LOCALS TO BENEFIT FROM PROPOSED CHANGES TO GAUTENG TOWNSHIP ECONOMY LAW
- BEE NEWS
- Aug 1, 2025
- 2 min read
Luyolo Mkentane | 30 July 2025
The proposed changes call for township-based retail malls and supermarkets to partner with township-based enterprises in sourcing products.
Gauteng finance and economic development MEC Lebogang Maile is calling for written submissions on proposed changes to a law giving preference to locals for control of the R400bn township economy.
The legislation effectively designates township areas as places “reserved for the exclusive and sole [benefit] of citizens and people who have permanent residency status in the republic”.
Proposed changes in the Gauteng Township Economic Development Amendment Bill call for township-based retail malls and supermarkets to partner with township-based enterprises in sourcing products and services.
Enterprises that obtain government contracts are “compelled” to spend a “certain percentage of their procurement spend on township enterprises and co-operatives”.
SA’s township economy is valued at R400bn, equivalent to almost 8% of GDP annually, and employs about 2.6-million people.
The sector includes 30,000 spazas (local supermarkets), which are valued at R200bn a year and are dominated by Somalis, Ethiopians, Pakistanis and Bangladeshis.
The amendment bill states a provincial organ of state must, “on such terms and conditions as may be agreed, assist sector township-based enterprises with the provision of buildings, land or premises on which township enterprises may undertake designated business activities”.
Enterprises would be exempt from paying any rentals, except for operational costs, for the first three years of operations if they were situated in an urban or periurban area, or the first five years for enterprises operating in a rural area.
Maile said the Gauteng Township Economic Development Act was published in the provincial Government Gazette on May 26, 2022.
“However, a number of errors and shortcomings in the act that did not fully align with the underlying policy were subsequently identified, delaying the promulgation of the commencement of the act,” he said.
The bill seeks to “comprehensively address the said errors and shortcoming and stimulate economic growth in the townships of Gauteng”, he said.
“Additionally, it seeks to establish a coherent and comprehensive legislative framework that fosters growth and opportunities in township areas, by refining and strengthening the act.
“It includes clearer definitions, new terms and a broader scope to support the growth of township-based enterprises and uplift deprived areas in the province,” he said.
“Specific issues related to economic transformation, the facilitation of township-based enterprises and the designation of township enterprise zones are also addressed to promote inclusive economic growth and empower township-based entrepreneurs,” he said.
Among other things, the amendment bill was aimed at enabling conditions for the creation and expansion of township businesses, which would “create more job opportunities, attract new investments and promote market access opportunities for township goods and services”.
Maile’s economic development department has a budget of R1.6bn for 2025/26 and R4.9bn in the medium-term expenditure framework.
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