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Eastern Cape Business 2019 edition

  • Text
  • Africa
  • Maritime
  • Companies
  • Investment
  • Business
  • Harbours
  • Ports
  • Economy
  • Tourism
  • Power
  • Energy
  • Renewables
  • Manufacturing
  • Water
  • Energy
  • Agriculture
  • Eastern
  • Municipality
  • Nedbank
  • Banking
The 2019 guide to business and investment in the Eastern Cape Province of South Africa is the 12th issue of this highly successful publication that, since its launch in 2007, has established itself as the premier business and investment guide for the Eastern Cape. The Eastern Cape’s investment and business opportunities are highlighted in this publication. In addition to the regular articles providing insight into each of the key economic sectors of the province, including tourism (in which the events sector is growing fast on the back of international attractions such as the IRONMAN African Championship) and energy, where the Eastern Cape is leading the nation in attracting investment in wind power. All of the major business chambers in the province have made contributions to the journal.

SPECIAL FEATURE A

SPECIAL FEATURE A REGIONAL OVERVIEW OF THE EASTERN CAPE PROVINCE Established manufacturers are investing in new capacity as two powerful new sectors – wind power and maritime – have started delivering on their potential to expand the Eastern Cape economy. By John Young The Day of the Seafarer has never previously been honoured in South Africa but on 25 June 2018 the International Maritime Organisation saw to it that three coastal cities celebrated the occasion. The highlight in Nelson Mandela Bay was the opening of the new national headquarters of the South African International Maritime Institute. This follows shortly after the launch of the Oceans Campus of Nelson Mandela University and dovetails with the ambitious plans of national government to use the maritime economy as a way of creating growth and jobs. These institutions will support an existing provincial maritime economy which is underpinned by three major ports: Port Elizabeth, East London and Ngqura. Port Elizabeth’s major cargoes are manganese and vehicles while both East London and Ngqura support Special Economic Zones (SEZs). There are plans to move manganese exports to Ngqura which will free up space for a waterfront development in the Port Elizabeth harbour. The Port of East London has recently been upgraded and it has been breaking records in EASTERN CAPE BUSINESS 2019 4

SPECIAL FEATURE numbers of Mercedes-Benz vehicles loaded for export. The country’s largest grain elevator in a port will start to run more efficiently as a result of a contract signed in 2018 with Afgri. The private contractor will work with Transnet Port Terminals to improve efficiency at the terminal. National government has named the Coega SEZ as the potential site for a 1 000MW Liquefied Natural Gas (LNG) plant. The value to the regional economy of the project is estimated at R25-billion. A gas-fired power plant (Dedisa) started operating at Coega in 2016, and there are plans to expand this sector. The Eastern Cape Development Corporation (ECDC) is the lead agency in driving economic growth in the province. The Investment Promotion Unit of the ECDC actively markets and facilitates investments. Eight economic sectors have been targeted as priorities, including renewable energy, the oceans economy and tourism. Work is being done on rail links to the Eastern Cape to enable more manganese to be exported through the province. These logistics upgrades are an indicator that the political will exists to improve infrastructure. In his 2018 State of the Province Address, Eastern Cape Premier Phumulo Masualle said that the province had become “one gigantic roads construction site” with active projects underway to the value of R7-billion and another R5-billion to be completed before 2022. The Eastern Cape is fast becoming South Africa’s wind-farm hotspot. Just two areas, greater Jeffreys Bay and Cookhouse/Bedford, will soon be contributing 1 185MW to the national grid. A joint venture in the Eastern Cape between Osho Ventures and Heidelberg Cement will create South Africa’s seventh cement manufacturer. Established sectors Historically, wool and ostrich feathers were the region’s first exports and these items are still in the export basket. The Eastern Cape was and is a global leader in mohair, the luxury fibre taken from Angora goats. The fertile Langkloof Valley in the west has enormous deciduous fruit orchards and Alexandria and Grahamstown produce pineapples, chicory and dairy products. The Eastern Cape is the leading livestock province in terms of numbers of sheep and cattle and produces a quarter of South Africa’s milk. The manufacturing facilities of Volkswagen South Africa (in Uitenhage) and Mercedes-Benz South Africa (East London) are at the core of the province’s important automotive sector. It was to support this sector that industrialisation took place in the province. Smelters and metal works were built to service car makers and automotive component manufacturers. Ford engines are built in Port Elizabeth and a wide range of makers of automotive glass, catalytic converters, vehicle tyres and other parts are found in Uitenhage, Port Elizabeth and at the Special Economic Zone (SEZ) in East London. Two Chinese car makers have recently invested in the Coega IDZ, First Automotive Works (FAW) and Beijing Automobile Corporation (BAIC). Local giants Volkswagen SA and Mercedes-Benz SA have invested heavily in increased capacity for new lines of production. The Eastern Cape’s beaches and natural beauty have been attractive to tourists for many years, but recent initiatives to expand the province’s offerings are paying off. With a focus on events and “adventure tourism”, visitor numbers are steadily growing. The province aims to be a “Top Three” domestic destination by 2020. Spending by tourists has grown from R2.4-billion in 2013 to R4.1-billion in 2015 and the average length of stay (5.3 days) is the best in South Africa. The Eastern Cape MEC for Economic Development, Environmental Affairs and Tourism Oscar Mabuyane reported in a booklet prepared for the 2019 Eastern Cape Investment Conference that several large investments have been made in the province. He cited: • SAB, R438-million plant upgrade • Mercedes Benz SA, R10-billion • Aspen Pharmacare, R3.4-billion • Nestle, R663-million • Yekani Technologies, R1-billion at Coega SEZ • MultiChoice, R900-million at ELSEZ • ​Volkswagen SA, R6.1-billion • ​BAIC, R11-billion at Coega SEZ. 5 EASTERN CAPE BUSINESS 2019

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