Department of Economic Development and Tourism 2021/22 Annual Report
Saldanha Bay IDZ 2021/22 Annual Report
Atlantis SEZ 2021/22 Annual Report
Wesgro 2021/22 Annual Report
The Western Cape Department of Economic Development and Tourism (DEDAT) and its entities, Atlantis Special Economic Zone (SEZ), Saldanha Bay Industrial Development Zone (SBIDZ) and Wesgro, responded to questions put to them about their 2021/22 Annual Reports.
The Committee heard that the DEDAT strategy is being reviewed to create a Jobs for Growth strategy which would drive inclusiveness and the kind of growth that is job absorptive allowing the Western Cape to be viewed as a beacon of hope. The big issues were around ports to allow for the free flow of goods facilitating both imports and exports. The Department is driving municipalities to automate services citizens expect and investment promotion programmes to ensure imports and exports are facilitated given how central this is to the creation of jobs.
The biggest challenge DEDAT had during 2021/22 was availability of energy and it has worked tirelessly to assist municipalities to land investments for alternative energy. This has also hugely impacted employment. The Department has provided experiential learning opportunities to set people up for employment. Tourism was hard hit by COVID-19, but there has been a great improvement.
Members raised questions on DEDAT’s energy plan and the policies considered to speed up providing assistance to municipalities so people would be able to access these resources faster. Members asked about red tape reduction particularly on trading permits and the automated truck booking system.
They asked what triggered the revised strategy and what DEDAT will change. Job creation needed to be seen in the strategic and operational plan. Members asked about the turnaround time for alternative energy to move away from a reliance on Eskom, the cost per electricity unit and what amount had been spent on feasibility studies to date. Members questioned the provincial government's lack of public participation processes saying they were bureaucratic. The filling of critical vacant positions in DEDAT was questioned.
Members wanted more information on the role DEDAT had in accelerating the ease of doing business and in influencing municipalities and its planning divisions. The Committee asked about an employee being fraudulently remunerated and the general practice on recovering the lost funds. The Committee expressed concern on the tourism that would be expected in the country, but was reassured by DEDAT that it was almost back to pre-COVID levels. Members asked when the study on the township economy was done and why this was such a lengthy process. On enterprise development work, the Committee wanted to know why DEDAT did not include its exit from the Pick n Pay Project in the APP and asked if there was an exit report and impact assessment? Members mentioned the Khayelitsha bandwidth and its support to about 329 businesses throughout the year and asked how its sustainability was tracked to measure the outcome and impact on the digital economy objectives.
Members wanted details on the preliminary jobs created and the selection criteria for supported projects and how this was adjudicated. They asked if DEDAT and Wesgro were duplicating their achievements. They asked if its communication strategy with Transnet was effective due to delays at ports. Members asked how investment values and jobs created were recorded and about tourism destination development such as attracting people to places such as the Strandfontein Pavilion. The Committee and members of the public emphasized that many industries, call centres and informal traders were struggling to access government funds. The Committee sought more information on I Can Centres.
Atlantis SEZ Acting CEO reported many boxes had been ticked in the establishment phase such as setting up the Board, board committees and Schedule 3D listing. There has been excellent progress and the team is ready to take the SEZ forward.
Members expressed their disappointment that with the significant provincial funding invested in Atlantis more should have been done. The capacity of the freight railway line between Atlantis and the City of Cape Town showed there was much spare capacity, but this was not properly utilized. Members highlighted throughout that the dependence on the state purse should be reduced and asked about the tax incentives for local and international businesses.
Saldanha Bay IDZ reported that the three attempts at port infrastructure improvement projects have not materialised and IDZ requires financing for port infrastructure that is not dependent on the Transnet balance sheet. To take the concept of a robust partnership with Transnet further, discussions at an intergovernmental level have been initiated via the Director-General of the Western Cape Government, Transnet and the Department of Public Enterprises. SBIDZ has lost custom due to outdated port infrastructure. Jobs for growth is dependent on the network industry. The port should be at a level related to market requirements and there needs to be a focus on marine and energy engineering. It is the deepest port in Southern Africa and all the posts in South Africa can fit into Saldanha Bay to indicate its size and potential.
COVID-19 and the evolving nature of geopolitics must be taken into account as supply chains are global. When this was locked down, the movement of goods was limited. SBIDZ is uniquely placed to be a services hub for off shore vessels. However, most of the private gas sector is in litigation which has caused it to slow down. However, the CEO said that what is not reflected in the SBIDZ Annual Report is the work over the past few months and the immense potential coming through to reindustrialize Saldanha on a green pathway. There are two projects in the pipeline with SASOL producing green hydrogen in Saldanha and ArcelorMittal restarting the steel mill to produce green steel. However, IDZ sustainability is unclear because it does not have an inter-governmental agreement with Transnet. There has been lacklustre cross-department alignment.
Members said what was needed was huge investment in infrastructure from private business and mining groups. They asked about the province's approach to consolidate infrastructure activities and about the agility of intergovernmental relations. It believed the political environment had an impact on agility and state owned entities.
Wesgro noted that as an interface between the public and private sector, COVID seriously impacted all sectors and any investment. There had also been a number of staff changes at Wesgro, but it has made good progress. It was tracking its audit action plan to ensure the qualified audit would be cleared. There is an entire review of policies across the agency. The focus has been on supply chain and asset management. There has been great support from DEDAT and the Auditor General to turn around Wesgro performance
The Committee requested responses in writing to priority areas for the changes anticipated within Wesgro and what the theory of changes were and how it would ultimately affect the organogram.
Western Cape Minister of Finance and Economic Opportunities, Ms Mireille Wenger, in her overview of April 2021 to 31 March 2022 said that during this period, the COVID-19 pandemic was still with us and the Department was responding to economic recovery during this time.
Department of Economic Development and Tourism Head of Department, Mr Velile Dube, said the strategy was reviewed and the Department is looking to create a jobs-for-growth strategy that will drive inclusiveness and the kind of growth that is job-absorptive and would allow for all in the Western Cape to see it as a beacon of hope.
The big issues were around ports and work done up to date was to allow for the free flow of goods at the ports facilitating both imports and exports. The Department has driven the work of municipalities for them to be able to automate services citizens expect. We have been driving investment promotion programmes to ensure imports and exports are facilitated given how central this is to the creation of jobs. The biggest challenge DEDAT had during the reporting period was availability of energy and it has worked hard to assist municipalities to land investments for alternative energy. This has had a huge impact on employment. The Department has also placed people in employment and provided experiential learning opportunities to set people up for employment. Tourism was hit hard by COVID-19, but there has been a great improvement.
The Annual Report was tabled and Committee members were invited to ask questions on Part A.
Discussion: Part A of Annual Report
Mr R Mackenzie (DA) referred to page 15 on the energy plan. He asked if the policies were looked at to speed up providing assistance to municipalities so people would be able to access the energy resources faster. The Department had relooked at its procurement but what about red tape reduction? Similar to the procurement report, could a red tape report be published? Where is this procurement report in order to see what happens on a daily basis? What is the communication strategy? He referred to the automated truck booking system on page 17.
A DEDAT Energy Team representative agreed about the lack of stable energy supply and the Municipal Energy Resilience (MER) Programme is working hard. This is a medium-term project to produce results for 2025. The MER Programme is made up of a number of components. The economic cluster had dealt with the energy crisis to speed up the provision of new energy to the grid. There are new legislative and policy approaches nationally, but we are working to prepare municipalities for the Independent Power Producer (IPP) procurement. The City of Cape Town has a 200 megawatt programme underway and it will be releasing a 300 megawatt programme early in 2023. We will be exploring the development of a pooled buying mechanism and this will benefit municipalities to buy from a number of IPPs which would hopefully reduce procurement costs. The second focus area is private business procurement. There is small scale embedded generation, but we need to look at how to support this even more. An immediate approach is to write to municipalities to approach their customers and find out where there might be a latent supply.
At the moment there is a rule that you can only feed onto the grid up to the maximum of what you use. Wheeling is energy trading using Eskom or a municipality grid. The City of Cape Town and George have pilot projects and these could draw in 335 megawatts by 2025. The energy developer would then pay a fee to Eskom where it passes through. We are also looking to support the National Energy Power Producer Programme. With the bid window there has been an issue surrounding local content. A third key area to enable infrastructure to have capacity to connect to the grid and the internal team is mapping this out. We are also working closely with Eskom in the Western Cape and the Municipal Energy Resilience (MER) Fund to help private and municipal IPP projects to know where to connect. This will speed up the delivery to develop a business case to be taken to potential financiers with the assistance of national and provincial partners for grid expansion. This will be a critical aspect if the applications come from Bid Window 6.
There is a focus on enabling systems and the key focus area is on revenue models. The Provincial Treasury and the World Bank are working on this together to review the models and see what else needs to be done in the Western Cape. We have been working with a number of financiers and there is a focus area on the free port in Saldanha. There are still some short term opportunities for gas. Advocacy looks at what is still needed on a national level to unlock things at a local level. On the provision for alternative energy, data is being collected and we are calculating the systems that are being installed. Bid Window 4 has 120 megawatts of energy installed since 2020 and a total of 562 megawatts in the province. Bid Window 5 has 785 megawatts in the province. The challenge is the financial close of the projects which has been pushed out to the end of October and those who do not meet this deadline could be pushed out. Of the 36 bids, 24 are in the Western Cape. This will be announced in December 2022. The problem is that the projects might be clustered around the same part of the grid which may already have reached its capacity.
On the automated truck booking system, root cause analysis has been done and regulates how trucks arrive to collect and discharge containers. This system aims to manage the flow of arrivals and improve efficiency. Transnet terminals are being engaged on this. There was a dedicated port session and an Annual Port Stakeholder workshop was held in November. This happens every year and provides the opportunity for reflection on whatever new priorities there need to be. Container terminals and ports in Cape Town have been a focus.
HOD Dube added that another aspect of the truck booking system was to ensure that the port is used 24 hours a day as there is so much capacity at night.
Ms N Nkondlo (ANC) asked about the revised strategy and what triggered this conversation. What has DEDAT seen that needs to be fixed in the strategy. She referred to the policy mandate and the five focus areas and said she was grappling with the alignment of this to the provincial strategic plan and the economic recovery of the province. The Western Cape Minister had emphasized previously job creation, but she has not seen this in the strategic and operational plan. Jobs are both qualitative and quantitative. At the end of the day there can be partnerships, but the goal post must not shift. We need to see job creation. She did not have an issue with the change in strategy, but wanted to know what triggered this. What is the turnaround time for not relying on Eskom? At what cost per electricity unit would this be when looking at the cost benefit analysis? How much has been spent to date on feasibility studies? DEDAT promised a revision of the Township Revitalisation Strategy in 2019, but where is this now? When will the Department respond to the informal economy? The economy of the Western Cape is not only formal. Is DEDAT not interested in confronting this issue?
HOD Dube replied that the strategy now under review is to respond to the immediate challenges that the economy has experienced. This is responding to the COVID-19 pandemic, poverty and joblessness. A long-term strategy is needed and this must be a lot more focused to include all of government. The Western Cape economy must be globally responsive and not just from a market perspective. The responses to the challenges are a lot more broader.
A DEDAT representative added that the strategy is informed by surveys that were conducted and various stakeholders will be involved to inform what the implementation must be. Emphasis is not only on what, but how. The partnerships will leverage resources from elsewhere and will enable us to create jobs. We have to recognize that the past four years have been difficult as the economy was not necessarily doing well and then COVID-19 hit which shifted the focus from GDP growth to job creation. The strong sector of tourism was hard hit. We are finding ways to ensure the voices in the informal sector are heard.
HOD Dube said once the strategy was completed it would be presented to the Committee. We are expecting that a township strategy will emerge from this implementation plan. We are looking at the whole of government in a holistic approach to solving this and a spatial dimension regarding townships.
A DEDAT representative agreed with Ms Nkondlo that much more needed to be done and much faster. Since 2019 4800 businesses have been assisted with green economy support. Studies have been developed and distributed. 24 municipalities have been supported with small scale embedded generation (SSEG) to feed back into the grid. There has been 147 megawatts of small scale embedded generation by municipalities since 2019.
The cost per unit looks at financial feasibility and all municipalities set their own tariffs which cost neutral or below. If the province looks to incentivize SSEG financially, this could change the picture, but essentially, as the cost of Eskom’s electricity increases and the cost of batteries and renewable energy comes down, you will see renewable energy costs become more favourable. Important to note is the IPP costs are based on long-term and 15 to 20 year contracts which is why they could be cheaper. On what has been spent to date in 2021/22, we spent R13.5 million and this year we are set to spend just under R14.4 million and we are looking to spend some of the reserve budget. Some of the big spend items are the transaction advisory support for the independent power producers. Other big ticket items are the hydrogen work in Saldanha and the electricity plan which is much needed. R9.9 million will be directed to municipalities for studies and electricity master plans and cost of supply studies. This does not include SSEG costs which are cost neutral.
On logistics, he could not speak on whether policies were addressed to be priority, but wanted to speak on ports which were not really a provincial mandate. The Western Cape has taken a collaboration route and is bringing leadership into the space where there have been so many stakeholders to bring this altogether.
Mr L Mvimbi (ANC) said he had an issue with provincial government on its lack of consultation and public participation. It seems to be more bureaucratic than participatory. He asked about the identified stakeholders that would be consulted? He referred to page 32 and 33 on human resources and the organizational structure and thought this already would have been dealt with. What has been the cost of this and the progress in filling these vacant positions?
HOD Dube replied that the current structure will be reviewed before dealing with vacancies. Only core critical posts were filled with four posts filled.
Mr H Van der Westhuizen (DA) asked what the role of DEDAT was in accelerating the ease of doing business. What role does DEDAT play in influencing municipalities and its planning divisions? It seems this can play a huge role if there are efficient municipalities. Rezoning, for example, can take months or years. How does the municipality see itself playing a role in this? He noted in the Annual Report that someone was fraudulently remunerated. Could DEDAT explain its general practice to recover this? Tourism and Arts Development was quite hard hit and there were challenges with the national fund to support artists and art development. What is DEDAT's capacity to support them now and what is the progress on tourism in the country?
The Department replied that the strategy is informed by surveys that were conducted and various stakeholders will be involved. The Tourism sector was moving from recovery to growth. From January 2023 we will be expecting 191 flights into Cape Town which is approximately 1.5 million seats. We would like to ensure that all visitors are offered a wonderful stay.
There is a thorough production report on the red tape issues we manage and advertising is quite a comprehensive process involving various tools. Advertising is ongoing and there is a business support line marketed through social media. Advocating is done through a call centre report and we have trend analysis, so we can pick up what the main issues are to take up with the various regulators. This month there have been about 20 cases with the Liquor Board which we have raised with it. We look at the systemic issues and at liquor applications. We publish our success stories and this is based not only on the business, but also the agency which encourages them to improve. We work with other departments and their clients and use this to advertise services. In the Western Cape, there is an SMME Forum which includes, for example, the NYDA. There are quarterly meetings and regular engagements to help with challenges with application processes.
On a political level, we work through the Council. There is an active daily WhatsApp group to deal with red tape reduction with entities such as the Black Business Chamber. There are many platforms so we are eminent in the field. Where there are blockages we can advocate far better. Last year we spent R1,2 million on project funding with municipalities. There are now requisite skills such as legal skills to add on to this to help municipalities in improving processes and red tape reduction. We asked municipalities what they needed to be improved. We tried to have electronic building plan control and event permitting. The Department’s role with the City of Cape Town is to do a regulatory impact assessment before laws are promulgated; it can come through the system to block what is unnecessary. This year R10 million has been allocated to municipalities based on their needs.
Tourism has been quite difficult over the past 24 months and COVID-19 as well as Omicron has affected this, but tourism numbers in the Western Cape have improved in comparison to other provinces. There has been limited relief funding available such as for tour guides. R50 000 was the maximum available for those who applied for assistance. Over R8 million in funds was allocated to entities outside of the Metro in supporting great geographic spread. We have also partnered with the private sector and the majority of those needing funding are co-funded. We have monitored ticket sales and job creation and just over 300 jobs were created. We visited !Khwa ttu which said it had seen an improvement in visitors due to the new product that was introduced. The Garden Route has increased ticket sales by over 20%. Our product offering for the Western Cape has taken a long-term route.
On salary recovery, the funds are able to be recovered and all fraud cases are investigated by the Provincial Forensic Services Unit. In this case a fraudster sent a request for a change in banking details. It was found that there was no collusion between the fraudster and the employee hence no recovery. There are controls in place to prevent such a case in future and the case was handed over to SAPS.
Mr G Brinkhuis (Al Jama-ah) asked how the Western Cape could assist municipalities in reducing the red tape for informal trading permits. The application process is online and many people are struggling with this.
The Chairperson referred to page 17 and challenges for the year. Growth was predicted to be 4.6% in 2021 which slowed to 1.8% in 2022. Why was this the case and what can be done to increase projected growth?
The Department replied that the growth projections have been revised downwards since the report was produced. The Russian invasion of Ukraine which had a global economic impact coupled with severe load shedding have been contributing factors.
Mr Mvimbi noted the response about the vacancies but asked why they were vacant.
The Department replied that the vacancies within the Department were a result of austerity measures. It did not have funding to fill all the vacancies.
Mr Mackenzie asked why nine senior vacancies were unfilled. One was a director post which was critical in his opinion. He asked about the salary fraud case and if the banking details were sent to DEDAT.
The Department replied that the administration of all salaries are done by the Corporate Services Centre (CSC), but DEDAT is responsible for the expenditure which is why it must carry the cost of the R63 000 loss as fruitless and wasteful expenditure.
HOD Dube said some of the senior vacancies were unfunded and there was one senior resignation. The strategy will be reviewed.
Discussion: Part B Performance Information
Ms Nkondlo asked when the study on the township economy was done. Why was DEDAT taking this long to have a response to this? Looking at Enterprise Development work, DEDAT would have exited the Pick n Pay Project this year. She asked why there was no mention of this in the Annual Report. Is there an exit report and impact assessment of this programme? She referred to page 82 on the Khayelitsha Bandwidth Barn and its support to about 329 businesses throughout the year. She asked how the Department tracked the sustainability of this to measure outcomes and impact on digital economy objectives? On the SMME Booster Fund, the report states that 263 businesses were supported. Can it provide detail on the preliminary jobs created? What was the criteria for the selection of the projects and how was it adjudicated? She asked about the Western Cape Economic Development Partnership and under which programme it resided and what exactly its purpose was. What is being achieved with this programme and how is it being measured?
The Department replied that the Township Economic Growth Strategy was a transversal one which was developed over a number of years. It had the support of various departments and was completed mid-2020. R38.5 million was pivoted for COVID relief at the time. Many business who benefitted from this were township related. The new strategy will focus on this. The Pick n Pay programme was a success but people have struggled to maintain this relationship. DEDAT only needed to establish the relationship. This process is currently under review. A comprehensive and transversal response must be given.
The Department replied that there was no formal tracking of beneficiaries. There was real difficulty in exiting entrepreneurs who were incubated. Looking at the rental cost for businesses in townships, it could be more expensive than it would be in the City given the lack of infrastructure. There are WhatsApp groups which help form constant dialogue for discussion and support. There are some maintenance issues on the ability for expansion. There is ongoing collaboration between DEDAT and the City to have proper reach in Khayelitsha and beyond. There is recognition that the ecosystem is fragmented and that we work in silos. Training on partnerships have brought about collaboration and better plans to be executed. Some unique systems were put in place to procure food from local township suppliers to ensure food security.
Mr Van der Westhuizen said he was grateful to see the City of Cape Town’s advertising by-law on page 38 which was engaged on. The Western Cape is considering a transport infrastructure by-law and there are concerns about advertising being banned on provincial roads. Other departments could either support or inhibit economic growth. To what extent were other departments engaged on this? He had the impression that Cape Nature was doing excellent work in promoting tourism. Lives and livelihoods must be considered. On the cycle tours and facilities supported by DEDAT it does well in ensuring the support is not depended on. However, to a large extent there seems to be a duplication with the work of Wesgro. How is it determined if DEDAT or Wesgro takes on the work? Is there a possibility of double-reporting where DEDAT and Wesgro are claiming the same successes?
The Department replied that economic development occurs throughout government spaces. The Jobs for Growth Strategy Development formed an Economic Think Tank to include planners from the departments in the various economic clusters to embed this work in government. Those relationships and systems must be in place. On the SMME Booster Fund, this is demand-led partnerships and there are specific categories for funding support. Some qualifying criteria relate to sound financial governance that must be in place. There must also be tax compliance. There are different committees to deal with the applications and how beneficiaries are selected. This is put out in print and online media as well as social media.
The roles are clear between DEDAT and Wesgro. The Department manages tourism infrastructure and Wesgro will have no part in safety aspects. Wesgro would do marketing and promotion tasks. The Department has a good relationship with Cape Nature and has quarterly meetings. DEDAT focuses on strategic development and then looks at product gaps to leverage funds from the private sector and municipalities. Many of the municipalities are disinvesting due to financial strain. The Department has attempted to unlock funds depending on the product. Municipalities focus on beaches or museums. An audit of tourism products in the different spaces has been done to ensure there continues to be investment by the visitors.
Mr Mackenzie said he received a call from Ina Paarman food suppliers who are waiting on spices. How can these people be assisted and what is the communication strategy with Transnet? Who is responsible for the development of tourism products? He referred to page 18 and 41 on Wesgro and asked about the R18 million surplus.
On Tourism's SMME Booster Fund, how can it cater for generators given the load shedding and he referenced Bredasdorp.
The Department replied that there are ongoing discussions with the municipalities on how to support businesses. A booster fund is being considered. Both operational costs and who will pay for the generators must be considered. There is a 10am daily check-in with port managers so there is a good idea of what happens with every vessel at berth and which are waiting to berth. Mr Mackenzie was asked to provide details on the suppliers to follow up.
The Chairperson referred to page 70 and the 320 jobs created. What is the nature of this work and what is the industry? Is there an alliance with the strategic areas DEDAT is looking into? There were eight investment projects worth billions said to be creating thousands of jobs. She asked for more information on this. Could DEDAT elaborate on the targets of the catalytic infrastructure projects and how these targets were achieved on page 81? The Saldanha Bay IDZ created 765 jobs which enabled a GDP contribution of R461 million. R1.71 million in investments were also created. She asked how the investment values and jobs created were recorded? The Khayelitsha Bandwidth Barn continues to report issues with their roof. What measures have been taken with the City to assist with this important work?
The Department replied that there was a technical indicator report to assess tracking jobs created and investment at the Saldanhha IDZ. The value of investments is counted as they contribute to GDP. The Department calculates the number of investors, the value of the investment and the projected investment. There were over 324 trade agreements and oversight is done quarterly on this. This reflects in the Agri Sector and also shows where the export has landed. There is oversight on this and DEDAT's role amounts mostly to oversight.
Mr Mackenzie asked a follow-up question on what was being looked for from a policy perspective? What should the Booster Fund do? The Strandfontein Pavilion is there so it does not require infrastructure but what is being done to attract tourists to the Pavilion.
The Department replied that it did not operate on this level on the ground. DEDAT simply gets them here, but then hands over to the municipal entity. The issue was funding and the municipalities must be engaged on local by-laws as well to see how they can be assisted by DEDAT. We should tailor make support and also engage with some of the DFIs such as SEFA and how their support can assist. He assured the Member that DEDAT would look into the sustainability of the businesses.
Ms Nkondlo said she was looking forward to the new strategy. On target setting on page 65, her concern was that performance indicators used "number of interventions" rather than "number of businesses" supported. She asked about skills development on page 100 and for the details of the employment opportunities for 80% of the beneficiaries. On page 72 on the vacancies, how has great work been done if there are vacancies? Can DEDAT indicate the sectors the jobs were in and if contractual? How many sector initiatives have been achieved and which sub programme is responsible for the monitoring aspect?
The Department replied that this information is contained in the Wesgro Annual Report on page 36. The investment landed was just over R5.9 billion. Quite a lot of work was done on the investment pipeline. Wesgro will provide more detail.
On vacancies, those below Director of Manufacturing such as deputies were doing the job. Quite deliberate choices have to be made to not fund certain positions. Looking at page 65, there is logic to the way ease of doing business is reported on. The first issue is improving processes, getting direct assistance to businesses on the help line. It is an enquiry and therefore a resolution rate is needed. This is not included initially, because the intervention must improve the process. When we look at the R5 billion, we estimate how many businesses would be affected by a certain regulation or improvement. For example, looking at how many people would apply for the liquor licence and the costs they would save. On economic modelling, we work closely with the sectors and leverage on databases. During COVID we also did surveys to understand the pressure points.
Mr Mackenzie asked for more details on the business process outsourcing (BPO) sector on page 114. How did the process work for companies? There is a new call centre in Mitchell’s Plain which is struggling to access government money. How does this work then?
Mr Van der Westhuizen referred to page 117 and funding through Manufacturing, Engineering and Related Services Sector Education and Training Authority (MERSETA). It seemed like more opportunities were need as it was a better recognized SETA. Do the problems SETAs generally experience cause young people to miss out on opportunities in the Western Cape?
The Department replied that it supported BPO as this was a growing industry, but artisans were also big. Women in Logistics are also taken and trained as truck drivers. This is part of the GBV response and about 80% of beneficiaries are females. Training is accredited. The Department focuses on four things: how much funding the partner would provide, the training we would get from them; if this is accredited; the mechanical absorption which companies must meet a 60% threshold for. SETAs have been problematic and the SETA Forum and TVET Forum looks at funding issues. These funding windows are not aligned to Technical Vocational Education and Training (TVET), but they will all be addressed. The Department is expected to be the lead employer; however, in the case of a learner becoming maimed or injured, DEDAT is not willing to take responsibility for this. The MER Fund allocation was quite large and the lead employer status could be transferred to the employer to take on that risk. All beneficiaries are absorbed in the companies they do their internships with and a very small percentage find employment elsewhere.
The Chairperson referred to page 82 on the decommissioning of I Can Centres and asked what DEDAT’s role would be in this, noting the ‘lack of partnerships and support' for this. On the Tourism Development Fund on page 90, what were the selection criteria and how was the R3.8 million distributed? How many beneficiaries came from previously disadvantaged groups? On page 92 she asked why the deviation on 'Tour Guides registered' occurred and DEDAT’s role in supporting the tour guides.
The Department replied that the numbers deviated because tourism was shut down. There was a limited number of requests for tour guides and many tourist establishments were not visited. It finally got through the backlog of licensing for tour guides. The deviation of 297 was an over performance of 'Tour Guides registered' and not an under performance. This is a demand based service. We are now at a pre-pandemic level for Tour Guide applications. Beneficiaries are SMMEs and all are owned by women. One beneficiary was a BEE. The Department researches the gaps in product development needs in each district and the nature of what tourists want to see. We then invite businesses to apply to show how they meet the need and link it to the gap analysis. There is an Evaluation and Adjudication Committee to approve the number of beneficiaries who must show impact. There is a monthly report and financials on procurement must be shown to DEDAT.
There is a three year monitoring process on the impact of the investment. It looks at how many visitors came. The I Can revolves around digital literacy and transformation to ensure people have the required digital skill set for jobs. Even in retail, an element of digital training is needed. The Elsies River I Can works very well and it also offers guidance on CV writing. The intention was also to see how to better utilize libraries. Information must also be accessed online and this requires digital literacy and security. In libraries you only have an hour before your session ends, so the aim was to work around this to support citizens in new innovative ways.
Ms Nkondlo said there have been two-in-ones in DEDAT where staff were doing two jobs such as a Deputy Director acting as a Director. Are these people receiving an allowance for this? On Page 166 on foreign workers, what is scarce and critical about being a Deputy Director since foreign workers were appointed? Does this skill not exist in South Africa? Looking at resignations, DEDAT is at over 35% in the 25-39 age group. No reasons are provided for the resignations, so are there exit interviews? What is the latest Employment Equity (EE) report since there is under representation and over representation in certain areas of the population groups? Is there equity in the economically active population of the Western Cape?
HOD Dube replied that the new strategy would cut across all economic structures and technical work will be done on operational design to properly execute the strategy. It is always possible to give an acting allowance, but there are also limitations for how long people can be in an acting role. The foreign people have been in DEDAT for quite a number of years and were appointed for having permanent residency. There are some millennials who left DEDAT due to rigid compensation frameworks. That age group always seeks upward mobility. Some people who resigned take up positions globally as it can be done in the comfort position of work from home or to take up promotion posts in DEDAT. Exit interviews are done on a voluntary basis. Currently DEDAT has an active EE Committee and a DDG was appointed for this. An Employment Equity Manager also participates in every committee. There were various working groups and training on the Employment Equity Act. The number of 'disputes dismissed' have been in favour of DEDAT linked to unfair dismissal and labour practices. Posts have been vacant as a result of resignation. The approach to employment equity has therefore been very deliberate. With filled posts, it is difficult to change the ratios, but we are deliberate when we do shortlisting for under representation. People with disabilities are also employed, but there are limitations on needing a driving licence, so we relook at if someone can use Uber or work from home in a certain position. The Department is very deliberate on people of colour, women and those with disabilities when positions are vacated and we are able to fill them. The best person howeve, should still get the job. We work with NGOs and newspapers.
Mr Mackenzie asked for more detail on 'disputes dismissed' on page 173. How long have the vacancies been vacant? In the new structure, how have the relationships been managed with people when they can see there is a vacant post above them, and they have been acting in the vacant position?
The Chairperson asked about the staff turnover rate of 19.1% and asked if this included its entities or just DEDAT and what caused this higher turnover rate. R17,3 million was spent on consultants for the Western Cape Green Sector Development. She asked what the positive outcomes were of using the consultants? Nine out of 15 resignations did not provide reasons and some of the resignations cited wanting a better work life balance and interpersonal relations at work. She was concerned that this pointed to an issue with the work culture within DEDAT. What steps were taken on this? There were five promotions and how many were recruited internally?
The Department replied that the turnover rate was as a result of contract staff leaving to take permanent posts in DEDAT. The entities are not included.
HOD Dube said there was a culture journey in the Western Cape government and presentations have been done on this. We started on leadership cohesion for senior management and this will be rolled out to the entire department. The biggest figure for consulting funds was R8.8 million and the other related to a different consulting group. This was for water and the eco system and attracting finance availability. Four marketing intelligence reports were developed such as on energy services, water, renewable energy and electric vehicles. The reports were used far and wide to tackle barriers with the private sector.
Larger business with investments around rooftop PV were also supported. 20 new businesses engaged directly. 14 businesses tracked progress of support provided against what is actually offered by the business. Looking at green economy investments, this is tracked through the declaration of investments which can only be seen once a product has reached financial close. A lot of the Bid Window 5 businesses were not counted as they had not reached financial close. R52 million in provisional declaration was for a project cutting across four provinces, but it is unclear which portion is for the Western Cape. 250 business are supported with direct engagement and 1210 are supported virtually. There were four industry briefs completed by Green Cape for water and energy. Four case studies were also produced. There are eight in-depth technical and regulatory inputs. This means some things can be changed in terms of regulations to be more favourable to the industry. Municipalities can also source their own energy since documents relating to this are reviewed periodically. Seven municipalities were assisted with wheeling and data scale renewable projects.
Questions from Members of Public
Mr Mlandeli Mbuku from Nyanga Tourism Forum referred to page 16 on the SMME Booster Fund. He asked which people qualified for this as the majority of the people from Nyanga were meat vendors? He asked who qualified for experiential learning programmes referred on page 17. He knew of many people who trained at UNISA but were all unemployed. What could be done about this. He requested the Chairperson to revisit the resolution taken in 2019 to consult with the Nyanga Tourism Forum.
The Chairperson replied this would be taken up in a committee resolution after the meeting adjournment.
DEDAT replied that the SMME Booster Fund was a demanding programme and DEDAT only supported businesses who supported SMMEs. This was represented in areas across the Western Cape such as Langa, Nyanga, Bonteheuwel, Vrygrond, Du Noon and Mitchell’s Plain businesses amongst others. Formal and informal businesses benefitted from the COVID Relief Fund in 2020. Close to a million people are unemployed and DEDAT has less than R500 million to effect change in the economy, so it will always feel as though DEDAT never does enough. More than R150 million and R200 million a year is dedicated to this, but resources are constrained so every community will not benefit. Any unemployed youth can benefit from the programme and 99% of beneficiaries hail from the townships in Cape Town. 80% of beneficiaries are female. R25 000 is allocated per job. When funds are offered to incentivized companies, the companies are held responsible for this. Companies will select the individuals, but would support DEDAT’s preferences. The proposal on Nyanga was received on urban development, but not on tourism projects. The Department has reached out to Dr Theuns Vivian, Destination Development Manager at the City of Cape Town, to assist from a community tourism perspective as this is their mandate. The Department would set up follow-up discussions on the needs of the Nyanga community.
Mr Linda Peter from Kraaifontein asked about tourism and said it seemed it was more important to create jobs, however in Kraaifontein more opportunities could be created. What programmes have been created for local entrepreneurs to benefit? Recycling amongst our communities could create jobs. There is a waste facility in Kraaifontein and many people do this, but they have nowhere to store the waste. Documents given by law enforcement are difficult to understand. The WC Government should not create another country as in the American states. All documents must align. He questioned if BEE really benefited black people. Jobs can be created if the City of Cape Town came on board. Documents and laws created so much difficulty. Applications for funding small businesses have too many complex requirements.
The Chairperson replied this would be considered in the committee resolutions.
The Department replied that application processes were constantly being reviewed to try and shorten the process and ensure it runs more smoothly. There is a huge effort to ensure application processes are streamlined. The Department regularly communicates with SEDA and SEFA to expedite processes. A discussion took place on product development and on active tourism products. Work must be done to build product and attraction value within a community. The correct City officials can be approached to facilitate the conversation.
Mr Paul Bester, Secretary General of the Informal Economy Development Forum (IEDF), commended the Western Cape Minister on the new strategy being planned. Each of the parties such as the DA, PAC and ANC have different ideas so it does not create alignment. IEDF was available to assist government. There was a lack of public participation. People on the ground must be included in the making of laws and regulations. Permit applications take too long. There is a government gazette which waives permit costs up until the end of December 2022. He wrote letters to the provincial office, but nobody seemed to know about this or implement it. This supercedes all by-laws which are very old, coming from the Zuma dispensation.
Permit costs must be waived. He had also written to the Premier on this. How much red tape was addressed? People on the ground are dying. He noted that 750 jobs were created in the Saldanha Bay IDZ in the previous financial year. He was party to the creation of jobs in his previous employment representing labour. A signed agreement was that the first people to be appointed were those from Saldanha Steel, but was this done? People have criminal records as people could not follow regulations to feed their families and the millions were not made available to the people. He asked about access to finance for those in the informal economy as they do not have access to finance. The funds for this must be restructured. Access to funding must be changed.
The Department replied that improving regulations on permits was an ongoing process. A meeting could be arranged with Mr Zolele Siswana, Area Manager in Cape Town who could look at how people in Kraaifontein could be assisted. Waiving of permits has been addressed with municipalities. R38 million was used to provide relief to people.
The Chairperson thanked the public for their engagement and said this showed that democracy was working.
Atlantis SEZ Annual Report 2021/22
Ms Jo-Ann Johnston, Atlantis SEZ Board Chairperson, noted the previous CEO had resigned to take up an opportunity in the Middle East.
Atlantis SEZ Acting CEO, Mr Matt Cullinan, said the previous CEO had done great work to put the organization together. There is a good team in place to follow through on the vision and mandate. Many boxes were ticked in the establishment phase such as setting up the Board, board committees and Schedule 3D listing. He acknowledged the support from Wesgro and the Saldanha Free Port. There has been excellent progress and the team is ready to take the entity forward.
Mr Van der Westhuizen said he understood setting up took a lot of time but provincial funding had been significantly invested in Atlantis so more could have been done to date. The railway line to a large extent exists, but could the reopening of the freight railway line between Atlantis and the City of Cape Town support the economic viability of this line and where do we stand with this? The Committee’s oversight visit to Atlantis showed that there was a lot of spare capacity and space which was vacant. There are a number of undeveloped properties and he had the impression that land sales and investments were not necessarily as a result of the SEZ work, but could be attributed to private entities. He wanted to be informed of the real achievements of the SEZ which was in line with the mandate and core function and why the investment was made. The economy must be stimulated and employment must be created.
Mr Cullinan replied that a feasibility study on the freight railway line was being concluded and it looked at the potential volumes for this. The volumes are not there in terms of what currently exists, because people have lost faith in this form of transport. The sense is that if the railway line was reestablished certain containerised transport might return. The immediate support for the railway line comes from the City of Cape Town. Strandfontein Waste will close in 2026 and Vissershok will be available to take over.
At the moment, Vissershok must be accessed by road which has high costs, but the immediate need is there in the range of 4500 tonnes per annum. We can start off with a few trains per day and build this up over time as demand arises. On financial modelling, any models beyond 10 years show a positive return on investment and the initial investment for this is R42 million to get the railway line back up and running. We believe there is a very strong case to be made, but an informal settlement has been set up on the railway line running through Du Noon. There are quite active programmes with the WC Government and the City of Cape Town for collaboration. The Atlantis SEZ is quite involved in promoting development in the broader Atlantis area. We are working together to turn the entire investment area into an investment opportunity. Many industrialists are not part of the SEZ, but are based on our boundary.
Ms Nkondlo welcomed the Atlantis SEZ Annual Report and was fascinated by how the SEZ was put together and officially legalized. She congratulated DEDAT on this. There was an issue about land not released by the City of Cape Town. Has this been concluded to attract investment into the space? What is the funding timeline between the Department of Trade, Industry and Competition (DTIC) and the Atlantis SEZ? Are the timelines aligned to budgeting and implementation of the SEZ projects? The sooner we navigate this space, the better. Are any of the SEZ core projects ready or are there still issues that we should anticipate in future?
Mr Cullinan replied that the Atlantis SEZ had over R100 million in funding from DTIC and was ready to appoint the main contractor for civil works in Zone 1. There is a high quality of civil infrastructure platform. The SEZ is building the first factory for the first investor. This looks very exciting and is quite positive. The SEZ is quite well aligned with DTIC, but it would like more support on civil infrastructure. However DTIC said this was not its responsibility and it only funded the top structure.
The SEZ reported on two investments and the infrastructure was not provided by the SEZ itself, but it has contributed significantly. For example, the Energy Curtailment is implemented by the City of Cape Town, but the SEZ brings industrialists and creates an environment for the private sector to capitalize. He invited the Committee to visit Atlantis again as it was different to how it was one year ago. We are valued for being there. The land transferred from the City of Cape Town to the Atlantis SEZ had to be sub parceled from larger pieces of land and consolidated with other pieces. Three new land parcels were created and the title deeds are now being prepared. One or two heritage concerns arose relating to Transnet expropriation and we hope this will be resolved by early 2023 and then the final transfer will go through.
Mr Mackenzie said he was comfortable with the report and congratulated the entity on its report.
The Chairperson said the dependence on the state purse should be reduced. Is there any new information on this and what are the tax incentives for local and international businesses? Should there be a local finance centre and what might make this possible?
Mr Van der Westhuizen noted that one of the two applications the SEZ made to DTIC was unsuccessful. He asked for more information on this and if the SEZ would be able to resubmit.
Mr Cullinan replied that the SEZ was resubmitted and it was successful.
The Chairperson asked if the public had questions. There were no questions from the public.
Saldanha Bay IDZ (SBIDZ) Annual Report 2021/22
The SBIDZ Deputy Board Chairperson, Mr Johann Stegmann, said the IDZ designation was in 2013. The SBIDZ baseline was achieved in 2016 when the entity was conceptualized and signed a number of agreements. Half of the property in Saldanha is owned by the IDZ and the rest is owned by Transnet National Ports Authority (TNPA). It signed five agreements with the municipality on its responsibilities to the IDZ. In that year a range of national priorities were assigned to the IDZ such as infrastructure, fibre and Operation Pakisa which led to TNPA going out on tender for three capital builds such as the 1km jetty and offshore supply base. The market did not like these bids and they went out again in 2018 and were unsuccessful. IDZ then got involved in 2019 and did feasibility studies were then done with Infrastructure South Africa (ISA). However, the financing of this got stuck as the operation model was not in place to go into an agreement. For all intents and purposes, we have a port which was opened up in 1976 and TNPA exports 60 million tonnes of ore per annum which is what the port did 50 years ago. The idea is to continue with the ore exports and further expansion of ore exports with TNPA. That is where the problem is as the marine and energy engineering ventures are postponed to the mid 2030s if ever. The investor pipeline is valued around R21 billion but half of that has been sterilized as it is dependent on vessel traffic in the port. We must come up with solutions that are not in isolation. Efficiency and infrastructure is needed as it has lost custom. SBIDZ has to find financing that is not dependent on Transnet and come up with solutions to get the ports up to the level to meet market requirements. The three attempts at port infrastructure improvement projects have not materialised.
The IDZ requires financing for port infrastructure that is not dependent on the Transnet balance sheet. The engagements with Transnet and Transnet National Ports Authority (TNPA) is to get clarity on what must take place in ports and its efficiency as well as what it needs to look like in a year’s time. To take the concept of a robust partnership with Transnet further, discussions at an intergovernmental level have been initiated via the Director-General of the Western Cape Government, Transnet chief executive and the Director-General of the Department of Public Enterprises. We have lost custom due to being outdated and the capacity it can handle on an annual basis. Looking at the infrastructure and financing required and how we deal with the National Ports Act, it could be an enabling mechanism, but it is now applied in a restrictive way. Jobs for growth is dependent on the network industry. The ports should be at a level related to market requirements.
IDZ has an overall investment of around R2 billion which has been spent on civil infrastructure. Some R300 million that is built is stranded now due to the lack of port infrastructure. A solution will be found through partnerships to find a way forward. A full feasibility study is being done with Treasury in partnership with the National Ports Authority. On designing and implementing very different operational arrangements with TNPA, we need to focus on marine and energy engineering.
It is the deepest port in Southern Africa and all the posts in South Africa can fit into Saldanha Bay to indicate its size and potential.
Ms Kaashifah Beukes, SBIDZ CEO, said that the Annual Report was difficult to table in this period under review as the investor pipeline was difficult to convert into paying tenants for various reasons such as COVID. When Provincial Treasury asked us to re-budget due to COVID-19, we did not know what we did not know. The dynamics and evolving nature of geopolitics must be taken into account as supply chains are global. When this is locked down, the movement of goods is limited. South Africans and the labour force who are part of the marine engineering fraternity were not able to travel for a long time. There are opportunities, but the Petroleum Industry Association said all the gas projects in South Africa were in litigation. SBIDZ is uniquely placed to be a services hub for off shore vessels with immense potential. However, when the private gas sector is in litigation it means it is not moving as rapidly as we would want it to from offshore fields.
What is not reflected in the Annual Report is the work over the past few months and the immense potential coming through to reindustrialize Saldanha on a green pathway. There are two projects where SASOL will produce green hydrogen in Saldanha and ArcelorMittal will restart the steel mill to produce green steel. SBIDZ has signed an MOU with SASOL to place that in the IDZ. The unique part of this agreement is carbon capture to produce more sustainable aviation fuel and other derivatives. The IDZ must be open to this and well resourced and the entire government must be committed to support this. However, the IDZ sustainability is unclear because it does not have an inter-governmental agreement with TNPA. There has been lacklustre cross-departmental alignment and with SOEs. Then secondly there is the lack of port infrastructure. We must focus on what our own line represents and divert the tenant pipeline. She thanked the SBIDZ team who had worked tirelessly and innovatively. There was unanimous consensus from the Saldanha Bay Municipal Council to swap land to unlock land required to build a road for biodiversity offsets. SBIDZ is clear on what is needed on the way forward. It has been quite a journey over the past two years.
Mr Mackenzie asked where Saldanha Bay IDZ is going. How can the potential be unlocked to avoid the stagnation there – he did not know if it is Transnet or the municipality? There was no drive to get the area developed. How can the inter-governmental forum be resuscitated?
The SBIDZ response was that 96% of iron ore goes to Saldanha. Manganese is the main export market. The local impact on the economy is zero which is why there are socio-economic issues in Saldanha, but this has improved with the IDZ.
Ms Nkondlo asked about the province's approach to consolidate infrastructure activities to leverage economic growth. Is Atlantis SEZ part of the thinking on infrastructure related activities? What is the agility of inter-governmental relations? The political environment is very interesting which impacts agility and state owned entities. Post COVID how agile can SBIDZ be as things seem to be stuck? We need to look at the type of political leadership we have and if this relates to a pre-COVID type of governance. She referred to page 47 and the underspending on the Administration Programme. She was concerned about the set-up being a hostile arrangement. We must do better on Board gender diversity. She asked about the underspending and wanted context on the cause of this.
The SBIDZ response was it was all about collaboration and partnership. SBIDZ wants to work with national government on its issues to ensure that there is synergy to leverage assets in the interests of economic growth and job creation. We are part of the infrastructure refresh programme and this was about network industries which are infrastructure leads. We have a close partnership with these entities. The market fluctuates over time, but transport of goods across the world is via sea vessels. South Africa can capitalize on this. The agility of intergovernmental relations means there is now one team and channel of communication. We simply look at what must happen for development and what the implications of this are. The agreement in place is discussed with shareholders. The 2024 elections coming up must also be bound by whatever is agreed now. The SBIDZ Board representivity should hopefully change and we are working on this. Underspending was due to time differences and would be spent in the following financial year.
Mr Van der Westhuizen said what was needed is huge investment in infrastructure. Could there be investment from government and the private sector such as mining groups? To what extent does Boegoebaai in the Northern Cape threaten the prospects of Saldanha? Is there a master plan for what is needed for future investments? Can investment funding be secured for this?
The SBIDZ response was that Boegoebaai is not threatening as each port serves a particular functional area. The problem is not TNPA plans, but rather it executing the plan.
The Chairperson referred to page 8 on the R21 billion pipeline. What steps are in place to secure this and what steps are being taken to reduce dependence on the state? An entity must get to a point where it is self-regulating. She asked what the SBIDZ role was in the Integrated Operating Model on page 9. There was a lack of upgrading of port structure and asked for an update. Rental income decreased and she wanted to know what the current state of this was. What are the tax incentives for local and foreign businesses to invest in the area?
The SBIDZ response was that half of the pipeline depended on vessel traffic. Infrastructure needed to be in place. We must do a marine environmental structure report to assess infrastructure. A reflection process was done to adjust the operational model based on revenue flows. SASOL and ArcelorMittal reached an agreement yesterday and an MOU was signed with SASOL to do a feasibility study to locate the hydrogen plant within the SEZ. One cannot provide timelines as there is a lot of flux in geopolitics. The drive to get off Russian gas is spurring a lot of investment in technology development to make producing green hydrogen more cost competitive.
The technology and IP SASOL has allowed it to be a bit more nimble than others in the space. We are focusing on our own land. The entity should be able to generate enough revenue to sustain itself. Tax incentives have been extended and this comes from the customs control area. 70% of the SEZ footprint means you can import without incurring VAT as a freeport. This is predominantly asked for by foreign investors. If a company places their own top structures, there would be a 10% depreciation value which is fixed. There is an employment tax incentive which has no age limitation in the SEZ. On the ease of doing business holistically, reducing red tape can be a better incentive than tax incentives due to sunset clauses. Efficiency gains can in some way become a monetary saving.
The Chairperson asked the SBIDZ to write to Mr Bester in answer to his earlier questions..
Wesgro Annual Report 2021/22
Wesgro Board Chairperson, Mr David Green, said that Wesgro was an interface between the public and private sector. COVID seriously impacted all sectors and any investment. There had also been a number of staff changes at Wesgro, but it has made good progress.
Ms Ronel Stander, Wesgro CEO, said Wesgro was tracking well its audit action plan and there is an entire review of policies across the agency. The focus has been on supply chain and asset management. There has been exceptional support from DEDAT and the Auditor General to turn around Wesgro performance.
Mr Mackenzie said he would submit some questions in writing. He referred to page 10 on its future plans which he said should be shared with the Committee.
Ms Nkondlo asked for an explanation of priority areas for the changes anticipated in organisation. This relates to the “how” instead of the “what”. What is the theory of change being considered and would this affect the organogram? She asked why board member, Ms Mpumi Dweba, resigned in October 2021?
The Chairperson said anything not responded to should be submitted in writing by Wesgro.
Mr Van der Westhuizen noted some projects were highlight vulnerable to external factors. The cruise ship industry was incredibly affected by COVID. He asked why certain fields such as healthcare was prioritized. The Western Cape was doing well with High Tech in establishing ICT hubs. Wesgro has also focused on call centres in the Western Cape. What is the thinking on this and what is the most important repositioning that will be seen in the future?
Mr Green replied that the qualified audit report related to a technicality on depreciation of computer and office equipment which amounted to less than R1 million. It will be ensured that a qualified audit does not reoccur. Wesgro asks for applications, but receives few from females. Wesgro will target increasing diversity on its Board. Ms Dweba was promoted from Cape Town Port Manager to Durban Port and thus could not serve on the Board.
Ms Stander replied that the “why” was to create a regional economy. It should be an inclusive economy which creates jobs. Wesgro also saw two catalytic trends underpinning everything across the Western Cape economy which was the green economy and digitalisation. All investors wanted to invest in the green economy, but we were not sufficiently powered to deal with this at the time. Looking at agriculture, it is impacted by the digital and the green transition. Wesgro ensures its focus is on what is required in order to be competitive. 95% of all wine exported from South Africa is from the Western Cape and it was important for the agriculture sector. Recently Wesgro has appointed someone to deal with opportunities in the EU Green Deal in relation to Europe and big export markets. There has been a strong focus on government agencies and entities and mechanisms are in place to ensure engagement with business.
Business is where the jobs will be created over the long term and we have systematic engagements in place. This has been a cross-government approach to engage with the private sector to create investor confidence. Africa has a big market and our trade performance was not impacted that much as Africa was open hence there is a focus on Africa. There is a Trade Services Desk to identify what the Western Cape is exporting. The exports are predominantly in ICT and the green economy. We need to create tech hubs in the Western Cape to design solutions for global exports. Wesgro leverages its unique position and works with the public and private sector and has insight into future economic opportunities from investors. This is how Wesgro knows what it needs to think about such as solar and green hydrogen. The theory of change relates to the fact that there are existing sectors that have been impacted by ICT and green and we know to unlock value in the economy, we must focus on energy, water, human capital, safety and access to the market. Wesgro works off the basis that the Western Cape economy performs well.
It has visionary leadership and its alignment works across the different spheres of government. There are five aspects which is to attract foreign investment and engage with consuls general and embassies as well as international business missions. Wesgro must constantly be responsive to what is happening. The V&A Waterfront and Investec are funders and Air Access funding has a direct correlation with economic growth. We have certainly seen the opening up of the US market through Air Access which leads the recovery of the tourism space. We expect more than 90% of recovery in tourism in the Western Cape. There are nine new cities and four new airlines that have air access to Cape Town. We have the facility and capability for the cruise industry. What is important about the cruise industry is to develop products so those based outside of Cape Town can also benefit from this.
The Chairperson congratulated Wesgro’s Air Access Team on the awards they had won.
[The Committee discussed its internal business but this was not included on the YouTube stream].
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