Cape Town wants to be the best city for business in South Africa – and it has a plan

 ·10 May 2023

The City of Cape Town has published its Ease of Business Index, tracking the performance of the city with the overall goal of making it the most business-friendly city in South Africa.

Geordin Hill-Lewis, the mayor of the city, said that the index aims to hold the area accountable and make Cape Town the easiest place to do business in Africa by cutting red tape.

Cape Town is on a roll to create economic and regulatory conditions that allow for and support business in the region. The new index was compiled following a survey with over 100 businesses participating.

The list focuses on key initiatives that respondents to the survey would like to see in Cape Town.

As a result, there are ten key indicators outlined in the ease of business report that Cape Town is committing itself to, focusing on fast-tracking procedural permit and licencing processes, adapting the cost of applied fees for processes and shortening the time it takes for applications to be completed.

The city also that this index is a starting point for cutting turnaround times and costs. Most indicators relate to the built environment and the construction value chain.

“We have developed this index through hard work over the last few months so that we can be held publicly accountable for our commitment to becoming an easier place to do business,” said the mayor.

“We do this because we know that it’s important for the business community to feel as though this is a good place to invest, to grow and to create jobs.”

James Vos, the mayoral committee member for economic growth, added that the index would be used to measure and assess the city’s performance on its goals.

The city’s guiding point is the achievement of economic growth in the area, said Vos.

“Creating a business-friendly environment is widely accepted as a fundamental pillar in overall economic growth,” said the committee member.

Some of the major initiatives tracked by the index include those relating to electricity supply. South Africa just reached a bleak milestone regarding load shedding, with accumulative 34 days in darkness with rolling blackouts taking their toll on daily life and business.

South Africa just hit a bleak load shedding milestone

Cape Town has already developed a four-stage plan to take load shedding with the overall goal of reducing its reliance as a city on the national grid and Eskom – becoming more energy independent.

Currently, the plan entails finalising the procurement of 200 MW of supply from independent power producers and altering policies regarding embedded power generation so that residents can generate more power than they normally consume and sell the excess to the City.

Furthermore, the city is offering cash-back incentives to households who save power – freeing up additional energy capacity. Cape Town is also procuring a further 500MW of electricity generation capacity.

“The city knows all too well that electricity is an essential utility requirement for business processes. Without it, no business, company or office can operate. Unreliable electricity supply, a lack of distribution networks in rural areas, and high connection costs all hinder business activity,” said the City of Cape Town.

According to the city, the following indicators will be tracked in the index:

  • Transferring public land – tracking the time it takes to transfer public land from the date of approval by the city council.
  • Getting land use rights – the complexity and time at which land permits are obtained are measured against the target period.
  • Getting building plan approval – measures the ease with which building permits are obtained.
  • Wayleaves – a wayleave refers to a contractual agreement that grants a contractor or developer the right to use another property without owning it. This will measure the ease of the wayleave application process by outlining the number of steps involved.
  • Getting electricity – This will measure the procedures, time and cost for a business to get an electricity connection in Cape Town.
  • Connecting to the water network – this will measure the procedures, time and cost involved in obtaining a new water connection.
  • Getting a revenue (rates) clearance certificate – measures the time within which revenue clearance certificates are issued, the number of steps in the issuing process, and the cost of application.
  • Obtaining a business licence – measures the ease of the application process by identifying the number of steps involved, the time taken to issue a licence, as well as the cost associated with applying for a business licence in Cape Town.
  • Informal trading permits – this indicator measures the ease with which informal trading permits are issued by recording the procedures, time and cost involved in obtaining the approvals needed to sell goods or services on City property.
  • Digitisation – this will measure the City’s progress on its automation across its administrative services.

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