Municipal elections will decide whether cities are engines of growth or hotspots of failed governance and unemployment.

South Africa’s upcoming municipal elections will determine far more than the political composition of local councils. They will influence whether the country’s cities become engines of growth and opportunity or hotspots of inequality, unemployment and governance failure.

The stakes in the year-end elections extend beyond potholes, electricity outages and coalition politics. How South Africa’s cities and towns function will determine the country’s broader development trajectory.

Large urban concentrations are the main development challenge. Over 45-million people, about 71% of the population, live in urban areas. With metropolitan municipalities accounting for around 55% of national gross domestic product (GDP) and more than half of all jobs, the country’s economic performance is closely tied to its cities.

At a February public seminar hosted by the Institute for Security Studies’ African Futures and Innovation (AFI) programme, urban scholars and practitioners debated what this meant for the country’s future. AFI head Dr Jakkie Cilliers said urbanisation itself wasn’t the problem; the issue was how urbanisation was managed, particularly where municipal capacity was weak.

The nature of South Africa’s urban challenge is often misunderstood. The country is not urbanising at the explosive pace of many other African states. It is already highly urbanised, and urban growth is slowing – yet most municipalities struggle to manage urban demand.

Around 2.2-million households live in informal dwellings, reflecting decades-long housing backlogs that the government has failed to resolve. Infrastructure systems are also strained.

The Department of Water and Sanitation’s 2023 assessment reports found that 73% of Water Services Authorities were rated critical or poor. Municipal non-revenue water (water lost through leaks, theft or inefficiencies before reaching customers) has climbed from 37% in 2014 to roughly 47%. In cities like Johannesburg, recurring water outages and infrastructure failures are stark reminders of declining municipal capacity. 

The seminar highlighted three interlocking constraints facing South Africa’s urban areas: weak institutional capacity, slow economic growth that is often not employment-intensive, and spatial inequality.

Municipalities must manage service delivery pressures while confronting structural challenges rooted in apartheid spatial planning and decades of uneven development. If they struggle to deliver infrastructure and housing under relatively moderate urban growth, the implications for economic productivity and social stability are dire.

The common narrative that South Africa has good plans but poor implementation may be too simplistic. Geci Karuri-Sebina, Associate Professor at Wits School of Governance, said at the seminar that the country managed to implement complex projects when political and economic incentives aligned, e.g. the 2010 FIFA World Cup. So, while limited administrative capability plays a role, politics is the larger determinant.

In some cases, new infrastructure does not produce equitable outcomes. Karuri-Sebina noted how malls in townships were implemented efficiently, but reinforced spatial inequality. South Africa’s public sector, she said, often avoided the political conflicts needed to reshape these patterns. Municipal instability illustrates the problem. Since 2016, Johannesburg has cycled through nine mayors in eight years, making long-term planning almost impossible.

Many urban pressures are rooted in national economic and institutional dynamics that cities cannot control. South Africa has shifted towards a services economy while its industrial base has weakened, limiting the ability to generate large-scale employment.

At the same time, the education system struggles to prepare young people for available jobs, leaving many entering urban labour markets without the required skills. Together, these dynamics reinforce unemployment and inequality that municipalities must manage but cannot resolve on their own. 

Spatial inequality compounds the problem. Many city residents spend hours commuting to work, with transport costs absorbing much of household income. These spatial patterns, shaped by apartheid planning and reinforced by slow reform, limit social and labour mobility.

The consequences extend beyond economics. Concentrated poverty, crime and weak service delivery erode the social fabric and trust in the state. In many neighbourhoods, private security and community patrols fill gaps left by struggling municipalities, leading to informal actors increasingly substituting for the state.

Basic infrastructure failures are the main problem. Functioning water systems, electricity networks and roads are the foundation of any urban economy. When these systems deteriorate, local economic activity suffers and investment declines. This creates a downward spiral in which failing infrastructure reinforces economic stagnation.

South Africa’s labour market dynamics make this particularly risky. Compared with many developing economies, the country has a relatively small informal sector. This has its disadvantages, because informality can buffer periods of economic stress. In South Africa, high unemployment translates directly into deep social and economic vulnerability, contributing to high poverty levels.

Against this backdrop, the coming municipal elections are especially significant. Local government is where citizens encounter the state most directly. Successful municipalities support local growth and quality of life. When they fail, the consequences are immediate and visible. As a major investment company chief executive remarked during the seminar, ‘We are keen to invest, but we need water and critical infrastructure. Without it, we simply cannot continue.’

These everyday experiences shape citizens’ perceptions of government and democracy more than national policy debates. If municipalities cannot reliably deliver basic services, public confidence in democratic institutions erodes.

During the seminar, the Human Sciences Research Council’s Professor Narnia Bohler-Muller noted that local government elections were approaching at ‘one of the lowest points in our history of democracy.’ Citizens frustrated by failing governance are increasingly drawn to promises of efficiency, even if that means more authoritarian solutions.

But South Africa has many of the ingredients for revitalising its cities: a sophisticated financial sector, a capable private sector, strong research institutions and technical expertise in planning and infrastructure management.

AFI modelling indicates that the country’s long-term trajectory is not fixed. Improvements in governance, infrastructure and economic policy could significantly accelerate economic growth and raise living standards. In a high-growth scenario, GDP in 2043 could be 53% higher than on the current trajectory.

Municipal elections rarely generate the excitement of national polls, but they are among the most consequential for South Africans’ daily lives. Voters will decide whether cities are places of possibility or centres of decline.

Written by Alize le Roux, Senior Researcher, African Futures and Innovation, ISS Pretoria

This article was first published in Africa Tomorrow, the blog of the ISS African Futures and Innovation Programme