The water crisis is proving to be a major threat to the the economy of the Western Cape province. The provincial review outlook, issued on 27 September, warned that even short term water shortages could severely knock down business’ reputation for reliability and quality. According to the outlook, 94 per cent of companies reported water as a direct risk to their operations.
The continuous increase in the water tariffs is not helping, as it could force businesses to close shop by maximizing the cost of production. The impact is felt even more by those who use water intensively. Heavily and moderately dependent sectors, which include agriculture, make up a third of the province’s economy. The sector has been dealt the heaviest blow as it relies heavily on water for irrigation.
Workers are going to feel pinch as they are set to lose their jobs. It is estimated that that about forty-five thousand jobs are on the line. According to the outlook, many construction companies have already halted their projects due to the water shortages.
“Going forward, agriculture employment is likely to contract over the forecast period – particularly in the earlier years as the impact of the drought and water shortage is expected to weigh on job creation” reads the provincial outlook.
The government is currently addressing the issue, focusing mainly on highly water dependent sectors such as agriculture, construction, manufacturing and tourism.
“A programme of support to businesses is provided by GreenCape, the City of Cape Town, the Water Research Commission, Department of Economic Development and Tourism, Department of Environmental Affairs and Development Planning and many others” reads the outlook.
Currently, residents are restricted to 87 litres per day, but there is no guarantee that they are complying. Last month the Mayor of the City of Cape Town, Patricia de Lille urged the big corporations to also contribute in the drive to avert the crisis.
“The managers of commercial properties must with immediate effect ensure that their monthly consumption of the municipal supply of water is reduced by 20 percent compared with a year ago.”