Ambitious plans to rebuild Gauteng’s economy
After the economic destruction resulting from the Covid-19 pandemic, now is the time for Gauteng to urgently rebuild its economy, said Gauteng Premier, David Makhura at the recent State of the Province Address. Calling for all hands on deck as the province moves from a focus on the public health emergency to the economic and service delivery emergency, he said decisive action was required to act against crime and corruption.
Makhura committed to accelerating service delivery and improve access to housing, electricity, water, sanitation, road maintenance, visible policing, quality education and health. The collapse of infrastructure for basic services, he added, requires a similar emergency response to the one used to deal with the Covid-19 public health emergency.
“Learning from our Covid-19 response and appreciating that the current unemployment crisis represents an emergency, all hands are on deck to reclaim the development trajectory,” said Makhura.
A key element of Gauteng’s economic recovery centres around an ambitious plan to modernise and reindustrialise the economy. The province has established a provincial war room, combining the efforts of government and industry leaders to drive economic recovery, unlock growth, create sustainable jobs and support SMME development.
The intention of the war room is to open up value chains, build competitive local content production, and promote commercially meaningful enterprise, supplier development, SMMEs and township enterprise. “In partnership with the PublicPrivate Growth Initiative, the province is working with businesses, organised labour, SOEs and government departments to reignite the Gauteng economy,” said Makhura, adding that the province has committed itself to the same social compact announced by President Cyril Ramaphosa in his State of the Nation Address in February.
The war room sessions have already resulted in positive outcomes, said Makhura. Work being done with the ICT and digital services sector is supporting the implementation of Gauteng’s 4IR strategy. “Our Township Cloud Zones, hot desking hubs and eKasi Labs will be optimal sites for new data centres and big investments in communication technologies,” he said.
Spread across Gauteng, eKasi Labs offer micro innovation hub facilities and specialise in fostering and cultivating a culture of innovation and entrepreneurship in townships by providing business development support, mentoring, a legal advisory and access to financial support. In the past year, 56 township businesses have been incubated at eKasi Labs. Working with the University of Johannesburg, Gauteng plans to turn the province’s e-waste, including discarded electrical appliances and electronic devices, into an economic opportunity by training youth to recycle them.
The province also has plans to attract more passenger and cargo airlines to OR Tambo International and Lanseria Airports and is looking at ways to promote urban agriculture in a bid to ensure future food security. Mirroring the president’s call to
develop the potential of the local cannabis industry, Gauteng plans to establish a dedicated unit with the provincial government to work with the cannabis industry and help address regulatory and licensing issues. Supporting townshipbased enterprises continues to be a key focus of Gauteng’s current provincial administration.
Makhura revealed that the province spent more than R20 billion on procuring goods and services from township-based businesses between 2014 and 2019. More than half of this spend was directed at women and youth-owned businesses.
The Gauteng Provincial Government is determined to fundamentally shift the economic landscape of its townships. Key to achieving this shift is the introduction of the Township Economic Development Bill, which is currently being subjected to public hearings.
Calling the bill a “ground-breaking piece of legislation”, Makhura says once implemented it will create new regulations and by-laws which will make it easier – and cheaper – to formalise more than 90% of informal businesses so that they can access financial support. The bill also allows for the creation of a Township Economy Partnership Fund which will provide small businesses and start-ups with access to funding.
To help support township businesses, the Gauteng Provincial Government has established a R500 million fund, of which R100 million has been earmarked to help those affected by both Covid-19 and the July 2021 unrest to rebuild and recover.
The development of Special Economic Zones (SEZs) is a core component of the drive to reindustrialise the economy. Designated areas that offer specific incentives to attract businesses to them, the province’s SEZs aim to grow manufacturing capacity, exports and employment opportunities long term, the province plans to convert the Gauteng city-region into a single, multi-tier SEZ.
The Tshwane Automotive Special Economic Zone is arguably the most advanced in terms of development of all the SEZs planned for Gauteng. Intended to be Africa’s first automotive city, it will accommodate automotive manufacturers and vehicle component suppliers. The Ford Motor Company is an anchor tenant. Although construction work continues, 12 component manufacturers are already operating in the Tshwane SEZ, announced Makhura.
To date, 3 440 permanent jobs have been created which exceeds the target of 3 288. During the construction phase, R1 billion has already been spent on SMMEs from Mamelodi township. “It’s all systems go,” said Makhura, adding that he hoped to soon witness the manufacturing of the first new Ford Ranger at the Tshwane Automotive
SEZ. A total of R45 billion has been committed to the Vaal River SEZ, situated in the Sedibeng area.
The new Vaal River Smart City, a green hydrogen innovation hub, a cannabis hub, agro-logistics, an aerotropolis, an aerodrome, air freight services and a revitalised steel manufacturing sector will all be situated at the Vaal River SEZ.
Makhura also reported that project development company, Maximum Group, has committed R20 billion in an agriprocessing hub and industrial park which will see the realisation of the West Rand Agri SEZ. Other SEZs intended for Gauteng include a high-tech SEZ in Lanseria which is intended to act as a hub for digital technology and services and a global business services SEZ at Nasrec.