247 businesses closed in South Africa in 2024 – so far

In January and February of this year, 247 companies have been liquidated in South Africa, more than at the same time last year, as businesses continue to struggle in the country’s moribund economy.

Stats SA released the country’s liquidation statistics on 25 March 2024, which revealed that liquidations decreased year-on-year in February.

However, the far higher number of liquidations in January meant that South Africa had seen more liquidations in the first two months of 2024 than in the same period in 2023.

In January 2024, there were 109 liquidations compared to 81 in 2023. In February 2024, there were 138 compared to 162 the previous year.

South Africa had 1,657 liquidations in 2023, considerably less than in previous years.

This could be attributed to a rebound following the Covid-19 pandemic, which saw thousands of companies close their doors.

However, Southern African Advisory Company’s Tiaan Herbst told Kaya Biz last year that it is crucial to interpret liquidation data with caution.

While South Africa’s recent drop in liquidations could indicate that the country’s economy is improving, it could also reveal that businesses are merely surviving in South Africa’s stagnant, “zombie” economy.

“The decline in liquidations amid periods of identified load-shedding is somewhat surprising as one might expect these power outages to negatively impact businesses, particularly small and medium-sized enterprises,” he said.

Herbst explained that the decline suggests businesses may have adapted to South Africa’s challenging operating conditions or that other economic factors are playing a more significant role in influencing the rate of liquidations.

“It could also point to a more robust economic landscape than initially thought, though interpreting this trend definitely would require a more nuanced analysis,” he said.

While the reduction in liquidations might be a positive sign, it could also indicate that businesses are merely surviving, which is not conducive to long-term economic health.

He said a reduced rate of liquidation may not necessarily signal economic recovery – it also largely signals a stagnant economy.

Herbst referred to this as South Africa’s “zombie economy”, meaning an economic landscape where businesses are neither growing nor failing – they simply maintain the status quo.

Below is an overview of South Africa’s liquidation statistics over the past seven years.