Menu

Provincial Treasury

MERO 2025/26

2025/26 Municipal Economic Review and Outlook shows municipalities are ‘Building on the Basics for Growth’

Western Cape Minister of Finance, Deidré Baartman, today tabled the 2025/26 Municipal Economic Review and Outlook in the Provincial Parliament. 

The publication shows that municipalities across the province are beginning to shift from managing pressure to planning for growth, supported by stronger infrastructure pipelines, targeted social programmes and a more resilient regional economy.

Key insights include:

  • Job growth remains strong, with 93 000 new jobs added between Q3 and Q4 of 2025 as infrastructure investment and service‑sector growth support employment.
  • The Western Cape Government and Western Cape municipalities have jointly invested more than R26.1 billion in the 2025/26 financial year alone.
  • Private‑sector infrastructure investment reached R96.64 billion by 2024, anchored by strong activity in finance, agriculture, energy and property.
  • Municipalities are increasingly adopting Alternative and Blended Finance mechanisms to close funding gaps, with municipal borrowing for large‑scale infrastructure rising to R6.43 billion in 2024/25, a 96.9 per cent increase from the previous year.

"The 2025 MERO indicates that despite immense pressure, the Western Cape’s municipalities continue to move forward; adapting, innovating and building on the basics for growth.

We see progress in services, more responsive budgets, expanding infrastructure pipelines, improving social indicators, and local economies that are proving more resilient than the national environment around them.

We also see the work that lies ahead. Strengthening logistics, unlocking investment, supporting vulnerable households, and building local growth engines that deliver jobs.

As we look to the year ahead, this government remains firmly committed to working with municipalities, the private sector and our residents to protect what is working, fix what is not, finance the fix, and keep building a Western Cape where every person has the opportunity to live, learn, work and thrive with dignity" said Minister Baartman.

 

Please see MERO documents below: