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Discover · Economy

The Economy

A Gini of 0.63, about 20% unemployment and Africa's largest tech hub, all in one city.

This week's economic pulse

SARB repo rate

7.25%
▲ 0.25 pts vs last

Set by the SARB Monetary Policy Committee.

as of 23 Sep 2026 · SARB

Prime lending rate

10.75%
▲ 0.25 pts vs last

Repo rate + 3.5 percentage points.

as of 23 Sep 2026 · SARB

Inflation (CPI)

4.5%
▲ 0.1 pts vs last

Stats SA headline CPI, year on year.

September 2026 · Stats SA

Petrol (95 unleaded)

R29.38/L
▲ 3.33/L vs last

Coastal price; adjusted monthly by the DMPR.

as of 7 Oct 2026 · Fuels Industry Association

Rand (USD/ZAR)

R16.72
▲ 0.01 vs last

Stronger rand is a lower number.

as of 2 Nov 2026

US Fed funds rate

4.00%
▲ 0.25 pts vs last

Upper bound of the FOMC target range (3.75-4.00%). The dollar side of the rand carry trade.

as of 16 Sep 2026 · Federal Reserve

US 10-year Treasury yield

5.00%
▼ 0.28 pts vs last

Daily close (constant maturity); what a dollar investor earns at home with no rand risk.

as of 23 Oct 2026 · Federal Reserve H.15

SA 10-year government bond yield

9.05%
▲ 0.07 pts vs last

Daily average yield on government bonds of 10 years and longer; the long-term cost of rand borrowing.

as of 1 Oct 2026 · SARB

0.63
Gini coefficient
19.5%
Unemployment (Western Cape, Q2 2026)
R 89,000
GDP per capita
14.2%
Contribution to national GDP
Cape Town is an economy of extremes. The Western Cape contributes 14.2% of South Africa's GDP, with Cape Town generating the bulk. The city hosts Africa's largest tech hub, a growing film industry, and world-class wine exports. Yet 19.5% of the Western Cape labour force was unemployed in the second quarter of 2026, and the Gini coefficient of 0.63 makes it one of the most unequal cities on Earth. Affluent Constantia and struggling Khayelitsha share a municipal boundary but not an economic reality.

Inequality: among the highest in the world, and barely moving

The Gini coefficient measures income inequality on a 0 to 1 scale. Cape Town's 0.63 places it near the top of global rankings. The gap is visible: private security estates and informal settlements separated by a single road. A decade of economic growth has not narrowed the divide.

Income inequality: Cape Town vs peer cities (Gini)

Stockholm
0.27
Berlin
0.29
London
0.35
New York
0.51
São Paulo
0.59
Cape Town
0.63
Johannesburg
0.65
0 = perfect equality, 1 = perfect inequality. Green <0.35, Gold 0.35–0.55, Red >0.55.
Key takeaway. Cape Town's Gini of 0.63 sits between São Paulo and Johannesburg. Among world cities with comparable data, only a handful are more unequal. The number has barely moved in a decade.

Which sectors drive the Western Cape economy?

The Western Cape economy is services-heavy. Finance, insurance, and business services generate nearly a third of GDP. Tourism is visible but smaller than most visitors assume. Agriculture (wine, fruit, wheat) is a modest GDP contributor but the largest rural employer and a major export earner.

Economic sectors by GDP contribution (Western Cape)

Finance & business
30.1%
Trade & hospitality
15.8%
Government
13.9%
Manufacturing
12.4%
Transport
9.2%
Construction
3.8%
Agriculture
3.6%
StatsSA GDP-R 2023. Finance includes insurance, real estate, and business services.
Key takeaway. Finance and business services alone generate 30% of the regional economy. Tourism (buried in "trade & hospitality") is the sector most visible to visitors but not the largest employer. Agriculture punches above its GDP weight in job creation.

Unemployment: better than the rest of SA, still about one in five

The Western Cape has South Africa's lowest provincial unemployment rate. Even so, 19.5% of the labour force was without work in the second quarter of 2026 (Stats SA), against 33.6% nationally. The rate has come down from about 25% at the COVID peak, but the recovery has been uneven, concentrated in skilled sectors while entry-level jobs remain scarce.

Unemployment rate over time (Western Cape)

Q4 2019
20.3%
Q4 2020
24.5%
Q4 2021
25.1%
Q4 2022
22.4%
Q4 2023
21.8%
Q4 2024
21.1%
Q2 2026
19.5%
Stats SA QLFS, official definition: fourth quarter of each year, then the latest quarter (Q2 2026). The expanded definition (including discouraged workers) is roughly 10 points higher.
Key takeaway. Unemployment has come down from its COVID peak of about 25% to 19.5% in the second quarter of 2026. The Western Cape has the lowest provincial rate, but the national figure is 33.6% (Stats SA QLFS, Q2 2026).

Data updated: 2026-10-27

Frequently asked questions

What is the Gini coefficient and why does it matter?
The Gini coefficient measures income inequality on a scale from 0 (everyone earns the same) to 1 (one person earns everything). South Africa's 0.63 is among the highest in the world, a direct legacy of apartheid-era economic exclusion. In practical terms, it means the distance between rich and poor is wider here than almost anywhere else.
Is Cape Town expensive for tourists?
The Rand's weakness against the Dollar and Euro makes Cape Town remarkably affordable for international visitors. A quality restaurant meal costs R200–400 (roughly €10–20). Accommodation ranges from R800/night for a good guesthouse to R3,000+ for luxury. For South African residents, the picture is different: prices rise with local inflation; the economic pulse at the top of this page shows the latest Stats SA CPI figure and its month.
What industries drive the Cape Town economy?
Finance and business services lead (30% of GDP), followed by trade and hospitality (16%), and government (14%). The tech sector is growing fast, with Cape Town hosting the highest concentration of startups in Africa. Wine, film production, and the creative industries punch above their GDP weight in international visibility.
How does Cape Town compare to Johannesburg economically?
Johannesburg generates more GDP overall (Gauteng province contributes 33% of national GDP vs the Western Cape's 14%). But Cape Town has lower unemployment, lower crime rates, and a more diversified economy. Johannesburg is the financial capital; Cape Town is the lifestyle and tourism capital. Many businesses maintain offices in both.
Labour & Employment
• Statistics South Africa, "Quarterly Labour Force Survey Q4 2024" (March 2025)
• Statistics South Africa, "GDP-R by Region 2023" (2024)
Inequality & Development
• World Bank, "Gini Index Data" (2024)
• City of Cape Town, "Spatial Development Framework: Economic Indicators" (2024)
Currency
• South African Reserve Bank, "Exchange Rate Data" (April 2026)

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