Wesley Diphoko, Online Editor,Business Report (02 June 2017)
Wesley Diphoko, Online Editor,Business Report (02 June 2017)

#TownshipEconomyReport: It's time to recognise Township Economy

By Wesley Diphoko Time of article published Jul 14, 2017

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No one yet knows the accurate economic impact of the township economy. Yet, we know its important role in driving economic development in South Africa.

In 2014 it was announced that the Gauteng Provincial Government will commission a baseline study on the township economy to understand its size, spread and strength as well as innovative ways of measuring its social and economic importance.

In 2017, there’s still no established national report which provides accurate information about the township economy.

We took some time to take a closer look at industries that were developed from the township economy and we found the following 6:

  • Football Industry.
  • Transport Industry.
  • Retail Industry.
  • Entertainment Industry.
  • Food Industry.
  • Beauty Industry.

1. Football Industry

When you hear the name Kaizer Motaung or Dr Irvin Khoza you think football. Many forget that these individuals are leading one of the most important industries to come out of the township economy.

The Football industry in South Africa emerged from the townships. Football clubs such as Kaizer Chiefs, Orlando Pirates and Sundowns are football industry brands that are leading today.

The football industry is one of the most successful industries to emerge from the townships and yet it is not seen as a success story of the township economy. The football industry in South Africa is worth billions with billionaires such as Patrice Motsepe invested in this industry.

Not so long ago Kaizer Chiefs was one of the football companies that was listed on the Johannesburg Stock Exchange.

The Football industry has produced millionaires from the townships, particularly in the Gauteng and KwaZulu Natal region.

In 2010 South Africa hosted the most important event in the world - the Fifa World Cup, which was a direct result of an industry that started in the townships of Soweto by Kaizer Motaung, Irvin Khoza and other leaders who shaped the football industry.

2. Transport Industry

The most common feature on South African roads is the taxi - a product of township transport industry. What you hear mostly about taxis is how unsafe they are as means of transport.

Little do you hear about the impact of the taxi in the township transport economy. Some of the millionaires in townships were borne out of the taxi transport industry.

The impact of this important sector of the township economy is not celebrated enough, due to distractions highlighted by people who are misunderstanding the township economy.

3. Retail Industry

You can’t mention the township economy without including the spaza shop, which is the most prominent feature of the township economy. South African retailers have realised the importance of retail in South African townships. As a result they are beginning to position themselves within townships.

Retailers such as Shoprite are a common feature now in the townships.

The spaza shop has not necessarily created well-known township retail brands. However, it has enabled many to start their own businesses.

4. Entertainment Industry

If you visit any township in South Africa you are greeted by sounds of music developed by township musicians. Kwaito, Mbaqanga and House are just some of the music genres that emanate from the township economy.

A well known music group the Ladysmith Black Mambazo is just one example of music brands that were born in the townships. Kwaito, a favourite music genre, has created leading entertainment business people such DJ Oskido, Don Laka and others.

The township entertainment industry has even created international icons such as Hugh Masekela & Jonathan Butler.

5. Food Industry

One of the hottest businesses in township has been Mzoli’s Place. An eatery based in the Gugulethu township, which brings local and international tourists to the township in Cape Town.

The township food industry has even created its own product line that you can only find there. Think sheep head - which is the common feature across South Africa’s township food industry.

6.Beauty Industry

Lastly, the beauty industry in the townships is the next big thing. In each township you find hairdressers and barber shops that are operating from homes and containers. There’s even a beauty product that came out of a township business by Hermann Mashaba - the Black Like Me brand.

These are just some of the 6 major industries of the township economy, and yet their impact is not well reported.

The time has come to recognise the economic developments driven mainly by the township economy.

The Infonomist will embark on a process of creating an information repository about the township economy. This should serve as another source of information about it and its various sectors.

Wesley Diphoko is the Online Editor for Business Report and head of Independent Media’s Digital Lab

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