Tens of thousands of people gathered below the Union Buildings to celebrate South Africa's transformation. On the stage, black and white musicians performed side by side. The loudest cheer was for Nelson Mandela, who steered this country away from the abyss. There was applause for Zimbabwe's Robert Mugabe, a man reviled by white South Africans but seen by some in the black majority as a freedom fighter. President Thabo Mbeki said South Africa still faces huge challenges.

"Endemic and widespread poverty continues to disfigure the face of our country. It will always be impossible for us to say that we've fully restored the dignity of all our people as long as this situation persists. For this reason, the struggle to eradicate poverty has been and will continue to be a central part of the national effort to build a new South Africa."

President Mbeki has five more years in which to narrow the economic gap between white and black, and promote stability across Africa. His authority, at home and abroad, has been boosted by his sweeping victory in this month's election.