines, [and] bringing about and maintaining broad monetary and financial stability in Africa.”[59] In 2000, the AACB began the ambitious African Monetary Cooperation Programme (AMCP) – a programme which proposed a single continental monetary zone, with a common currency and central bank by the year 2021[60]. Although this date is appears unlikely to be met, the programme is nonetheless underway. The AMCP envisages integration at a regional level first and then at a continental level. The region that South Africa fits into is the Southern African Sub-Region, which falls under SADC. The SADC countries have agreed to a Memorandum of Understanding (MOU) on Macroeconomic Convergence, committing themselves to following policies that ensure macroeconomic stability[61]. Within SADC there is a Committee of Central Bank Governors (CCBG) tasked with cooperation and regional integration. One of their key projects is the development of national payment, clearing and settlement systems for SADC countries[62] – such a system is a key element of any financial integration plan.

South Africa’s role in the African Monetary Cooperation Programme is critical. Firstly, without South Africa’s support of the programme, it may not gain the necessary African or international attention and support it requires. Secondly, the size and maturity of the South African financial system will lend necessary weight and stability to the programme. Thirdly, South Africa’s hegemony puts it in the best position to encourage cooperation and to sanction countries not complying with the requirements. Lastly, South Africa has the systems and experience required – South Africa has a well established national payment system using real-time gross settlement, whereas many African countries do not have any such system. Included in these systems and experience is South Africa’s foreign currency trading systems and involvement with the Bank for International Settlements, as mentioned earlier. South Africa’s crucial role is reflected in the position it holds in the SADC Committee of Governors – its reserve bank governor is chairperson of the committee and South Africa coordinates the Finance and Investment Sector[63].

Trade regimes

As hegemonic stability theory has historically been applied to the developed world, one of the key emphases in the theory is that the hegemon encourages liberalism (Gilpin) or an open market for goods (Keohane). Liberalism and open markets are traditionally associated with increased competition, efficiency gains, economies of scale and cheaper goods. The situation in Africa is very different. Africa exists in a system already liberalised to a degree by the World Trade Organisation (WTO), in which goods are produced at an already low cost by the developed world or emerging Asian economies, in particular China. Trade between African states is limited and the majority of production is targeted at overseas markets. Nevertheless, Africa has constantly pursued regional integration and has several large regional organisations, including SADC, the Common Market for Eastern and Southern Africa (COMESA) and the Economic Community of West African States (ECOWAS). As Asante argues, Africa’s focus on regionalism is more to do with economic development than tariff issues. Africa is aiming more at “changing the structure of production and trade … [and] their net effect will not be felt over a short period of time.”[64] The role of the hegemon in Africa should therefore not just be to encourage countries to trade with each other, but to encourage the development of a trade structure.

Intra-Africa trade in 2004 only accounted for 10% of Africa’s total exports[65] and of that approximately 25% were South African exports to Africa and 8% were African exports to South Africa.[66] Excluding South Africa, intra-African trade is only 8% of total African trade. South African trade is also very regionally biased, 67% of South African exports in 2004 went to SADC countries[67]. Furthermore, as previously mentioned, the trade balance is heavily in South Africa’s favour. Finally Africa only accounts for 15% of South Africa’s exports[68]. Taken together, this paints a picture of Africa being heavily dependent on South Africa, particularly for imports, and of Africa being of marginal importance in South African trade. One would therefore wonder why South Africa would pursue a trade regime with Africa. The rationale can only be understood in the broader context of South Africa’s long-term ambitions in Africa and its objectives with regard to the other regimes.

Firstly promoting trade and economic linkages can contribute to political stability. Countries that are economically dependent upon each other are less likely to antagonise each other, and more pressure may be exerted on dissenting countries through the threat of trade sanctions. A trade regime and increased intra-African trade would therefore benefit the political regime. Secondly trade, investment and finance are all very closely linked. The interest of South African countries in Africa and the growing South African investment in Africa will firstly increase South African exports to Africa, and then as the investments begin to increase the productive capacity of the countries, regional trade will strengthen. In effect, South Africa’s level of development puts it in the best position to exploit African regionalism – first through exploitation of export opportunities, and subsequently through investment to take advantage of geographic or country specific productive advantages. Although the short-term benefits of trade liberalisation would be limited for South Africa, the long-term potential of the African market is significant, because of its proximity and its development potential. Africa would also benefit through integration with South Africa, firstly through access to the largest economy in Africa, and secondly through South Africa’s strong trade linkages with the rest of the world. Cooperation and a common view on trade would in addition benefit Africa’s negotiations with international markets, particularly in this era of large trade blocs.

Trade is an important aspect in all of Africa’s development initiatives. NEPAD identifies one of its priorities as “accelerating intra-African trade and improving access to markets of developed countries.”[69] SADC has set the targets of a free trade area by 2008, a customs union by 2010 and a common market by 2015[70] – key steps in the process of achieving a monetary union. South Africa officially supports increasing African trade. The Minister for Trade and Industry, Mandisi Mpahlwa, has expressed similar beliefs as those above:

“It is in all of our interests for us to grow the levels of trade between African countries, and use trade as a means to further develop our continent. South Africa is acutely aware of the imbalances that exist in trade relations with other countries on the continent. … [The] Department of Trade and Industry is continuing development of an import facilitation policy which would seek to redress what is an unacceptable pattern of trade, by encouraging and mobilizing the South African private sector to buy from our own continent.”[71]

He also makes it clear where South Africa will be focussing its hegemonic energy – not in the creation of a new trade regime, but in the consolidation of existing ones. He notes that a problem is the “proliferation of regional economic communities … - of sub-Saharan Africa’s 53 countries, 6 are members of one regional economic community, 6 belong to two and 20 are members of at least three.”[72] This likely will be the greatest benefit of South African hegemony to trade, a central point of focus around which regionalism and integration can consolidate. The first challenge for South Africa would therefore be to integrate the Southern African Customs Union (SACU) with SADC. SACU is the oldest customs union in the world and comprises South Africa, Namibia, Botswana, Swaziland and Lesotho.[73] Since all members of SACU are also members of SADC, SACU will have to be dissolved into the planned SADC customs union. A SADC-SACU task force has already been formed to investigate this issue[74].

The challenges to economic integration are substantial and little progress has been made. As Trevor Manuel observed “the key reason that the economic integration agenda has stalled, is that most Member States do not see any concrete benefits from economic integration, against the substantial cost of surrendering sovereignty.”[75] It is currently very unlikely that the target dates set by SADC for integration will be met. However South Africa remains committed to integration, as “the development of the SADC region remains the centrepiece of [South Africa’s] foreign policy and [South Africa’s] own economic development priorities.”[76] With the reluctance of many countries to commit to integration, the role played and example provided by South Africa could be crucial in wearing down this reluctance. Additionally as South African investment and trade strengthens in the area, the benefits of integration could become more apparent to the countries. Although the creation of an African trade regime is a pivotal component and ultimate goal of most initiatives, it is also the area that is likely to make the slowest progress. The benefits of political stability, and the additional capital and financial flows provided by a financial regime are both immediate and tangible. However the benefits of a trade regime, whereby governments lose control over tariff revenue and protectionist strategies, are less obvious and tangible. It will be in this area that South Africa will require all of its hegemonic coercive powers and persuasiveness in order to achieve results.

Conclusion

Given the size, diversity and maturity of South Africa’s economy and given the level of infrastructural development, South Africa enjoys sizeable degree of relative hegemony in Africa. South Africa’s President dreams of an African Renaissance and a “Pax Africana”[77], and South Africa has demonstrated a strong interest in and commitment to Africa. But is this a clear case of hegemonic stability theory at work? South Africa faces substantial challenges, not least of which Africa being the least developed continent in the world. Africa has 34 of the world’s 48 poorest countries and 24 of the 32 countries in the world with the lowest levels of human development[78]. Another significant obstacle is that the word ‘hegemony’ has become associated with unilateralism and domination, and South Africa therefore attempts to deny its hegemony in order to avoid these negative connotations. The suspicion with which Africa sees South Africa and the fear of South Africa becoming a self-righteous bully hamstring South Africa’s ability to act and to enforce much needed transformation in Africa. Furthermore South Africa only enjoys hegemony at a regional level and is a smaller player internationally. An international system already exists, of which Africa is a marginal, incompletely integrated component. Any transformation in Africa and any regime in Africa therefore has the dual challenge of having to be both acceptable to Africa and acceptable to the international system. Lastly the success of any African effort is largely dependent on international support. Although this essay has focussed mostly on South Africa and its role, South Africa alone does not have the resources and capacity that are required to lift Africa out of poverty. South Africa must ensure in all its efforts that the international community remains involved. There are two particular reasons that may cause the international community to disengage from Africa – misguided hope or excessive despair. Misguided hope would be brought about by the perception that Africa is taking now control of and is responsible for its own destiny and therefore does not need outside assistance, or a particular danger for South Africa is the perception that South Africa is now taking care of Africa and therefore outside assistance is no longer necessary. Excessive despair is a problem already faced by Africa – persistent poverty, the perceived lack of development progress and concerns about aid effectiveness saw a decline in levels of aid in the 1990’s. Fortunately with a new wave of optimism, this trend has been reversed and aid levels are increasing significantly[79]. However any future failures could have severe repercussions and at the extreme could result in Africa being written-off as a hopeless case.

It could be argued that Africa’s underdevelopment is in fact the result of it not having a willing, committed hegemon for much of its independence. Without a hegemon developing and sustaining the African systems, the systems have collapsed resulting in severe impoverishment. As the Great Depression was Kindleberger’s example of the results of a lack of a willing hegemon, Africa’s underdevelopment could be the result of its lack of a willing hegemon. Furthermore it must be stressed that nothing in hegemonic stability theory suggests hegemonic unilateralism and dictatorship. Kindleberger speaks of leadership and responsibility, not bullying and domination. Gilpin speaks of common interests, not the forceful pursuit of self interests. Keohane speaks of cooperation, not imposing your will on others. South Africa and Africa’s fear of hegemony does not therefore make this theory inapplicable, but it will likely create a more unique outcome. South Africa has taken great pains to work within existing African structures and transform them to its needs, rather than create new structures and impose them on Africa. Most of the major initiatives undertaken by South Africa are not new, but have existed in one form or another in Africa for many years. The dream of a united Africa has been pursued long before South Africa became independent, South Africa has only added its strength and leadership to the pursuit of this dream. Because of this, the outcome is more likely to be an African system, rather than a South African system. South Africa will undeniably have a pre-eminent position in this system, but it will develop strongly African characteristics.

If no progress is made and Africa decays further, it is unlikely to have any impact on the understanding of hegemonic stability theory. The arguments could be made that South Africa was not hegemonic enough, was too reluctant to use its hegemonic coercive powers, or that hegemonic stability theory can only be applied in the global context and not regional situations. However with a plethora of Afro-pessimistic theories available, hegemonic stability theory is unlikely to get any attention. However, if the negative trends are reversed and this is indeed the African century, supporters of hegemonic stability theory will no doubt make South Africa their poster child. If Africa does begin to develop and this development can be linked to South Africa’s role, it would greatly strengthen the arguments for hegemonic stability theory.

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[1] Kindleberger CP, The World in Depression, 1929-39, University of California Press, Berkley, 1973, pg 291-308

 [2] Gilpin R, The Political Economy of International Relations, Princeton University Press, Princeton, 1987, pg 86

 [3] Keohane, R, After Hegemony: Cooperation and Discord in the World Political Economy, Princeton University Press, Princeton, 1984, pg 31

 [4] Ibid, pg 244

 [5] Ibid, pg 57

 [6] Ibid, pg 139

 [7] Gilpin R, op. cit., pg 75

 [8] Habib A, Landsberg C, “Hegemon or Pivot?: debating South Africa’s role in Africa’, http://www.sarpn.org.za/documents/d0000620/P611-Pivotalstate.pdf, August 2003

 [9] Keohane, op. cit., pg 32

 [10] International trade statistics 2005, WTO Publications, Geneva, 2005, pg 83

 [11] Lutchman J, Daniel J, Naidu S, “South Africa And Nigeria: Getting Closer” in HSRC Review vol. 2, no. 4, Human Sciences Research Council, November 2004, pg 10

 [12] Sovereign Ratings List, http://www.moodys.com/moodys/cust/content/Content.ashx?source=StaticContent/Rating Lists/SovRatList.pdf, 4 August 2006

 [13] Market Profile: For the month of July 2006, JSE, http://www.jse.co.za/stats/markstats/market_profile/docs/20060701-Market_Profile.pdf, 1 July 2006

 [14] Developing a Capital Market in Africa, Bond Exchange of South Africa, http://www.bondexchange.co.za/besa/action/media/downloadFile?media_fileid=4440, 17 October 2005

 [15] Unless otherwise stated, statistics are from the World Bank World Development Indicators Online Database and from African Development Indicators 2005, World Bank, Washington DC, 2005

 [16] The World Factbook 2005, Central Intelligence Agency, Washington, 2005

 [17] Kindleberger CP, op. cit., pg 291-292

 [18] Ahwireng-Obeng F, McGowan P, “Partner or Hegemon? South Africa in Africa”, in Journal of Contemporary African Studies, Vol. 16 Issue 1, January 1998, pg 5

 [19] Habib A, Landsberg C, op. cit.

 [20] Barber J, Mandela’s World, James Currey, Oxford, 2004, pg 173

 [21] Ibid, pg 182

 [22] South African Foreign Policy Discussion Document, Department of Foreign Affairs, http://www.info.gov.za/greenpapers/1996/foraf1.htm, 1996

 [23] Keohane R, op. cit., pg 138

 [24] Barber J, op. cit., pg 190

 [25] Ibid, pg 173

 [26] Charter of the Organisation of African Unity, http://www.fordham.edu/halsall/mod/1963OAU-charter.html, July 1998

 [27] Lagos plan of action for the economic development of Africa: 1980-2000, Organisation of African Unity, Addis Ababa, 1980, pg 4 - 5

 [28] Grobbelaar N, ‘Every Continent Needs an America’: The Experience of South African Firms Doing Business in Mozambique, SAIIA, Johannesburg, 2004, pg 8

 [29] Barber J, op. cit., pg 179

 [30] Mbeki T, The African Renaissance, South Africa and the World, http://www.unu.edu/unupress/mbeki.html, 9 April 1998

 [31] Manuel T, Budget Speech 2004, http://www.info.gov.za/speeches/2004/04021815161001.htm, 18 February 2004

 [32] Manuel T, Budget Speech 2006, http://www.info.gov.za/speeches/2006/06021515501001.htm, 15 February 2006

 [33] Daniel J, Naidoo V, Naidu S, “Corporate Expansion Into Africa” in HSRC Review vol. 1, no. 3, Human Sciences Research Council, September 2003, pg 7

 [34] South African Trade by Continents, Department of Trade and Industry, http://www.thedti.gov.za/econdb/raportt/rapcont.html, July 2006

 [35] Barber J, op. cit. pg 180

 [36] South African Trade by Continents, op. cit.

 [37] Grobbelaar N, op. cit., pg 2

 [38] Daniel J, Naidoo V, Naidu S, op. cit., pg 7

 [39] Daniel J, Naidoo V, Naidu S, op. cit., pg 6 – 7

 [40] Grobbelaar N, op. cit., pg 2 – 4

 [41] Southall R (ed), South Africa’s role in conflict resolution and peacemaking in Africa, HSRC Press, Cape Town, 2006, pg 11 – 13

 [42] Ibid, pg 181

 [43] Mbeki T, Launch of the African Union: Address by the chairperson of the AU, http://www.au2002.gov.za/docs/speeches/mbek097a.htm, 9 July 2002

 [44] Manuel T, Opening Address By Chairman, http://www.info.gov.za/speeches/2000/0010021010a1005.htm, 26 September 2000

 [45] Cilliers J, From Durban to Maputo: A review of 2003 Summit of the African Union, http://www.iss.co.za/Pubs/Papers/76/Paper76.html, August 2003

 [46] Annual Report 2004/05: Department of Foreign Affairs, South Africa, http://www.dfa.gov.za/department/report_2004-2005/finan04-05.pdf, 4 August 2006, pg 67

 [47] Manuel T, Budget Speech 2004, op. cit.

 [48] Manuel T, Budget Speech 2005, http://www.info.gov.za/speeches/2005/05022316151001.htm, 23 February 2005

 [49] The Pan-African Parliament, http://www.africa-union.org/root/au/organs/Pan-African_Parliament_en.htm, 19 March 2004

 [50] The African Peer Review Mechanism (APRM), http://www.dfa.gov.za/au.nepad/nepad49.pdf, 16 September 2003

 [51] SADC Objectives, http://www.sadc.int/english/about/objectives/index.php, 29 August 2006

 [52] SADC Principles and Guidelines Governing Democratic Elections, http://www.sadc.int/english/documents/political_affairs/index.php, 29 August 2006

 [53] Organisation and governance, http://www.bis.org/about/orggov.htm, 29 August 2006

 [54] CLS Bank live with four additional currencies, http://www.cls-services.com/news/article.cfm?objectid=99DC57CA-E804-6F82-D9D81BDAE465EBB5, 6 December 2004

 [55] Developing a Capital Market in Africa, op. cit., pg 17

 [56] JSE Security Exchange, Annual Report 2004, pg 7

 [57] Manuel T, Budget Speech 2004, op. cit.

 [58] Kganyago L, Speech at “Reuters Economist Of The Year” Award Ceremony: “South Africa As A Financial Centre For Africa”, http://www.treasury.gov.za/speech/2004081101.pdf, 11 August 2004

 [59] Announcement of the Meeting of African Central Bank Governors (AACB), http://www.reservebank.co.za/internet/Publication.nsf/(Web%20Main%20Frameset)?OpenFrameSet&Frame=frmMain&Src=%2Finternet%2FPublication.nsf%2F0%2F296672d2642a0faa42256b41003676d5%3FOpenDocument%26AutoFramed, 21 February 2002

 [60] Mboweni T, African economic integration, http://www.sarpn.org.za/documents/d0000569/index.php, 9 October 2003

 [61] Ibid

 [62] Activities of the Committee of Governors, http://www.sadcbankers.org/EXC.htm, 29 August 2006

 [63] Structure of the Committee of Central Bank Governors in SADC, http://www2.sadcbankers.org/SADC/SADC%20Bankers.nsf/1eb144f6ed4e3b1e422568700030e9c9/9b59e107ddd70fca422568700031a703?OpenDocument, 29 August 2006

 [64] Asante SKB, Regionalism and Africa’s Development: Expectations, Reality and Challenges, MacMillan, London, 1997, pg 24

 [65] International trade statistics 2005, op. cit.

 [66] South African Trade by Continents, op. cit.

 [67] South African Trade by Regions, Department of Trade and Industry, http://www.thedti.gov.za/econdb/raportt/rapregi.html, July 2006

 [68] South African Trade by Continents, op. cit.

 [69] NEPAD in brief, http://www.nepad.org/2005/files/inbrief.php, 28 April 2006

 [70] Current TIFI Activities, http://www.sadc.int/english/tifi/about/activities.php, 30 August 2006

 [71] Mpahlwa M, Address by Minister of Trade and Industry at Export Africa 2006, http://www.dti.gov.za/article/articleview.asp?current=1&arttypeid=2&artid=1114, 31 May 2006

 [72] Mpahlwa M, op. cit.

 [73] Southern African Customs Union (SACU), http://www.dfa.gov.za/foreign/Multilateral/africa/sacu.htm, 26 April 2004

 [74] SADC-SACU Executive Secretaries Meeting, http://www.sadc.int/index.php?action=a2001&news_id=729&language_id=1, 15 June 2006

 [75] Manuel T, Opening Remarks SADC Integrated Committee of Ministers Meeting, http://www.sadc.int/index.php?action=a2001&news_id=732&language_id=1, 22 June 2006

 [76] Ibid

 [77] Mbeki T, “Pax Africana - dream or reality?” in ANC Today, Vol. 5, No. 13, http://www.anc.org.za/ancdocs/anctoday/2005/at13.htm, 1-7 April 2005

 [78] African Development Indicators: 2005, World Bank, Washington DC, 2005, pg xxi

 [79] Aid rising sharply, according to latest OECD figures, http://www.oecd.org/dataoecd/0/41/35842562.pdf, 28 August 2006