WHAT MIGHT SOUTH AFRICA HAVE LEARNED ABOUT HOUSING SUBSIDIES FROM CHILE?

ABSTRACT

During the 1990s South African cities took on certain of the characteristics of Latin American cities: rapid urbanward migration, the proliferation of shanty towns and land invasions, the spread of informal employment and residential segregation based on income. Despite increasing similarity little in the way of public policy has been learned from across the South Atlantic. For example, although the South African government has adopted a policy of housing subsidies that bears many similarities with the widely-praised Chilean programme, it appears not to have studied that experience. The paper argues that this neglect led to South Africa failing to avoid problems that the Chilean programme had already experienced: the lack of end-user finance, accentuation of urban sprawl, low quality of construction and the neglect of rental housing. Since Chile began its programme in 1977, the paper argues that South Africa might have avoided or at least mitigated some of its difficulties by studying Chilean experience.