'Scan Globally; Reinvent Locally': Reflecting on the Origins of South Africa's Capital Housing Subsidy Policy

Abstract

Perhaps in an ideal world, governments would learn from the experiences of others. What has worked well or badly in one place can be repeated or avoided in another. Of course, one place is different from another so that modifications to any policy are usually necessary. When South Africa adopted its new housing policy in 1994, there was a lot of experience around. However, despite the efforts of powerful institutions like the World Bank, it chose to ignore much of that experience. Arguably, six years later, it is about to adopt some of the advice it previously rejected. The paper considers why South Africa ignored experience elsewhere and how it managed to avoid pressure from the World Bank to accept housing policies that it felt were inappropriate to its needs. The lesson of this experience is ambiguous. It shows that governments often have their own agenda and that medium-sized, middle-income countries have considerable influence in their negotiations with 'developmental' Washington. On the other hand, by adopting a set of macroeconomic policies which were in accord with current orthodoxy, and the reduced housing budget that this policy implied, perhaps South Africa merely showed that there are much more powerful hegemonic forces operating than the World Bank.