South Africa in the African Economy

Abstract

A key feature of the world economy in recent decades has been growing economic integration among groups of countries. This pattern is also evident in Africa, and, since 1994, in the integration between South Africa and the rest of the continent across many economic dimensions. A question that naturally arises as countries grow more closely integrated is what influence they might have on each other. In particular, does a country’s economic growth have “spillover effects” on its partner countries? Are these spillovers generally beneficial, and what is their size? And what might be some of the future implications of regional integration? This article updates what was, to our knowledge, one of the first empirical assessments of the spillover from South African growth to other African countries.¹ It also discusses some implications of the updated results in the context of more recent research on African regional integration.