The South African economy is challenged by high unemployment and inequality. Dealingwith these two challenges is an explicit focus of most economic planning by the post-Apartheid government; from the Growth, Employment and Redistribution (GEAR)macroeconomic package to the most recent National Development Plan (NDP). Moreover,
the government’s perspective is that
full employment cannot be attained unless SouthAfrica can deal with the current situation of declining manufacturing jobs and increasing jobs with low productivity and slow wage-growth in services such as retail, personalservices, security, domestic services and office-cleaning (National Planning Commission,2011). In sum, South Africa faces some persistent and structural economic changes whichhave locked the country in a vicious cycle of low employment growth and worseninginequality.Hence there have been various attempts to promote pro-poor and employment-creatingeconomic growth because sustainable economic growth and development are challengedby inequality and high unemployment in the country (Patel, 2011). Pro-poor economicgrowth here simply means economic growth that can benefit the poor through reductionsin poverty and inequality. This can be achieved by reducing unemployment and increasingwages (Mohamed, 2012). But this requires heavy investment. Therefore, variousgovernment ministries have embarked on policies to stimulate investment and createlabour-absorbing economic growth.