Unlocking Economic Growth and Development
The City of Johannesburg prides itself on being Africa’s finance and economic capital. About 55 international airlines fly into the City and 75% of corporate headquarters are based in Johannesburg. It is the only city in South Africa that boasts four local and international conference venues capable of hosting more than 5 000 delegates. With so much achieved in just about two decades, Councillor Ruby Mathang, Member of the Mayoral Committee (MMC): Economic Development in the City of Johannesburg, says past successes have laid a solid foundation for the present and the future of the City.
According to Councillor Mathang, over the past 20 years of democratic governance, the City has focused its energies on rebuilding Johannesburg into a city very different from what the architects of the previous apartheid regime handed over in 1994. “We often refer to this as the stitching together of Johannesburg, so that the previous divide and rifts of apartheid planning are replaced gradually with
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an integrated functional metropolis,” he says. In this respect, bridging the gap between the rich and the poor has led to the hefty investments into what is commonly referred to as the hitherto disadvantaged communities and neighbourhoods of the City. He points out that: “These are dormitory townships such as Soweto, Ivory Park, Alexandra, Orange Farm, Diepsloot, Kliptown and many others that were deprived of economic infrastructure such as decent roads, telecommunications, reliable transport systems, and so forth.”
A Sophisticated Growth
Ensuring economic growth in the City has also been about sustaining existing infrastructure which in some cases was derelict - short of total collapse. The inner City is a classic case in point. “We have sustained the CBD [central business district] through very challenging times, from the late 1980s until the late 1990s, where vacancy levels were extremely high due to capital flight from the inner City for the northern suburbs and the emergence of newer economic centres such as office parks and malls. Today, the inner City is a lot more prosperous with massive re-investment realised over the years through various initiatives such as the Urban Development Zone tax incentive scheme and urban regeneration initiatives. Add to this the successful hosting of the World Cup in 2010 and the world, at large, has a clear indication that we have witnessed sophisticated growth in the City,” notes Councillor Mathang.
The City has changed its manner of operation over the last few years with regards to the economic inclusion of all citizens. “This has become much more robust and our vision to build an ideal economy has been at the centre of the Growth and Development Strategy (GDS) 2040, with a clearly defined outcome of a city economy that is inclusive, job-intensive, resilient and competitive and harnesses the potential of its citizens. This is an economy that places its people at the centre of development,” he stresses. To further illustrate this; the City recently presented a national benchmark in the announcement of a record R47-billion city budget. “The budget for the 2014/15 financial year consists of a massive R10.4 billion budget allocation for capital projects spread throughout all regions of the city,” Councillor Mathang reveals.
Various city departments and entities will undertake the roll out and delivery of a multitude of projects ranging from the important infrastructure programme in, and around, the corridors of freedom; the construction of new housing stock and refurbishment of hostels and flats; the building of new libraries in Lehae, Alexandra and Coronationville and the upgrading of existing library stock; the construction of new health facilities in places like Finetown, Ivory Park and Zandspruit; City Power investment in ageing infrastructure as well as new bulk provisions; the provision of new infrastructure projects related to water provision and conservation; the development of new parks and continuous maintenance of existing public open spaces and grass cutting. “These are but highlights of the vast capital projects to be undertaken in the year and [they] reflect the continuous and sustained investment in the city.” The City of Johannesburg municipality, through the Department of Economic Development, is truly committed to shaping a more sustainable city economy and boost long-term city revenues.
It is no secret that a high unemployment rate, particularly among the youth, has become the bane of South Africa and its economic hub is not immune. Every year, hundreds of thousands of new job seekers, with the vast majority being the youth, join the army of the unemployed. In acknowledging this phenomenon, the City recognises that small businesses and entrepreneurs play a pivotal role in creating jobs in communities. Indeed, statistics say that small, medium and micro enterprises (SMMEs) account for approximately 40% of South Africa’s Gross Domestic Product (GDP) and employ more than half of the private sector work force.
The City contributes about 17% to the South African and 48% to the Gauteng economies respectively. “With this in mind, we need to develop interventions to unlock the latent economic wealth found in formerly marginalised areas of the City, through the provision of infrastructure upgrades. We have prioritised the redevelopment of marginalised areas in the recent years and, in some parts of the City, these are beginning to show results,” Councillor Mathang reiterates. The development of economic nodes such as Bara Link, Maponya Mall and Orlando Ekhaya in Soweto, Pan African Mall in Alexandra and Town Square Mall in Orange Farm, as well as industrial development projects such as the Soweto Empowerment Zone and Bambanani Industrial Node in Ivory Park, are just examples of some of the City’s efforts in this regard.
“The Jozi@work Programme is quite, possibly, one of the most progressive partnerships, yet, to be pursued by any arm of government” exclaims Councillor Mathang. According to him, the programme will see the City partner with local enterprises and cooperatives in all communities of the City so that they are active agents in the delivery of municipal services. “It will change the way we have always done business. Jozi@work will turn job seekers into job makers. Our residents will be our suppliers as well as customers. We envisage the creation of 40 000 new jobs across the City by end of 2016. Over R1 billion in City contracts will be placed with community based enterprises.”
Tourism an Economic Growth Imperative
Tourism, in all its forms, is an important contributing factor to the City’s economic growth and development. Councillor Mathang elaborates: “The City’s infrastructure, tourism sites, attractions and vibrant lifestyle offering plenty of reasons for travellers to enjoy spending quality leisure time here. Joburg’s legendary shopping, dining, entertainment and nightlife is complimented by fabulous weather, as well as an astonishing array of facilities like spectacular golf courses, gyms, spas and wellness centres which add to its appeal as a destination.” Urban tourism is coming into its own in Johannesburg, with an increasing number of visitors keen to explore diverse aspects of the City – from all the exciting developments downtown (including Braamfontein and the CBD) to the established heritage routes, sites and attractions of Soweto and Alexandra – and not forgetting the leisure and lifestyle activities like the Neighbourhoods Market in Braamfontein and the Sunday Market at Arts on Main.
The City experienced a substantial 53.6% growth in international visitors in the period 2009-2013 and it intends to capitalise on this success to achieve even greater success in the future. Councillor Mathang explains that the fact that Johannesburg is the most-visited city on the African continent needs to be utilised to promote its appeal as a popular destination for business and leisure, in order to attract even more visitors.
“This, in turn, will pass benefits down the entire value chain for business and leisure tourism stakeholders thus enabling us to grow the economy on many different levels – from formal industry, right down to SMME’s in our very diverse communities”. As articulated in the Growth and Development Strategy 2040, tourism remains an economic growth imperative on the City’s agenda. It is an important catalyst to encourage the development of the SMME sector in order to encourage the growth and development of a vibrant second economy.
”The City also offers a plethora of cultural, leisure, sporting, fashion and lifestyle activities that are fast making us the leading destination for both leisure and business tourists. One of Johannesburg’s major competitive advantages is its international recognition as the business and commercial capital of the African continent,” declares Councillor Mathang. Tourism is characterised by its labour intensiveness and low barriers to entry for employment and entrepreneurial participation. It employs a multiplicity of skills and creates demand for other services and products. It is for these reasons that the sector has been identified as one of the priority sectors for job creation and entrepreneurial opportunities in the National Industrial Policy Framework (IPF), the New Growth Path and the Gauteng Economic Development and Employment Strategy (GEDES). “These same attributes enable the sector to significantly contribute in addressing the triple challenge of unemployment, inequality and poverty as well as steadily marching into the future and maintaining Johannesburg’s status as ‘A World Class African City’,” concludes Councillor Mathang.
by Andrew Ngozo