Patricia de Lille
Explains how the city did it, and what the advantages to South Africa are
CAPE Town’s recent ranking as 21st in the world on the list of cities with the best foreign direct investment strategies is an achievement for all South Africans to be proud of.
It is testament to the strategic effort of the city in recent years to position itself as a globally competitive business destination.
As the only African city to appear on this prestigious ranking by fDI Intelligence, a division of the Financial Times, Cape Town is in the company of great cities like Amsterdam, Miami and Auckland whose initiatives to compete for international investment are being increasingly acknowledged.
Worldwide, cities are taking a more prominent role relative to countries as drivers of economic growth.
While country dynamics, including national economic policy and political stability, do have an effect on the attractiveness of any particular city as an investment destination, individual cities can do much to position themselves against other international destinations.
To not do so would be to simply accept the ebb and flow of the relevant national economy. The overriding sentiment that is expressed to us by potential investors is that Cape Town is a city that works.
For cities to truly thrive, they need to be both internally focused and globally positioned. This is particularly the case when it comes to tackling economic challenges.
This is the approach I took to the local economy early on in INTO THE FUTURE: Cape Town is Africa’s information technology hub, with more tech start-ups than anywhere else on the continent my first term as mayor of Cape Town. It was then formalised in Cape Town’s 2013 economic growth strategy, which has several key intervention areas at the core of the city’s investment attraction efforts. These include:
Reducing the regulatory burden through the creation of a one-stop shop and regulatory modernisation;
Rolling out a business incentives programme;
Improving Cape Town’s reputation as a serious investment destination through rebranding and the strategic use of external relations;
Focusing on infrastructure investment to create a crowding-in effect with the private sector, with massive new investment in the infrastructure needed for the 21st century such as an extensive broadband network; and
An aggressive promotion of the city to private businesses weighing their options of whether to invest in Cape Town or another city.
I have personally led this last initiative. Following the US model of mayors competing against ACCESS: For companies wanting to get their goods into the continent’s retail markets, most of the retail giants are headquartered in Cape Town with a store presence across Africa each other to attract jobcreating businesses, we repurposed our entire international relations strategy and policy to focus on economic growth.
Gone were superfluous trips by anonymous officials at the drop of a hat.
In came a new targeted approach where delegations (led by myself) go to pitch to companies and industries looking to expand their African footprint.
This involved extensive research and business profiling. It was coupled with a strategy of creating greater access to Cape Town, especially via air routes, to make us a more viable destination for business travellers to commute to from all over the world.
In the past five years, we have added direct international flights to Cape Town from Africa, Europe and Asia, and we are working on a route to the US.
And we have used all of our international networks and platforms to communicate our message of being a modern, trailblazing city that believes in making progress possible together.
In 2013, I established an enterprise and investment department in my office to act as a onestop shop for any investor wanting to land their investment in Cape Town.
Furthermore, Cape Town has recognised that attracting and landing investment requires a whole-city approach, whereby specific and systemic constraints to investments are identified and addressed by role-players across the administration.
This has also informed our regulatory modernisation programme, which has led, for example, to innovative systems like the development applications management system being introduced. This has streamlined the submission and approval of building plans and land use applications, including online submissions — a first for South Africa.
A responsive local government is one of the most important facets in attracting investment. We have significantly improved our ability to facilitate investment queries, helping potential investors to locate suitable land and assess the availability of services like electricity and water.
A new development in recent years is the city’s economic areas management programme, which offers credible, comparative and fresh market intelligence across more than 60 business precincts that can be used to inform investment decisions.
I was determined to put in place an incentive package that could both attract investment and rejuvenate failing industrial areas.
Atlantis was an obvious candidate to pilot our incentive programme and after four years of it being in operation it is immensely encouraging to witness the industrial development that has taken place there.
Through a combination of measures such as fast-track disposal of council land and certain reductions in electricity tariffs, Atlantis has attracted a number of manufacturing facilities, including international companies such as Hisense, which produces TVs and fridges, and GRI Renewable Industries, which produces towers for wind turbines.
It is hoped that the Atlantis industrial area will soon receive national designation as a green technology special economic zone, which will further incentivise investors.
In terms of Cape Town’s investment brand, we were faced with something of a dilemma — it is already recognised internationally as an iconic city and has won a number of global awards as a premier tourism and leisure destination, but this tourism brand has completely overshadowed our attractiveness as a business and investment destination.
It was for that reason the city decided to launch its Invest Cape Town initiative at the end of last year. This initiative is looking to firmly position Cape Town as a globally competitive business destination by highlighting the local economy’s diverse offerings and its enormous strengths in key sectors.
Cape Town’s economy is particularly strong in those sectors that are poised to be the fastestgrowing global sectors of the future. The city is attracting thinkers, innovators and designled entrepreneurs who are helping to build an ecosystem that is strong in many aspects of the knowledge economy.
We are Africa’s information technology hub, with more tech start-ups than anywhere else on the continent.
We are Africa’s green economy hub, accounting for a significant proportion of the project managers and local supply of components into the national renewable energy programme.
For those companies wanting to get their goods into the retail markets on the continent, most of the retail giants and e-commerce companies are headquartered in Cape Town with a store presence across Africa.
Cape Town is therefore in a very strong position to attract investment and take our economic growth to new heights in the coming years. Along with our partners, we aim to propagate this message across the globe.
Cape Town’s success will be South Africa’s success. The city sees itself as able to make a meaningful contribution to much-needed national growth and the creation of desperately needed jobs.
De Lille is mayor of Cape Town
A modern, trailblazing city that believes in making progress possible together
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