Game-changing public-sector interventions to stimulate the economy


The recent approval of the 30-year Aerotopolis master plan will bring much needed jobs for the Gauteng province.

The City of Ekurhuleni at its council meeting at the end of October approved the master plan which will pave the way for economic impact that is projected at R8.1 billion per annum.

Ekurhuleni Mayor Mzwadile Masina said the Aerotropolis, which is located near the renowned OR Tambo International Airport, is envisaged to be a game-changing intervention that would facilitate spatial, economic and social transformation.

Using labour intensive scenarios, the Aerotropolis promises massive job creation, set to change the landscape of joblessness in the city and the Gauteng province.

The master plan, the Mayor said, has been developed to identify projects in sectors such as retail, aerospace, advanced manufacturing, logistics and distribution, research and development, health and life sciences to be used enablers of economic turnaround plan.

Spokesperson for the municipality, Themba Radebe, said the plan has been in the pipeline for about five years.

The City of Ekurhuleni, the Gauteng Provincial Government and the Airports Company South Africa have embarked on the development of Ekurhuleni Aerotropolis.

“This programme is a deliberate growth trajectory that aims to reposition and enhance the value proposition of the Gauteng City Region, with a particular emphasis of the Ekurhuleni Regional Economy as the footprint of the first Aerotropolis in the African continent,” said Mayor Masina.

The Aerotropolis, which is the first on the African continent, leverages the presence of the airport which handles 19 million passengers every year and has the capacity for 60 million passengers. OR Tambo International Airport also handles 83% of all air cargo movements, thus playing a critical economic role for South Africa, Gauteng and Ekurhuleni.

“The OR Tambo International Airport is in a good position to accelerate its logistic and air cargo activities regionally. The airport is already a gateway for the transit of high value time sensitive products, such as electronic equipment, as well as textiles and footwear for nearby countries,” the Mayor said.

At the centre of the master plan is to redesign the city’s layout, infrastructure and economy to be centred on a major airport. Masina said that the critical road infrastructure networks are being prioritised to unlock the footprint of the Aerotropolis to enable mobility, integration and densification.

“This through exploring ways of leveraging the economic opportunities created from having the OR Tambo International Airport located in the city to position the city to become a destination for investors seeking to relocate their operations.”

When coming to funding, the Mayor said, the project requires a multi-layered approach that is capable of leveraging on the financial capabilities of the private and public sector.

“The funding plan requires strategic partnerships between all stakeholders, including government, development finance institutions, property owners, developers and investors, research and development agencies, institute of higher learning, external funders and underwriters through a systematic and coordinated integrated development planning process in order to deliver the strategic objectives of the Aerotropolis.”

Expanding the knowledge economy

Rail parastatal Transnet says its research centre will contribute to job creation and the expansion of the country’s knowledge economy.

The State-owned rail, port and pipeline company on Monday launched the Matlafatˇsto Centre, a hub dedicated to increasing the competitiveness, capacity and capability of Small, Medium and Micro-sized Enterprises (SMMEs) through skills transfer and access to research and development facilities.

“We also aim to empower black-owned and black-managed enterprises by providing financial support,” Transnet Group Chief Executive Siyabonga Gama said.

He was speaking on Monday during the launch of the Transnet Matlafatˇso Centre, which the state owned entity is running in partnership with the University of the Witwatersrand. The centre is located at Wits University.

To date, R19.4 million has been spent on the centre, which will use innovation and research to promote high value enterprise development. Transnet will spend about R62 million on the centre over a five-year period.

“We know that a lot of people face difficulties and challenges when they are trying to find jobs but here we are… (creating) entrepreneurs who can create jobs, people who can grow and contribute the economy, which is important,” Gama said.

Transnet is hoping that its partnership with Wits will lead to new ideas, incubations and inventions, which can be commercialised.

“The model we are unveiling today is one that creates a fulcrum for research and innovation initiatives. Once it has matured, Transnet will roll it out nationally in a structured and well-coordinated fashion to reach all the communities of our country,” Gama said.

Wits Deputy Vice-Chancellor Professor Andrew Crouch said the university has positioned itself as a research intensive institution because it believes that through research and innovation, it will drive technology and the future.

The Transnet Matlafatˇso Centre is an example of one of the centres that has been established to introduce innovation in the curriculum and to the broader public.

Crouch said the country needs to find innovative solutions to address the challenges of the 21st first century such as artificial intelligence, robotics, big data, poverty and inequality.

“Wits is tackling these challenges head on. We are looking at trying to resolve these challenges with innovative ways going forward.

“We also have a teaching and learning plan because teaching in the classical sense has changed. We have to embrace technology and make sure that the technology becomes an enabler to significantly increase our access to higher education,” Crouch said.

The university will soon be launching two online programmes in an attempt to make education more accessible.

Public Enterprises Minister Lynne Brown said she was excited about the potential of the Transnet Matlafatˇso Centre.

“Increasing the competitiveness and capacities of black-owned and managed SMMEs to take their place in the Transnet supply chain – and those of other large companies – is exactly what is needed to spread the wealth these companies generate and to change peoples’ lives,” Minister Brown said.

She said Transnet recently released a set of financial results for the six-month period ending in September, showing a 13.8% increase in revenue earnings.

“These are good results achieved in a very difficult economic environment. They are the outcome of improved operational performance by Transnet – on the back of practical cost-cutting measures such as drastically reducing requirements for overtime work – coupled with increases in mineral production and consumer demand.

“Best of all, the results were not achieved at the expense of developing skills and infrastructure that our nation profoundly needs, by shedding jobs that the nation can ill-afford to shed, or by decelerating Transnet’s expansion into Africa,” Minister Brown said.

Driving job creation

President Jacob Zuma has reiterated government’s commitment to investing in infrastructure as a means of stimulating growth and creating jobs.

The President was fielding questions in the National Assembly in November.

“Such spending is the equivalent of planting the seeds that will grow the economy. Our unwavering commitment to infrastructure development was strongly demonstrated during the recent Medium Term Budget Policy Statement, when the Minister of Finance announced that R948 billion will be spent on infrastructure over the next three years.

“This will certainly result in further job creation and stimulation of economic growth.”

ANC MP Pinky Kekana had asked how the Presidency, through the Presidential Infrastructure Co-ordinating Commission (PICC), intended to use infrastructure development to stimulate economic growth and create jobs.

The President said the increased investment in infrastructure in the country in recent years has served as an economic boost during the period when the economy was faced with enormous pressures.

He said when the commodity boom turned and mineral demand decreased a few years ago, it directly impacted on a number of mineral-exporting countries.

He said in South Africa, as a result of the additional infrastructure investment, the economy has maintained growth, albeit at modest levels, until this year.

“Earlier this year, the economy went into a technical recession but recovered in the last quarter. The direct impact of new infrastructure spend has been considerable. It has been estimated that the multiplier effect has been R268 billion in the economy and this is associated with more than 700 000 jobs that are sustained in the economy.”

He said the establishment of the PICC has yielded positive results and enables government to keep track of infrastructure spending and eliminate bottlenecks in the implementation of projects.

“The new market conditions have led to some State-owned companies reducing their new capital spending. This matter is now receiving attention, as we need to ensure that the combination of public and private sector spending on infrastructure is stepped up,” President Zuma said.

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