Treasury launches spatial economic activity data to clarify geographic distribution of SA’s economy

Delivering his keynote speech, Finance Minister Enoch Godongwana said the launch represented an important milestone. File photo: GCIS

Delivering his keynote speech, Finance Minister Enoch Godongwana said the launch represented an important milestone. File photo: GCIS

Published Jun 20, 2023


National Treasury yesterday officially launched the Spatial Economic Activity Data South Africa (SEAD-SA) programme, a project focused on clarifying the geographic distribution and characteristics of economic activities within the country.

Delivering his keynote speech, Finance Minister Enoch Godongwana said the launch represented an important milestone on a journey that started about nine years ago when the metropolitan municipalities lobbied the national government to make available national administrative data sets that could assist them in making sense of their city economies.

“The problem they wanted to be solved was the lack of spatialised economic activity data in South Africa. Metros did not know where firms and jobs were located within their boundaries, and how firm and employment activity changed over time.

“The cities explained that this meant that they were making policy, planning, and investment decisions on modelled and incomplete data, largely accessed at a cost from the private sector,” he said.

Godongwana said financial support to South Africa’s metros through grant instruments was projected at R6.3 billion over the medium term.

“We all know the challenging times South Africa finds itself in increasing fiscal risks, low economic growth, high unemployment, declining productivity, and stubborn structural economic constraints. These are putting a brake on the kind of economic activity we are striving for to meet our developmental challenges.

“The country cannot afford low returns on public sector investment, firm closures, and downsizing or job losses. Reviewing this data, its value in providing clear policy directions and evidence to assist government make tough investment choices and decisions, is abundantly clear,” he said.

Godongwana said metros were the country’s job generators.

“This role must be supported through public sector planning and investment both from an economic and human settlements perspective,” he said.

Godongwana said the data showed that job shedding within strategic industrial spaces in metros, with more than half of the top 30 metro industrial spaces losing jobs since 2014.

“The reasons for this can lead to uncomfortable truths. Publicly owned industrial spaces are often negatively affected by land governance, service delivery, business safety, and urban management failures.

“Our own investment in these spaces often fails to yield a return based on these same constraints. The message is that we have a responsibility to do everything in our power within the public sector to get these spaces productive and competitive,” he said.

Godongwana said the SEAD-SA programme was not owned by any particular entity.

Meanwhile, Trade and Industry Minister Ebrahim Patel said South Africa’s urban population was concentrated in large metropolitan areas.

“South Africa also has significant opportunities outside the large metro areas in smaller metros and cities in large and small towns, and rural economies and can be tapped to expand human welfare. And this is where the information that can be mined from the special economic activity data can be very useful as a tool for policy.

“In the words of the study, the creation of an open access special texts, special tax panel is a greatly special data about the economic geography of the country,” he said.

The South African Revenue Service (Sars) is also collaborating having extended the exploration of a spatialised version of the entire Sars Integrated Business Register to enable access to additional public and third-party data sources. The agreement is to integrate this with Stats SA’s National Statistics System.

Sars deputy Commissioner Joneston Makhubu said: “This is a breakthrough in the partnership because it allows tax data at a micro-level to be made available for research purposes, as well as for policy development purposes.”