Gauteng: profile of the province

About Gauteng

South Africa’s political transformation, together with the relaxation of exchange controls and the liberalisation of African economies, has meant that South Africa has become an increasingly valuable port for Africa.

Old Economy
At one time, the bulk of Gauteng’s growth came from mining, and to a lesser extent heavy manufacturing associated with those commodities. Production of food products, automotive components and assembly, industrial chemicals, iron and steel production, metal fabrication and refined petroleum products have been the mainstay of the Gauteng manufacturing sector.

New Economy
Gauteng has come a long way in the past 20 years, with these industries becoming overshadowed by far greater growth trajectories in ‘smart’ or hi-tech industries like information and communications technology (ICT), financial services and media, including film making. These are industries more in tune with developed than developing economies.

Star of Emerging Markets
The growth of emerging markets - South Africa and Gauteng in particular - has outperformed the global average. Africa has simultaneously enjoyed a period of sustained economic liberalisation and a reduction in government intervention, which in turn has made these newly-open economies more susceptible to innovation and leaping the digital divide. As the epicenter of technology in South Africa, Gauteng has become the undisputed continental leader in driving technology through Africa.

Economic reform and liberalisation has had a number of laudable results: a stronger private sector, lower inflation and an investment environment that has attracted unprecedented capital inflows, both short and long-term in nature.

Gateway to Africa
Covering an area of nearly 17,000 sq kms, Johannesburg is the provincial capital while Tshwane is the national administrative capital. However, the province is essentially one big city, with 97% of its population living in urban centres.

Gauteng is the economic centre not just of South Africa, but of all Africa. Though the smallest of South Africa's nine provinces, covering only 1.4% of the country's land area of the country, it contributes approximately one-third of the country's total gross domestic product (GDP), and is also responsible for 10% of Africa's total GDP.

For this reason, Gauteng has become one of the most popular trade and investment destinations in the world, not only in its own right but as a gateway to the rest of the country and all Africa. Most multinational companies operating in southern and eastern Africa opt to locate their headquarters in Johannesburg, since the province is able to provide world class services and opportunities. There are many lucrative possibilities arising from a wealth of natural resources and almost unlimited export and import opportunities.

Because of the relative openness of its economy and the liquidity of its currency, the rand, South Africa is one of the world's favourite emerging markets. It is often seen as a bellwether for unfolding global trends as its currency reacts among the first to global financial trends and capital flows.

Gauteng is seen as the central point of international investment, economic growth and long-term financial stability of the country. The majority of the business headquarters are found in and around Johannesburg metropole, one of three metropoles in the province. It is home to the JSE Securities Exchange, as well as bond exchange and over-the-counter (OTC) market. The stock exchange is robust and active, and six years ago established a vibrant alternative board, AltX, similar in vision to AIM on the London Stock Exchange.

Most Important Sectors
The most important economic sectors are financial and business services, logistics and communications and mining. Key drivers of the economy are manufacturing, property, telecommunications and trade.

Gauteng is:
•    the center of the country’s motor manufacturing industry
•    the country's centre of finance and industry, and is home of the nation’s banks, law and accounting firms
•    home of the mining houses. Mining dominates the western areas of Gauteng and manufacturing in the eastern parts. Coal, iron and steel are predominant in the southern Vaal region
•    home of government services in the northern Tshwane metro
•    the heart of the nation’s telecommunications, information technology and media industries,
•    home to Wadeville and Alrode, which combined have the most industries per square kilometer in the country
•    is the financial capital of Africa: more than 70 domestic banks have their head offices in the province, and at least that number of foreign banks, stockbrokers and insurance giants
•    home to the JSE in Johannesburg, the 17th-largest stock exchange in the world by market capitalisation.

Centre of the country’s transport hub
A quick glance at a map will show the province is the geographic heart of the country: all roads and railways lead to the province, it is home to the country’s main international airport and Africa’s busiest both passenger-wise and cargo, OR Tambo International Airport, and boasts two inland ports, City Deep and Kazerne, that are the hub of an export-growth zone. These serve rail, road and air freight customers through the Southern African region.

Manufacturing
The manufacturing sector alone employs 600,000 people in over 9,000 enterprises. Manufacturing includes basic iron and steel, fabricated and metal products, food, machinery, electrical machinery, appliances and electrical supplies, vehicle parts and accessories, and chemical products.               

Banks
South Africa's formal banks comply with international banking standards and offer one of the most sophisticated banking systems in the world. Customers have online, real-time, nationwide access to bank accounts 24 hours a day, 365 days a year. The fact that the banking sector was relatively unscathed by the recent global banking crisis is testimony to the level of banking supervision and regulation in the province and country.

Media
The national free-to-air broadcasters, the SABC and eTV, are situated in Gauteng alongside subscription TV channel Multichoice – the largest broadcaster on the African continent. Film and documentary-making facilities are also available. The province has the best telecommunications and technology on the continent, with correspondents for the world's major media stationed here, as well as South Africa's five television stations. It also has the highest concentration of radio, internet and print media in Africa.

World-class Infrastructure
One of the major infrastructural developments currently underway for the 2010 FIFA World Cup is the construction of the much awaited Gautrain Rapid Rail Link.

This multi-million rand rapid rail system will connect OR Tambo Airport with Johannesburg and Tshwane metros and is a pillar of the province's economic strategy. The Gautrain has established itself as a benchmark project for the empowerment of disadvantaged people, having created 11,700 direct jobs and 63,200 direct, indirect and induced jobs.

The Gautrain will be seamlessly integrated into existing transport modes by physical integration of routes and stops, similar quality of service, and co-ordinated timetables.

In order to improve the current traffic flow situation and to provide a road network that will stimulate the development potential in the province, the South African National Roads Agency Ltd (SANRAL) has proposed an improvement to the Gauteng freeway network by improving the existing network, as well as the provision of additional infrastructure.

The Gauteng Freeway Improvement Project (GFIP) will provide an interconnected network of inner and outer ring roads and directly link the historically neglected areas of the Western and Southern townships of Johannesburg.

For more information about the Gauteng Department of Economic Development and how you can make the most of investing in the Gauteng economy contact:
Tel: +27 11 355 8087