Gauteng’s government is moving to ensure innovative and rapid growth
A series of programmes aim to develop an infrastructure that will expand economic opportunities
One of the most compelling narratives of the 21st century has been the rise of cities and city states. It marked an important departure from the notion that sovereign states are the centres of economic activity. To underscore this point, New York has an economy bigger than Canada’s, for instance, whilst Osaka (Japan) ranks higher than Switzerland.
This phenomenon has also found traction on our own continent, with Gauteng featuring as one of the 10 largest economies in Africa with an estimated size of R1.063-trillion in 2017, contributing about 35% of SA’s economic output. This brings into sharp focus the role of subnational governments in managing their economies, as key instruments to build inclusive economies that are a catalyst for bridging inequality and building socioeconomic prosperity.
In 2014 the ANC-led Gauteng provincial government adopted a 10-pillar programme for the transformation, modernisation and reindustrialisation of Gauteng over 15 years, aimed at gearing the province to rapidly grow the size and efficiency of the economy on an inclusive and transformative trajectory. The central proposition of the programme is to build a globally competitive city region that leverages off a basket of complementary economic activities to consolidate Gauteng’s position as the dominant economic hub of SA and the continent.
In doing this it must ensure that millions of our people who, by design and history, were systematically excluded from ownership, management and participation in our economy, are placed front and centre of driving this growth and emerge as its principal beneficiaries. Their participation must therefore be driven by inclusivity and result in the rapid reduction of unemployment, poverty and inequality as we advance towards the SA envisioned in the Freedom Charter.
A developmental government such as our own must therefore be an active participant in directing the trajectory of socioeconomic investments, both through its redistributive capacity and as a major player in the economy through procurement spend. The provincial government must play a significant role in building a sustainable and inclusive economy.
Such growth requires strategic investment in productive infrastructure to ensure both the efficiency of movement of goods and services and to enhance the cost-competitiveness of products manufactured for domestic and foreign consumption.
Gauteng invested R30bn in infrastructure between 2013 and 2016, constituting an average annual growth rate of 20.7%. This was the fastest increase in infrastructure spending in the country. These investments created 92,000 direct jobs and have made a R15bn contribution to household incomes. It is estimated that on average 92c of every rand spent on infrastructure was retained in the Gauteng economy, while R6bn has been raised in direct government revenue.
These investments in infrastructure, along with the recent opening of a one-stop investor centre, have helped position Gauteng as a destination of choice for foreign direct investment on the continent. EY’s 2016 Africa Attractiveness Survey reveals that R30bn in foreign direct investment projects came into the Gauteng economy in 2014 and 2015, growing to a cumulative R66bn by the end of 2016.
We are also SA’s leading export economy, having realised growth in exports as a percentage of GDP from 44% in 2010 to 52.9% in 2016.
With a further R42bn in planned infrastructure expenditure over the next three years, we have every reason to be bullish about the economic prospects of the province.
Urbanisation is an unfolding global trend that demands that government leaders think differently about where we locate new settlements, particularly in the context of apartheid spatial planning. Gauteng’s Mega Human settlement plans and our investments in public transport infrastructure are beginning to transform our urban landscape, breaking the backbone of apartheid spatial planning by building integrated, sustainable human settlements supported by quality public transport and economic opportunities.
Already Gauteng is forging ahead with feasibility studies to extend the Gautrain to Mamelodi in Tshwane, Boksburg in Ekurhuleni, Randburg/Lanseria in Johannesburg, Mogale City, and Syfertfontein and Roodepoort/Jabulani in the West Rand.
One of the most striking features of Gauteng is its youthful profile. The province’s youth bulge means the highest proportion of our population are young people aged between 15 and 35.
Working in partnership with the private sector, the Gauteng government has made major strides in facilitating ease of entry of township enterprises in localisation and manufacturing initiatives to produce goods locally and supply to domestic and foreign markets.
In addition to determining a mandatory setaside, which guarantees work for qualifying black firms and township enterprises, the Gauteng government has also leveraged its procurement budget to support township-based small, medium and micro enterprises. Just over R41bn has been spent on youth-, women- and township-based enterprises that provide services to Gauteng government departments.
Since the start of the fifth administration, Gauteng has recorded the largest net gain in jobs created since the 2008 global financial crisis. The Tshepo One Million partnership with the private sector is a cutting-edge initiative of the Gauteng government, with just under half-a-million young people having benefited from the programme since its inception.
In 2016, Gauteng spending on township economies exceeded R6bn, with the highest number of township enterprises now benefiting from government procurement since 1994. Over the next three years well over R40bn in government procurement will be focused on black people, women, the youth and people with disabilities, creating entry-level opportunities for many more new companies to do business with the provincial government.
The advent of the fourth industrial revolution has highlighted significant opportunities in internet ecosystems, data mining and digitalisation. Equipping young people with the skills to leverage these opportunities is therefore crucial in creating many more opportunities for them as “techtrepreneurs” and allowing them to access new markets as small enterprises across all sectors.
Gauteng is therefore at the forefront of deploying digital technology for teaching and learning. We have created platforms for innovation and entrepreneurship through the rollout of eKasi Labs and partnerships with Gautengbased universities, ensuring that we provide the required assistance for skills development and investment in research and development.
Building on these initiatives the government continues to work to ensure Gauteng remains the province of genuine hope, which is fast becoming tangible through the lived experiences of the people of the province. It is this that gives us the courage to proclaim that Gauteng is better today than it was yesterday, and that it will no doubt be even better tomorrow than it is today.
Mgcina is an ANC member of the Gauteng legislature and chairs the roads and transport portfolio committee.