South Africa

South Africa’s biggest city descends into chaos

Daily Investor • 17 May 2026

Johannesburg is in crisis. Infrastructure is collapsing, there are widespread electricity and water outages, crime is out of control, and its finances are a mess.

It has reached such critical levels that the city has been sued, and Finance Minister Enoch Godongwana stepped in to try to stop the death spiral.

The City of Johannesburg Metropolitan Municipality’s problems are well known and have been making headlines for years.

Water problems are particularly prevalent, with many neighbourhoods experiencing outages which can last for days or weeks.

The main cause is the lack of upkeep. Joburg Water has failed to perform the required maintenance on municipal infrastructure for years.

In turn, it is resulting in leaks at its reservoirs and an inability to efficiently deliver water from the bulk supplier to the end user.

The collapse of the city’s water infrastructure is not isolated. The same is happening with the electricity grid, road network, and security services.

Residents and businesses in the city face frequent electricity outages, driven by municipal-level grid failures managed by City Power.

Many of Johannesburg’s sub-transmission and distribution infrastructure is well past its intended design life.

The road network faces a similar challenge. 32% of the city’s 13,599 km road network is now classified in “poor” or “very poor” condition.

The total maintenance backlog for roads and related stormwater infrastructure has ballooned to a staggering R115 billion.

Motorists have grown accustomed to dealing with large potholes on roads, malfunctioning traffic lights, or collapsing bridges.

Crime is also out of control in Johannesburg. Many groups argue that the crime epidemic is closely linked to governance and structural failure.

Simple things like walking down the street or visiting Johannesburg’s city centre have become extremely dangerous, as criminality is now rife across the city.

Financial collapse in Johannesburg

Recent revelations revealed that the City of Johannesburg is facing severe financial challenges and is technically bankrupt.

The situation has reached such concerning levels that Finance Minister Enoch Godongwana has stepped in.

Last month, Finance Minister Enoch Godongwana threatened to withdraw billions of rands in funding to Johannesburg if it did not scrap an unaffordable wage bill.

In a scathing letter to Johannesburg Mayor Dada Morero, Godongwana delivered a stark warning about the metro’s severe financial distress and deteriorating governance.

He said that the City of Johannesburg currently owes creditors R25.2 billion, while only having R3.9 billion in cash in the bank.

The Finance Minister threatened to withhold the city’s national government support if immediate remedial actions are not taken to reverse the financial slide.

Julia Fish, managing director of JoburgCAN, said that the letter confirmed that Johannesburg is budgeting on hope, not cash.

“The city’s budgets and adjustment budgets have repeatedly been built on revenue targets it is not able to meet,” she said.

“That is not sound budgeting by South Africa’s most important city, and it has left Johannesburg with a major cash-flow crisis.”

Equally concerning is that the Johannesburg Stock Exchange (JSE) suspended trading in the City of Johannesburg’s listed bonds.

The JSE announced the suspension in March 2026 after the city failed to publish its audited annual financial statements for the 2025 financial year.

The city’s dismal financial situation further hurts service delivery, as it cannot pay all service providers within 30 days of receiving the relevant invoice or statement.

“When suppliers are not paid, services fail,” Fish said. “We have seen repeated real examples, such as in the provision of water.”

City of Johannesburg sued over its collapse

On 11 May 2026, the DA Johannesburg Mayoral Candidate, Helen Zille, announced that they had taken the matter of poor service delivery in Johannesburg to court.

They filed court papers in the South Gauteng High Court against Johannesburg Water, the City of Johannesburg Metropolitan Municipality, and Executive Mayor Dada Morero.

The legal case focuses on the mismanagement of the City’s worsening water crisis and its continued failure to implement the Water Turnaround Strategy.

“This legal action follows years of accelerated infrastructure collapse, lack of maintenance, and chronic water outages,” Zille said.

“The court application makes it clear that the crisis facing Johannesburg is not the result of an unavoidable disaster.”

“Instead, it is the direct consequence of political failure, poor governance, and deliberate inaction by the Mayor and his Mayoral Committee.”

The court papers argue that the City and Johannesburg Water have failed in their constitutional and legal obligations to residents.

It added that the city did not take adequate and reasonable steps to address the ongoing crisis and implement the approved recovery measures.

The Organisation Undoing Tax Abuse (OUTA) has also launched litigation in the Johannesburg High Court targeting the city’s corporate governance.

OUTA CEO Wayne Duvenage said that the City of Johannesburg needs urgent intervention to turn matters around.

“We are in a crisis. We are well beyond the brink. Technically speaking, the City of Johannesburg is bankrupt and does not have a viable financial solution.”

He added that the decay is on display for all to see. “The potholes are getting bigger. There are more and more of them. Traffic lights do not work,” Duvenage said.

“It is dangerous here, and we have become used to this stress. This is not how a modern city, an economic hub that is supposedly world-class, should operate.”

Johannesburg Mayor Dada Morero responds

The Executive Mayor of the City of Johannesburg, Dada Morero, recently responded to the Finance Minister’s correspondence.

He engaged directly with the minister to discuss the letter’s contents and the issues raised about Johannesburg’s finances.

“Both parties have since agreed to convene a formal engagement between the city and the Ministry of Finance to address and clarify the matters outlined,” he said.

Morero added that there is no cause for concern. “The city’s administration remains fully operational and continues to exercise effective oversight and control,” he said.

In a separate statement, he provided details about an engagement with the Auditor-General of South Africa (AGSA).

“The engagement was characterised by open, constructive, and robust discussions on strengthening collaboration between the City and the Auditor-General,” he said.

He said that there was a shared aim of enhancing governance, accountability, and long-term financial sustainability.

“The discussions also reflected on the City’s ongoing financial challenges and the interventions required to secure long-term sustainability,” he said.

“While notable progress has been achieved in specific areas, significant financial pressures persist and require decisive intervention.”

He said there is a pressing need to expedite the implementation of existing turnaround plans, strengthen consequence management, and enforce accountability.