text: sudden surge of some foreign companies to disinvest, but to what extent are they actually cutting their economic links with South Africa when withdrawing their direct operations or selling their South African assets? This problem has received only scant attention in the documentation on the subject. 14. It may be recalled at this stage that a number of developments, both internal and external, roughly coincided with the period of the 1980s when the debate on disinvestment from South Africa assvuned considerable international importance. First, the overall investment rate (capital formation) of the economy showed a marked decline, from 26.4 per cent in 1980 to 19.5 per cent in 1987. The stagnant economic growth and sometimes negative growth rates of the South African economy recorded in 1982, 1983 and 1985 were mainly a reflection of this slow but steady deceleration in its overall investment ratio. Secondly, the fluctuating price of gold introduced a certain amount of instability in the country's external resources, which compelled recourse to exchange controls and other restrictive measures. Thirdly, a variety of internal developments, constituting an altogether different set of destabilizing factors, such as repeated states of emergency, media restrictions, mass detention, industrial action by workers, bannings, political trials, etc., produced a climate not conducive to business confidence. Recent studies on the South African economy conclude that, at the current annual population growth of 2.3 per cent (black population growth is 2.8 per cent), it is necessary for the economy to grow at a minimum of 5 per cent per annum to avoid further intensification of unemplo 3rment which, according to unofficial estimates, stands at as high as 6 million. Thus, as a consequence of declining finances, the volatility of gold-based export */ The present chapter relies mainly on documents E/1989/17,
analysis: The text discusses the decline of investment in South Africa, the impact of disinvestment on the economy, and the need for economic growth to address unemployment. It highlights the factors that contributed to the decline in investment, including the stagnant economy, fluctuating gold prices, and internal instability. The text also mentions the need for the economy to grow at a minimum of 5% per annum to avoid further intensification of unemployment.