text: on South Africa by providing it with a financial lifeline to meet its repasrment obligations. Converting short-term debt into 10-year exit options, with lenient debt repayment terms circumvent financial sanctions by functioning as new loans, moreover. In the absence of these measures, capital outflows would have been even more substantial and larger surpluses on the current account of the balance of payments would have been required to offset deficits on the capital account (current account surpluses that South Africa experienced between 1985 and 1989 were heavily influenced by gold sales, although the price of gold was on the decline). 42. Debt rescheduling has not helped restore South Africa's creditworthiness, however, and the coxmtry has failed to attract new loans and investments. At the same time, compulsory debt repasnments and interests have, in the absence of new capital inflows, drained the economy. The debt crisis re-emerged in 1988 when debt repajmnents, a rise in imports stimulated by a minor economic boom and a drop in gold prices all contributed to a rapid deterioration in South Africa's foreign reserve position to levels barely sufficient for two months' import cover. Despite the leniency of the second interim agreement the situation worsened by September 1989, with the country's foreign reserve down to only R48 million or 3.4 days of import cover. 2. Dual exchange rate system 43. As a further measure to relieve the 1985 debt crisis, the South African Government reintroduced the dual exchange rate system, which consists of a 'commercial rand' and a 'financial rand'. The higher commercial rand rate is used for all transactions on the current account of the balance of payments, as well as for foreign loans. The low financial rand rate is used for transactions on the capital account, excluding loans. This is aimed at 
analysis: The text discusses the financial situation of South Africa, specifically the debt crisis and the measures taken to alleviate it. It highlights the country's reliance on short-term debt and the conversion of short-term debt into longer-term loans with lenient repayment terms. The text also mentions the reintroduction of a dual exchange rate system to relieve the debt crisis. Given the focus on financial issues, economic development and international trade seem to be the most relevant categories.