South Africa has begun a new phase inits history. This article reports on a study examining thechallenge of promoting equitable and fiscally sustainablegrowth, and evaluating alternative paths to growth using aneconometric model developed by World Bank staff. The broadconclusion is that there needs to be greater complementaritybetween stimulating the economy through public investmentand reviving private investment if South Africa is toachieve a sustainable growth. The prospects of success willbe improved considerably if skills are upgraded and areorientation towards exports is achieved, accompanied by arestructuring of public expenditure - within fiscallysustainable limits - for targeting the poor. The scenariosexamined assume that political stability is achieved andthat access to international capital markets improves.
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