FBDM LED Strategy Review 2014/15
FRANCES BAARD DISTRICT MUNICIPALITY
COMPANY PROFILE COMPANY
THE REVIEW OF THE FBDM DISTRICT LOCAL ECONOMIC DEVELOPMENT STRATEGY
1 | P a g e © FBDM LED Strategy Review 2014/15 CONTACT DETAILS
Bopa-Lesedi
Anneke Kruger
PO Box 1026 Kimberley 8300
Tel.: +27 53 861 2929 Cell: +27 82 926 0124 E-mail: [email protected]
2 | P a g e © FBDM LED Strategy Review 2014/15 CONTENTS
1. INTRODUCTION ...... 8
1.1. PROJECT BACKGROUND ...... 8
1.2. PROJECT OBJECTIVES ...... 8
1.3. THE CONCEPT OF LED ...... 9
2. POLICY REVIEW ...... 10
2.1. INTRODUCTION ...... 10
2.2. NATIONAL POLICY REVIEW ...... 11
2.2.1. THE CONSTITUTION...... 11
2.2.2. THE WHITE PAPER ON LOCAL GOVERNMENT ...... 11
2.2.3. THE MUNICIPAL SYSTEMS AND MUNICIPAL STRUCTURES ACT, ACT 32 OF 2000 ...... 12
2.2.4. THE MUNICIPAL FINANCE MANAGEMENT ACT, ACT 56 OF 2003 ...... 13
2.2.5. THE INTERGOVERNMENTAL RELATIONS FRAMEWORK ACT, ACT 13 OF 2005 ...... 14
2.2.6. BROAD BASED BLACK ECONOMIC EMPOWERMENT ACT, ACT 53 OF 2003 ...... 14
2.2.7. THE NATIONAL LED FRAMEWORK FOR RSA ...... 15
2.2.8. NATIONAL DEVELOPMENT PLAN ...... 16
2.2.9. NATIONAL SPATIAL DEVELOPMENT PERSPECTIVE (NSDP), 2006 ...... 16
2.2.10. INTEGRATED SUSTAINABLE RURAL DEVELOPMENT STRATEGY ...... 16
2.2.11. REGIONAL INDUSTRIAL DEVELOPMENT STRATEGY (RIDS) ...... 17
2.2.12. TOURISM GROWTH STRATEGY ...... 18
2.2.13. NEW GROWTH PATH, 2010 ...... 18
2.2.14. THE INDUSTRIAL POLICY ACTION PLAN, 2013/14-2015/16 ...... 19
2.2.15. INDUSTRIAL POLICY ACTION PLAN (IPAP2), 2010/11 ...... 20
2.3. PROVINCIAL POLICY REVIEW ...... 22
2.3.1. NORTHERN CAPE PROVINCIAL GROWTH AND DEVELOPMENT STRATEGY (NCPGDS) 2004- 2014 . 22
2.3.2. NORTHERN CAPE PROVINCIAL SPATIAL DEVELOPMENT STRATEGY ...... 23
2.3.3. NORTHERN CAPE LOCAL ECONOMIC DEVELOPMENT STRATEGY ...... 23
2.3.4. NORTHERN CAPE AGRICULTURE & AGRO-PROCESSING SECTOR DEVELOPMENT STRATEGY ...... 24
2.3.5. NORTHERN CAPE PROVINCE MINERAL SECTOR DEVELOPMENT STRATEGY ...... 25
2.4. DISTRICT POLICY REVIEW ...... 26
2.4.1. INTEGRATED DEVELOPMENT FRAMEWORK OF THE FRANCES BAARD MUNICIPALITY ...... 26
2.4.2. FRANCES BAARD GROWTH AND DEVELOPMENT STRATEGY ...... 26
3 | P a g e © FBDM LED Strategy Review 2014/15
2.4.3. FRANCES BAARD DISTRICT MUNICIPALITY CONSOLIDATED LOCAL ECONOMIC DEVELOPMENT STRATEGY ...... 27
2.4.4. FRANCES BAARD SPATIAL DEVELOPMENT FRAMEWORK ...... 28
3. SITUATIONAL ANALYSIS ...... 29
3.1. CURRENT STATE OF FRANCES BAARD...... 30
3.2. POPULATION DISTRIBUTION ...... 35
3.2.1. POPULATION GROWTH ...... 35
3.3. HOUSEHOLD DISTRIBUTION ...... 36
3.4. ECONOMIC PROFILE ...... 36
3.4.1. GROSS DOMESTIC PRODUCT ...... 37
3.4.2. HOUSEHOLD INCOME ...... 40
3.4.3. UNEMPLOYMENT ...... 41
3.4.4. EMPLOYMENT ...... 42
3.4.5. SKILLS LEVEL ...... 44
3.4.6. PRODUCTION PROFILE ...... 45
3.4.7. LOCATION QUOTIENT GVA ...... 46
3.4.8. TRADE PROFILE ...... 47
4. OTHER IDENTIFIED PROJECTS WITHIN THE DISTRICT ...... 49
5. INSTITUTIONAL ANALYSIS ...... 55
5.1. INTRODUCTION ...... 55
5.2. OUTCOMES OF THE ASSESSMENTS ...... 56
5.2.1. ORGANOGRAMS AND MANAGEMENT...... 56
5.3. CONCLUSION AND WAY-FORWARD ...... 63
6. OPPORTUNITY ANALYSIS ...... 64
6.1. BACKGROUND ...... 64
6.2. SWOT ANALYSIS ...... 65
6.3. POTENTIAL ANALYSIS METHODOLOGY ...... 66
6.4. SECTOR OPPORTUNITES ...... 68
6.4.1. AGRICULTURE SECTOR ...... 68
6.4.2. MINING ...... 73
6.4.3. MANUFACTURING ...... 77
6.4.4. SERVICE SECTOR ...... 82
6.4.5. TOURISM ...... 84
6.5. CONCLUSION ...... 88
4 | P a g e © FBDM LED Strategy Review 2014/15
7. PROJECT IDENTIFICATION ...... 89
7.1. PROJECT PRIORITISATION CRITERIA ...... 89
7.2. LED PILLARS AND PROGRAMMES ...... 90
7.3. PRIORITISED PROJECTS ...... 92
8. IMPLEMENTATION GUIDELINES ...... 94
8.1. ROLES AND RESPONSIBILITIES OF THE VARIOUS STAKEHOLDERS ...... 94
8.2. STRATEGY IMPLEMENTATION GUIDELINES ...... 96
8.2.1. IMPLEMENTING AGENT OF PROGRAMMES AND PROJECTS ...... 96
8.2.2. SUPPORT AGENT TO IMPLEMENTING AGENTS ...... 97
8.3. APPLICATION GUIDELINES ...... 98
9. STRATEGIC ALIGNMENT AND INSTITUTIONAL FRAMEWORK ...... 100
9.1. MARKETING AND LED PROMOTION ...... 100
9.2. INTEGRATED PROGRAMMING OF PROJECTS AND ACTION PLAN ...... 102
9.3. ACTION PLAN FOR THE NEXT 5 YEARS ...... 103
10. MONITORING AND EVALUATION FRAMEWORK ...... 108
11. CONCLUSION ...... 110
5 | P a g e © FBDM LED Strategy Review 2014/15
LIST OF TABLES
TABLE 1: HOUSEHOLD SIZE ...... 36
TABLE 2 : HOUSEHOLD INCOME ...... 41
TABLE 3: EMPLOYMENT BY SECTOR (% CONTRIBUTION) FOR LM'S ...... 44
TABLE 4: GVA BY SECTOR ...... 45
TABLE 5: GVA ...... 47
TABLE 6: LED PROJECTS ...... 49
TABLE 7: IDP PROJECTS ...... 50
TABLE 8: DGDS PROJECTS ...... 53
TABLE 9: DEVELOPMENT POTENTIAL – AGRICULTURE SECTOR ...... 69
TABLE 10: OPPORTUNITIES – AGRICULTURE SECTOR ...... 71
TABLE 11: DEVELOPMENT POTENTIAL – MINING SECTOR ...... 75
TABLE 12: OPPORTUNITIES – MINING SECTOR ...... 76
TABLE 13: DEVELOPMENT POTENTIAL – MANUFACTURING SECTOR ...... 79
TABLE 14: OPPORTUNITIES – MANUFACTURING SECTOR ...... 80
TABLE 15: DEVELOPMENT POTENTIAL – SERVICE SECTOR ...... 82
TABLE 16: OPPORTUNITIES – SERVICE SECTOR ...... 83
TABLE 17: DEVELOPMENT POTENTIAL – TOURISM...... 86
TABLE 18: OPPORTUNITIES - TOURISM...... 87
TABLE 19: PILLARS AND PROGRAMMES ...... 90
TABLE 20: PRIORITISED PROJECTS ...... 92
TABLE 21: ROLES AND RESPONSIBILITIES ...... 94
TABLE 22: 5 YEAR ACTION PLAN ...... 104
LIST OF GRAPHS
GRAPH 1: POPULATION GROWTH...... 35
GRAPH 2: GDP OF FRANCES BAARD ...... 38
GRAPH 3: SECTOR GROWTH ...... 38
GRAPH 4: GVA PER SECTOR ...... 40
GRAPH 5: UNEMPLOYMENT RATE ...... 42
GRAPH 6: EMPLOYMENT STATUS FBDM ...... 43
GRAPH 7: EMPLOYMENT BY SECTOR (% CONTRIBUTION) ...... 43
6 | P a g e © FBDM LED Strategy Review 2014/15
GRAPH 8: SKILLS LEVEL ...... 45
GRAPH 9: IMPORT DESTINATIONS AS % OF TOTAL ...... 48
GRAPH 10: EXPORT DESTINATIONS AS % OF TOTAL ...... 48
GRAPH 11: DEDICATED LED OFFICIALS ...... 56
GRAPH 12: LED PLACEMENT ...... 57
GRAPH 13: LED REPRESENTATION ...... 57
GRAPH 14: LED COMMITTEE ...... 58
GRAPH 15: LED STRATEGY DEVELOPMENT ...... 59
GRAPH 16: LED AS PART OF THE IDP CONSULTATION ...... 59
GRAPH 17: LED LOCAL FORUMS ...... 60
GRAPH 18: ALIGNMENT OF LED ...... 61
GRAPH 19: KEY SECTORS IDENTIFICATION ...... 61
GRAPH 20: LED IMPLEMENTATION ACTION PLAN ...... 62
GRAPH 21: MONITORING AND EVALUATION SCHEDULE ...... 63
LIST OF MAPS
MAP 1: AGRICULTURAL POTENTIAL...... 69
MAP 2: MINING POTENTIAL ...... 74
MAP 3: MANUFACTURING SECTOR ...... 78
MAP 4: TOURISM ...... 86
7 | P a g e © FBDM LED Strategy Review 2014/15 1. INTRODUCTION
1.1. PROJECT BACKGROUND
The Frances Baard District Municipality embarked on a process of the review of its Local Economic Development Strategy. The fundamental purpose of this project is to ensure that Frances Baard District Municipality has a credible Local Economic Development Strategy that is practical and implementable. As part of the process of identifying the development methodology, a thorough policy analysis was proposed. This policy analysis process seeks to ensure that there is a common understanding of all new pieces of legislation that have been introduced and how they impact on the project.
Furthermore this analysis seeks to ensure that the outcomes of the Local Economic Development Strategy are in line with most major economic development initiatives from all spheres of government. .
1.2. PROJECT OBJECTIVES
In summary the goal of this study is to:
“formulate a Local Economic Development Strategy based on the identified development needs, opportunities, competitive and comparative advantages to inform and guide Frances Baard District Municipality and its local municipalities to facilitate development, unlock economic development potential of the area, encourage private sector investment and create a conducive environment for enterprise development and job opportunities for the community.”
Given the above-mentioned goal of the exercise, the following project objectives have been identified:
Conducting an in-depth analysis of the real (but underlying) development opportunities in the key economic sectors in the study area; Identifying practical sectoral programmes that could be used as basis for pro- active economic development initiatives; Applying a nodal development philosophy to address rural specific economic problems such as isolation from markets, dispersed service delivery, etc. Identifying financing sources and investment options that could enhance practical implementation; Emphasising local job creation, alleviation of poverty and redistribution of opportunities and wealth; Focusing explicitly on opportunities for small enterprise and cooperatives development in all economic sectors; Promoting the creation of an enabling environment for economic development by addressing human resource development (labour market) and an
8 | P a g e © FBDM LED Strategy Review 2014/15
appropriate institutional framework as integral components of programmes and projects; Achieving skills transfer as part of the interaction with the local municipality and key stakeholders by utilising known approaches, such as counterpart training; To apply an objective prioritisation process for project and programme selection; Ensuring that the strategy aligns with and adds value to the existing policies and strategies such as the IDP’s and Spatial Development Framework, as well as, private sector initiatives.
1.3. THE CONCEPT OF LED
There are quite a number of definitions that have been adopted globally when it comes to defining what Local Economic Development (LED) is, but in South Africa the World Bank adaptation has been adopted and is as follows:
“Local Economic Development (LED) is the process by which public, business, and nongovernmental sector partners work collectively to create better conditions for economic growth and employment generation with the objective of building up an economic capacity of a local area to improve its economic future and the quality of life for all” Local Economic Development is an ongoing process, rather than a single project or a series of steps to follow. It involves identifying and using local resources, ideas and skills to stimulate economic growth and development. The aim of LED is to create enterprise development and employment opportunities for local residents, alleviate poverty and, redistribute resources and opportunities to the benefit of all local residents. In order for Local Economic Development (LED) to be effective, a community (local, ordinary people, entrepreneurs and local government) with the support of knowledgeable individuals and experts needs to identify and consider its own economic strengths, weaknesses, opportunities and threats and agree on a shared strategy.
LED is characterised by the following objectives:
Creating an enabling environment for enterprise development; Establishing a job-creating economic growth path; Embarking upon sustainable rural development and urban renewal; and Bringing the poor and disadvantaged to the centre of development
9 | P a g e © FBDM LED Strategy Review 2014/15 2. POLICY REVIEW
2.1. INTRODUCTION
Local Economic Development (LED) strategies are informed and are done within certain parameters of national, provincial and local government policies, programmes and initiatives. In this section the analysis on the broad legislative framework, within which, Local Economic Development on a local level is conducted.
The policies and programmes discussed are by no means the only legislative frameworks to be considered, but gives a general indication of legislation that is linked to matters of employment, poverty eradication and economic growth. Taking these frameworks into consideration when formulating and implementing Local Economic Development initiatives will ensure wider government support and easier access to support instrument from government and donor organisations.
Policies need to interact with one another. The following diagram is an illustration of these interactions:
FIGURE 1: POLICY NEEDS
ACCELERATED & SHARED GROWTH INITIATIVE FOR SOUTH AFRICA (AsgiSA)
National Spatial Development National LED Framework Framework
Provincial Growth and Provincial Spatial Development Plan Development Framework
Integrated Spatial Development District Growth and Development Plan Framework Development Plan
LOCAL ECONOMIC DEVELOPMENT (LED)
10 | P a g e © FBDM LED Strategy Review 2014/15
The most relevant policies and legislation to the LED process are:
The Constitution Act 108 of 1996; The White Paper on Local Government, 2000; The Municipal Systems and Municipal Structures Act, Act 32 of 2000; The Municipal Finance Management Act, Act no.56 of 2003); The Intergovernmental Relations Framework Act, Act no 13 of 2005 Broad Based Black Economic Empowerment Act, Act 53 of 2003; The National LED Framework for RSA; National Spatial Development Perspective (NSDP) 2006; National Local Economic Development Framework, 2006; National Development Plan, 2013; National Strategy for the Development and Promotion of Small Businesses in South Africa, 1995. Integrated Sustainable Rural Development Strategy 2000; Regional Industrial Development Strategy (RIDS), 2006; Tourism Growth Strategy 2012-2020; New Growth Path, 2010; The Industrial Policy Action Plan (IPAP 1,2&3);
2.2. NATIONAL POLICY REVIEW
2.2.1. THE CONSTITUTION
The Constitution (Act 108 of 1996) is the cornerstone for all legislation and policy- making in South Africa. In particular, chapter 7 defines the role of local government in its community with regard to objectives and duties it must fulfil.
•Frances Baard District Municipality is legally bound to promote social and economic development within its community. This implies that public investment should largely focus on developing the municipal area in terms of local economic development and providing for the basic needs of the community. Thus, it is important that the FBDM provide services, infrastructure provision, Implication community services, educational components and business support to areas that lack these services or in areas where improvements of these services are required.
2.2.2. THE WHITE PAPER ON LOCAL GOVERNMENT
This policy identifies local government’s responsibilities with regard to economic development. This includes promoting their respective localities, SMME’s and providing skills training.
11 | P a g e © FBDM LED Strategy Review 2014/15
•The White Paper has a direct impact on the development, policy formulation and human resource development projects of the local municipality. It emphasises the need and importance of local municipal support to business through training and development of support systems. It is important that FBDM provide the local businesses with the required support structures but also providing the local communities with the required skills in order to obtain job opportunities through the implementation of Training programmes and/or promoting possible training Implication programmes to the local communities. It entrenches the concept of developmental local government and further intensifies the need for cooperative government in to promote socio-economic development across communities.
2.2.3. THE MUNICIPAL SYSTEMS AND MUNICIPAL STRUCTURES ACT, ACT 32 OF 2000
The Municipal Structures Act of 1998 defines types and categories of municipalities, division of functions and powers within municipalities, and the regulation of internal systems.
Alternatively, the Municipal Systems Act of 2000 provides municipalities with guidelines which ‘enable municipalities to move progressively towards the social and economic rising of local communities’ so that basic services may be met.
The Municipal Systems Act (Act 32 of 2000) lists the duties of a municipal council, within its financial and administrative capacity, as follows in Section 4(2):
Exercise the municipality’s executive and legislative authority and use the resources of the municipality in the best interest of the local community. Provide, without favour or prejudice, democratic and accountable government. Encourage the involvement of the local community. Strive to ensure that municipal services are provided to the local community in a financially and environmentally sustainable manner. Consult the local community about o The level, quality, range and impact of municipal services provided by the municipality, either directly or through another service provider; and o The available options for service delivery. Give members of the local community equitable access to the municipal services to which they are entitled. Promote and undertake development in the municipality. Promote gender equality in the exercise of the municipality’s executive and legislative authority. Promote a safe and healthy environment in the municipality.
12 | P a g e © FBDM LED Strategy Review 2014/15
Contribute, together with other organs of state, to the progressive realisation of the fundamental rights contained in sections 24, 25, 26, 27 and 29 of the Constitution.
•According to the Municipal Structures Act, Local municipalities are responsible for the delivery of municipal services. If a given local municipality does not have the requisite capacity to provide municipal services, the FBDM can provide municipal services directly until the local capacity is developed. The Municipal Systems Act legally bounds the FBDM to fulfill its Implication duties and produce an IDP and LED strategy to guide economic development within the FBDM.
2.2.4. THE MUNICIPAL FINANCE MANAGEMENT ACT, ACT 56 OF 2003
The Municipal Finance Management Act (MFMA) aims to modernise budget and financial Management practices in municipalities in order to maximise the capacity of municipalities to deliver services to all their residents, customers and users. It also aims to put in place a sound financial governance framework, by clarifying and separating the roles and responsibilities of the executive mayor or committee, non - executive councillors and officials. The Act empowers the mayor (or executive committee) to provide political leadership by taking responsibility for policy and outcomes, and holds the municipal manager and other senior managers responsible for implementation and outputs. Non - executive councillors are empowered to play a key policy - approval and monitoring role through the municipal council.
The Act aims to enable managers to manage, but to make them more accountable. All these various roles are possible because of the stringent reporting requirements of the Act – the challenge facing all stakeholders is their capacity to use the management information produced in terms of the Act to improve the efficiency and effectiveness of the municipality.
The Act is required by the Constitution, which obligates all three spheres of government to be transparent about their budgets and financial affairs. It also forms an integral part of the broader reform package for local government outlined in the White Paper on Local Government in 1998. The Act must be read together with other local government legislation, particularly the Municipal Systems Act, to ensure alignment of IDPs, budgets, performance systems and governance across municipal entities.
13 | P a g e © FBDM LED Strategy Review 2014/15
•It is important that the FBDM adheres to financial procedures presented in the Act when engaging in financial matters relevant to any LED activities. Implication
2.2.5. THE INTERGOVERNMENTAL RELATIONS FRAMEWORK ACT, ACT 13 OF 2005
The purpose of this Act is to establish a framework for the national government, provincial governments and local governments to promote and facilitate intergovernmental relations. It further seeks to provide for mechanisms and procedures to facilitate the settlement of intergovernmental disputes and to provide for matters connected therewith.
•Frances Baard District Municipality needs to appreciate the existance of the structures and fora, established under the auspices of this piece of legislation. In this regard, particular cognisance needs to be discharged to maximisation of the effect of this strategy through, the Premier's Intergovernmental Forum, the Provincial and District LED Fora, District IGR Fora and all committes and subcommittees consequent thereto. Implication Particular care needs to be exercesized towards intra and inter sphere relations when implementing the strategy.
2.2.6. BROAD BASED BLACK ECONOMIC EMPOWERMENT ACT, ACT 53 OF 2003
To uproot inherited social imbalances, the Broad-Based Black Economic Empowerment Act of 2004 was passed. Here, systematic measures are in place to uplift the previously disadvantaged community. Designated individuals include Africans, Coloureds, Indians, women, workers, the youth, disabled persons and those that live in rural communities.
14 | P a g e © FBDM LED Strategy Review 2014/15
•Frances Baard District Municipality is responsible for addressing the issue of transformation in its community. Therefore, sector strategies and development policies established by the Municipality must be compliant with the BBBEE legislation. Implication
2.2.7. THE NATIONAL LED FRAMEWORK FOR RSA
The Framework is intended to build a shared understanding of LED in South Africa and put into context the role of local economies in the national economy. It seeks to mobilise local people and local resources in an effort to fight poverty. The focus of the Framework is upon:
Improving competitiveness of the 52 District and Metropolitan municipal regions in South Africa by providing an approach to developing local economies with the participation of all relevant stakeholders.
1. Rendering economic growth compatible with social equity and safeguarding the environment. 2. What the state can do to support and reward citizens who organise locally and operate in local level partnerships to engage in greater economic activity, spreading economic activity in an even manner. 3. How the state can be a platform to facilitate the inclusion of all to participate in the economy.
•The Framework sets out the following three key roles which Local Government can play in the LED process: •To provide leadership and direction in policy making. •To administer policy, programmes and projects. •To be the main initiator of economic development programmes through Implication public spending, regulatory powers and their promotion of industrial, small business development, social enterprises and cooperatives.
15 | P a g e © FBDM LED Strategy Review 2014/15 2.2.8. NATIONAL DEVELOPMENT PLAN
The National Development Plan (NDP) offers a long-term perspective. It defines a desired destination and identifies the role different sectors of society need to play in reaching that goal.
•The NDP aims to eliminate poverty and reduce inequality by 2030. According to the plan, South Africa can realise these goals by drawing on the energies of its people, growing an inclusive economy, building capabilities, enhancing the capacity of the state, and promoting Implication leadership and partnerships throughout society.
2.2.9. NATIONAL SPATIAL DEVELOPMENT PERSPECTIVE (NSDP), 2006
The NSDP provides a framework within which to discuss the future development of the National space economy by reflecting the localities of severe deprivation and need of resource potential, of infrastructure endowment and of current and potential economic activity, by describing the key social, economic and natural resource trends and issues shaping the National geography.
•The NSDP states that economic growth should be a pre- requisite for the achievement of other policy objectives, key among which would be poverty alleviation. It further states that efforts to address past and current social inequalities should Implication focus on people not places.
2.2.10. INTEGRATED SUSTAINABLE RURAL DEVELOPMENT STRATEGY
The purpose of the Integrated Sustainable Rural Development Strategy is to enhance the welfare of the poor that inhabit rural areas of South Africa.
16 | P a g e © FBDM LED Strategy Review 2014/15
Municipalities are key players in the implementation of the ISRDS due to their decentralized nature and ability to physically interact with their respective rural communities.
•Frances Baard District Municipality is responsible for transforming local rural areas into economically viable communities. To facilitate positive change, an in depth understanding of local rural areas is required along with an Implication excellent relationship with the local businesses.
2.2.11. REGIONAL INDUSTRIAL DEVELOPMENT STRATEGY (RIDS)
The RIDS presents a comprehensive framework for industrial development in South Africa and builds on the outcomes of the National Spatial Development Perspective (NSDP). The NSDP acknowledges the fact that the landscape of economic development is not equal across all regions in the country.
Echoing the NSDP, the RIDS calls on all regions to build their industrial economies based on local competitive advantages and opportunities. It aims to bridge the first-second economy gap in South Africa based on the spatial development principles of the NSDP.
Such a strategy focuses fundamentally on addressing the key obstacles to the functioning of the economy, primarily through infrastructural interventions which will better enable all regions to access markets and resources.
The strategic objectives may be summarised as follows:
Attempt, as far as possible, to reduce economic disparities between regions, address the needs of both the first and second economies, and narrow the gap between them. Pay particular attention to the needs of those regions which are lagging behind the national norms. Enhance current regional strengths and lead sectors of the economy. Promote sustainable economic growth and employment in provinces and municipalities. Build regional competitive capabilities and firm-level support measures. Enhance regional performance in attracting foreign direct investment.
17 | P a g e © FBDM LED Strategy Review 2014/15
•The RIDS aims to bridge the first and second economy gap. This could also be of value for the Frances Baard District Municipality in order to bridge the gap between the first and second economy. •The RIDS also presents a comprehensive framework for industrial development in South Africa. Industrial development is also needed in the FBDM. Support funds will be launched by the DTI that will support Implication local industrial development projects, which will contribute thus to the industrial development of the FBDM.
2.2.12. TOURISM GROWTH STRATEGY
The Tourism Growth Strategy provides a three year plan (2008- 2010) to boost South Africa’s competiveness in the global tourism and travel market. Through increasing global competitiveness, the tourism industry aims to contribute significantly to AsgiSA’s growth target of 5%.
•Tourism is a ‘major contributor to the local economy’ of the FBDM. Consequently, the FBDM is expected to contribute to the TGS (and ultimately AsgiSA) through developing and expanding its existing market in a way that promotes transformation, distribution and sustainability in the industry. This suggests that a local tourism strategy is essential for boosting economic Implication development in the area.
2.2.13. NEW GROWTH PATH, 2010
The New Growth Plan (NGP) is government’s action towards targeting mass joblessness, poverty and inequality. The growth plan identifies where employment creation is possible with success indicators being jobs, equity growth and environmental outcomes. The short to medium term outcomes are to support labour absorbing activities, especially in infrastructure, agriculture values chain and light manufacturing services. Whilst also promoting Small Micro Enterprises (SMEs), Black Economic Empowerment (BEE), education and skills development.
The NGP aims to create five million jobs by the year 2020 with contributions from various government sectors and private sectors. The job drivers with potential for mass employment creation identified in the growth plan are:
18 | P a g e © FBDM LED Strategy Review 2014/15
Infrastructure for employment and development; infrastructure including energy, transport, water, telecommunication infrastructure and housing Improving job creation in economy sectors; agricultural value chain, agro processing and mining value chain, manufacturing sectors, tourism and certain high level services Seizing potential of new economies; green economy and growing knowledge in this industry Investing in social capital and public services Spatial development, especially in rural development The identified job drivers will influence provinces and localities in a different manner due to different factors, therefore localities must adopt the broad drivers in the NGP to their circumstance and locality.
•The New Growth Path sets out an ambitious programme which will require alignment in terms of the Strategy, to create jobs, through a series of partnerships between the state and the private sector that builds on our strengths in the following areas: •the green economy •agriculture •mining Implication •manufacturing •tourism and other high-level services.
2.2.14. THE INDUSTRIAL POLICY ACTION PLAN, 2013/14-2015/16
The Industrial Policy Action Plan (IPAP) 2013/14 – 2015/16 is Department of Trade and Industry’s (DTI) efforts to continuously build on industrial development and IPAP is the core contributor. IPAP addresses South Africa’s economic challenges through industrial development, identifying key sectors that can generate employment and government lead by the DTI’s investment towards the sectors.
The IPAP contributes to the NGP through identifying sector clusters that can contribute towards job creation in the country.
The identified sector clusters are:
Metal fabrication, capital equipment and transport equipment; Green and energy saving industries; Agro-processing; Automotives, components and medium and heavy commercial vehicles; Plastics, pharmaceuticals and chemicals; Clothing, textiles, leather and footwear; Bio fuels;
19 | P a g e © FBDM LED Strategy Review 2014/15
Forestry, paper, pulp and furniture; Cultural industries, crafts and films; Aquaculture; Business process services; Advance manufacturing; Sawmilling sectorcturing; Donwstream mineral beneficiation; Furniture manufacturing; Upstream oil and gas.
•FBDM needs to ensure that the programmes and projects that emerge from the LED Strategy need to focus on the sectors mentioned above. The design of the strategy needs to be such that the incentives offered in these programmes are accessible Implication as a result.
2.2.15. INDUSTRIAL POLICY ACTION PLAN (IPAP2), 2010/11
IPAP 2 has a direct and sustainable impact on manufacturing productivity in South Africa. The IDC has introduced a funding model for IPAP2 for approximately R50 billion for the next five years for the roll out of plans to support IPAP2. The 2010/2011 Industrial Policy Action Plan or IPAP2, as it has become known, builds on the National Industrial Policy Framework (NIPF) and the 2007/8 IPAP. IPAP2 is a product of extensive collaborative work by the Economic Sectors and Employment Cluster of Ministers.
The 2010/11 – 2012/13 Industrial Policy Action Plan rests on four cornerstones,
1. First, government intends to develop proposals to enhance access to concessional industrial financing for investment in IPAP priorities, and other productive sectors on terms comparable to those of our major trading partners. 2. Government will revise procurement legislation, regulations and practices to enable the designation of large, strategic and repeat or ‘fleet’ procurements in a range of sectors. This will aim to sequentially increase competitive local procurement and supplier development opportunities, minimise ‘leakages’ from the domestic economy, and support meaningful Broad Based Black Economic Empowerment (B-BBEE) in all 3 spheres of government and in SOE’s.
20 | P a g e © FBDM LED Strategy Review 2014/15
3. Government will deploy its trade policies more strategically. This includes intensifying the campaign led by SARS against practices such as, customs fraud, under invoicing, smuggling and illegal imports - all of which profoundly undermine productive capacity and employment in the economy. 4. Anti-competitive practices will be targeted, particularly where these concern intermediate inputs to downstream labour absorbing production as well as consumer goods to low income households.
New areas of focus of industrial policy include:
Metals fabrication, capital and transport equipment, green and energy saving industries and agro processing, will be qualitatively
IPAP2 will build on and broaden interventions in sectors which were identified in the first Industrial Policy Action Plan, namely:
Auto motives and components, medium and heavy vehicles; plastics, pharmaceuticals and chemicals; clothing, textiles, footwear and leather; bio- fuels; forestry, paper, pulp and furniture; cultural industries and tourism and Business Process Services (or Call Centres.)
The third cluster focuses on sectors with the potential to develop long-term advanced capabilities:
Nuclear, advanced materials and aerospace.
It is estimated that the IPAP will result in the creation of 2 477 000 direct and indirect decent jobs over the next ten years. It will diversify and grow exports, improve the trade balance, build long term industrial capability, grow our domestic technology and catalyse skills development.
In terms of local government, it is only the changes to public procurement policy and legislation that will have implications and operations responsibilities. These include:
Identifying the opportunities to improve domestic procurement leveraging across the three spheres. E.g. the $10 mil offset programme. The use of public expenditure to support many of the IPAP sectors Revising the National Industrial Participation Programme (NIPP) and integrate the Competitive Supplier Development Programme (CSDP).
21 | P a g e © FBDM LED Strategy Review 2014/15
•The FBDM must make concerted effort to meet national employment targets set out by the new growth plan. Thus, during policy-making, industry and job creation must at all times be considered in respect to local economic development initiatives and their contribution to the goals of the plan. This is especially relevant for LED projects that are in line with the Growth Plan’s key sector. The IPAP2 has a specific relevance regarding manufacturing activities in the District as well as the Green Economy. These two cluster activities can result in funding Implication opportunities for LED initiatives related to manufacturing, agro- processing and green economy.
2.3. PROVINCIAL POLICY REVIEW
2.3.1. NORTHERN CAPE PROVINCIAL GROWTH AND DEVELOPMENT STRATEGY (NCPGDS) 2004- 2014
The core purpose of the NCPGDS is to enable stakeholders from public, private and para-stated sectors together with labour and civil society to determine a plan for sustainable growth and development of the Northern Cape. The NCPGDS sets to tone for development planning and outlines the strategic planning direction in the Province. The main objectives set by the NCPGDS for development planning in the Province are: 1. Promoting the growth, diversification and transformation of the provincial economy; 2. Poverty reduction through social development; 3. Developing requisite levels of human and social capital; 4. Improving the efficiency and effectiveness of governance and other development institutions; 5. Enhancing infrastructure for economic growth and social development.
22 | P a g e © FBDM LED Strategy Review 2014/15
•The NCPGDS identified the following priority sectors: •Agriculture and Agro-Processing •Mining and Mineral Processing •Manufacturing •Fishing and Mari culture •Tourism •It is necessary for the Frances Baard District Municipality to work in conjunction with the Northern Implication Cape Provincial government to vertically align goals of local IDP’s (and subsequently LED frameworks) with the NCPGDS.
2.3.2. NORTHERN CAPE PROVINCIAL SPATIAL DEVELOPMENT STRATEGY
The Northern Cape Province is still in the process of formulating a Spatial Development Strategy, but as part of the NCPGDS there is Section dedicated to this aspect. It states that the Spatial Development Strategy should not only give effect to national spatial development perspectives, but should also make provision for provincial, district and local development priorities for the space economy in the Northern Cape. This will provide a means to guide strategic decisions regarding the location and distribution of resources in time and geographic space.
•Key issues that will be addressed by the Spatial Development Strategy are Established growth centres, Emerging growth centres, Stagnating small towns, Land Reform areas, Development corridors and Special resource areas. It would be important for the FBDM to be aware of nodes and/or corridors to be developed within the municipal area in order to align the LED Implication initiatives with these nodes and/or corridors.
2.3.3. NORTHERN CAPE LOCAL ECONOMIC DEVELOPMENT STRATEGY
The Northern Cape LED is currently being formulated and is aimed at building a shared understanding of LED in the Province and to put into context the role of local economies in the provincial economy. It seeks to mobilise local people and local resources in an effort to fight poverty.
23 | P a g e © FBDM LED Strategy Review 2014/15
•Although the Northern Cape LED is currently still being formulated it is important that the FBDM align their initiatives with those identified in the Northern Cape LED. This will ensure a coordinated approach to economic growth and development within the FBDM which falls within the Northern Implication Cape Provinces
2.3.4. NORTHERN CAPE AGRICULTURE & AGRO-PROCESSING SECTOR DEVELOPMENT STRATEGY
The NC AAPSDS is one in a series of economic sector development strategies that aims to provide for a more accurate prioritisation of effort and resource allocation by the public sector generally, and provincial government, in particular, in its endeavours to deliver on its mandate to promote the economic development of the Northern Cape province. The NC’s traditional strength is in the production of a wide range of primary commodities. Adding value to the commodities could make a significant contribution to the transformation of agriculture in the province and, by extension, rural and national development.
Agro-processing can increase the viability, profitability and sustainability of production systems through their impact on increasing incomes of primary producers, create employment and foreign exchange earnings, and address the market risks associated with primary agricultural production.
•The FBDM need to align their Agriculture and Agro-Processing initiatives with this Strategy in order to contribute to the better alignment and coordination of the Agriculture and Agro- Processing Sector within the Northern Cape. Implication
24 | P a g e © FBDM LED Strategy Review 2014/15 2.3.5. NORTHERN CAPE PROVINCE MINERAL SECTOR DEVELOPMENT STRATEGY
The Mineral Sector Development Strategy also forms part of the series of economic sector strategies. The Northern Cape Province has very rich mineral deposits and this strategy aims to align the various initiatives in the Northern Cape regarding the Mining Sector. It is important to note that although the Mining contributes largely to the GGP of the Northern Cape, the sector is in decline and as part of this strategy the Northern Cape Province is looking at better job creation opportunities by diversifying the Mining industry.
•The Frances Baard District Municipality have large amounts of minerals in the area, however it would be the responsibility of the FBDM to promote the diversification of the Mining industry in order to provide better job opportunities for the local Implication communities.
The following are Provincial LED initiatives that would have an impact on the FBDM:
Manufacturing Cluster and Centre’s
The Department of Economic Affairs has in an effort to establish manufacturing centres in all 5 districts within the province established a partnership with the Centre for Advanced Manufacturing (CFAM) based at the University of the North West. This is in an effort to facilitate local manufacturing of a range of products (list of 10 products to the value of R100 million) that has been identified. This will give a boost to the economy as this will service the agricultural and mining sector which relies on other provinces for such services.
The project will have four major phases and it is hoped that the project will benefit women, youth and the disabled, approximately 100 jobs will be created from this initiative.
Business Process Outsourcing & Off Shoring Two main centres have been identified as the centres for business process outsourcing and off-shoring. These centres are Sol Plaatje and Ga-Segonyana Municipalities. It is hoped that a total of 350 jobs will be created over the 08/09 and 09/10 financial years. The Northern Cape was part of a delegation that visited
25 | P a g e © FBDM LED Strategy Review 2014/15 the United States and the Netherlands which aimed to brand South Africa as a destination for BPO & O.
2.4. DISTRICT POLICY REVIEW
2.4.1. INTEGRATED DEVELOPMENT FRAMEWORK OF THE FRANCES BAARD MUNICIPALITY
The Frances Baard District Integrated Development Plan is a holistic strategic plan that provides an overview of the development strategies envisaged for the whole district. It provides strategic direction; it coordinates and aligns the initiatives of local municipalities in the district with those of the Provincial Sector Departments. The district Integrated Development Plan mainly focuses on the following aspects:
Socio-economic development – especially economic growth, job creation, and poverty eradication, broad based black economic empowerment and environmental development. Service delivery, with emphasis on the provision of basic services. Governance, specifically as it relates to deepening democracy, thus through the ward committees system, capacity building, etc. It is critical that the strategies adopted in the District IDP are aligned with the principles of NSDP and the objectives of the Northern Cape Provincial Growth and Development Strategy (NCPGDS).
•The IDP addresses the existing needs of the communities in the Frances Baard District, through a framework of sustainability and identified roles and projects for the Frances Baard District Municipality, which includes the Phokwane Municipality, the Magareng Municipality, the Dikgatlong Implication Municipality and the Sol Plaatje Municipality.
2.4.2. FRANCES BAARD GROWTH AND DEVELOPMENT STRATEGY
The FBDM GDS is envisaged as a process of collective planning to improve alignment between spheres of government and other social partners to impact on poverty and accelerated shared growth. The FBDM GDS provides an action plan to meet the development needs of the community. The GDS aims to achieve this through the further development of leading economic sectors namely: Agriculture and Agro-Processing
26 | P a g e © FBDM LED Strategy Review 2014/15
Mining and Mineral Processing Tourism Manufacturing Transport Services SMME Development Institutional Capacity Building
•It is important that the FBDM align these initiatives and those identified within the LED Strategy in order to ensure better development of the FBDM economy as a whole. These priority economic sectors provide an opportunity for focussed Implication development within the FBDM.
2.4.3. FRANCES BAARD DISTRICT MUNICIPALITY CONSOLIDATED LOCAL ECONOMIC DEVELOPMENT STRATEGY
The Consolidated Local Economic Development Strategy was also formulated by Urban-Econ and submitted to the FBDM in 2006. However the strategy was only approved by Council in 2009. In the process of formulating the new LED Strategy Urban-Econ consulted the consolidated document in all processes in order to ensure that the documents are aligned.
•The FBDM needs to assess the impact of the previous LED Strategy and assess the issues that have emerged over the last term of the Strategy and through this process address those issues adequately. Implication
27 | P a g e © FBDM LED Strategy Review 2014/15 2.4.4. FRANCES BAARD SPATIAL DEVELOPMENT FRAMEWORK
The Spatial Development Framework (SDF) of the FBDM provides the District with development directives regarding Economic Development Nodes and Economic Growth Potential of Towns. The SDF makes provision for agro-processing, mining beneficiation, tourism and tertiary education nodes within the FBDM spatial perspective.
•The SDF identifies nodes for specific development activities and it would therefore be the responsibility of the FBDM to align the LED initiatives to these already identified nodes. Implication
It is important that FBDM ensure that the IDP, LED and SDF of the Local Municipalities are aligned to that of the FBDM. It is also important that LED initiatives are incorporated into the IDP’s and SDF’s of each of the Local Municipalities in order to ensure that LED initiatives are supported financially and spatially.
28 | P a g e © FBDM LED Strategy Review 2014/15 3. SITUATIONAL ANALYSIS
The focus of this phase is to collect both Social and Local Economic Development focal data (socio-economic research) and as such get an understanding of the status quo within the municipality. This phase shall further begin a process of developing a municipal profile of the LED situation within Frances Baard. To this extent this phase shall include the conducting of institutional and other related assessments. A number of research data bases shall also be used to arrive at the following:
To provide the current overview of the Frances Baard District economy including sector performances for agriculture, mining, manufacturing, tourism and other sectors. Demand and supply analysis of existing economic activities in the Frances Baard district and the identification of key economic role players and drivers. The LED Unit and its capacity to implement effective LED. The Planning and coordination aspects of LED within the municipality. The various LED related projects, both current and envisaged. The population, migration and human development related data. The major economic development sectors in the area and the growth trends of these sectors (this shall also focus on the impact of the current global economic crisis). Formulation of SWOT analysis including an evaluation of identified strengths and opportunities and analysis of weaknesses and threats. Identification of constraints to growth and development such as, the impact of HIV/AIDS on the demographic profile, exploitation of resource base, international market influences, environment degradation, lack of entrepreneurial skills and poverty. Furthermore, the situational analysis shall include the assessment of the current LED Initiatives and in this context shall use a multi-disciplinary approach towards this evaluation, where the progress of each project is measured, the impact of these projects in terms of jobs, venture creation, skills development, affirmative procurement etc.
The collation of such data has been be based on the various available methodologies such as the development of questionnaires, one-on-one interviews and desk top studies of the various data bases. Following the outcomes of the assessments process Bopa Lesedi has developed a potential analysis which incorporates the following: a. The spatial context of developments across the district. This implies proper maps, including clear indications of critical transport routes, nodes and hubs.
29 | P a g e © FBDM LED Strategy Review 2014/15
b. A clear indication of the economic basis of each of the major towns within the various town of the Frances Baard Municipal Area. c. A longer-run perspective on the relative significance and potential growth of the main economic sectors (with clear indication of significant niches within these sectors). The sectors should include amongst others: Mining. Manufacturing. Tourism, sport, recreation. Financial and business services. Transport. Construction. Public administration and social services (access to education, health, etc.) d. An indication of the relative significance of different types of enterprises, shaping local development, ranging from large multinationals (e.g. mining groups) to informal micro-enterprises (e.g. in tourism, crafts and trade). e. A long-term perspective on population growth, linked to expect inward and outward migration as well as the HIV/Aids factor. f. Some comparison of Frances Baard trends and critical development factors with those characterising other small mining towns. g. The information has to incorporate existing (as summarised in the Inception Report) and envisaged projects/initiatives.
3.1. CURRENT STATE OF FRANCES BAARD
The Northern Cape has a surface area one third the size of SA, yet it is inhabited by only 2, 2% of the country’s population. The Northern Cape Province is the largest province, with an estimated population of 1,096,731 people; which is the smallest share of the South African population (Statistics SA, Midyear population estimates 2011).
Frances Baard District Municipality is one of the five districts in the Northern Cape Province. The District is bordered on the eastern side by the North West and Free State Provinces and accommodates a population of approximately 353, 198 people (Community Survey, 2007)
The District Municipality was named after Frances Baard, a woman who played an important role in the struggle for democracy in South Africa. Frances Baard District Municipality (DM) is one of five district municipalities located in the Northern Cape Province.
30 | P a g e © FBDM LED Strategy Review 2014/15
Frances Baard District Municipality is the most populated district in the province with a 33.4% of the province population distribution. The district comprises of four local municipalities with the population distribution estimated as follows: Magareng (22 000), Dikgatlong (42 000), Phokwane (50 000) and Sol Plaatje (244 000) with the highest population (Quantec Research Data of 2011).
Frances Baard District Municipality is the smallest district in the Northern Cape. However, it accommodates the largest portion of the population of the Province. The municipality is located in the far eastern portion of the province. It shares its northern borders with the North West province and its eastern border with the Free State province. Kimberley, which is where the district municipality is located, is less than 500km away from Johannesburg in the north, and less than 1 000km away from Cape Town in the south and the Port of Durban in the east. It comprises the four local municipalities of Dikgatlong, Magareng, Phokwane and Sol Plaatje.
The Frances Baard District Municipality is a place of wide-open spaces, where golden savannahs stretch as far as the eye can see. It is a place of arid natural beauty, where resilient green cacti and tenacious thorn trees fill the landscape, and bright yellow sunflowers can be seen following the sun’s arc across deep blue skies.
Five gushing rivers divide this landscape: the Vaal, Orange, Modder, Harts and Riet, which give life to the region and its inhabitants.
The history of this region is very much defined by the diamond rush of the 19th century. A shepherd called Swartbooi found a diamond in 1869 that caught the world’s attention. The 83-carat diamond was bought by a collector called Schalk van Niekerk and came to be called The Star of South Africa. Sir Richard Southey, the Colonial Secretary of the Cape declared: “This is the rock upon which the future of South Africa will be built.”
In no time diamond diggers from around the world converged on this region in search of fortune. First the riverbanks of Klipdrift (Barkly West) were scoured and then a new rush of digging began in Kimberley, where the biggest hand-dug excavation in the world was created through sheer determination. Soon Kimberley was the diamond capital of the world, and a bustling metropolis spawned.
To this day, diamonds can still be found near Hopetown, in Kimberley and on the banks of the great rivers that flow through the Diamond Fields. Apart from its mining roots, the Diamond Fields have a great variety of other experiences on
31 | P a g e © FBDM LED Strategy Review 2014/15 offer. There are cultural attractions like the ancient San etchings at Wildebeest Kuil and the Anglo-Boer War Battlefields Route to explore. There are several game farms in the region where you can see the endangered rhino and other game, and birdwatchers can spot a wonderful variety of endemic species. The five major rivers are perfect for water activities like fishing, paddling and boating, and explorers can go in search of the rumbling Gong-Gong Waterfall out near Barkly West. Unique experiences include the world-class Maloof Skate Park in Kimberley, Agritourism in the lush Vaalharts Valley and a visit to the beautiful old Nazareth House Mission Station near Warrenton. Afrikaans and Setswana are the principal languages of the District, with English and Xhosa spoken to a much lesser degree. The continental climate is hot in the summer (an average maximum of 32.0C) with occasional dramatic thunderstorms and mild winters with endless blue skies. The N12 Route runs through the District, which is almost exactly in the middle of South Africa; 500km from Johannesburg to the northeast and 1000km from Cape Town in the southwest.
Dikgatlong Local Municipality was established in 2000 through the Local Government Demarcation process, whereby the towns of Barkly West, Delpoortshoop and Windsorton were amalgamated into one municipality.
The name Dikgatlong is derived from a Setswana word meaning "confluence", as it refers to the place where the Harts and Vaal Rivers flow into each other at Delpoortshoop.
Dikgatlong is one of four local municipalities within the jurisdiction area of Francis Baard District Municipality. Francis Baard is one of five district municipalities within the boundaries of the Northern Cape Province. The municipality lies on the northern bank of the Vaal River, 37km from the city of Kimberley, which is south- east from Dikgatlong. Dikgatlong is a Setswana name meaning “confluence”, referring to the place where the Harts and the Vaal rivers flow into one another. The name can be traced back some 300 years. Dikgatlong is located in the middle of the Frances Baard District Municipality and the town of Barkly West is its administrative centre. Other towns in the region are Delportshoop, Longlands, Kutlwano, Windsorton, Ulco and Sydney on Vaal. Dikgatlong is home to the site of the first alluvial diamond digging in the region and is renowned for its excellent fly-fishing spots and luxury game lodges where you can see many of the Big Five. The adventurous are encouraged to go in search of the Gong-Gong Waterfall on the Vaal, where the quiet river suddenly tumbles into a gully and fills out into a tranquil pool.
32 | P a g e © FBDM LED Strategy Review 2014/15
Today livestock, irrigation farming and commercial mining drive the district’s economy, although a few diggers can still be seen sifting through gravel on the river banks in the tradition of diamond diggers of old! Setswana is the most widely spoken language, followed by Afrikaans.
Magareng Local Municipality is an administrative area in the Frances Baard District of the Northern Cape Province. Magareng is a Setswana name meaning "in the middle". The name reflects the geographic location of the municipality in relation to other areas. Warrenton is on the banks of the Vaal River and about 75Km from Kimberley, which was in arid country. Diamonds were found in Kimberley in 1870 soon there was a huge demand for food. In 1880 a syndicate bought the western portion of the farm Grasbult on the Vaal River.
The name ‘Magareng’ is the Setswana word meaning ‘the middle’, and is derived from the fact that this region is literally in the middle of the country. Warrenton, a quiet agricultural town, is the administrative centre of the municipality and other communities include Ikhutseng, Warrenvale and Windsorton Road. The area is largely defined by agriculture, which is sustained by one of the largest irrigation schemes in the southern hemisphere. There are also a number of commercial farms which breed cattle, game, ostrich and goats. There are three historic stone blockhouses from the Anglo- Boer War still standing on the banks of the Vaal River, and an old railway bridge built in the 1920s – a line that still connects the Northern Cape and the North West Province.
Phokwane Local Municipality is named after Queen Phokwane, the wife of Kgosi Galeshewe of the Barolong boo Ra-Tlhaping tribe. Phokwane is nestled in the lush green delta of the Hartswater region and boasts the second-largest irrigation scheme in the Southern Hemisphere, namely the Vaalharts Irrigation Scheme.
The municipality is situated 125km along the N18 to Vryburg. The administrative seat of the municipality is Hartswater. The majority of inhabitants are found in the peri-urban areas of the municipality. In terms of agriculture, Phokwane exports grape, citrus and olive products. There are two major towns in the area – Hartswater (the administrative centre) and Jan Kempdorp. Smaller towns include Valspan, Pampierstad and Ganspan. Phokwane is defined by the lush Vaalharts Valley and the many activities surrounding the harvesting and production of local produce such as olives, pecan nuts, peanuts, citrus, wine, cotton and stone-fruit. Wheat, mealies (corn) and Lucerne are also grown. The Vaalharts Irrigation Scheme that sustains 1280 farms
33 | P a g e © FBDM LED Strategy Review 2014/15 in the area is the second largest irrigation scheme in the southern hemisphere, and covers 36,950ha. Activities in the area include taking a dip in a canal and exploring the region by 4x4 or even micro light. Nature lovers can explore the wilderness on horseback, spot a variety of endemic birds, go fly-fishing on one of the gushing rivers or visit the serene Ganspan Pan. Hartswater and Jan Kempdorp have all the necessary modern amenities including golf courses, shopping complexes, restaurants and accommodation to suit every need.
Sol Plaatje Local Municipality is located in the Frances Baard District Municipality in the Northern Cape Province. It includes the diamond mining city of Kimberley. This municipality is named after Solomon ‘Sol’ Plaatje, a writer, politician and activist renowned for his incredible grasp of languages (fluent in seven). Sol was the first Secretary General of the African National Congress and dedicated much of his life to the struggle and the liberation of African people.
At the heart of Sol Plaatje Municipality is the bright metropolis of Kimberley, the capital city of the Northern Cape, and Galeshewe, the vibrant township on the city’s border. The municipality also includes the towns of Modder River, Ritchie, Riverton, Ronald’s Vlei, Beaconsfield, Kenilworth and Spytfontein.
The municipality has a population of about 250,000, by far the most populated region in the Frances Baard District. Agricultural land is mostly used for game farming, sheep and cattle farming, and cash crops such as lucerne, grapes, cotton and soybeans. Mining is still an integral part of the economy today. Kimberley receives a significant 3,472 hours of sunshine per annum; this is a major resource with potential for solar power and electricity generation and heating. Projects have already been initiated as part of the municipality’s innovative eco- village housing developments. (Source: http://www.localgovernment.co.za)
34 | P a g e © FBDM LED Strategy Review 2014/15 3.2. POPULATION DISTRIBUTION
3.2.1. POPULATION GROWTH
The Frances Baard population decreased slightly from 324 678 in 1996 to 323 523 in 2001 and then increased over the next ten years at an average annual growth rate of 1, 35% to 382 086 in 2011.
Overall, the population therefore increased by 58 524 over the period 2001 to or on average approximately by 5852 persons per year. The population in Frances Baard increased at a slightly higher rate than in the Northern Cape province on average where the average annual growth rate amounted to 0,83% for the same period.(Note that the base year is taken as 1996).
GRAPH 1: POPULATION GROWTH
(STATSSA, Census 2011)
The Census 2011 Municipal Report for the Northern Cape indicated an average growth rate of 1.35% for the FBDM area between 2001 and 2011. Sol Plaatje and Dikgatlong Local Municipalities indicate the highest population growth in die District of 2.0%, with Phokwane Local Municipality at 0.30%.
The district population has grown from 315 853 in 2005 to 395 148 in 2013; this means that between 2005 and 2013 the district population has grown by an annual growth rate of 1.19%. For the same period, 2005-2013, HIV infection annual growth rate was 14.4%, HIV deaths annual growth rate 19.79% and other deaths annual growth was only 1.95% (FBDM IDP 2013 -2016).
These growth rates are simply an extrapolation of those for the last ten years and do not take factors that could influence population growth into account.
35 | P a g e © FBDM LED Strategy Review 2014/15
• Growth statistics can be seen as a key indicator for possible demand within the economic as well as infrastructure • Growth statistics can also be an indication of migration paterns which will have a direct impact on LED.
3.3. HOUSEHOLD DISTRIBUTION
As could be expected Sol Plaatje is by the far the densest municipality in the district follows by Phokwane and Dikgatlong is the least dense municipality. TABLE 1: HOUSEHOLD SIZE
Household size (Percentage) Total LM 1 2 3 4 5 6 7 8 9 10+
Sol Plaatje 19 19 17 18 11 7 4 2 1 2 100
Dikgatlong 22 19 16 16 10 7 4 3 1 2 100
Magareng 24 20 15 14 9 7 4 3 2 3 101
Phokwane 25 20 15 14 10 6 4 2 2 2 100
(StatsSA Census 2011)
From the household size table it is evident that Frances Baard has got fairly small household sizes with 21% of household living one person, 19% 2 people, 16% three people, 17% four people and household with five plus sizes making up only 27% of households.
From census 2011, it is also with noting that 85% of Frances Baard District Municipality is formal residential area, 8% informal, 1% tradition, 4 % farms, 1% commercial, 1% small holding and 1% collective living quarters (FBDMSDF 2013).
3.4. ECONOMIC PROFILE
Local Economic Development is the creation of a platform and environment in order to engage stakeholders to implement municipal strategies and programmes. It’s the process whereby all economic forces in a municipality are brought on board to identify resources, understand needs and plan the best way of making the local economy fully functional, investor friendly and competitively productive.
36 | P a g e © FBDM LED Strategy Review 2014/15
Municipalities are mandated by the provisions of Section 152 (c) of the Constitution of South Africa 1996 to ensure the socio-economic development of local communities.
The district economy is still very much primary based and skewed towards the Sol Plaatje Local musicality economy. Sol Plaatje alone is responsible for just over 80% (rand value) of the value addition in the District while the secondary sector contributes a mere 7,2% (FBDM IDP 2013 -2016).
Issues
The District continues to have high unemployment rate with Dikgatlong and Magareng Municipality exceeding 40%. Due to its primary -Sol Plaatje has about 67,14% of the Economically Active population Inability to identify and market bankable investment opportunities Identification and marketing of ‘bankable’ investment opportunities.
3.4.1. GROSS DOMESTIC PRODUCT
The Northern Cape Province recorded a 2.1% annual economic growth rate which is 1.5% lower than the average South African Growth Rate of 3.6%. The Northern Cape Province’s largest economic contributor is the primary sector (mining and agriculture) which contributes 32.2% followed by the secondary sector (manufacturing and construction) which contributes 7.3% and lastly the tertiary sector which contributes 51% of the Provinces’ Economy (Statistics SA: GDP 2010).
The Gross Domestic Product indicates the value of services and goods produced within the geographic boundaries of an area during a period of one year. Frances Baard District Municipality is the strongest economic region in the province, accounting for 36% of the 28 provincial gross domestic products (GDP). The Major contributor to the regional GDP is Sol Plaatje (74%), followed by Phokwane (15%), Dikgatlong (8%), Magareng (2%) and the District Management Area (1%).
37 | P a g e © FBDM LED Strategy Review 2014/15
GRAPH 2: GDP OF FRANCES BAARD
(Global Insight 2011) In terms of correlation and trend, we see from Graph 1 that the only lagging economy is Dikgatlong which has been on a worrying decline since 2005. Other than Dikgatlong, there has been a moderate slow-down in the economic growth of other Municipalities.
The economy of the district consists of the primary (agriculture and mining), secondary (manufacturing, electricity and construction) and tertiary (trade, transport, financial and social services) sectors (FBDM IDP 2012-16).
GRAPH 3: SECTOR GROWTH
(Global Insight, 2011)
38 | P a g e © FBDM LED Strategy Review 2014/15
The above graph, on the Sector Growth of the District, provides a picture of the sector performance in the District. It is evident that the tertiary industries have been performing the best followed by primary and lastly the secondary, especially the electricity sector which provides a negative growth rate (FBDM IDP 2012-16).
Clearly, the Frances Baard District economy is characterised as a growing services economy providing, as it were, “soft” services to the wider community. Fixed capital investment in manufacturing and mining has stagnated, indicating that Frances Baard and its surrounds is not considered a major manufacturing area that attracts long term fixed capital investment. This has an impact on employment in the primary sector, amongst others, because of declining mining activities and increased mechanisation in both the agricultural and mining sectors. In fact, the Primary sector has shed more than 5 000 jobs over the period 1996 to 2011.
The Secondary sector (Manufacturing, Electricity, gas and water and Construction), has likewise shed a large number of jobs – from 14 339 in 1996 to 7 769 in 2011, a loss of 6 570 jobs over the period. This state of affairs emphasises the fact that manufacturing and construction are not attracting investments and that these sectors have been in decline for a long time. The Tertiary sector (Wholesale and Retail Trade, Catering and Accommodation; Transport, Storage and Communication; Finance, Insurance, Real Estate and Business Services; Community, Social and Personal Services and General Government) is the only sector that registered real growth over the period 1996 to 2011, increasing its share in the GVA from 69,9% in 1996 to 79,2% in 2011 (FBDM SDF 2013).
39 | P a g e © FBDM LED Strategy Review 2014/15
GRAPH 4: GVA PER SECTOR
(Quantec, 2011)
Over the same period, employment in this sector increased from 46 141 persons to 72 614, an increase of 26 437 jobs. This represents an overall increase of 14 577 jobs over the 15 year period, or, on average 972 jobs per year. The GVA is illustrated in the table and graph above. Within the income brackets indicated in the Graph the number of people earning that amount in FBDM is smaller compared to the number of people in the Northern Cape. The number of people earning nothing or less than R800 per month is larger in the Northern Cape than in Frances Baard (FBDM SDF 2013). 3.4.2. HOUSEHOLD INCOME
A total of 12 271 (13%) of the households in the District earn no income with 10% earning less than R800 per month. 20% (19 355) of the households earn between R1 601 – R3 200 and 38% earn more than R3 200 (FBDM IDP 2013 -2016).
40 | P a g e © FBDM LED Strategy Review 2014/15 TABLE 2 : HOUSEHOLD INCOME
Household Income per Local Municipality
Municipality No Income R1 – R 400 R 401 -801 R 801 – R 1 601 – R 3 201 - Totals R1 600 R 3 200 Plus
Sol Plaatje 7 032 2 001 3 215 9 683 11 291 27 073 60 295
Dikgatlong 1 814 618 866 2 905 2 800 2 963 11 966
Magareng 934 294 477 1 440 1 430 1 543 6 118
Phokwane 2 491 868 1 403 4 004 3 834 4 944 17 544
Total 12 271 3 781 5 961 18 032 19 355 36 523 95 923
Percentage 13% 4% 6% 19% 20% 38% 100%
(FBDM SDF 2013).
Indicated in the Table above is the percentage of households earning less than R3 200. Within Dikgatlong Municipality 60.07% of the households earn less that R3 200, with Magareng Municipalities households at 59.69%. 43.43% of the households in Sol Plaatje Municipality earn less that R3 200 (FBDM SDF 2013). 3.4.3. UNEMPLOYMENT
The unemployment rate indicates the number of people who are without employment as a percentage of the total economically active population. According to Statistics South Africa, the unemployment rate is the proportion of the labour force that is unemployed. Unemployed persons are those aged between 15-64 years, who:
Not employed during the last 7 days Actively looked for work or tried to start a business Able to start work within 7 days
The Frances Baard DM has an unemployment rate of 27.9%, similar to that of the Northern Cape. Furthermore the Dikgatlong LM has the highest unemployment rate (39.7%) within the District Municipality as compared to the other local municipalities. The main contributing factor to the low levels of employment in Dikgatlong LM is the high percentage (86.2%) of labour force that has not obtained a Grade 12 Senior Certificate and Higher Qualification, resulting in a primarily unskilled labour force (Quantec Research, Standardized Regional Data, 2011). The largest portion of formally employed persons in Frances Baard are skilled (44.7%), followed by semi- and unskilled (41.4%) workers. Only 13.9% of local workers are considered to be highly skilled.
41 | P a g e © FBDM LED Strategy Review 2014/15
The official unemployment rate in the Frances Baard District Municipality in 2011 rose to 27.2% from 26.9% in 2010 and 26.8% in 2009. Looking at the local municipal level, Dikgatlong LM, Magareng LM and Phokwane LM have the highest unemployment rate in the district (well above that of the District level), with the 2011 rates sitting at 38.5%, 32.6% and 32.5% respectively. However, the unemployment rate in Sol Plaatje LM in 2011 is below that of the District, at 24.6%. This can be attributed to the fact that this local municipality houses the business hub of the Northern Cape Province, the City of Kimberley. GRAPH 5: UNEMPLOYMENT RATE
45.0
40.0
35.0
30.0
25.0
20.0
15.0
10.0
Sol Plaatjie Dikatlong Magareng Phokwane FBDM
(Quantec Standardised Regional Data, 2011) 3.4.4. EMPLOYMENT
Despite the high unemployment rate, the District has seen an increase in the level of jobs created post South Africa's democracy. The total number of people employed in the district is registered at 92 668, in 2011, from 77033 in 1995.
The Tertiary sector has shown a steady increase in the level of employment from 1995 to 2011, while the Primary sector saw a decline in its contribution to employment over the same period. It is important to note that the District was quite resilient in job creation during the 2007/09 recession, where the country saw a number of job cuts. This can be attributable to the local government's support in keeping the economy afloat. At the local municipal level, Sol Plaatje recorded the highest number of employment in 2011, at 60114. In addition, the LM has seen a steady increase in the employment level from 1995 to 2011.
42 | P a g e © FBDM LED Strategy Review 2014/15
GRAPH 6: EMPLOYMENT STATUS FBDM
120000 100000 80000 60000 40000 20000 0 1995 2000 2005 2011
Employed Unemployed Not Economically Active
(Quantec Standardised Regional Data, 2011)
The breakdown by sector shows that the Tertiary sector is the biggest driver of employment, led by government at 32.9% of total jobs created, the trade sector at 15.8% community services 14.6% and finance & business at 11.5%.
GRAPH 7: EMPLOYMENT BY SECTOR (% CONTRIBUTION)
6.5% 6.8% Agriculture 4.0% 32.9% 0.5% Mining 3.9% Manufacturing Electricity & Water Construction Trade 15.8% Transport Finance & Business
14.6% 3.5% Community Services 11.5% General Government
(Quantec Standardised Regional Data, 2011) The tertiary sector is the principal driver of employment in the Sol Plaatje local municipality, driven by general government, community services and trade industries. The majority of the labour force in the Dikgatlong municipality is absorbed by the mining Industry, followed by trade and general government. The
43 | P a g e © FBDM LED Strategy Review 2014/15
Magareng LM labour force is absorbed by government and community services and lastly, in the Phokwane LM agriculture, community services, government and trade industries are the biggest driver of employment
TABLE 3: EMPLOYMENT BY SECTOR (% CONTRIBUTION) FOR LM'S
Sol Plaatje Dikgatlong Magareng Phokwane
Agriculture 1.7 8.9 9.3 29.3
Mining 4.0 34.4 6.1 2.5
Manufacturing 3.7 5.7 2.6 5.3
Electricity and water 0.3 0.4 0.9 1.7
Construction 3.7 5.6 3.1 4.6
Trade 16.4 14.2 15.5 14.5
Transport 3.5 3.5 5.0 3.2
Finance and Business 13.0 4.3 11.4 7.6
Community Services 14.8 10.1 20.0 16.0
General Government 38.9 12.9 26.0 15.4
(Quantec Standardised Regional Data, 2011) 3.4.5. SKILLS LEVEL
The lack of appropriately skilled people is one of South Africa's principal drivers of the high unemployment rate. There has been clear evidence of a shift in the profile of the main economic sectors of the country over the past 2 decades, characterised by a decline in the share of primary and secondary sectors (which are labour intensive and can absorb unskilled labour) and an increase in the Tertiary sector (which requires skilled labour). This shift is also true for the FBDM, as will be illustrated in the Production profile of the District. Given that the largest employers in the FBDM come from the tertiary sector, almost half of the people employed in the District are skilled (41.8%); there is however a large portion that is Semi- and Unskilled (36.1%). A breakdown of the local municipal level shows that just less than 50% of Sol Plaatjie's workforce is skilled and interestingly, this LM has the highest portion of highly skilled labour in the district, at 24.9%. The percentage of semi-and unskilled labour is highest within the Dikgatlong, Magareng and Phokwane LMs, at 57.2%, 41.7% and 54.7% respectively.
44 | P a g e © FBDM LED Strategy Review 2014/15 GRAPH 8: SKILLS LEVEL
70.0
57.2 60.0 54.7
50.0 45.2 41.8 41.7 39.0 40.0 36.1 29.9 30.6 31.0 30.0 24.9 22.1 19.3 20.0 14.3 12.2 10.0
0.0 FBDM Sol Plaatjie Dikgatlong Magareng Phokwane
Highly skilled Formal - Skilled Formal - Semi- and unskilled
(Quantec Standardised Regional Data,2011) 3.4.6. PRODUCTION PROFILE
In 2011, the total output from the Frances Baard District Municipality was R11 billion, contributing approximately 33.1% to Northern Cape's total output for the year. TABLE 4: GVA BY SECTOR
FBDM Sol Plaatje LM Dikgatlong Magareng LM Phokwane LM LM
Agriculture 2,5 0,7 3,0 3,9 15,3
Mining 10,6 6,5 48,4 9,2 4,5
Manufacturing 4,2 3,6 6,9 2,2 7,3
Electricity & Water 2,0 1,3 1,7 3,9 7,7
Construction 1,5 1,2 2,4 1,9 2,7
Trade 12,9 13,1 10,4 12,7 13,9
Transport 12,5 13,1 8,3 15,5 11,1
Finance & Business 19,6 21,6 7,0 22,4 14,6
Community Services 11,2 11,9 5,3 12,8 12,0
General Government 23,0 26,9 6,6 15,5 11,0
45 | P a g e © FBDM LED Strategy Review 2014/15
(Quantec Standardised Regional Data,2011)
The largest industries, as measured by their gross value added, were as follows:
General government services – 23.0% Finance & Business- 19.6% Trade- 12.9% Transport – 12.5% Looking at sectoral contributions within the local municipal level, economic activity in the Sol Plaatje LM is largely driven by general government, and finance & business, with the two industries contributing just under half of total output. The mining industry is the principal driver of economic activity in the Dikgatlong LM, with gross value added at 48.4%.
Economic activity in the Magareng LM is driven by Finance & Business (22.4%), Trade (15.5%) and general government (15.5%). Lastly, agriculture is the biggest industry in the Phokwane LM, with gross value added at 15.3% and this is closely followed by finance & business at 14.6%. Phokwane LM is a net exporter of grapes, citrus and olive products.
The District’s agricultural production is made up of predominantly field crops followed by animal products, animal and horticulture sub-sectors. The actual products in these sub-sectors are wheat, fruit, peanuts, maize, cotton, olives, cattle, game farming, viticulture, fishing and vegetables (FBDM IDP 2014 – 2016).
Some of the minerals found in the District include diamonds, limestone’s, and cement. Of these, diamond mining is the dominant contributor to mining production. Limestone and cement deposits are found/located in the Alco area. Small scale miners continue to look for opportunities and thus resulted in a lot of small scale operation in the Dikgatlong and Windsorton areas.
3.4.7. LOCATION QUOTIENT GVA
A location quotient (LQ) is an analytical statistic that measures a region’s industrial specialization relative to a larger geographic unit (usually the nation).
An LQ is computed as an industry’s share of a regional total for some economic statistic (earnings, GDP by area, employment, etc.) divided by the industry’s share of the national total for the same statistic. For example, an LQ of 1.0 in mining means that the region and the nation are equally specialized in mining; while an LQ of 1.8 means that the region has a higher concentration in mining than the nation.
46 | P a g e © FBDM LED Strategy Review 2014/15
TABLE 5: GVA
FBDM Sol Plaatje LM Dikgatlong LM Magareng LM Phokwane LM
Agriculture 2,5 0,7 3,0 3,9 15,3
Mining 10,6 6,5 48,4 9,2 4,5
Manufacturing 4,2 3,6 6,9 2,2 7,3
Electricity & Water 2,0 1,3 1,7 3,9 7,7
Construction 1,5 1,2 2,4 1,9 2,7
Trade 12,9 13,1 10,4 12,7 13,9
Transport 12,5 13,1 8,3 15,5 11,1
Finance & Business 19,6 21,6 7,0 22,4 14,6
Community Services 11,2 11,9 5,3 12,8 12,0
General Government 23,0 26,9 6,6 15,5 11,0
(Quantec Standardised Regional Data, 2011)
The location quotient table shows the comparative advantage of the District's local municipalities in terms of production. According to this table, the industries in which the Sol Plaatje LM has the highest comparative advantages are Government services, Finance & Business.
It is important to note that the LM has a comparative advantage across most industries. Looking at the Dikgatlong LM, the Mining industry has the highest comparative advantage, followed by manufacturing. Both the Magareng and the Phokwane LMs have the highest comparative advantage in agriculture (FBDM IDP 2013 -2016). 3.4.8. TRADE PROFILE
The Frances Baard District Municipality is a net importer of goods. Total imports amounted to R88mn in 2011, while exports were a mere R474mn for the same period. The District's main import partners are Europe and America, with 86.5% and 10.1% of total imports for 2011. The top three commodities imported are:
Base metals (78.6%) Vehicles, aircraft, vessels & associated transport equipment (6.3%) Machinery & mechanical appliances (4.0%)
47 | P a g e © FBDM LED Strategy Review 2014/15
GRAPH 9: IMPORT DESTINATIONS AS % OF TOTAL
79,7 80,0 70,0 57,2 60,0 50,0 40,0 25,8 30,0 15,5 20,0 10,9 5,0 3,3 10,0 0,3 1,4 0,9 0,1 0,0 Africa Americas Asia Europe Oceania Not allocated
Northern Cape Frances Baard DM
(Quantec Standardised Regional Data, 2011)
The FBDM's main export destinations for 2011 were Europe (57.2%), Asia (25.8%) and Africa (15.5%). The District's main export commodities are:
Precious and semi-precious stones (56.8%) Vegetable products (26.9%) Base metals (12.4%)
GRAPH 10: EXPORT DESTINATIONS AS % OF TOTAL
86,5 90,0 79,7 80,0 70,0 60,0 50,0 40,0 30,0 20,0 10,1 10,9 5,0 10,0 0,3 0,7 2,4 0,9 0,4 3,3 0,0 0,0 Africa Americas Asia Europe Oceania Not allocated
Northern Cape Frances Baard
(Quantec Standardised Regional Data,2011)
48 | P a g e © FBDM LED Strategy Review 2014/15 4. OTHER IDENTIFIED PROJECTS WITHIN THE DISTRICT
It is important to take cognisance of other projects currently identified within the District. As such a compilation was done of identified projects from the previous LED, previous IDP as well as the previous DGDS.
TABLE 6: LED PROJECTS
PROJECTS FROM LED LOCATION
AGRICULTURAL SECTOR
Goat Farming
Game Breeding
Vegetable & Fruit Processing
Field Crop Processing
Meat Processing
MINING SECTOR
Formalising of Pebble Mining
Mining Beneficiation
MANUFACTURING SECTOR
Tannery Plant
Chips Factory
Vegetable & Fruit Processing
Field Crop Processing
Meat Processing
Packaging & Distribution of Products
Expansion of the Manufacturing Sector
SERVICE SECTOR
Central Freezing Facility & Cold Storage Transport
49 | P a g e © FBDM LED Strategy Review 2014/15
Business Process Outsourcing & Off-shore Hub
SMME Database & Support Programme
Form Business Support Network
Skills Training Facilities
Industrial Development Strategy
TOURISM SECTOR
Mining Tourism
Game viewing/Trophy Hunting
Eco Tourism
Adventure Tourism
Expansion of Hospitality Industry
Tourism Marketing Strategy
TABLE 7: IDP PROJECTS
PROJECTS FROM IDP LOCATION
Landscaping Galeshewe Day Hospital GALASHEWE
SMME Village Galeshewe GALASHEWE
Galeshewe Sport Node GALASHEWE
Parks
Galeshewe Greenbelt Development GALASHEWE
Galeshewe Stadium Upgrade GALASHEWE
Street Upgrade Greenpoint GREENPOINT
Lanscaping Roodepan ROODEPAN
GLIP(Galeshewe Light Industrial Park) GALASHEWE
Playground Equipment Parks
50 | P a g e © FBDM LED Strategy Review 2014/15
Additional Bulk Electricity (80MVA) & Network Upgrade
High Mast Lighting (Proj70)
Upgrade Of Substation Ashburnham ASHBURNHAM
Control Panels/Switchgear at Southridge S/S SOUTHRIDGE
Upgrading Silson Road Substation
Electrification of Soul City SOUL CITY
Eletrification of Donkerhoek (521) DONKERHOEK
Electrification of Tswelelang (493) TSWELELENG
Electrification of Greenpoint 10/11 GREENPOINT
Department Of Energy (DoE) Integrated National Electrification Programme Grant
Electricity Demand Side Management Grant (Eskom)
Kamfersdam Water Reduction KAMFERSDAM
Donkerhoek Services DONKERHOEK
Beaconsfield Upgrade Waste Water Treatment Works BEACONSFIELD
Ritchie Waste Water Treatment Works RITCHIE
Promise Land
Riverton Water Purification Works RIVERTON
Water Zone Metering (Non Revenue Water Minimization Project)
Counter Funding MIG/NDPG
Upgrading of Municipal Flats in Ward 23 WARD 23
Upgrading of 50 Toilets in Ward 19 WARD 19
Planning & Surveying Diamant Park 230 Erven DIAMANT PARK
Homevale WWTW Upgrade (15M) HOMEVALE
Replacement Programme IT Hardware
51 | P a g e © FBDM LED Strategy Review 2014/15
GIS Hardware Replacement& New Software
New Cemetery: Detail Planning & Fencing
New Refuse truck
Water Tank
Water & Sanitation for 1450 Stands
Construction of Bulk sewer pipeline for 1450 sites
The Upgrading of Jan Kempdorp Waste Water Treatment Plant JAN KEMPDORP
Masakeng 840 Sites sewer reticulation Network MASAKENG
Upgrading Of Streets and Storm water Pampierstad PAMPIERSTAD
Guldenskat township Establishment GULDENSKAT
CBD Revitilisation
Valspan and Pampierstad CBD Revitalisation Business plan VALSPAN&PAMPIERSTAD
Housing Project Jan Kemptdorp/Valspan (1000) JAN KEMPDORP
Housing Project Sakhile 1450 SAKHILE
Kingston 604, Informal settlement Upgrading KINGSTON
Magogong Station Township Establishment MAGOGONG
Hartswater Cemetery Extension HARTSWATER
South Eastern Development
Electrification Project
Masakeng 1348 MASAKENG
Hartswater New Landill Site Development HARTSWATER
Kingston Electrification project 684 Households KINGSTON
Land Audit
Bonita Park 127 BONITA PARK
Jan kempdorp 100 sites, Settlement planning JAN KEMPTON
52 | P a g e © FBDM LED Strategy Review 2014/15
Electrification Project Ganspan GANSPAN
Vaalharts Revitalisation Project VAALHARTS
Sakhile Electrification Project SAKHILE
Barkly West-Water Treatments Works: Refurbishment of Sand BARKLY WEST Filters
Maintenance Water Treatment Works
Maintenance of WTW buildings
Maintenance Waste Water Treatment Works
Maintenance Water And Sewer Networks
Repair PLC Longlands -Complete
Maintenance Streets & Stormwater Drainage STORMWATER
Repair & Maintenance of Paved Roads
TABLE 8: DGDS PROJECTS
PROJECTS FROM DGDS LOCATION
Waste Removal
Electricity
Roads
Construction Commission
Local Procurement
Skills Base Development
Awareness of Projects
Availability Of Incentives
Availability of Land for the Development of Infrastructure
SMME Training & Skills Development
53 | P a g e © FBDM LED Strategy Review 2014/15
MINING COMMISION
Procurement Reform
Networking Between Government& various Sectors
Processing &B beneficiation of Minerals
Establish Suitable New Transport Infrastructure to Support new Mineral Operations
Provide Expert Training & Equipment to Small Local Entrepreneurs
Develop Mining Tourism
Agro-Processing
TOURISM COMMISION
Diamond & Gemstone Jewellery
Preferential Procurement Initiative
Dipudi Project
Establishment of Vaalharts Agricultural Development hub
Olive Project
Flamingo Project
54 | P a g e © FBDM LED Strategy Review 2014/15 5. INSTITUTIONAL ANALYSIS
5.1. INTRODUCTION
Part of the process of the development of a Local Economic Development (LED) Strategy, includes the undertaking of an institutional assessment. The main purpose of this Institutional Assessment is to arrive at tan understanding of the following: i. The municipal capacity to create a conducive environment (i.e. plan, coordinate and implement) for effective local economic development within the Frances Baard District, ii. To understand the state of institutional preparedness for local economic development within the District iii. To begin a process of the creation of a vision for local economic development for District.
The methodological approach used for this assessment was mainly a qualitative approach. To ensure an in-depth and varied data, a multi-pronged approach was followed. The assessment was done using the following data collection instruments:
Literature Review
A desktop review of research and current municipal planning and other critical documents such as the municipal integrated development plan (IDP) and other policies such as the procurement policies etc. was undertaken. Furthermore, a prior assessment of the state of LED across the Northern Cape was undertaken by the Provincial Department of Economic Development and the team largely used the results of this study to determine the status quo with regards to LED Capacity.
This study by the Department of Economic Development sought to get responses on the following broad subjects within the LED environment:
a. Organogramme and management b. Consultation with a broad range of stakeholders c. LED Planning, internally and externally d. LED implementation e. LED Monitoring and evaluation f. LED reporting Collective Reflection by the Assessment Team
The Assessment team after every engagement with the municipalities reflected on the outcomes and explored ways in which the outcomes of the engagement would either be addresses or harnessed through the strategy and other interventions.
55 | P a g e © FBDM LED Strategy Review 2014/15
The reflection also allowed for the team to begin exploring creative ways in which the project would be implemented.
5.2. OUTCOMES OF THE ASSESSMENTS
5.2.1. ORGANOGRAMS AND MANAGEMENT 5.2.1.1. DEDICATED LED OFFICIALS
One of the components that were investigated included the question around the capacity of LED units within the District. Below is a graph summarizing the findings.
GRAPH 11: DEDICATED LED OFFICIALS
Dedicated LED Manager/Official 4,5 4 3,5 3 2,5 2 1,5 1 0,5 0 Yes No
Yes No
When looking at the Capacity of LED Units across the districts, 4 out of 5 municipalities in the district have a person or persons dedicated to focus on LED.
Frances Baard District Municipality and Sol Plaatje Municipality have a very elaborate LED Unit which focuses on the various aspects of LED. It is important to note that Magareng only has a Local Economic Development Intern and this effectively diminishes the municipality’s LED Capacity to effect LED. 5.2.1.2. THE PLACEMENT OF THE LED UNIT
In line with the previous assessment of the capacity, it is important to know where the Unit is placed within the organogramme within the specific Municipality. Below is a graph summarizing the findings.
56 | P a g e © FBDM LED Strategy Review 2014/15
GRAPH 12: LED PLACEMENT
Where is LED placed on the organogram? Municipal Managers Office 20%
Planning and Development 80%
From the assessment, it has become clear that the LED Unit is generally placed at the Planning and Development Department at the municipality with the exception of 1 municipality (Magareng). It can be concluded that the placement of these units within the Planning and Development Departments, makes LED central to the IDP and other development planning processes. 5.2.1.3. LED REPRESENTATION ON MUNICIPAL MANAGEMENT STRUCTURES
Another question that was asked was whether there is any LED representation on Municipal management structures and planning. Below is a graph summarizing the findings. GRAPH 13: LED REPRESENTATION
Is there LED representation on Municipal Management structures and Planning?
40%
60%
Yes No
57 | P a g e © FBDM LED Strategy Review 2014/15
It has emerged that 40% of the municipalities within the District don’t have direct representation of LED on Management Structures. This is particularly concerning as it means LED related matters might not get the necessary attention and processing as would be desired. 5.2.1.4. LED COMMITTEE ON COUNCIL LEVEL
It is important to know if there is a LED committee on council level. Below is a graph summarizing the findings. GRAPH 14: LED COMMITTEE
Is there a LED committee on council level?
40%
60%
Yes No
The assessment has revealed that 60% of the municipalities within the District report to a Committee of Council. This means both oversight and proper accountability and at the same time is assured of continued support from the highest decision making structure within the municipality. 5.2.1.5. LED STRATEGY DEVELOPED BASED ON CONSULTATION
Within the LED process it is important to know if the LED strategies are based on consultation. Below is a graph summarizing the findings.
58 | P a g e © FBDM LED Strategy Review 2014/15
GRAPH 15: LED STRATEGY DEVELOPMENT LED Strategy developed based on consultation
6 5 5
4
3
2
1 0 0 Yes No
Was the LED Strategy developed based on consultation?
All the municipalities within the district have developed their LED Strategies based on consultation. Consultation in the context of LED means the strategy enjoys popular buy in from a varied set of stakeholders and as such implies an improved level of support for the strategy during implementation. 5.2.1.6. LED PART OF THE ANNUAL IDP CONSULTATION
It is critical for the LED to form part of the annual IDP review. All the municipalities have included the LED in the annual IDP reviews and consultations. This is critical as it facilitates the process of amendment and review of the LED Strategy based on a consultative approach. Below is a graph summarizing the findings. GRAPH 16: LED as part of the IDP Consultation
LED part of the annual IDP consultation
No
Yes
0 1 2 3 4 5 6
Is LED part of the annual IDP consultation?
59 | P a g e © FBDM LED Strategy Review 2014/15 5.2.1.7. LOCAL LED FORUMS
This is essential as it will be the basis for further engagement and harmonization of relations among the various stakeholders. Below is a graph summarizing the findings. GRAPH 17: LED local forums
Local forum where Public and Private stakeholders 6 meet 5 5
4
3
2
1 0 0 Yes No Is there a local forum where Public and Private stakeholders meet?
All municipalities have local LED Forums including the District LED Forum. This is a forum where both public and private sector meet to share views, experiences and plans related to economic development and growth. This is essential as it will be the basis for further engagement and harmonization of relations among the various stakeholders. 5.2.1.8. LED ALIGNMENT TO MAJOR PLANS AND APPROVED BY COUNCIL
The key findings of the question whether the LED is aligned to major plans and approved by council is illustrated in the following graph.
60 | P a g e © FBDM LED Strategy Review 2014/15 GRAPH 18: Alignment of LED
LED strategy aligned to NGP, PGDS, PSDF and adopted by council 6
5
4
3
2
1
0 Yes No
Is there a LED strategy that has been aligned NGP, PGDS, PSDF and adopted by council
100% of the municipalities in the district have aligned their plans to the critical planning pieces both within the country and the province. This is essence means the capacity to leverage resources and benefit from the opportunities and incentives offered by the various programmes and strategies. 5.2.1.9. STRATEGY IDENTIFIES THE KEY SECTORS OF THE ECONOMY
Key sectors need to be identified to ensure effectiveness. Municipalities must know how to position themselves to ensure maximum benefit. Below is a graph summarizing the findings. GRAPH 19: Key sectors identification
Key sectors identified
No 0
Yes 5
0 1 2 3 4 5 6
Have key sectors been identified?
All the municipalities have identified their key sectors and as such have a clear sense of their competitive and comparative advantage. This means each
61 | P a g e © FBDM LED Strategy Review 2014/15 municipality knows how to position itself to benefit maximally from its critical economic sectors. 5.2.1.10. LED IMPLEMENTATION PLAN
Key sectors need to be identified to ensure effectiveness. Municipalities must know how to position themselves to ensure maximum benefit. Below is a graph summarizing the findings. GRAPH 20: LED Implementation action plan
LED implementation Action Plan 6 5 5
4
3
2
1 0 0 Yes No
Yes No
All the municipalities in the district have LED Implementation Plans. These are to ensure that the strategy has an annual focus over a 5-year period. 5.2.1.11. SCHEDULE FOR MONITORING AND EVALUATION
Monitoring plays an important role in LED implementation. Municipalities should attempt to put an efficient monitoring and evaluation system in place. Below is a graph summarizing the findings.
62 | P a g e © FBDM LED Strategy Review 2014/15 GRAPH 21: Monitoring and evaluation schedule
Schedule for monitoring and evaluation 4,5 4 4 3,5 3 2,5 2 1,5 1 1 0,5 0 Quarterly None
Quarterly None
From the assessment it is seen that 4 out of 5 municipalities or 80% have a quarterly monitoring system of monitoring of progress related to LED Implementation. This means that there are opportunities to strategize on corrective measures should there be a need for it.
5.3. CONCLUSION AND WAY-FORWARD
It is clear from the outcomes above, that the municipalities in the District are well placed institutionally to take forward the strategy. It is however important that there be a new focus towards projects and the LED officials to plan, coordinate and implement LED Projects.
63 | P a g e © FBDM LED Strategy Review 2014/15 6. OPPORTUNITY ANALYSIS
6.1. BACKGROUND
The purpose of this section is to identify potential local economic development opportunities in the Frances Baard District Municipality, based on the current situation within the municipality, as detailed in the preceding situation analysis. A swot analysis and local sectoral potential analysis will help create an understanding with regard to the sectoral competitive advantages of the local economy and this will be used to determine the development potential within Frances Baard.
The analysis seeks to identify supply and demand factors to assess market opportunities based on the gap between existing and potential levels of development and by reviewing the resource base for potential exploitation and beneficiation, i.e. extent, location, utilization and opportunities. In addition constraints to development such as the impact of HIV/Aids on the demographic profile, exploitation of resource base, international market influences, environmental degradation, lack of entrepreneurial skills and poverty are identified. This section is structured according to the following sub-sections:
SWOT Analysis Potential Analysis & Value Chain Gap Analysis Sector Potential Analysis
In addition constraints to development such as the impact of HIV/Aids on the demographic profile, exploitation of resource base, international market influences, environmental degradation, lack of entrepreneurial skills and poverty are identified LED initiatives around the world have repeatedly failed due some common myths about LED, listed and deflated below: 1. LED can occur without regional linkages:
Economic development needs cannot be met by individual communities alone – cognizance needs to be taken of regional context, which has implications for linkages, leakages, injections and comparative advantages of an area.
2. Economic development causes sprawl:
Economic development can be managed within spatial and environmental frameworks. 3. Any new business is right for our community:
Communities are characterized by varying skills, education levels, cultural and moral preferences, consumer preferences and income levels that all impact on
64 | P a g e © FBDM LED Strategy Review 2014/15 which types of businesses are feasible on the one hand and socially appropriate on the other. In addition, climate, infrastructure and geographical characteristics impact on which businesses will be viable.
4. An economic development officer will turn our economy around.
Economic development results from the processes of numerous public, private and civic sector actors within an enabling environment. While LED officers and LED units are needed to drive these processes, they alone will not transform an entire economy. 5. Industry will locate here if we provide enough incentives.
While tax and other incentives are considered by industry role-players when deciding on where to locate, other factors also come into play, such as infrastructure, proximity to input sources, proximity to markets, quality of life, labour pool quality, overall business and banking environment and so on. Offering incentives without addressing the other factors will, at best, result in short-term investment until such a point as incentive schemes expire.
6. One big manufacturer will solve all of our economic problems.
Economic development must be sustainable and in order to be considered sustainable, a diverse economy should be the goal. A mature, strong and stable economy is characterized by strength across a range of sectors, including primary, secondary and tertiary activities that cater for diverse consumer and business (value chain) needs.
6.2. SWOT ANALYSIS
A SWOT analysis is a commonly used tool used to facilitate a strategic review of a particular organisation. It is a high-level exercise that identifies strengths, weaknesses, opportunities and threats of the organisation. The strengths and weaknesses are internal factors that the organisation may control. Opportunities and threats are those factors external to the organisation and therefore the organisation has little or no control over these macro environment factors. The SWOT analysis does not identify what should be done. Rather, it provides a framework for identifying where strategic opportunities may exist and how to avoid weaknesses inherent in the organisation or external threats from limiting future expansion and growth. The purpose of the SWOT analysis is to identify and assess the strengths, weaknesses, opportunities and threats in Frances Baard District Municipality, in terms of local economic development. The identification of strengths, weaknesses, opportunities and threats within the municipal area provides the basis upon which the pillars of the LED strategy may be built. The SWOT analysis is illustrated below.
65 | P a g e © FBDM LED Strategy Review 2014/15 FIGURE 2: SWOT ANALYSIS
Strengths Weaknesses •Most skilled population in Province within •Low skills levels to match manufacturing District accross the district •Best infrastructure in Province •Limited understanding of growth and •Uniquely positioned (N12) development in the country •Food and beverage sector strongest with •Misunderstanding of roles and responsibilities •Interlinkages with other provinces with development •Existing export trade •Rigiidty of local government legislation •Central rail infrastructure •The ineffectiveness of some IGR structures •Central location of the District •Lack of marketing of District •Mines •No clear competitive advanatage •Best services sector offering in province •Limited buy in mobilisation from private sector •Headquarters of most provincial institutions in District SWOT
Opportunities Threats •Trading relations with neigbouring countries •Service delivery protest •University •Adverse AG findings •Presence of alternative energy •Change of political quard •Introduction of new technology through •Change in local policy regime renewable energy initiatives. •Difficult relations betwee nprivate sector and •Sol Plaatje 30 year city development plan public sector •Promotion of district as adventure tourist •Vaalhartsdam destination •Lack of capacity of officials •Support by smaller towns to contribute to larger town for the benefit of the District
6.3. POTENTIAL ANALYSIS METHODOLOGY
As part of the potential analysis a value chain gap analysis has to be conducted which could be defined as a series of activities that add value to a product.
In the business environment the value chain could be seen as a linked set of value adding processes that convert basic input materials into products or services for the final consumer. The activities that take place can be categorised under two headings, namely:
66 | P a g e © FBDM LED Strategy Review 2014/15
Primary activities – activities directly concerned with creating and delivering a product. Secondary activities – however not directly involved with production, but could increase effectiveness or efficiency.
FIGURE 3: POTENTIAL ANALYSIS METHODOLOGY
Identify strengths
Alignment Methods with to Leverage National & Strengths Provincial (Projects) Initiatives
Methodology
Identify Project Missing Prioritisation Links
Establish Value Chain
As part of the potential analysis a value chain gap analysis has to be conducted which could be defined as a series of activities that add value to a product. In the business environment the value chain could be seen as a linked set of value adding processes that convert basic input materials into products or services for the final consumer. The activities that take place can be categorised under two headings, namely:
Primary activities – activities directly concerned with creating and delivering a product Secondary activities – however not directly involved with production, but could increase effectiveness or efficiency
67 | P a g e © FBDM LED Strategy Review 2014/15 6.4. SECTOR OPPORTUNITES
The purpose of this sub-section is to provide an assessment of the economic activities within Tourism and the four leading economic sectors in order to determine their potential for economic development. The leading economic sectors were determined by using different criteria such as GGP contribution, comparative advantage (location quotient), exports and the district’s GDS. The following leading sectors were identified:
1. Agriculture Sector
2. Mining Sector 3. Manufacturing Sector
4. Services
5. Tourism Industry
The economic potential for each of the above leading economic sectors will be analysed in the following sub-section. (It is important to note that many studies conducted within the FBDM have addressed the topic of sector analysis within the district. It is therefore the aim of this sub-section to consolidate the information, update the information where applicable and to add value through interpretation of the information. 6.4.1. AGRICULTURE SECTOR
There is no moderate to high land in terms of agricultural production potential in the District, which means that what agricultural resources there are must be carefully conserved. There has been an improvement, particularly in Phokwane Municipality, to the agricultural potential due to large scale irrigation schemes.
Although the irrigation schemes, of which the largest is the Vaal Harts scheme, represent a major increase in the arable land resource, they also have negative side effects particularly with regard to long term soil fertility and water quality. The IEMP observed indication of reduced flow in the rivers and signs of nitrification and sedimentation.
However, the relationship between these activities and the impact of upstream activities in the Gauteng province and farmers along the river must also be understood because it would appear that the rivers have poor water quality and quantity when they enter the District.
68 | P a g e © FBDM LED Strategy Review 2014/15 MAP 1: AGRICULTURAL POTENTIAL
6.4.1.1. DEVELOPMENT POTENTIAL
TABLE 9: DEVELOPMENT POTENTIAL – AGRICULTURE SECTOR
Criteria Current Reality Implications
Availability of Land in the Frances Baard DM has low to This implies that further expansion of natural resources moderate potential for agricultural activities. the agricultural sector would be The moderate potential areas are mainly vertical integration i.e. canning & located within the DMA area. There is packaging, improved crops, water however no area which provide high potential management and/or the use of water for agricultural activities. wise plants. Water used for agricultural activities are mainly sourced from the Vaal-Harts irrigation scheme. This increases the area of arable land resources but also provides negative impacts on long term soil fertility and water quality. DWAF has also have also recommended that no further water be used for irrigation which places a strain on the agricultural water supply in Frances Baard DM (IEMP).
69 | P a g e © FBDM LED Strategy Review 2014/15
Criteria Current Reality Implications
Economic linkages Various linkages exist for Agriculture in the There is potential for expansion Frances Baard DM. There are strong on manufacturing of inputs backward linkages with various sectors, such (Fertilizers, Machinery & irrigation as the manufacturing sector for the production systems) and outputs (Specialised of machinery and fertilisers, the transport agricultural products & argri- sector for the transport of inputs, as well as processing) the electricity and water sector for the provision of adequate water supplies to farmlands for irrigation and other processes. There is also potential for expansion Other backward linkages include inputs from on the tourism sector labourers, most of which have fairly low levels (accommodation facilities, of education and generally earn low wages. conference facilities, cultural tours, etc.) Forward linkages which exist are raw produce being exported to other areas. Very little value adding processes take place within the Frances Baard DM.
Market Relevant trends in this market are the move New agricultural ventures should towards organic produce. take cognisance of the trends in the market and feasibility studies need to be conducted to determine the viability of these new ventures.
Gap Analysis The agricultural sector is mainly based on Increase the focus on processing primary activities and very little processing is and in particular of new products. done in the area; this provides an opportunity processing activities in the Frances Baard DM.
Logistics / Nodal The agricultural activities are dispersed There is potential to further develop point function throughout the District, but main nodes are these agricultural nodes. identified in
Availability of A larger portion of the population in the This implies that there is a lack of labour Frances Baard DM is unemployed and has a specialised labour in the area. low level of skills.
Technology Effectively there is no real potential for It is important for the FBDM to agricultural activities in the Frances Baard ensure that these new technologies DM, which means that the expansion of are implemented in their farming activities would include implementing new activities, in order to ensure market technology such as water wise plants and competitiveness, but also the better water management.
70 | P a g e © FBDM LED Strategy Review 2014/15
Criteria Current Reality Implications sustainable use of the available resources.
Enabling Some of the constraints i.t.o enabling Land reform tends to disrupt Environment environment which have been identified are commercial activities. The FBDM as follows: need to tap into the programmes initiated by the DoA, to ensure that . Lack of financial services and support for the the existing farmers and emerging intensive and subsistence farmers farmers receive the necessary . Lack of supporting services for farmers in the support. area . Lack of efficient representation of farmers’ interests . Under-utilisation of the services of extension officers
6.4.1.2. OPPORTUNITIES
TABLE 10: OPPORTUNITIES – AGRICULTURE SECTOR
Goat Farming The South African goat cheese industry is undeveloped as compared to France, United States, Europe, Australia and New Zealand. The goat cheese industry is a niche market as goat cheese is an acquired taste. The goat cheese industry is a very small market and is a relatively new concept as compared to other countries. Cheese sales in South Africa are growing with 3% per annum against a world figure of 1.8% this is encouraging and should stimulate manufacturers to promote the variety, quality and availability of their cheeses.
Demand for existing and new cheeses will continue to grow for the foreseeable future, a fact which paints a positive future for cheese in South Africa. How local cheese makers will rise to the challenge automatically becomes an objective for them. A significant part of the anticipated R13 billion additional spending by South African consumers, during the build-up to the 2010 World Cup and the foreign currency spending of 3 million visitors, will be spent on food. South African cheese makers should make sure that they offer the correct cheeses for this opportunity, in order to grab a slice of this spend. Various other products could also be produced from the goats milk such as: . Goat milk . Cheese . Yogurts . Body products (creams)
71 | P a g e © FBDM LED Strategy Review 2014/15
. Soaps
Game breading The Frances Baard DM shows significant potential for game farming. This could potentially have various spin-off effects such as breeding game for the purposes of selling to other game farms or for meat processing. A study done at the wildlife centre at the University of Pretoria showed that an average sized game farm could generate 54% of its gross income from hunting, 21% from live animal sales, 18% from trophy hunters, 5% from eco-tourism and 2% from meat production.
Vegetable & Fruit The Frances Baard DM contributes largely to the production of the Northern Cape’s Processing fruit and vegetables. But as mentioned in the case of potatoes there are very little value adding processes taking place in the area. This results in the opportunity for the development of fruit and vegetable processing within the Frances Baard DM, such as: . Potatoes (Chips) . Carrots (Carrot Juice) . Olives (Olive Oil, soap) . Grapes (mainly wine grapes, raisins) . Tomato (Tomato paste, dried tomatoes) . Citrus, Sub Tropical and Deciduous Fruits . Mushrooms . Sweet Potatoes
Field Crop The FBDM contributes to the majority of the Field Crops produced in the Northern Cape. However very little is being done to add value to these field crops. Thus there is a further opportunity for the processing of these field crops, such as: . Maize . Wheat . Sunflower seeds . Dry beans . Lucerne . Ground nuts There is an opportunity to expand the field crop production of FBDM with the production of pecan nuts.
Meat processing FBDM contributes greatly to the livestock of the Northern Cape, but as stated there is very little being done with regards to value adding to the livestock. The industry is thus concentrated in the primary sector. There is however opportunity for meat processing with in the area, such as: . Beef Cattle . Pigs . Chicken . Ostriches
72 | P a g e © FBDM LED Strategy Review 2014/15
Possible new As stated FBDM Agricultural sector is mainly reliant on the Vaal-Harts irrigation products system and that DWAF are suggesting that no water should further be used for irrigation systems which place a strain on the agricultural sector of FBDM. The possibility of moving towards water wise plants provides an opportunity for further diversification of the Agricultural sector, and would result in the Agricultural sector not being over dependant on the irrigation system within the FBDM. Possible new farming crops which need to be researched by the FBDM are: . Cassava (tropical root crop) various uses include: o Basis for food, flour, animal feed, alcohol & starches for sizing paper and textiles, sweeteners, prepared foods and bio-degradable products. . Cowpeas (protein rich bean crop) various uses include: o The leaves and growth points can be picked and used as a vegetable dish. o The leaves can be dried and used as a meat substitute. About 1 kg cowpeas are a full meal. o The green seeds are sometimes roasted like peanuts and these are then used as a substitute for coffee. o Ground dried seeds mixed with onions and spices can be fried in oil. The seeds can also be cooked. o It can be used as green manure. o It can be planted for hay production. o Silage can be made by mixing the green leaves with sorghum or maize. o Cowpeas can be planted for hay production and the hay can be sold. The viability of these new products needs to be researched by the FBDM by means of feasibility studies. The production of these new products could also be implemented as community based projects.
6.4.2. MINING
The FBDM is one of the centres of mining activity in the Northern Cape, hosting some of the largest diamond and limestone operations in the Northern Cape Province. Currently there are 22 mining rights issued within the district. As mining interest grows this number is expected to increase. What is also evident from the FBDM is that almost 80 mining supply, assembly and repair companies have located themselves in the District to participate and contribute to the local mining sector.
Mining companies present opportunities for further development through the Social and Labour Plans (SLPs), which has to receive input from the Local and District Municipalities and ultimate approval from the Department of
73 | P a g e © FBDM LED Strategy Review 2014/15
Mineral Resources. Each Mining Right has to be associated with an approved SLP and mines have to make significant financial commitments to these. Small Scale Mining (SSM) is also a widespread practice within the FBDM. Small scale mining serves as a means for many families to diversify their income streams, to lift them from the poverty levels which surround them and most important, it creates economic activity close to where rural communities are based. SSM is perceived as a difficulty to manage and administer but developed correctly it can serves as a catalyst for change in small areas across the District. At the summit small scale miners raised their practical issues which they cannot overcome. MAP 2: MINING POTENTIAL
74 | P a g e © FBDM LED Strategy Review 2014/15 6.4.2.1. DEVELOPMENT POTENTIAL
TABLE 11: DEVELOPMENT POTENTIAL – MINING SECTOR
Criteria Current Reality Implications
Availability of extractable reserves The Northern Cape has mineral Develop a strategy to retain the wealth which has provided the focus on Frances Baard as a Northern Cape with national and diamond capital of the world. international importance w.r.t minerals.
The Northern Cape produced 37% of the countries diamonds. De Beers has been the world’s largest producer of uncut diamonds. The De Beers base is in Kimberley which is located in the heart of South Africa’s diamond fields.
Market trends Despite the current economic Develop an elaborate support crisis there is still a positive strategy for Small Scall Miners demand for diamonds in the world, which is a positive impact for the diamond mines of Frances Baard DM.
Availability of labour The Frances Baard DM has Develop and implement an declining population and the elaborate skills development majority of the population have strategy in partnership with the very low skills therefore there is a Univesity of Sol Plaatje small availability of skilled labourers in the area.
Technology changes Overall extraction costs are a Introduce a combination of labour combination of variables such as intensive methods and grade of diamonds, mining depth, technologically advanced geology, labour efficiency and production methods technology. More efficient technology and improved labour productivity can therefore increase the profitability of the mines.
75 | P a g e © FBDM LED Strategy Review 2014/15
Economic linkages The Diamonds extracted within Develop a District Beneficiation the FBDM are exported to other Strategy regions (national and international) for further processing and beneficiation. Value adding processes could be implemented locally which would increase job opportunities.
Mining inputs, such as machinery, piping, tubing, chemicals, mining timber, iron and steel products, explosives, electrical machinery, cables and wiring, foodstuffs, etc. are sourced mainly from outside FBDM, resulting in a massive income leakage out of the area. The mines potentially represent a substantial local market for these manufactured products and by strengthening the local backward linkages, the manufacturing sector can be stimulated.
6.4.2.2. OPPORTUNITIES
TABLE 12: OPPORTUNITIES – MINING SECTOR
Mining Beneficiation The Northern Cape and Frances Baard District Municipality is well endowed with mineral resources but certain problems and constraints do exists such as the decline in the diamond sector. Mining is concentrated on stones and minerals with very little beneficiation taking place within the province. This limits the amount of value added to the mining products and therefore reduces the benefit that accurse to the provincial economy. There is an importance for mineral beneficiation and processing in Frances Baard District. For this industrial development to take place it is important not to forget the availability of important mineral deposits in the area. Currently these minerals are only mined and then transported to other areas where they are processed and beneficiated overseas. By developing processing and
76 | P a g e © FBDM LED Strategy Review 2014/15
beneficiation plants in the District, numerous jobs could be created and value adding can take place locally, benefitting the local communities and local economy. This could also attract further investors to the area. Sectors such as construction, transport & tourism could be benefitted by such as initiative. Cluster opportunities which could be linked to this are:
Cutting & Polishing Industry Jewellery Industry Tools (drill-points, cutting blades) Precision instruments This initiative could also be linked to the Provincial Diamond Hub project.
Formalising of Pebble There are many small-scale miners informally involved in pebble mining along Mining the river banks within the FBDM. This could be formalised through the establishment of cooperatives and joint assistance from the FBDM in order to reach better markets and improve the viability of the pebble mining industry for those individuals involved.
6.4.3. MANUFACTURING
Manufacturing has a range of potential service under which it can be segregated. For purposes of this LED Strategy it is important to segregate it into the following sub-categories and they are viz:
a. Food and Beverages b. Clothing and Textiles c. Motor Rail Technology and d. Solar and related technology 6.4.3.1. THE FOOD AND BEVERAGES SECTOR
The demand for food and beverage products has been on the increase over the last five years. There is an established cluster in Ritchie and Jan Kempdorp, with a possibility of a Milling Plant in Warrenton, there is however great potential in the other secondary sectors supporting the food and beverage sector.
The sector is highly regulated and the prices are regulated by statutory and industry bodies. Sector penetration is however difficult due to fore contracts. At the same time there is potential for BBBEE. With regards to international competitiveness, the sector is highly subsidized internationally and as such makes it difficult for competition. 6.4.3.2. CLOTHING AND TEXTILE
The sector has taken a serious dip over the recent past in Kimberley. The major clothing factories have been closed down or scaled down. The basic infrastructure
77 | P a g e © FBDM LED Strategy Review 2014/15 still remains in place. There are a number of fairly qualified and skilled labourers for this sector. There are no take up agreements but the market is clearly defined. The profit margins are still low and the sector is highly competitive. The demand for the products are increasing and are innovated regularly thus making it a very dynamic manufacturing environment. 6.4.3.3. MOTOR AND RAIL TECHNOLOGY
There is an expansion of infrastructure by Transnet and PRASA, where these entities are rolling out train stock both for freight and passenger rail purposes for the next 20 years. There is a real possibility for partnership with regards, to downstream production activity related to these items. 6.4.3.4. SOLAR AND RELATED TECHNOLOGY
There is an increase in the demand for energy efficiency products and services. The District and in particular, Kimberley is centrally located for transport purposes. Whilst there is increasing demand for these services, the sector is highly innovated and technical and as such will require a measure of skills and such implies minimum opportunities for job creation but it has high return possibilities. MAP 3: MANUFACTURING SECTOR
78 | P a g e © FBDM LED Strategy Review 2014/15 6.4.3.5. DEVELOPMENT POTENTIAL
TABLE 13: DEVELOPMENT POTENTIAL – MANUFACTURING SECTOR
Criteria Implication Implications
Economic linkages The manufacturing sector is mainly linked to primary sectors such as agriculture and mining. The main manufacturing taking place is the production of machinery needed by the primary sectors or adding value to the produce of these primary sectors.
Market trends International manufacturing trends Manufacturing initiatives should towards natural and organic products focus on commodities that will be have not been exploited in the Frances demanded by emerging markets Baard DM. and on “green” products, such as recycled goods and energy efficient goods.
Gap Analysis Very little value adding of raw produce is taking place in the Frances Baard DM, and the opportunity to establish value adding processes should be realised.
Availability of labour The majority of the population in the The employment opportunities Frances Baard DM are unskilled, which provided in the manufacturing implies a lack of skilled employees to sector require specific skills, which implement specialised value adding require further training. processes.
The seasonal workers and/or unemployed population could be easily absorbed into these
Technology changes It is important for the Frances Baard DM to implement new technologies to gain a comparative advantage in the value adding processes.
Enabling Environment The manufacturing sector is classified as Feasibility studies need to be an important growth potential sector, not conducted to determine the viability only by the FBDM but also by the DTI of the new opportunities identified. which provides various incentives for such projects.
79 | P a g e © FBDM LED Strategy Review 2014/15 6.4.3.6. OPPORTUNITIES
TABLE 14: OPPORTUNITIES – MANUFACTURING SECTOR
Tannery Plant This initiative could connect livestock (goat, sheep, game) production with downstream industries such as meat processing, craft making & retail activities. The animals are slaughtered at the local abattoir, where the meat can then be processed to other products such as sausages, salami, patties, dry wors, etc. This could be sold at an onsite shop which also provides a restaurant where people could different dishes. The tannery plant which could also be located on site could use the skins to produce various products such as leather shoes, belts, cushions, etc. and then sold in a curio shop. The project could also provide extensive training to the community in order for the local community to be active in all stages of the project, but less intensive training workshops for tourists could also be included.
Chips Factory The Frances Baard DM exhibits potential for the establishment of a chips factory since potatoes are a very valuable vegetable crop in South Africa (value and volume). The Frances Baard DM (67%) produces the largest amount of potatoes in the Northern Cape and the best potato farmer in South Africa lives in Frances Baard DM. However there is very little value adding taking place in the Northern Cape which leads to the establishment of the chips factory (Simba, Willards, etc.)
Vegetable & Fruit The Frances Baard DM contributes largely to the production of the Northern Processing Cape’s fruit and vegetables. But as mentioned in the case of potatoes there are very little value adding processes taking place in the area. This results in the opportunity for the development of fruit and vegetable processing within the Frances Baard DM, such as:
Carrots (Carrot Juice) Olives (Olive Oil, soap) Grapes (mainly wine grapes, raisins) Tomato (Tomato paste, dried tomatoes) Citrus, Sub Tropical and Deciduous Fruits Mushrooms Sweet Potatoes
Field Crop Processing The FBDM contributes to the majority of the Field Crops produced in the Northern Cape. However very little is being done to add value to these field crops. Thus there is a further opportunity for the processing of these field crops, such as:
Maize Wheat
80 | P a g e © FBDM LED Strategy Review 2014/15
Sunflower seeds Dry beans Lucerne Ground nuts
Meat Processing FBDM contributes greatly to the livestock of the Northern Cape,but as stated there is very little being done with regards to value adding to the livestock. The industry is thus concentrated in the primary sector. There is however opportunity for meat processing with in the area, such as:
Beef Cattle Pigs Chicken Ostriches
Packaging & Distribution of Expanding on the agro processing opportunity in the Northern Products Cape provides the opportunity for the development of packaging plants. The Kimberley farmers alone use 12 million cartons and 10 million fibre bags annually. This results in the opportunity to produce environmentally friendly packaging locally. Starch based biodegradable plastics could be used to produce shopping bags, bread bags, bait bags, over wrap, ‘flushable’ sanitary product backing material, and mulch film.
Expansion of the Mining Sector Manufacturing Sector Cutting & Polishing Industry Jewellery Industry Tools (drill-points, cutting blades) Precision instruments Agricultural Sector Manufacturing of Irrigation equipment Construction Sector Manufacturing of construction and building equipment Limestone mined in the area could provide an opportunity for brick making
Solar and related technology The developments in the alternative energy space present a number of opportunities and these include the manufacturing of the following items:
Solar Panels Building Inputs-such as fencing, concrete etc. Transformers for the power stations
Rail and Motor Technology The Transnet and PRASA initiatives present opportunities for some or all of the components of the coaches to be manufactured in the district.
81 | P a g e © FBDM LED Strategy Review 2014/15 6.4.4. SERVICE SECTOR
The finance and business services sector includes inter alia financial intermediation; insurance and pension funding; real estate activities; renting or transport equipment; computer and related activities; research and development; legal; accounting; bookkeeping and auditing activities; architectural, engineering and other technical activities; and business activities not classified elsewhere.
The community and personal services sector includes public administration and defence activities, activities of government, government departments and agencies; education, public and private; health and social work; sewage and refuge disposal, sanitation and similar activities; activities of membership organisations; recreational, cultural and sporting activities. There have been fluctuations in the growth performance of the finance and business services sector for this period. For the same period the community services has a more stable growth performance.
The finance and insurance sub-sector has the greatest contribution towards the overall growth performance of the finance and business services sector. The major/primary business and service node in the Frances Baard DM is Kimberley and the various secondary nodes are Barkly West, Warrenton, Jan Kempsdorp, Hartswater and Pampierstad.
The government services sub-sector has the greatest contribution towards the overall growth of the community services sector. The service sector as a whole has had the largest contribution toward employment opportunities in the Frances Baard DM for the last 11 years since 2001. 6.4.4.1. DEVELOPMENT POTENTIAL
TABLE 15: DEVELOPMENT POTENTIAL – SERVICE SECTOR
Criteria Implication Implications
Market trends Various services such as electricity, There is a need to focus on research water, refuse removal, sanitation, and development within the economy education, health and social work, with specific focus on agriculture, infrastructure and recreational facilities manufacturing and tourism. are provided in the Frances Baard DM; however these services are mainly focused in the primary and secondary nodes.
Availability of labour The population of the Frances Baard DM Education facilities and research and is unskilled which leads to a lack of skilled development go hand-in-hand. It is workers in the sector. The skills supplied important to ensure that education by the population in the Frances Baard facilities and are conducting relevant
82 | P a g e © FBDM LED Strategy Review 2014/15
DM are not always the skills required by research as well providing the relevant the businesses in the area. training courses in order capacitate the local labour force in order to enter emerging markets such as the ICT industry.
Technology change The use of internet has become an important resource for businesses and the lack of research and information in the ICT and telecommunication of the Frances Baard DM poses a constraint on business development in the area.
Enabling Environment There is a lack of cooperation between business support organisations in the Frances Baard DM which leads to inadequate support for small businesses to develop in the area.
6.4.4.2. OPPORTUNITIES
TABLE 16: OPPORTUNITIES – SERVICE SECTOR
Central Freezing Facility & Cold The fruit and vegetable products that are produced in the area need to be storage transport stored in freezing facilities before transported in cold storage transport units to the airport or other surrounding areas. This presents an opportunity for an SMME business to establish such a business in the area.
Business Process Outsourcing The Sol Plaatje LM is currently in the process of establishing a call centre and Off-Shoring hub. (BPO&O) in the area. The FBDM requested funding sources for this project because the District could not fund the whole of the project. The DTI has a BPO&O investment incentive initiative which could be linked to this project. This also opens the opportunity for FBDM to market the area as a BPO&O location which provides call centres, data processing and other services. It is important that the FBDM take note that establishing the area as a BPO&O destination would require infrastructure upgrades and skills development within the local communities.
SMME Database and Support The FBDM is currently in the process of appointing a service provider to Programme conduct research in the state of SMME in the FBDM.
83 | P a g e © FBDM LED Strategy Review 2014/15
This would include a database of SMME’s, creating a support structure for SMME’s, and creating a partnership and alliance program.
Form business support network In FBDM there is only one Small Business Support Centre which is in Kimberley. They offer non-financial support to SMME’s. There are also other support institutions in FBDM, such as DTI, SEDA, Khula Finance, IDC, NAFCOC, NOCCI, Ntsika, NCMAC, NCEDA, SMME Development Trust, Cedar Investments, Umsobomvu, etc. A major constraint though is the lack of co-operation between the SBSC, municipalities and the various business support organisations, because of insufficient communication & information of new opportunities in the area. In order for the SMME’s to grow the business support organisations should be linked in order to provide the best support advice to the emerging entrepreneurs.
Skills training facilities This would require an audit of the available skills within the FBDM and the skills that would be required by the new opportunities identified within the FBDM. The FBDM then need to establish skills training facilities to create the needed skills within the area. These skills will be linked to various opportunities such as agro processing, mining beneficiation and the linked opportunities, and manufacturing opportunities.
Industrial Development The opportunities identified within this potential analysis of the FBDM Strategy provide various opportunities for industrial development within the FBDM. It would however be important for the FBDM to implement an Industrial Development Strategy in order to coordinate this development to benefit the FBDM region as a whole.
6.4.5. TOURISM
Tourism is not an economic sector on its own (as classified by the SIC), but forms part of other sectors especially the trade, transport and finance sectors. However, due to its increasing importance as an income and employment creator in South Africa, it is believed that this industry should be discussed separately from the other sectors. Tourism development in the District has faced various challenges during the past decades, including a lack of tourism financial and human resources, limited private sector partnerships, inadequate involvement of local communities and lack of tourism infrastructure in certain areas.
84 | P a g e © FBDM LED Strategy Review 2014/15
As a result the District has not featured prominently on the national and international travel map and is the least visited of South Africa’s provinces. In certain overseas markets such Germany, France and the Benelux the province has an above- average market share while it has fared poorly in other markets such as the Far East, Africa (excluding Namibia where it has a large market share) and the Americas. The Northern Cape in general also has a very limited (less than 2%) share of the domestic market.
There are a number of challenges relating to Tourism growth in the District and some of these factors include the limited and expensive air and railway access to and within the province (particularly air access is very limited), the lack of a winning brand and promotions strategy, inadequate funding and resources for tourism development and promotion, institutional fragmentation, limited co-operation and partnerships between the private and public sectors, a seasonal demand pattern, imbalances in urban and rural tourism development, limited involvement of previously disadvantaged communities, tourism security concerns, lack of product and service quality and infrastructure constraints (particularly in traditionally neglected areas).
Mining has always defined the history in this part of South Africa and, when diamonds were discovered in Kimberley, unprecedented growth took place in the province. The district accommodates the largest proportion of the population of the province, giving it the largest population density (26, 2 persons per square km) in the province. As a destination this region is the most visited regional destination in the Northern Cape. The destination is known for its key attractions such as the Kimberley Big Hole, Wildebeest Kuil Rock Art Centre, Galeshewe Activity Route, Kimberley Ghost Trail, McGregor Museum, Hartswater irrigation system and wine cellar, Anglo-Boer War battlefields and many more.
85 | P a g e © FBDM LED Strategy Review 2014/15 MAP 4: TOURISM
6.4.5.1. DEVELOPMENT POTENTIAL
TABLE 17: DEVELOPMENT POTENTIAL – TOURISM
Criteria Current Reality Implications
Availability of resources The Frances Baard DM provides a variety of tourist attractions which range from natural beauty attractions such as the river systems and the wide open savannah to manmade attraction such as the Big Hole, historic museums, Vaal Harts irrigation system and historic land sites.
Market Trends Tourism development is mainly based in Kimberley (Sol Plaatje LM) due to the rich history and diamond mining in the area. There is only one tourism office in the Frances Baard DM, situated in the Sol Plaatje LM, which results in the lack of marketing of the other LM’s as tourist destinations. The tourism activities in the
86 | P a g e © FBDM LED Strategy Review 2014/15
Frances Baard DM are mainly based on the mining history of the area as well as the historic importance of the area in the Anglo War.
Technology change Tourism has a large potential for development in the Frances Baard DM, but is dependent on the natural and manmade resources in the area. Therefore the Frances Baard DM should implement initiatives to protect the natural environment from aspects such as climate change.
6.4.5.2. OPPORTUNITIES
TABLE 18: OPPORTUNITIES - TOURISM
Mining tourism The mining sector in FBDM is declining which leads to a high number of retrenchments from mines and farms. This leads to the high demand for job opportunities in the FBDM area. The people active in the mining industry need to secure jobs, and with their knowledge of the mines they could be trained as tour guides for the various mines. These tours could also consist of educational tours for schools and students.
Game viewing/trophy hunting The Frances Baard DM shows significant potential for game farming. This could potentially have various spin-off effects such as trophy hunting or game viewing. A study done at the wildlife centre at the University of Pretoria showed that an average sized game farm could generate 54% of its gross income from hunting, 21% from live animal sales, 18% from trophy hunters, 5% from eco- tourism and 2% from meat production. This initiative also needs to be linked to activities for woman such as spa facilities.
Eco tourism Bird Watching Fly Fishing Hiking Trails Water Sports (Vaal & Harts Rivers) o Heritage Resources & Historic Sites
Adventure Tourism Mountain biking Extreme sports
87 | P a g e © FBDM LED Strategy Review 2014/15
Expansion of the Hospitality Need to provide wider variety of accommodation facilities such as hotel, Industry lodges and guesthouses. There also needs to be an expansion within the restaurant industry, since currently there are only franchise restaurants and no unique restaurant to the FBDM.
Tourism Marketing Strategy A coordinated and integrated tourism marketing strategy is required for the FBDM. It is important that the FBDM and local municipalities work together to implement a coordinated effort in marketing the area as a tourism destination.
6.5. CONCLUSION
This section provided an analysis of economic potential within the Frances Baard DM, and the identification of development opportunities and constraints within the different economic sectors. The development opportunities (projects) which were identified will then be prioritised in the following section to assist in the assessment of these projects. The main challenge for local economic development in the Frances Baard DM is to diversify the economic base and add value to the primary products that are produced in the area. To ensure the accountability and responsibility for implementing the projects identified in this section a monitoring and evaluation framework needs to be incorporated into the Frances Baard DM performance management system.
88 | P a g e © FBDM LED Strategy Review 2014/15 7. PROJECT IDENTIFICATION
7.1. PROJECT PRIORITISATION CRITERIA
To determine which of the identified projects will have the highest impact on the economy in terms of job creation, capacity building and social development, it is important to prioritise these projects according to a specific set of criteria, which will facilitate the selection process of strategic anchor projects. The project prioritisation criteria developed for the Frances Baard economy is discussed in the following paragraphs. This implies that each potential LED programme/opportunity must be weighed against each indicator towards determining which initiatives will result in the most beneficial impacts, while taking limited resource availability into cognisance.
1. Employment creation: This is the most fundamental indicator against which all LED initiatives must be weighed, since it aligns with the main objective of LED in Frances Baard. This indicator will give weight to initiatives that use labour intensive production methods and create secondary opportunities in the local economy for investment.
2. Strategic Importance: The strategic importance of an LED initiative mainly relates to the expansion of local value-chains in the economy and the reduction of such gaps. By initiating strategic initiatives in this way causes the formation of economic clusters and networks that facilitates production cost advantages and higher levels of capital retention in the local economy.
3. SMME Development and Entrepreneurial Assistance: This indicator is vitally important within the context of the Frances Baard LED. The unavailability of institutionalised assistance to small businesses and entrepreneurs has been identified as a key constraint to local investment. This indicator would thus ensure that initiatives that support entrepreneurs and SMMEs gain a higher priority ranking.
4. BEE and Capacity Building: This indicator will give preference to initiatives that support BEE and capacity building among the local labour force. This implies that initiatives that provide skills development and -training opportunities for local people will receive more weight in the ranking process.
5. Anchor Projects: Anchor projects can be defined as large initiatives that create spin-off opportunities for entrepreneurs (and SMMEs) in the local economy. Such projects must be recognised for their potential to stimulate
89 | P a g e © FBDM LED Strategy Review 2014/15
the economy in an indirect way, beyond the initial investment to establish the anchor project.
7.2. LED PILLARS AND PROGRAMMES
This Section outlines the Strategic Pillars, Programmes and Projects.
These Strategic Pillars are based on the situation experienced within the economy of Frances Baard and aim to utilise existing strengths and opportunities by transforming these into workable programmes and actions that will assist in reducing threats and alleviate the weaknesses in the local economic environment.
The Strategic Pillars are supported via the development of programmes that aim to enable the specific sectors. Distinct actions are formulated in order to reach the targets of each programme. TABLE 19: PILLARS AND PROGRAMMES
Pillar Programme Project
Introduce more products to the Goat Farming Goat Milk Project, formal market Goat Cheese Yoghurts Body Creams Soaps Medical Projects
Focus on maximizing value addition Vegetable, Fruit and Field Potato chips to the current farming activity Crop processing Carrots Olives Grapes Tomatoes Citrus Mushrooms Sweet Potatoes Wheat Sunflower seeds Dry Beans and Lucerne
Focus on value adding products with Engage in meat processing Beef regards to livestock Pork Chicken Ostrich and Game
90 | P a g e © FBDM LED Strategy Review 2014/15
Conduct research on the possibility Research the value and the Cassava of the introduction of other products sustainability of new Cowpeas onto the market products
Create a more sustained effort Implement mining related Create a strategy for improving the towards mining beneficiation in the projects following areas: District Cutting and polishing Jewellery Industry Tools and precision instruments Develop a support strategy for Small Scale Miners Establish a Small Scale Miners Fund in partnership with other state funding agencies Initiate the implementation of a Mining Exposition in the District
Strengthen the focus on job creation Strengthen the Development of feasibility plans and and innovation through the manufacturing Sector business plans for: acceleration of manufacturing Tannery Plant activity Rail Technology Plant Solar Equipment Plant Chips Factory Vegetable and Fruit Processing Plant Field Crop Processing Plant Meat Processing Plant Packaging and Distribution Products
Ensure that the service sector and Strengthen the institutions Partner with Sol Plaatje the servicing of institutions focused and the District with regards University to improve the on LED have the necessary support to support services services sector and capacity to support the Develop a SMME Support secondary sectors of the economy Programme for SMMEs Strengthen the existing business service networks
91 | P a g e © FBDM LED Strategy Review 2014/15 7.3. PRIORITISED PROJECTS
TABLE 20: PRIORITISED PROJECTS
Availability of Equity Partners
Technoligical Considerations
Projects Commercial Development Criteria: Total
Economic Criteria: Total
Market Growth Potential
Local Content in Capital
Job Creation Potential
Broad Based BEE
Regio
Expenditure
Project Size
PRIORITY
VALUE
Local
nal Impact
Crieteria: Total
AGRICULTURAL SECTOR Goat Farming 8 3 3 2 12 4 3 5 7 2 3 2 27 3 Game breeding 9 3 4 2 6 2 2 2 8 3 2 3 23 4 Vegetable and Fruit Processing 10 3 3 4 8 2 3 3 12 4 4 4 30 2 Field Crop 9 3 3 3 11 4 3 4 10 3 3 4 30 2 Meat Processing 11 4 3 4 10 3 3 4 11 3 4 4 32 1 Casava 9 3 3 3 11 3 4 4 10 3 3 4 30 2 Cowpeas 11 3 4 4 10 3 3 4 11 3 4 4 32 1 MINING SECTOR Mineral Beneficiation (Cutting and 11 3 4 4 11 3 4 4 10 4 2 4 32 3 Polishing, Tools, Instruments)
Formalisation of Pebble Mining 11 4 5 2 14 5 5 4 14 4 3 3 39 1 Supporting Small Scale Miners 11 4 4 3 11 3 4 4 11 4 3 4 33 2 Creation of a Small Scale Mining 10 2 4 4 11 3 4 4 11 4 3 5 32 3 fund Creation of a Mining Exposition in 10 4 4 2 11 3 4 4 11 4 3 4 32 3 the District MANUFACTURING SECTOR Tannery Plant 8 2 3 3 9 3 3 3 11 3 4 4 28 5 Chips Factory 10 3 3 4 11 3 4 4 10 3 3 4 31 4 Oil (vegetable) Processing Plant 11 3 4 4 11 3 4 4 10 3 3 4 32 3 Field Crop Processing 11 3 4 4 11 3 4 4 10 3 3 4 32 3 Meat Processing 12 4 4 4 10 3 3 4 11 4 3 4 33 2 Solar Equipment Manufacturing 12 4 4 4 9 3 4 2 11 4 3 4 32 3 Rail Technology Manufacturing 12 3 5 4 12 4 4 4 14 5 4 5 38 1 Plant SERVICES SECTOR Creating a service offering 12 5 4 3 13 4 4 5 12 5 3 4 37 2 through the Sol Plaatje University SMME Support Programme 13 5 5 3 14 4 5 5 14 4 5 5 41 1
92 | P a g e © FBDM LED Strategy Review 2014/15
Strengthening of the Business 13 5 5 3 14 4 5 5 14 4 5 5 41 1 Support Network Institutionalise Incubation Hubs 13 5 5 3 14 4 5 5 14 4 5 5 41 1 Across the District TOURISM SECTOR Mining tourism 12 4 4 4 12 4 4 4 12 4 4 4 36 1 Game Viewing and Trophy 11 5 3 3 11 4 3 4 10 3 4 3 32 3 Hunting Eco-Tourism 10 3 3 4 11 4 3 4 10 3 4 3 31 4 Adventure Tourism 12 4 4 4 11 4 3 4 11 3 4 4 34 2
93 | P a g e © FBDM LED Strategy Review 2014/15 8. IMPLEMENTATION GUIDELINES
This Section provides some framework for the implementation of the Frances Baard District Municipality’s LED Strategy. The actual implementation of the specified Pillars and development programmes is vitally important and should be regarded as of the utmost importance.
While individual wealth and employment creation projects have been formulated for Frances Baard, the deployment of the LED strategy (i.e. the various Pillars and their respective development programmes), is central to the successful placement of the Municipality on a higher economic growth path. This Section builds on the Potential Analysis and the LED Development Framework, and serves as a basis for implementation.
8.1. ROLES AND RESPONSIBILITIES OF THE VARIOUS STAKEHOLDERS
There are various players involved in LED and in any situation where they need to be depolyed, a well thought through process needs to be engaged and as such ensure that their involvement results in the attainment of the general LED Vision. In this regard, there are a number of inter and intra sphere players whose roles and responsibilities needs to be mapped properly in order to direct the process fairly. In this regard, the roles and responsiblities of the various stakeholders are detailed as follows: TABLE 21: ROLES AND RESPONSIBILITIES
Institution Roles And Responsibilities
National Government Sets and regulates National LED Policy and Regulations Monitors LED related projects Conducts LED related reasearch in order to inform policy Creates learning forums for mutual LED learning exchange
Provincial Government Sets and regulates Provincial LED Policy Monitors LED related projects Conducts LED related reasearch in order to inform policy Provides support to District and Local Municipalities on LED Supports the implementation of LED Projects
94 | P a g e © FBDM LED Strategy Review 2014/15
Convenes and manages LED Forum for LED Lessons and Planning Develops Provincial LED Strategy and framework for LED Strategies for municipalities Implement National LED Policy
District Municipality Develops LED Strategy for alignment with local municipal LED Strategies Champions the implementation of LED Projects within the local municipalities Supports the process of implementation of LED Projects within local municipalities Provides Institutional LED Support to local municipalities Attracts investment within the district and as such empowers local municipalities in terms of projects
Local Municipalities Develops LED Strategy for alignment with District LED Strategy Champions the implementation of LED Projects within the local municipality Supports the process of implementation of LED Projects within local municipality Monitors the progress and growth of the economy in the local space Shall convene a multi-stakeholder LED Forum for mutual planning and learning
Private Sector Shall with the support of the municipality initiate projects from the LED Strategy Shall engage with the various stakeholders in the realisation of the various projects Shall report on the projects to the LED Forum
Civil Society Shall with the support of the municipality initiate projects from the LED Strategy Shall engage with the various stakeholders in the realisation of the various projects Shall report on the projects to the LED Forum
Communities Shall provide the labour to the projects Shall be the broad based component of the ownership of the project
95 | P a g e © FBDM LED Strategy Review 2014/15 8.2. STRATEGY IMPLEMENTATION GUIDELINES
To facilitate successful strategy implementation, it is necessary to outline an implementation framework tailored to the Frances Baard LED Institutional Framework. This implementation framework is based on the development Pillars and programmes identified above. The implementation framework reflects the key strategic points of implementation specifically with regards to the various sectors. Therefore it is important to understand the institution when developing the implementation guidelines. In this regard, Frances Baard is structured in 2 ways in order to implement LED and these are viz: 1. As implementing agent of programmes and projects 2. As a support agent to implementing agents and as such an implementing agent of programmes only. 8.2.1. IMPLEMENTING AGENT OF PROGRAMMES AND PROJECTS
Local Municipalities
District Frances Baard Private Sector LED District Forum Municipality
Civil Society
From the model above, the implementation approach will be as follows:
Frances Baard will be the owner and champion of the project, Frances Baard will in this case interact with the local municipalities, private sector and civil society in order to address issues related to ownership of the project, feasibility studies related to the projects and other implementation related matters, Once all of these matters are executed, the implementing agent and or the project owner, will then report to the Frances Baard District Municipality through the District LED Forum.
Institutional structure to implement this model:
96 | P a g e © FBDM LED Strategy Review 2014/15
Director: Development and Planning
Investment LED Project LED Manager Promotion Manager Management Unit
Investment Senior LED LED Projects Officer Officer Officer
LED Officer
LED Clerk
8.2.2. SUPPORT AGENT TO IMPLEMENTING AGENTS
From the model above, the implementation approach will be as follows:
The Local Municipalities, Private Sector and Civil Society will be the owner and champion of the project, Frances Baard will be a project supporter and provide oversight support only to the projects The Project Champions will report to the Frances Baard District Municipality through LED Forum.
97 | P a g e © FBDM LED Strategy Review 2014/15
Director: Development and Planning
LED Project LED Manager Management Unit
Senior LED LED Projects Officer Officer
LED Officer
LED Clerk
8.3. APPLICATION GUIDELINES
The previous round of LED Strategies has proven that there has been a proliferation of LED Strategies but minimal implementation of projects to give real effect to economic development in the local space.
The intention therefore with this section of the Strategy is to give some broad guidelines around how the projects should be approached and consequently implemented. It is also important to understand that the real implementation of these projects falls outside of the Strategy but the guide will also create a commonly accepted approach towards projects and as such set the standard for project implementation. In this regard, there are four critical stages that the projects would need to go through and these are:
a. Pre-feasibility Study b. Feasibility Study c. Business Development Plan d. Capital Raising
Prefeasibility
The pre-feasibility part of the project is the most common and the most resource intensive of preliminary project preparation options. It is a forerunner to a feasibility study. It should seek to lay a good foundation for undertaking an investigation that normally precedes a decision to go forward with a given project proposal.
98 | P a g e © FBDM LED Strategy Review 2014/15
Feasibility
A feasibility study is defined as an evaluation or analysis of the potential impact of a proposed project or program. It is conducted to assist decision makers in determining whether or not to implement a particular project or program. In short it is an investigation, which tries to clearly establish whether a project will work and achieve its expected results. Business Plan
A business plan is a comprehensive planning document, which clearly describes the business developmental objective of an existing or proposed business. The document describes the concept, the market problem, proposed solutions, business and revenue models, marketing strategy, technology, company profile, as well as financial data for the consequent years. Raising Capital
Capital Raising in South Africa is not as rigorous as it is in other countries and markets. It more difficult for public sector as compared to private sector, this mainly because of the rigidity of the legislative regime in the country. It is therefore important that this process be focused on private sector and as such that all LED Projects be anchored in a Technical Partner who is not in the public sector.
99 | P a g e © FBDM LED Strategy Review 2014/15 9. STRATEGIC ALIGNMENT AND INSTITUTIONAL FRAMEWORK
9.1. MARKETING AND LED PROMOTION
Whilst the Local Economic Development Strategy is a product of the Frances Baard District Municipality, it is a product of intergovernmental and intersphere consultation and input. Intergovernmental communication, consultation and coordination therefore become important for purposes of ensuring that the Frances Baard District Municipality’s LED Strategy is a success both at development level and implementation level.
Intergovernmental relations in South Africa are regulated by the Intergovernmental Relations Framework Act (IGRF Act). Very specifically this piece of legislation is intended to promote and facilitate co-operative decision-making and make sure that policies and activities across all spheres encourage service delivery and meet the needs of citizens in an effective way.
The IGRF Act establishes the provisions to guide the three spheres of government in terms of implementing policy and legislation, of establishing intergovernmental structures, managing the conduct of IGR, settling disputes and monitoring and reporting to Parliament.
LED Communication, Consultation and Coordination Intergovernmental communication happens through the various intergovernmental forums. IGR Forums are meetings where town specific regional development issues are discussed at a strategic level, including the impact of legislation, policies and other matters of mutual interest.
Forums are consultative bodies designed to facilitate intergovernmental dialogue and communication on matters of mutual interest, such as the implementation of national policy and legislation, the co-ordination of development planning and the co-ordination and alignment of provincial and local strategic and performance plans.
Forums are in place so that the various role-players work closely together and that the activities they plan are integrated. Forums need to have clear channels of communication between them. Proactive communication is the key for good IGR and efficient implementation of government programmes. For purposes of the Frances Baard LED Strategy it is important to focus on the District IGR Forum and the District LED Forum. At a District level the following IGR Structures exist:
100 | P a g e © FBDM LED Strategy Review 2014/15
Technical Intergovernmental Forum
This forum discusses issues of district and local interest, within and amongst district and local government agencies. It also discusses issues raised by the Premier’s intergovernmental Forum and broader areas of policy, legislation, implementation, co-ordination and alignment.
This forum is chaired by the District Municipal Manager and is coordinated by the District Municipality. This structure is particularly important and useful to the LED process as it will be used as a platform to elevate the institutional issues and other related aspects, such as projects in order to mobilise more support in terms of planning, coordination and implementation.
It further feeds critical issues to the Intergovernmental Forum for further buy-in and mobilisation. The District Intergovernmental Forum
The District Intergovernmental Forum, is chaired by the District Mayor and is primarily comprised of the Local Municipalities’ Mayors. It is supported by the Technical Intergovernmental Forum and seeks to further mobilise issues from Technical Intergovernmental Forum and as such mobilise buy-in further up on the intergovernmental chain. Premier’s Intergovernmental Forum
This forum discusses issues of national, provincial and local interest and in particular from the Districts. It also discusses issues raised by the President’s Coordinating Council and broader areas of policy, legislation, implementation, co- ordination and alignment.
This forum is co-chaired by the Premier and the MEC for Cooperative Governance. It is coordinated by the Office of the Premier and consists of Heads of Departments from all Provincial Government Departments and District Municipal Managers and Mayors and meets at least four times a year.
This structure is particularly important and useful to the LED process as it will be used as a platform to elevate the institutional issues and other related aspects, such as projects in order to mobilise more support in terms of planning, coordination and implementation. This forum will also ensure that some of the issues are elevated to Cabinet.
Intergovernmental Marketing
A multi sectoral strategy like the Frances Baard District Municipality LED Strategy needs marketing because:
The strategy focuses on more than one sector, The strategy requires the involvement of multiple partners The strategy has a number of anticipated results and outcomes
101 | P a g e © FBDM LED Strategy Review 2014/15
The strategy requires a multi developmental approach at the various spheres of government Furthermore intergovernmental marketing of the LED Strategy is necessary because:
It will be used as a mechanism of creating a common understanding of LED and as such common vision, It will set the tone for the new understanding of LED within the Province, It will mobilise for sector support, resources and skills, It will address unrealistic expectations about LED and related programmes and projects It will create the opportunity for the development of collective response mechanisms to challenges related to LED It is also important to understand that there are different platforms and mechanisms for intergovernmental marketing and to this extent the District can undertake the following to ensure intergovernmental marketing: i. Ensure that the LED Strategy is a standing item on the agenda of the various intergovernmental fora such as the Technical IGR, IGR and Premier’s Intergovernmental Forum. ii. Ensure that the Frances Baard District LED Forumreports on progress and challenges of the LED Strategy to the Technical IGR. iii. The Frances Baard District Municipaity to embark on an initiative aimed ensuring that the LED Forums are functional and at the same time has a standing item on the agenda, how the local municipalities are unpacking the district strategy within the various localities. iv. The local municipalities to review and or develop their LED Strategies in line with the District LED Strategy. v. Ensure that the LED Strategy is simplified, summarised and the critical issues are summarised in such a manner that it can be used as part of the broader marketing of the district.
9.2. INTEGRATED PROGRAMMING OF PROJECTS AND ACTION PLAN
In developing an Implementation Plan, there are certain non-negotiable principles. Once it has been decided what has to be achieved, plans have to be put in place to achieve this. It is equally necessary to decide up front what the required outcomes are and to track progress towards the achievement of these targets. It is a well-known fact that if one focuses one’s attention too widely, you are in danger of not achieving anything. It is for this reason that we would like to preface the development of strategic focus and programmes by a brief introduction on the necessity of and links between the various non-negotiable steps in the process.
102 | P a g e © FBDM LED Strategy Review 2014/15
Focus means just that – focus. In order to ensure that we achieve what we set out to do, the number of things targeted should be finite (such as less than ten, and maybe less than six). This does not mean twenty, fifty or more than a hundred. It is also important to keep in mind not only what is to be achieved, but also by when and by whom. Lastly it is also important to track what agreements are in place about trade offs, non-negotiables, etc. In this area the Agenda for Change negotiated up-front will play a key role in making sure that the focus and balance in the plans as developed are just right.
5 Year Action Plan Strategy implementation is driven by action plans. The following key issues should be considered:
Who takes responsibility for each programme or project? What are the targets in terms of outputs, timing and funding? What steps need to be taken to achieve the targets? What will be the reporting structures (including to stakeholders)? What are the performance monitoring and evaluation systems and processes? What has to happen to ensure they are in place and used?
Ideally LED strategies are delivered through public/private sector partnerships that are strongly driven or led by the municipality. The private sector is often keen to manage initiatives aimed at improving the vitality and viability of a local area or to be involved with business development initiatives. Community groups may seek to lead initiatives to improve the health or housing conditions of a target group of disadvantaged individuals.
Strategy implementation is never as clear-cut as the strategy development itself. It often takes longer than expected and involves a consistently changing environment. Within each project and program that is being implemented, strategic thought will occur at every step of the way. This will often focus on how to best advance the project in an often rapidly changing environment.
9.3. ACTION PLAN FOR THE NEXT 5 YEARS
A proposed 5 year action plan is included on the following pages.
103 | P a g e © FBDM LED Strategy Review 2014/15 TABLE 22: 5 YEAR ACTION PLAN
Programme Project Project Interventions Responsibility/ Responsibility/ Support Deliverable No: Champion
Goat Farming Goat Milk Project, Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Goat Cheese Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Yoghurts Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Body Creams Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Soaps Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Medical Products Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Vegetable, Fruit Potato chips Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study and Field Crop processing Carrots Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Olives Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Grapes Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Tomatoes Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Citrus Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Mushrooms Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Sweet Potatoes Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
104 | P a g e © FBDM LED Strategy Review 2014/15
Wheat Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Sunflower seeds Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Dry Beans and Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study Lucerne
Engage in meat Beef Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study processing Pork Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Chicken Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Ostrich Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Game Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Research the Cassava Commission research Frances Baard DM Dept. Economic Development and LMs Research value and the document sustainability of new products Cowpeas Commission research Frances Baard DM Dept. Economic Development and LMs Research document
Implement minig Develop a District Commission the development of Frances Baard DM Dept. Economic Development and LMs Mining Strategy related projects Mining Strategy the strategy
Establish a Small Develop a framework for the Frances Baard DM Fund Guidelines Scale Miners Fund FUND in partnership with other state funding agencies
105 | P a g e © FBDM LED Strategy Review 2014/15
Initiate the Commission the Mining Expo Frances Baard DM Dept. Economic Development and LMs Mining Expo implementation of Concept a Mining Exposition in the District
Stregthen the Tannery Plant Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study manufacturing Sector Rail Technology Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study Plant
Solar Equipment Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study Plant
Chips Factory Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study
Vegetable and Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study Fruit Processing Plant
Field Crop Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study Processing Plant
Meat Processing Commission a feasibility study Frances Baard DM Dept. Economic Development and LMs Feasibility study Plant Packaging and Distribution Products
Strengthen the Partner with Sol Sign a partnership agreement Frances Baard DM Sol Plaatje Municipality and SPU Memorundun of institutions and Plaatje University with the SPU partnership
106 | P a g e © FBDM LED Strategy Review 2014/15 the District with to improve the regards to support services sector services Develop and Support Programme Frances Baard DM implement a SMME Support Programme for SMMEs
Strengthen the Frances Baard DM existing business service networks
107 | P a g e © FBDM LED Strategy Review 2014/15 10. MONITORING AND EVALUATION FRAMEWORK
Implementation of the LED Strategy needs to be monitored on an ongoing basis. Progress with respect to new investment and the impact thereof on the local economy needs to be constantly assessed and monitored over the implementation period of the strategy. To enhance efficiency and effectiveness of the strategy, continuous adjustments need to be made, based on market fluctuations and demand changes. This entails continuous strategic re-positioning.
The rationale for developing and updating a monitoring and evaluation system include the following:
1) Inform the sector departments of the development needs of the municipality. 2) Ensure that all role players are aware of all projects planned in the municipality. 3) Make information of all projects available at one glance. 4) Compare Frances Baard District Municipality with municipalities of other size and scale within the province and country 5) Inform all role players on the progress of project implementation. 6) Determine the contribution and effectiveness of each strategy as projects and KPIs can be linked to specific strategies (PGDS, LED & IDP). 7) Pinpoint the area of intervention through progress and tracking reports. 8) Compare progress year on year.
Mechanisms for Monitoring and Evaluation
In order to undertake a thorough monitoring and evaluation process there a number of things to be put place in order to ensure effectiveness and these are: i. Using the LED Forum as a structure for Monitoring and Evaluation As illustrated in the sections above, it is critical that the LED Forum receives reports on LED progress across all municipalities. In this regard, the Forum, through the LED Office can track the project progress against the reports and as such report to the various structures within the institution.
ii. Engaging in annual review LED is a continues process that has to be observed closely to see if it is producing any results and if there should be any changes in the process. It is important that the economic development strategy is reviewed on an annual basis by the municipality to assess progress and constraints in the process. The following guidelines can be used to review the progress of the LED strategy:
108 | P a g e © FBDM LED Strategy Review 2014/15
1) Reviewing the SWOT analysis of the strategy and see if certain opportunities are still feasible. 2) Review any new information that can influence the feasibility and outcomes of certain opportunities. 3) If there are any changes in circumstances in the strategy there should be an evaluation of the goals, vision and objectives of the project. 4) There should be an indebt review on weather projects are reaching their goals and sowing any progress. 5) Steps should be in place to handle any setbacks in the strategy. 6) There should be criteria to measure performance of projects. 7) There must be a stage in the review process that can evaluate the possibility of other potential projects that might be feasible. 8) Projects can also be changed or restructured to deliver more acceptable results. The LED process can also experience certain setbacks that might hamper the strategy and should be carefully handled to prevent problems of the strategy (World Bank, 2009):
a) Politics. b) Lack of strategic thought. c) Inadequate research, monitoring and evaluation. d) Grant chasing.
109 | P a g e © FBDM LED Strategy Review 2014/15 11. CONCLUSION
A critically important aspect for the successful implementation of the LED Strategy is the need to ensure that all stakeholders and parties involved in the LED process take ownership of the programmes and projects identified. Based on the formulation of the strategy with the numerous potential products and projects, the following is recommended to achieve optimal sustainable local economic development, employment creation, and improvement in living conditions and standards, as well as human resource development:
Start focusing on the sectors with the highest development potential, followed by the sectors with less potential. Ensure balanced stimulation of growth and development within all sectors by not focusing solely on one sector Before embarking on the implementation of specific projects, ensure that adequate funding sources and management capacity are in place Start implementing projects with the highest potential for stimulating economic growth and development Make sure that the projects that stimulate economic growth do not adversely affect the environment or human living conditions Set reasonable time frames for implementation and ensure effective and continuous monitoring of project progress and impacts
The role of FBDM should be focused on creating an LED unit to coordinating and integrating all LED initiatives within the district, as well as facilitating stakeholder participation and the formation of public-private partnerships.
The LED department and LED forum need to clarify the segregation of duties. This will prevent duplication of effort and ensure that good outcomes are achieved in spite of limited human and financial resources.
Incentives need to be created to attract the private sector to invest in the region. The achievement of local economic development will be made easier when there is participation from all sectors within the FBDM.
110 | P a g e ©