This paper is intended to contribute to the discussion on how to build a broader framework to respond to the EU CBAM and engage in diplomacy with the EU to support South Africa and Africa’s “just energy transition”. With South Africa being the Presidency of the G20 in 2025, this also provides African countries with an excellent opportunity to engage with all G20 members (including the United States (US)) on how to restore the integrity of the multilateral trading system and advance a just transition for African countries that also advances their economic development and social transformation. 

The aims of this study were to review current policies and initiatives in the cosmetics sector, including funding support; developing a cosmetic sector strategy over the short- and long-terms; and defining funding and technical models to support the implementation of the strategy. It comprises a brief literature review, analysis of the data provided by international and local agencies, findings from the survey of cosmetic and retail firms in South Africa, and recommendations for the way forward.

This report is a summary of a feasibility study that explores the potential of promoting timber in South African construction by addressing challenges and leveraging benefits. It emphasises capacity building and demand creation deliverables to unlock timber’s environmental, economic, and social benefits in various construction industries.

The study was prepared for TIPS on behalf of the Department of Trade, Industry and Competition  by Enterprises University of Pretoria (Pty) Ltd

TIPS industry studies aim to provide a comprehensive overview of key trends in leading industries in South Africa. They aim to provide background for policymakers and researchers and strengthen our understanding of current challenges and opportunities in each industry, thereby enabling a more strategic response.

This industry study examines global trade trends in the electronics industry, with a focus on South Africa’s position in the global trade of electronic products.  

Bongeka Ngcobo holds a degree in Social Science and an Honours in Social Science (Public Policy), both from the University of KwaZulu Natal. She has over five years of experience in donor-funded programmes. She also has an extensive background in administration , community development, youth empowerment and stakeholder relations. 

Zamaswazi Shabalala has over a decade of experience as a project coordinator and administrator across higher education, non-profit, and international development sectors. She has a proven track record in stakeholder management, project management and programme implementation, data management, logistics, budget management, and event coordination. She holds a Diploma in Office Management and Technology (majoring in Business Administration) from the University of South Africa (Unisa), and a Diploma in Information Technology (NQF 5) from Jeppe College of Commerce and Computer Studies. She is pursuing a Bachelor of Business Administration (majoring in Business Management) at Unisa. She has completed short courses in Project Management from the University of Stellenbosch and Financial Management from Ninette Mouton.

Main Bulletin:  The Real Economy Bulletin - First Quarter 2025

Main Bulletin: The Read Economy Bulletin - First Quarter 2025

Luthandolwethu Zondi joined TIPS as an Economist in October 2023. Prior to this, she served as a Junior Researcher at the Centre for Science, Technology, and Innovation Indicators (CeSTII), where her focus was on conducting survey research related to Science, Technology, and Innovation. With an MPhil in Development Finance (Cum Laude) from the University of Stellenbosch Business School, Luthando's areas of expertise include inclusive economic development, financial inclusion, and sustainable development.

The State of Small Business in South Africa, a special edition of the Real Economy Bulletin, summarises the available information on the number of small businesses, in total and by industry and province; their contribution to the GDP and employment; ownership by race, gender and age; and access to skills and infrastructure. For the formal sector, it also reviews the available data on the sector’s investment and profitability. The analysis is primarily based on household surveys and financial data through 2024.

Key findings

• The available (limited) data suggest that formal small businesses contributed 19% of GDP and 33% of employment in 2023. The informal sector generated just under 5% of GDP but provided 17% of employment, mostly in the form of own-account workers, who operated microenterprises with no other employees.
• Formal small employers have seen a decline in both numbers and employment since the 2020 COVID-19 downturn. In contrast, formal own-account workers and informal businesses have more than recovered. Value added by formal small business reportedly dropped 7% in 2023, presumably largely due to loadshedding and slow overall economic growth.
• Small business in South Africa has long lagged far behind other upper middle income countries. Only around 6% of all working-aged adults are employers or own-account workers in South Africa, compared to 20% in other upper middle income countries outside of China, and 27% in China.
• The largest sectors for small formal business are commercial services and trade, followed by manufacturing. In the informal sector, trade is far more important, followed by community services and construction. The latter includes own-account artisans such as plumbers and electricians
• Whites owned 38% of small formal businesses in 2024, although they comprised only 7% of the working-aged population. Fifteen years ago, whites owned 57%. African women owned only 13% of small formal businesses in 2024, although they made up 41% of the working-aged population
• The median age of formal business owners is 47, ten years more than for waged employees. One in ten white business owners is at retirement age
• The median income for formal employers in 2024 was R15 000 a month, compared to R10 000 for the self employed. It was R4800 for waged workers in small formal business,and in large businesses it was R6000. Median incomes in the informal sector ranged from R5000 for employers to R2000 for waged workers and only R1200 for own-account workers.
• In the lowest-income 60% of households, only 8% said earnings from a business formed their most important income source. In the richest 10% of households, 17% said most of their income came from a business.
• Small formal businesses owned around 20% of private formal-sector assets in 2023. In contrast, most indicators suggest informal businesses had almost no assets at all.
• In 2024, Gauteng, the Western Cape and KwaZulu-Natal accounted for 74% of formal small business, compared to 58% of the working-aged population and a similar share in informal businesses. The number of formal employers has grown steadily only in the Western Cape. The provincial spread of informal business is proportional to the population.
• Waged workers in small formal business were half as likely to be union members as those in larger companies, with virtually no union members in the informal sector. Smaller formal businesses were substantially less likely than larger ones to provide retirement or medical funds, or to meet requirements in the Basic Conditions of Employment Act.
• In 2024, 22% of formal own-account business owners had graduated university, up from 17% in 2009. For formal employers, the share had risen from 13% to 17%. In contrast, only 5% of waged workers in small formal businesses had a degree in 2024. Under 5% of informal business owners had a degree, and only 30% had at least matric, compared to 55% of their formal counterparts.
• According to Statistics South Africa, 50% of informal businesses operated in their own homes in 2023. Over 30% worked outside (at an open market, taxi rank or sidewalk), 11% in someone else’s home, and only 5% in a non-residential building. For business owners in the poorest 60% of households, around 90% had electricity at home but only 60% had running water. Just 14% had a computer, although 80% had a smartphone.

Download a copy or read online

From Q3 2014 to Q3 2024 South Africa's imports and exports both trended upwards, with growth in exports outpacing growth in imports. In Q3 2024, exports are 22% higher than they were in Q3 2014, while imports are 3% higher. In addition, the quarterly average for exports (R459 billion in constant 2024 rand) was higher than it was for imports, at R428 billion. South Africa went from subsequent quarters with a negative trade balance, at the start of the timeframe, to subsequent quarters with a positive trade balance, at the end of the timeframe.