Assessing economic vulnerability in South African municipalities: A focus on mining-dependent regions using the Economic Complexity Index

Abstract

South Africa’s historical reliance on mineral resources has established thriving towns and settlements, sustaining households for decades. However, the decline in demand for these resources and mine closures pose significant threats to the future of these areas, creating vulnerabilities in towns and their dependent regions. This article addresses concerns about the vulnerability of certain South African municipalities, particularly those heavily dependent on mining. Employing an Economic Complexity Index (ECI), the study identifies and classifies vulnerable mining towns and regions. The methodology involves applying the concept of economic vulnerability, utilising sub-national economic and trade data to determine the complexity of municipal economies. In addition, geospatially linked data is employed to identify mining dependent areas at risk. The results highlight municipalities with low economic complexity, signalling the need for targeted interventions and emphasising the importance of economic diversification in mitigating risks. The study not only serves as a warning for current planning, but also lays the groundwork for future research and evidence-based policymaking to ensure the sustainability and resilience of regional economies in South Africa.