Cape Town - The recent bout of load shedding, which badly affected small businesses, is estimated to have cost billions of rand, the City of Cape Town said on Wednesday.
In a statement the City said sentiment was unanimously shared across the sector that load shedding has been crippling small businesses as most are unable to afford the costs associated with investing in a generator.
"Without a doubt, the cost to the economy is real and it is certain to cost billions of rands. In addition, the potential for businesses shedding jobs to keep trading is the intrinsic unquantifiable cost which we need to mitigate wherever possible," said Alderman James Vos, mayoral committee member for economic opportunities and asset management.
Cape Town contributes more than 70% of the Western Cape’s Gross Domestic Product (GDP), and in turn, the province contributes around 14% to the national GDP.
"It is therefore clear that the economic burden of load shedding will be felt by Cape Town, as well as other economic hubs in the country. This is especially the case because industries, such as the manufacturing sector, are reliant on electricity as they are located in large urban areas," said Vos.
Economist Dr Azar Jammine has said the direct impact of load shedding on the South African economy was between 0,1% and 0,2 % of the GDP.
In the Western Cape, the City’s green economy partner GreenCape conservatively estimates that over the past two weeks and counting, load shedding cost the economy R75 million an hour.