SA is dismantling its own economy. Every year we produce fewer goods, employ fewer workers, and import what we could make at home. In 1993 industry contributed 28% of GDP. Today it is just 18%. Manufacturing has shrunk to 13%.
This is not merely economic decline; it is national erosion. No country has prospered without a strong industrial base, and SA will be no exception.
For three decades policy has centred on liberalisation and foreign investment. Yet growth has stagnated, and unemployment remains among the highest in the world. The missing piece is clear: industrialisation. Without a revival of manufacturing, mining, energy, construction and agro-processing, we will remain stuck in slow growth, joblessness and inequality.
Industries do more than make products. They raise productivity, drive innovation and create mass employment. They stimulate supporting sectors from logistics to finance. Importantly, they provide jobs for both skilled and semi-skilled workers, a lifeline in a country where youth unemployment hovers near 50%.
Instead of building value-added industries, SA exports raw commodities and imports finished goods. We export iron ore and import steel. We export fruit and import fruit juice at a premium. Each missed opportunity is another nail in our economic coffin.
Countries that have prioritised industrialisation have thrived. For example, China’s rise as the world’s factory was not luck or cheap labour alone. It was deliberate: investment in infrastructure, supportive tax regimes, skills development and policies that attracted global capital. SA cannot replicate China, but we can learn from its intentional strategy.
Local research confirms this. Kholekile Herbert Ntsobi’s 2025 doctoral study at The DaVinci Institute in Hammarsdale, shows that township economies are not doomed by lack of potential but by weak local economic development, poor policy co-ordination and limited entrepreneurial support.
His proposed Integrated Township Economic Development & Co-ordination Framework (ITEDCF) demonstrates how townships can be repositioned as hubs of industrial and entrepreneurial growth, aligned with SA’s National Development Plan 2030 and the AU’s Agenda 2063 vision of inclusive, sustainable development.
To revive our industrial sector several priorities are urgent:
- Infrastructure. Rolling blackouts, failing railways, and congested ports are strangling industry. Reliable power, modern rail, efficient ports and smart logistics must be treated as the foundation of growth, not as afterthoughts. Industrial output cannot expand if goods cannot be produced consistently or transported competitively.
- Skills. SA is not producing enough artisans, engineers, or technicians. Vocational education has withered, leaving businesses desperate for talent. Technical and vocational training must be revamped, with updated curricula that cater to modern industry, ranging from robotics to renewable energy. Every student should be equipped with digital literacy, problem-solving skills and creative thinking. A skilled workforce is our only lasting competitive edge.
- SMEs. Large industries cannot carry growth alone. Small & medium enterprises are engines of innovation and job creation, but are excluded from access to finance, mentorship and markets. By opening doors for SMEs in agriculture, manufacturing and technology, we can build a broader and more resilient industrial ecosystem.
- Policy certainly. Investors have been burned by inconsistency and short-termism. A predictable regulatory framework, targeted incentives for local production and protections against unfair dumping will restore confidence. Policy must send a clear message that SA rewards those who invest in value-adding industries.
- Partnerships. The government cannot do it alone. It must provide stability and infrastructure. Business must bring investment, innovation and expertise. Higher education institutions must produce the skills and research to drive competitiveness. Unless these forces work together, progress will remain fragmented and fragile.
SA has already lost three decades to stagnation. Factories have closed, mines have shrunk and opportunities have been wasted. Yet the window for industrialisation has not closed. We can still rebuild our factories, revitalise our mines and add value to our agricultural products.
The path forward is clear: let’s have modern infrastructure, world-class skills, empowered SMEs, policy certainty and genuine partnerships. If we act now we can create millions of jobs, restore dignity to our people and build an economy that works for all. If we delay, we will consign another generation to unemployment and poverty. Industrialisation is not an option. It is the key to SA’s future.
• Matsa is business development manager: corporate education at business school The DaVinci Institute.
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