Impact Assessment

Economic Governance and the Local Business Environment: Evidence from Two Economically Lagging Provinces of South Africa, Christian M. Rogerson, University of Witwatersrand, 2009

    International donors supporting local economic development processes in South Africa have sought to improve local business environments by kick-starting local reforms and dialogue between local government and the private sector. The author argues for the importance of such policy interventions, in order to strengthen local economic development processes.

    The article also documents the findings of an assessment tool which was developed to measure changes in the business environment between 2006-2009 for 16 local municipalities in South Africa┬┐s Eastern Cape and Mpumalanga provinces.

    Summary of results
    The results of the participatory assessment show that in 2009, stakeholders rate local governments in Eastern Cape and Mpumalanga highest on issues relating to policies, laws and regulations; availability and reliability of electricity; openness and transparency; education and health facilities; along with availability of business premises.

    In contrast, the lowest ratings are for (in) efficient administration of local regulations, lack of government support for LED, poor public space and entertainment, and, the lack of attention to the natural environment, which many respondents commented was in a situation of severe decline.

    It is shown that whilst a general improvement is recorded in the overall quality of local business environments across surveyed municipalities, in many cases the improvement is marginal. This, it is argued, points to a need for sustained intervention and support in order to achieve necessary improvements in the local business environments within these two poor provinces of South Africa.