West Cape News

Strong opposition from sectors of the West Coast community to the marketing of Saldanha Bay as an Industrial Development Zone has emerged following “overblown” media reports of R83 billion of investment and 40 000 jobs over the next 20 years.

Additionally, the Saldanha Bay Municipality has spent R1.4 million on marketing Saldanha Bay as an IDZ which does not yet exist.

The positioning of the area as an IDZ is still subject to feasibility studies being conducted by the Department of Trade and Industry (DTI) and the Provincial Department of Economic Development.

But municipal employee Shane Cordom, in the position of manager of the IDZ, said the municipal council had “committed themselves to the development of industrial development and further committed themselves to pursue investors to come to our area”.

“Council has spent R1.4 million on the development of industrial development. This money has been spent on salaries, stakeholder management, professional fees, international engagements, etc,” said Cordom.

Yet there is no IDZ as yet. The feasibility study funded by both the DTI and province – to the tune of R9 million – is being managed by WESGRO, the investment and trade promotion agency of the Western Cape.

The feasibility study results are due out in March 2011.

Convenor of the Langebaan Action Group and Langebaan Ratepayers and Residents Association, Johan Ackron, who is a development economist at Stellenbosch University School of Public Management and Planning, said media reports of R83 billion in investment and the creation of up to 80 000 jobs were “over-blown”.

“(These) are at best premature with some potential reputational risk to the region,” he said.

Nigel Gwynne Evans, Director for Manufacture and Development of the Department of Economic Development, agreed that media reports “are creating expectations which are not in the best interests of development”.

Gwynne Evans, whose department is driving the feasibility study, said: “at this point, as provincial government, we have not definitely decided if it will be an IDZ.”

Ackron said there was concern that “speculation” prior to the completion of the feasibility study would be detrimental. “It should not allow itself, for the want of measured good judgement, to become merely another costly and sensational development failure.”

Of concern was also the expenditure of R1.4 million by the municipality over 12 months to May 2010 to essentially market a non-existent IDZ.

The economic benefits of IDZs were also questionable.

He said IDZs were associated with little benefit for the local population as many of the positions would be filled by management and skilled labour from outside the community.

“In the order of 71 percent of the labour force in the West Coast district have incomplete secondary education or less, so this is a real risk for the West Coast where the potential for large scale direct absorption of local labour in more skilled jobs in relatively more sophisticated industries could be limited.”

Coega, the first region to be declared an IDZ in South Africa in 2001, had similar marketing strategies as Saldanha Bay. “Their (Coega’s) marketing agency has declared it the best thing for the African economy-even before it started,” said Professor Stephen Hosking. environmental economics and applied microeconomic research specialist at the Nelson Mandela Metropolitan University.

“I do not know anything about the motivation and rationale for SB (Saldanha Bay) IDZ. Presumably the two things they aim for are the same as Coega IDZ aimed for: mainly lots of extra national government funding, including special deals and subsidies, with few questions asked about or returns expected on their expenditure – and jobs to match. And secondarily, a fast-tracking process for prospective industrial development proposals.”

Hosking said whether or not the Coega IDZ has been successful depends on perspective. “The tax payer assessment has yet to be done.”

Environmental concerns have also been on the priority list of environmentalists who are concerned that if the IDZ in Saldanha Bay is not planned properly, it would lead to irreparable damage to the Langebaan lagoon linked to the bay. The lagoon is on the Ramsar list as an internationally important wetland.

But Cordom said investment in the area was needed and the municipality was not only marketing Saldanha Bay as an IDZ but as an area for investment.

“If you look at all the IDZs in our country you will note that the municipalities initiated and partly funded the IDZs…Saldanha Bay has a 23 percent unemployment rate, so how do we address this? We need to create an environment in which people can invest,” he said. – Fadela Slamdien, West Cape News