A bold plan: Western Cape economic opportunities MEC Alan Winde is focusing on the province’s long-term growth potential. Picture: HETTY ZANTMAN
A bold plan: Western Cape economic opportunities MEC Alan Winde is focusing on the province’s long-term growth potential. Picture: HETTY ZANTMAN

Last week will surely be remembered as a stormy time. While a major cold front moved with pace towards SA, delivering torrential rainfall and destructive fires in the Cape, another devastating "economic storm’ hit our country after Statistics SA revealed that our economy had officially entered recession.

The confluence of recent factors, set out clearly by S&P Global Ratings, Fitch and Moody’s over the past two weeks, had accelerated the contraction of the economy and increased unemployment.

As members of the board of Wesgro — Cape Town and the Western Cape’s official tourism, trade and investment agency — we were confronted by a different reality when hearing the news. While the national economy is sick, there is growing evidence to suggest that the Cape economy is performing relatively well.

The province’s growth over the past five years now matches that of Gauteng, SA’s economic powerhouse, and remains above the national average. The Western Cape maintains the lowest unemployment rate, with the smallest number of discouraged work-seekers, by far.

The construction sector is booming, with building plans submitted increasing by 27.3% in 2016-17, a nearly R1bn increase in value. The province’s property market is now the best performing in the country.

The Cape is also leading the way in new technology. More than 60% of SA’s information and communications technology start-ups are located in the Western Cape.

Cape Town’s IT and software industry includes 200 companies employing 7,500 people. The Silicon Cape industry body alone has 9,000 members.

The Western Cape has a forward-looking economy and is now the heart of the growing renewable energy sector. GreenCape has recorded 293 green economy projects in the Cape, which is now up from 40 in 2010 — more than 10,000 local jobs have been created in the renewable sector alone.

So while the forecast is gloomy for SA, we should be encouraging our pockets of hope and expecting more of them. Because if they succeed, the path out of the recession can be easier and quicker.

This is also reflected in the high levels of investment that continue to be recorded. Over the past five years, Wesgro has attracted R8.8bn worth of investment into the province, facilitating almost 6,000 jobs. A R1.3bn investment by Pegas Nonwovens in 2016, the single biggest recent investment facilitated by the agency, will now create 500 direct jobs in Atlantis, a development node close to Cape Town.

This is helped by a city administration dedicated to investment, as reflected in the City of Cape Town’s ranking as the one of the top cities for foreign direct investment strategy — the only city in Africa to make this list.

The collaborative Cape Town Air Access project — a model public private partnership driven by Wesgro and bringing together the City of Cape Town, the Western Cape government, Airports Company SA, Cape Town Tourism and South African Tourism — seeks to increase the number of direct flights to the city.

The nine new flights and 10 expansion flights have added 600,000 seats in the past two years. This has grown the number of passengers passing through Cape Town International Airport to a record high of 10-million in 2016, making the airport the third busiest on the continent. This growth has helped bring R4bn into the regional economy in quarter three of 2016 alone.

Greater air access is important not just for the business and investor community but also for boosting Cape Town and the Western Cape’s tourism sector.

With clear economic priorities, set out by the province’s forward-looking economic opportunities MEC Alan Winde, and with a world-class city doing all it can to make itself attractive for investment, under the stewardship of our hard-working executive mayor Patricia De Lille, the Cape is creating an enabling environment for growth and job creation, thereby boosting the confidence of investors who drive growth.

Of course, the challenges that exist at national level should always be factored in. These will have an impact on every province and city, but Cape Town and the Western Cape has shown itself to be capable of being a resilient incubator of growth — attracting investment and creating jobs.

This is precisely the good news we should be proud of and sharing. Indeed, it is part of the recipe of economies that succeed world-wide.

California, for example, has been a key driver of the US economy’s growth, even during the tough economic times over the past decade. Regions like Bavaria in Germany and Victoria in Australia provide the "internal" economic competition that drives investment and growth and helps the national economy overall.

So while the forecast is gloomy for SA, we should be encouraging our pockets of hope and expecting more of them. Because if they succeed, the path out of the recession can be easier and quicker.

That is precisely why we must rise to the occasion during this difficult time and double down on our efforts to grow the economy — because if regional economies like the Western Cape succeed, the country will succeed too.

For our part, Wesgro will do all it can to help SA weather the recession storm

• Spicer is deputy chairman of the Wesgro board and Harris is CEO of Wesgro.

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