{"id":860977,"date":"2026-05-21T08:04:40","date_gmt":"2026-05-21T06:04:40","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=860977"},"modified":"2026-05-21T08:05:16","modified_gmt":"2026-05-21T06:05:16","slug":"another-sign-of-collapse-in-south-africas-richest-city-3","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/government\/860977\/another-sign-of-collapse-in-south-africas-richest-city-3\/","title":{"rendered":"Another sign of collapse in South Africa’s richest city"},"content":{"rendered":"\n

At the city-owned Johannesburg Art Gallery, paint is peeling off the rain-damaged ceiling, the elevator doesn\u2019t work, and parquet tiles are loose and cracked.<\/p>\n\n\n\n

Years of neglect of the 111-year-old gallery, a once-grand building now surrounded by inner-city decay, have led to the relocation of the bulk of the collection\u2019s more than 9,000 artworks.<\/p>\n\n\n\n

Original paintings by Claude Monet and Pablo Picasso sit in galleries elsewhere in the city, some of them private.<\/p>\n\n\n\n

The situation is just one indication that Africa\u2019s financial capital, also known as \u201cthe place of gold\u201d for once being the site of the world\u2019s biggest gold rush, is on the verge of collapse.<\/p>\n\n\n\n

Water and power outages are frequent, streets are potholed, and many of the abandoned high-rises in the city centre have been appropriated by armed gangs who extract rent from squatters.<\/p>\n\n\n\n

Added to that, most capital projects have ground to a halt, the city has failed to collect on billions of dollars in debt, and long-term loans have been taken out to service recurrent expenditures, according to the opposition party.<\/p>\n\n\n\n

Last month, South African Finance Minister Enoch Godongwana told Johannesburg Mayor Dada Morero that his city will lose crucial state funding unless it addresses $1.4 billion in wasteful spending and cancels plans to raise municipal workers\u2019 wages by more than $600 million over this year and next.<\/p>\n\n\n\n

This is an unprecedented situation for Johannesburg, which on paper should have no problem paying its bills.<\/p>\n\n\n\n

The city boasts more millionaires than anywhere else in Africa, is home to the bulk of the country\u2019s big companies, and hosts a stock exchange with more than 10 times the daily trading volume of its biggest rival on the continent.<\/p>\n\n\n\n

“Johannesburg possesses arguably the strongest municipal revenue base in Africa, supported by major corporates, affluent suburbs and significant economic activity,\u201d said Kevin Allan, managing director of Municipal IQ, which tracks the performance of South Africa\u2019s 257 municipalities.<\/p>\n\n\n\n

The problem is politics<\/h2>\n\n\n\n
\"\"<\/a><\/figure>\n\n\n\n

\u201cBut a strong economic base does not automatically translate into a well-run municipality.\u201d As the city sits at the heart of three contiguous urban areas that together account for about a third of the country\u2019s economic output, this volatility could lead to even bigger problems.<\/p>\n\n\n\n

\u201cJohannesburg\u2019s decline should concern every South African because it is the engine room of the economy,\u201d said Busi Mavuso, the head of lobby group Business Leadership South Africa.<\/p>\n\n\n\n

The problem boils down to politics. Since the African National Congress lost its majority in the 2016 elections, the city has been run by a series of fractious coalition governments and has had 10 mayors, including one from a tiny party who was accused of ties to a funeral-policy fraud scam.<\/p>\n\n\n\n

With no barrier to entry in terms of voting thresholds, 18 parties are currently represented in Johannesburg\u2019s council. As frequent council seat changes have become the norm, so have inconsistent policies, stop-start projects, corruption scandals and wasteful spending.<\/p>\n\n\n\n

\u201cWhen you have unreliable partners, you flip-flop. Today you are in, tomorrow you are out,\u201d said Chris Santana, who oversees finances for councillors in the Democratic Alliance party, which has led ruling coalitions in the 4.8-million-person city in the past.<\/p>\n\n\n\n

\u201cThere\u2019s no consistency, no institutional knowledge. That\u2019s where we find ourselves today.\u201d This constant churn has also made Johannesburg a shorthand for out-of-touch politicians.<\/p>\n\n\n\n

Last year, Morero pledged to clean up neighbourhoods used by visiting dignitaries during Group of 20 meetings after President Cyril Ramaphosa told him the city was \u201cfilthy,\u201d sparking protests from residents in other underserved areas.<\/p>\n\n\n\n

And speaking to the media about residential anger over water shortages, the leader of Gauteng province, where Johannesburg is situated, confessed he uses hotels to take showers.<\/p>\n\n\n\n

When reached for comment, the City of Johannesburg\u2019s communications department referred queries to mayoral spokeswoman Khathu Mulaudzi, who referred them back to the communications department, saying \u201cthese are city issues and deserve a city response.\u201d<\/p>\n\n\n\n

ANC under pressure<\/h2>\n\n\n\n
\"\"<\/a><\/figure>\n\n\n\n

City spokesman Nthatisi Modingoane referred queries back to Mulaudzi. The chaos in Johannesburg is in some ways the culmination of problems that have festered for years.<\/p>\n\n\n\n

Until the 2008 financial crisis, South Africa enjoyed its strongest period of economic growth in the democratic era. <\/p>\n\n\n\n

Johannesburg, then firmly under the control of an ANC yet to be sullied by allegations of corruption, was slated to host the 2010 football World Cup.<\/p>\n\n\n\n

To prepare Johannesburg for the international stage, authorities sought to address the fallout of \u201cWhite flight\u201d \u2014 a phenomenon in which companies and wealthy individuals abandoned the city centre for northern suburbs, leading to downtown decline and again cleaving the landscape along racial and economic lines.<\/p>\n\n\n\n

Improving transit connections was seen as the best way to fix this. Officials broke ground on the start of a high-speed railway network, repaired highways and began building the first stations on what were meant to be low-cost bus routes.<\/p>\n\n\n\n

\u201cUntil the World Cup, everything was tightly controlled, delivery happened,\u201d said David Everatt, a professor at the city\u2019s Wits School of Governance who researches inner city decline.<\/p>\n\n\n\n

But after the tournament, these projects languished. The rail network was never expanded as planned, and half-built bus stations have sat idle for more than a decade, locking people into an apartheid-era transport system that costs the poor up to 40% of their income.<\/p>\n\n\n\n

After Jacob Zuma became president in 2009, the ANC\u2019s popularity plummeted as his tenure was plagued by corruption.<\/p>\n\n\n\n

From then on, said Everatt, we see \u201cmore factions within the ANC and by 2016 we are into coalition politics. Every decision becomes politicised.<\/p>\n\n\n\n

It becomes, \u2018What can we extract from this decision?\u2019\u201d Those dynamics persist to this day, he added.<\/p>\n\n\n\n

Now, Johannesburg is at an inflexion point. If the finance minister goes ahead with his threat to yank $480 million in funding, it could render the city incapable of meeting payments to creditors, adding to arrears that Godongwana has already put at $1.5 billion, citing recent financial statements supplied to the Treasury.<\/p>\n\n\n\n

Just this week, the state power utility took out a full-page newspaper advertisement threatening to cut off parts of Johannesburg\u2019s electricity if the municipality did not pay the $320 million it owes to the company.<\/p>\n\n\n\n

The private sector is now stepping in to fill in some gaps. Health insurer Discovery is fixing potholes, an initiative partly funded by Anglo American, is erecting streetlights in the city centre, and some of the Johannesburg Art Gallery\u2019s most prized works are being kept at a gallery owned by Standard Bank.<\/p>\n\n\n\n

\u201cWe are trying to find ways of leaning in,\u201d said Mavuso, the business lobby group leader, after the president asked that businesses do more.<\/p>\n\n\n\n

In addition to the challenges for residents, Johannesburg\u2019s troubles pose a political headache for Godongwana.<\/p>\n\n\n\n

Both he and Morero are ANC members, and if Godongwana were to order the provincial government to take over the city, it would be a gift to the ANC\u2019s biggest rival, the Democratic Alliance, which is leading in polls ahead of local elections in November.<\/p>\n\n\n\n

The DA\u2019s mayoral candidate, former Cape Town Mayor Helen Zille, has released ads featuring her swimming in giant potholes and fishing in slimy municipal swimming pools.<\/p>\n\n\n\n

In a statement on May 6, hours after the finance minister’s letter leaked, Morero assured the public that \u201cthere is no cause for concern\u201d and said he would engage with Godongwana.<\/p>\n\n\n\n

A day later, he issued another statement asserting that the city wasn\u2019t bankrupt and reiterating his commitment to \u201cstabilising municipal finances.\u201d<\/p>\n\n\n\n

Yet with polls showing that no party will win a majority this November, Everatt isn\u2019t optimistic that the situation will change.<\/p>\n\n\n\n

\u201cThis government is so on its last legs. They are waiting for the next coalition to replace the last coalition,\u201d he said. \u201cI am not sure that we have hit bottom yet.\u201d<\/p>\n\n\n\n

Reported by Antony Sguazzin for Bloomberg.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

A 100-year-old building with the most valuable artworks in South Africa is collapsing in plain sight.<\/p>\n","protected":false},"author":59,"featured_media":860978,"comment_status":"open","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[1850,24616,25047,853],"class_list":["post-860977","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government","tag-bloomberg","tag-city-of-johannesburg-coj","tag-johannesburg-art-gallery","tag-south-africa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/860977","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=860977"}],"version-history":[{"count":4,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/860977\/revisions"}],"predecessor-version":[{"id":860983,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/860977\/revisions\/860983"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/860978"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=860977"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=860977"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=860977"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}