Western Cape Business 2022 by Global Africa Network Media

THE GUIDE TO BUSINESS AND INVESTMENT IN THE WESTERN CAPE PROVINCE

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2022 EDITION

WESTERN CAPE BUSINESS

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CONTENTS

Western Cape Business 2022 Edition

Introduction Foreword 5

Western Cape Business is a unique guide to business, tourism and investment in the Western Cape.

Special features A regional overview of the Western Cape

Cape Town’s new stock exchange is based on smart technology, something the Western Cape is rapidly becoming famous for. Special Economic Zones at Atlantis and Saldanha aim to tap into growing markets – maritime, oil and gas and renewable technologies.

Bio-pharmaceutical company lands Covid vaccine contract The Western Cape is a centre of medical innovation.

Economic sectors Agriculture 24 Rooibos is now a protected asset.

Development finance and SMME support Craft designers are preparing for US markets.

Oil and gas

Business Process Outsourcing 47

Energy

References

Manufacturing

Construction and property

The Atlantis Special Economic Zone is attracting Greentech investors. Boatbuilders are busy.

An affordable housing scheme in Ottery will reduce the housing backlog.

Tourism 38

BPO growth is bolstering employment.

Key sector contents

Index

Overviews of the main economic sectors of the Western Cape.

WESTERN CAPE BUSINESS THE GUIDE TO BUSINESS AND INVESTMENT IN THE WESTERN CAPE PROVINCE

2022 EDITION

A maritime cluster will help to create focus in the energy sector.

Covid-19 waves are causing uncertainty.

Education and training

Banking and financial services

Online schools are booming.

Cape Town has a stock exchange again.

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ABOUT THE COVER:

Top left and then clockwise to centre: Cape Town Stadium from Lion’s Head (Jean van der Meulen from Pexels); Black grapes (Kai-Chieh Chan from Pexels); A wind farm north of Touws River (Perdekraal East Wind Farm); Franschhoek (BrandSA); Rescue boat in action (Gemini Marine); Protea in bloom (David Clode on Unsplash); Beach huts at Muizenberg (A Gorman Photography).

FOREWORD

Western Cape Business A unique guide to business and investment in Western Cape.

Credits Publishing director: Chris Whales Editor: John Young Managing director: Clive During Online editor: Christoff Scholtz Designer: Simon Lewis Production: Aneeqah Solomon Ad sales: Gavin van der Merwe Sam Oliver Jeremy Petersen Gabriel Venter Vanessa Wallace Shiko Diala Administration & accounts: Charlene Steynberg Kathy Wootton Distribution and circulation manager: Edward MacDonald Printing: FA Print

he 2021 edition of Western Cape Business is the 14th issue of this highly successful publication that, since its launch in 2005, has established itself as the premier business and investment guide for the Western Cape. The Western Cape has several investment and business opportunities. In addition to the regular articles providing insight into each of the key economic sectors of the province, a special feature on thriving agricultural exports gives insight into the details of what fruits and wines go where. An interview with the Port Manager of the Port of Cape Town provides more understanding of the scale of the logistics operation that is a major port. Another special feature examines the City of Cape Town as a national headquarters for the thriving asset management sector. The cover picture reflects an exciting new find of gas condensate off the south-eastern coast, a potential game-changer for the Western Cape and South African economies. This new development is covered in the overview of the oil and gas sector. To complement the extensive local, national and international distribution of the print edition, the full content can also be viewed online at www.westerncapebusiness.co.za. Updated information on the Western Cape is also available through our monthly e-newsletter, which you can subscribe to online at www.gan.co.za, in addition to our complementary business-to-business titles that cover all nine provinces as well as our flagship South African Business title and the new addition to our list of publications, African Business, which was launched in 2020. ■ Chris Whales Publisher, Global Africa Network Media | Email: chris@gan.co.za

DISTRIBUTION

Western Cape Business is distributed internationally on outgoing and incoming trade missions, through trade and investment agencies; to foreign offices in South Africa’s main trading partners around the world; at top national and international events; through the offices of foreign representatives in South Africa; as well as nationally and regionally via chambers of commerce, tourism offices, airport lounges, provincial government departments, municipalities and companies.

PUBLISHED BY Global Africa Network Media (Pty) Ltd Company Registration No: 2004/004982/07 Directors: Clive During, Chris Whales Physical address: 28 Main Road, Rondebosch 7700 Postal address: PO Box 292, Newlands 7701 Tel: +27 21 657 6200 | Fax: +27 21 674 6943 Email: info@gan.co.za | Website: www.gan.co.za

Member of the Audit Bureau of Circulations COPYRIGHT | Western Cape Business is an independent publication published by Global Africa Network Media (Pty) Ltd. Full copyright to the publication vests with Global Africa Network Media (Pty) Ltd. No part of the publication may be reproduced in any form without the written permission of Global Africa Network Media (Pty) Ltd. PHOTO CREDITS | Amdec Group; Dimzique Jewellery; Eskom; Gestamp Renewable Industries; Hayden Cobra; Newmark Hotels; iContact BPO; Impulse Biomedical; studioMAS; Petroleum Agency SA; Saldanha Bay IDZ; SA Rooibos Council; Stellenbosch University; The Big Picture Company; The Woodstock Exchange.

ISSN 1816 370X DISCLAIMER | While the publisher, Global Africa Network Media (Pty) Ltd, has used all reasonable efforts to ensure that the information contained in Western Cape Business is accurate and up-to-date, the publishers make no representations as to the accuracy, quality, timeliness, or completeness of the information. Global Africa Network will not accept responsibility for any loss or damage suffered as a result of the use of or any reliance placed on such information.

WESTERN CAPE BUSINESS 2022

A REGIONAL OVERVIEW OF THE

WESTERN CAPE

The Saldanha Bay Industrial Development Zone is targeting the marine and oil and gas sectors. Credit: SBIDZ

Cape Town’s new stock exchange is based on smart technology, something the Western Cape is rapidly becoming famous for. Special economic zones at Atlantis and Saldanha aim to tap into growing markets – maritime, oil and gas and renewable technologies. By John Young

have their headquarters in the Cape. Seven of the top 10 managers in the Plexcrown Ratings of 2019 are based in Newlands (MiPlan), Victoria & Alfred Waterfront (Allan Gray), Claremont (Coronation), Bellville (PSG and Boutique CI), Pinelands (Old Mutual) and Westlake (Prescient). Cape Town also, according to the Global Financial Centres Index (GFCI), ranks second in Africa in 2020 (behind Mauritius) in competitiveness as a financial centre. The ranking is an aggregate of indices covering five things: business environment, financial sector development, human capital, infrastructure and reputation. Neighbouring Stellenbosch is advancing its reputation for technological innovation and the output of the region’s four universities and six TVET colleges ensures that the tech sector has the necessary human capital.

s a way for the Western Cape to show off its growing reputation as a tech-friendly destination, the launch of the Cape Town Stock Exchange in August 2021 was an ideal event. When several new bourses launched in 2017 most of them put an X in their names and all of them based themselves in Johannesburg. In 2021, 4AX made the move south and rebranded as the Cape Town Stock Exchange. Not only does this give the exchange immediate access to a global brand, but it puts them at the heart of an area which has been home to financial institutions for as long as there have been banks and insurance companies in South Africa. A more recent trend has seen asset managers setting up in the Cape. Of the 20 finalists named for the 2020 Morningstar South Africa Fund Awards, 13

WESTERN CAPE BUSINESS 2022

SPECIAL FEATURE Cape Town’s share of national employment in the financial sector is about 20% and the contribution to gross value-added (GVA) is 15%. More recently, the city has become home to several financial technology (fintech) incubators: according to Tracxn there were 173 fintech startups in Cape Town in 2021 and French Tech Labs operates out of Century City. There are 22 active incubators and accelerators in the region which provide networking and marketing opportunities and links to funders and markets. The City of Cape Town has installed 848km of fibre-optic cable and the sector supports more than 40 000 jobs with established brands such as Amazon and Panasonic and startups such as Luno, Yoco, Jumo and SweepSouth. Cape Town hosts more than half of all startups in South Africa. Technology has also been embraced by entities such as the Western Cape Department of Agriculture which graduated its second group of drone pilots in 2021, having trained 13 pilots the year before.

Investment The province has a dedicated investment agency, Wesgro. The Investment Promotion Unit of Wesgro has been working with various regions within the Western Cape to attract investment and accelerate exports. Seminars have been held in the Cape Winelands, the West Coast and the Garden Route. In recent years, the biggest investments have been in renewable energy and manufacturing. Other important sectors are agro-processing, aviation, business services, education and training, financial services, real estate, ICT, light manufacturing, oil and gas, timber, tourism, waste beneficiation and clean energy. Encouraging investment in Cape Town has been recognised as something that needs a full-time office and a strategy. Invest Cape Town is an agency of the city that works to create the best possible conditions to attract investors. Areas of focus include broadband access, energy security, the reduction of red tape and improving air access to the city. A Red Tape Reduction Unit has been successful at a provincial level. The plan is to now set up similar units at municipal level.

The Provincial Government of the Western Cape has announced that it intends creating a portfolio of investment projects that can attract private finance. In addition, a commitment has been made to invest in infrastructure. Another vehicle for attracting investment is the creation of Special Economic Zones (SEZ) and Industrial Development Zones (IDZ). Large industrial operations already exist at Saldanha and the Port of Saldanha Bay is the portal for the export of South Africa’s iron ore. The Saldanha Bay Industrial Development Zone (SBIDZ) is becoming a hub for a range of maritime repair activities and oil rig maintenance and repair. The National Department of Trade, Industry and Competition (dtic) and the provincial government have collectively invested R500-million in core infrastructure, a lease agreement has been signed with TNPA, and a phased approach to development has begun. The SBIDZ fits neatly into two overarching visions: Operation Phakisa and Project Khulisa, the targeted growth strategy of the Western Cape Provincial Government which includes servicing and repairing of oil rigs as a priority. The Western Cape is lobbying hard for Saldanha Bay to be a site for a gas-to-power plant. If a gas plant is built at Saldanha, then it could be a catalyst for the use of gas in many other sectors such as manufacturing and residential. The Atlantis Special Economic Zone (ASEZ) is attracting investors in the Greentech market. An early investor in the zone was GRI Towers South Africa, a wind turbine tower manufacturer. With new renewable energy projects such as solar parks and wind farms being rolled out every month, this sector is on a steep growth path. The conversion by South Africa’s key markets to electric vehicles will have an effect on the country’s automotive manufacturers; ASEZ is hoping to attract the makers of new components for the new age.

Economy Finance, business services and real estate combined contribute 28% to the gross domestic product (GDP) of the Western Cape. The financial services and insurance sector are key components of the economy. Although agriculture only accounts for 4.3% of GDP on its own, the sector is responsible for the fruit and vegetables that contribute to agro-processing

WESTERN CAPE BUSINESS 2022

SPECIAL FEATURE

Green technology and manufacturing for the renewable energy market are the focus of the Atlantis Special Economic Zone. The large blue building is the premises of early investor, wind turbine tower manufacturer GRI Towers South Africa. Credit: ASEZ by GreenCape to map the assets and challenges in these areas. In addition to trying to attract green investment into the province, the province is working for improved regulations related to smallscale embedded generation (SSEG). Cape Town also wants to be able to rent out its infrastructure to a power producer who can supply a user via that infrastructure. Much of this work is done by a unit called the Sustainability Energy Markets within the Energy Directorate. Another area of focus for this group is to investigate energy use by lowincome households. The Cape Peninsula University of Technology’s Energy Institute is a leader in research in the field of electricity. The South African Renewable Technology Centre (SARETEC) on the Bellville campus of CPUT offers courses such as Wind Turbine Service Technician and Solar Photovoltaic Service Technician and various short courses such as Bolting Joint Technology. The Centre for Renewable and Sustainable Energy Studies is at the University of Stellenbosch where a new School for Climate Studies has been launched. The University of Cape Town has the Energy Research Centre and the University of the Western Cape is doing research on the possibilities of hydrogen as an energy source. ■

which accounts for nearly 40% of the province’s export basket. (Agro-processing accounts for 8.1% of GDP.) Citrus, wine, apples and pears, grapes, fruit juice, fruit and nuts and tobacco all appear in the top 10 of the province’s exports. Seventy percent of South Africa’s beverage exports come from the Western Cape. Grapes and wine sales to Europe remain strong, but the Chinese market is becoming increasingly important. The province has a diverse manufacturing sector ranging from textiles, clothing, footwear, boatbuilding and furniture to coke and refined petroleum products. Excluding agro-processing, other manufacturing makes up 6.9% of GDP.

Energy The province and the City of Cape Town are lobbying national government for a greater role for municipalities in the generation and distribution of energy. The potential of renewable energy is being realised through the national independent power producer programme and there is a strong lobby to build a gas-to-energy plant in the province. The City of Cape Town and the Western Cape Provincial Government are investing in resilience. A market intelligence report covering energy, renewable energy, water and waste was created WESTERN CAPE BUSINESS 2022

INTERVIEW

The perfect destination for a post-lockdown visit The Western Cape citrus sector has bounced back and is set to break records while the film industry is showing strong signs. What are the broader outlines for the rejuvenation of the tourism sector? The tourism sector had an incredibly tough time in 2020 and 2021, and although inbound tourism numbers are beginning to show a promising increase, we need to continue to monitor the progress of the industry. The resumption of activity will come with its own challenges in terms of maintenance of top-quality guest experience as well as in terms of working capital for businesses needing to reopen their operations after such an extended period of closure. The assistance of tourism SMMEs through training and continued red tape reduction is also key. We need to ensure that our tourism assets are correctly maintained, and we continue to support the regional and local tourism offices during this period of reopening. Wesgro will continue to promote Cape Town and the Western Cape as the perfect destination for a post-lockdown visit.

Agro-processing is a large part of the success story of Western Cape agriculture. Credit: RFG Foods

esgro is the official tourism, trade, investment and film promotion agency for Cape Town and the Western Cape. Western Cape Business asked Wesgro how it is going about tackling the tough new environment for travel, trade and tourism.

What steps are in place to take the Air Access programme forward? The Cape Town Air Access project approved its recovery strategy in June 2020 and this was to ensure that airlines could return to Cape Town as soon as restrictions were lifted locally and internationally. Part of the lobbying effort was convincing the South African government to lift travel restrictions sooner rather than later, which was successfully done with a number of industry partners when international flights resumed in October 2020. The team is now focussing on making sure all previous airlines return to Cape Town and that routes remain sustainable through the recovery period. The project will therefore continue with its core route development and support strategy of route retention, route expansion and new route establishment for Cape Town and the Western Cape. WESTERN CAPE BUSINESS 2022

Did activities continue under lockdown to encourage trade and investment? The Wesgro export unit was able to leverage digital solutions and during the 18-month period from 1 April 2020 – 30 September 2021 was able to support exporters with: • 63 virtual/hybrid export education and awareness networking sessions • Virtual export training: 10 courses, 216 companies, 70 companies mentored • 64 virtual/hybrid/in-market export and OFDI missions to support exporters connecting with international markets. Are there priority sectors that Wesgro is targeting? Agriculture, agro-processing, agribusiness, furniture • Manufacturing and value-added products •

A street scene in Afghanistan. Or is that a Cape Town street dressed for the fourth season of Homeland? Credit: The Big Picture Company • • • • • • •

Is the film sector making a comeback? According to the City of Cape Town’s Film Permit office, film bookings have doubled since 2020. They report that the permits include four international projects, plus multiple local TV series. Communications plans for foreign projects are controlled to help drive audiences to go to cinema or distribution, and this could be years away from projects on locations shooting in the province. Note that our Cape Town Film Studios (Wesgro owns 10%) is fully booked for the next two years. Wesgro helped to support the amazing projects that came out of the Cape Town International Animation festival. Animation projects take years of work and are a great job creator. Many projects in production and distribution were shared. A partnership to develop more capacity in the industry has been announced, with 10 000 learners being identified, 6 000 creatives being empowered, and 200 jobs being created by a series of partnerships between Triggerfish and E4D. As Gavin Watson, the team leader for E4D noted, the animation industry is attractive to young people and is growing fast. He also added that the opportunities for animation extend outside the traditional film industry, within fields like advertising, app and web design, architecture, engineering, gaming, industrial design, medicine, and the motor industry, not to mention growth sectors like augmented reality and virtual reality. Wesgro agrees with this sentiment and looks forward to further industry gains during Cape Town’s Africa Games Week in September. ■

Green industries Cosmetics, natural ingredients, organic Services Clothing, textiles, leather, footwear Boatbuilding and auxiliary services Health tech and medicinal cannabis Aerospace and defence

Are some sectors recovering better than others? The year 2021 saw a remarkable rebound in the agricultural sector, both in terms of output and associated export earnings. One of the most noteworthy success stories has been in the citrus sector, with the Citrus Growers Association of Southern Africa (CGA) forecasting that the South Africa citrus industry would likely break all export season records with an estimated 158.7-million cartons in 2021. South Africa exported 146-million tons of fruit in 2020. If the estimate is reached, it would represent a third consecutive season of record export volumes. Export earnings speak directly to this with citrus fruits the province’s largest exported product in 2020, with associated export earnings of R18.8-billion exported in 2020, an increase of 55% on 2019. Apart from a good grower’s year in 2020, the increase in demand from this product group globally was supported by the immune-boosting properties of citrus. Petroleum oils have traditionally been the province’s largest export commodity in terms of earnings. A number of other traditional agricultural commodities have reported significant growth, including apples, blueberries, pears and wine.

WESTERN CAPE BUSINESS 2022

Green technology manufacturers welcome at Atlantis SEZ

Business Development Executive Jarrod Lyons explains how the ASEZ offers a great location to trade with Africa and to benefit from South Africa’s renewable energy procurement programme.

location and clustering. Our partners’ competitive advantage rests on making more productive use of inputs, which requires continual innovation. We achieve this through the Living Lab by providing our partners with a platform to share knowledge, resources and outputs in a manner which promotes profitability through resource efficiency. Our established partnerships with tertiary institutions contribute to our ability to provide our partners with well-curated skills driven by their needs, as well as the needs of a transitioning, traditional, coal-based economy to a green economy. The ASEZCo has enterprise development initiatives in place, which provide our partners with a suitable list of entities from which they can procure goods and services. Integration into our Living Lab bodes well for new partners, as we assist them in identifying collaborative opportunities with existing partners and facilitating engagements, which will lead to an

he Atlantis Special Economic Zone (ASEZ) for green technologies is located on the West Coast of South Africa, in the Cape Town Metro. The zone is dedicated to manufacturing and provision of services in the green technology space. Wind turbines, solar panels, insulation, biofuels, electric vehicles, materials recycling and green building materials are examples of green technology that are welcomed. The Atlantis Special Economic Zone SOC (ASEZCo) has undertaken over the past few years to establish itself as a globally-competitive company operating state-of-the-art infrastructure in Cape Town. The ASEZCo is equipped to assist both local and foreign investors in landing their green technology manufacturing investment in a seamless, well-managed process which eliminates unnecessary red tape and promotes a fast-tracking to market. As a value proposition, the ASEZ offers Greentech manufacturers benefits from coWESTERN CAPE BUSINESS 2022

FOCUS

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tip of Africa close to two ports with capabilities of landing and exporting bulk goods, as well as containers filled with sub-components. With the awarding of 25 projects in Round 5 of the REIPPPP, and the stringent localisation requirements associated with the REIPPPP, the ASEZ is well positioned to capitalise on component manufacturing opportunities to service the IPP projects recently awarded. The ASEZCo is utilising this market opportunity to coordinate a collaborative sales pitch to partners which can establish their manufacturing facilities in the ASEZ. This collaborative approach encompasses InvestSA (the dtic), Wesgro, InvestCT and GreenCape and has demonstrated significant success in the past. We continue to engage with potential partners with our ASEZ and are adamant that we will achieve significant success in this regard over the next 12 to 18 months. ■

improvement in the overall triple-bottom-line of all partners located in the ASEZ. New partners sought The Business Development Unit of the ASEZCo has placed a tremendous amount of its marketing energy in the community-focused communications and events for the direct benefit of the community. There comes a time, however, when community expectations need to be met. This can only be done through the landing of new and expansion of existing partners in the ASEZ with the view to create jobs and employment opportunities for the broader SMME network in the Atlantis and surrounding areas. The Business Development Unit has taken the stance of a more commercially-focused entity by reaching out to specifically targeted investors who want to benefit from integrating into the Living Lab of the ASEZ. The unit benefits from expertise in the green economy and leverages relationships with organisations like Wesgro and GreenCape to remain relevant in green economy investment promotion. With ASEZCo’s comprehensive understanding of Greentech value chains, the unit has the ability to identify partners with capabilities of servicing the needs of the South African and African Greentech markets. Servicing the growing African market with green technologies which contribute to sustainable infrastructure development is a superb way in which SEZs can make a difference. The ASEZ for green technology manufacturing is perfectly suited to enhance trade opportunities with Africa and the rest of the globe as it is well located on the southern

CONTACT For additional information on investing in Atlantis Special Economic Zone and understanding the Greentech landscape in South Africa, please contact Jarrod Lyons at jarrod@atlantissez.co.za

WESTERN CAPE BUSINESS 2022

FOCUS

Harnessing the green economy for growth and increased job opportunities The Atlantis SEZ has dedicated Infrastructure and Integrated Ecosystem (IES) teams. Integrated Ecosystem Executive Ellen Fischat explains how they help to create shared value. contexts, as opposed to closed laboratory settings. The task of convening and connecting the multi-disciplinary stakeholders falls mostly on the Infrastructure and Integrated Ecosystem (IES) teams, both supporting the ASEZCo’s establishment as a resource-efficient, carbonneutral and socially-inclusive industrial hub. Through its positioning as this eco-industrial park the ASEZ aims to attract Greentech investors who embody the elements and ethos of green technology manufacturing. It also means bringing the principles of the green economy into how the Atlantis SEZ is run and how the utility service needs of the investors are ultimately met and delivered. In recent years, purpose has gained momentum in business. With societal issues on the rise, government and community resources are under pressure. And increasingly, consumers expect organisations to step in and play a greater role in advancing social or environmental issues. But, while companies understand the moral imperative in delivering value for all stakeholders, a huge opportunity exists in seeing the business imperative. This can be explained through a simple but powerful idea: a company’s success and social progress are interdependent. This is the key principle of shared value. Tourism companies can’t thrive if a pandemic prevents us from travelling. Food suppliers can’t thrive if extreme weather events spoil farmers’ crops. Farmers can’t thrive if supply chains are fragmented. And communities go hungry when there is limited access to food supplies. And financial services can’t thrive amid financial hardship.

The IES team, left to right: Christelle Brown, Ellen Fischat (Integrated Ecosystem Executive), Michael Webster, Ursula Wellmann, Charlotte Perang and Florenchia Solomons.

he Atlantis Special Economic Zone Company (ASEZCo) for green technologies aims to harness the green economy for growth and increased job opportunities. It does this by driving sustainable, socioeconomic development and job creation, while positioning itself as a world-class eco-industrial park through its Living Lab. A Living Lab (LL), in contrast to a traditional laboratory, operates in a real-life context with a user-centric approach. The physical or organisational boundaries of a Living Lab are defined by purpose, scope and context. The scope, objectives, activities, resources and degree of participation and boundaries of a living laboratory are open for definition by its participants. These participants consist of multi-disciplinary stakeholders, from public to private sector, tertiary to research institutions and most importantly the local community and civic society. Industries adopting Living Labs share an approach to finding innovative solutions to open and real-world WESTERN CAPE BUSINESS 2022

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community integration. This is done to enable the Atlantis community, notably its youth, to tap into increased job opportunities, locally as well as in the buoyant green economy. Green skills development and growing technical capabilities within the community form part of the ASEZCo’s strategic objectives, aligned to the legislative requirement of the SEZ Act to grow the regional economy and drive socio-economic impact. This includes a range of interventions to support the skills development pipeline, some starting at foundational level, going through to school, college and ultimately at the workplace. The IES programmes are anchored by intentional, continuous and wider stakeholder community engagement, through our Community Stakeholder Network (CSN). This elected group of community leaders hail from a variety of sectors, such as small business and informal traders, education, youth, women and people with disabilities, Early Childhood Development, faithbased and traditional council and cultural groups. The CSN serves as a conduit for meaningful communication between the ASEZCo and the Greater Atlantis Community, therefore ensuring dialogue between the public and private sector and the community at large. The principles of multi-stakeholder engagement and collaboration provide a feeding ground for fostering local innovation, the co-creation of solutions and a conducive business environment.

In this context, purpose has an important place within business strategy. When used to its full potential, it can reach beyond risk mitigation – or doing no harm – to actually create new value for business (and society). Shared value is a framework designed to create business solutions to social and environmental problems. Put differently, it’s a means to deliver on your purpose, profitably. Shared value The creation of both societal and business value is integral to shared value. Societal value comes from vastly improving the conditions in which we live; advancing health outcomes, education, employment, financial or digital inclusion, service access and participation and/or helping to reduce our impact on the environment. Meanwhile, business value can range from increased revenue or market share to improved productivity, greater efficiency, reduced costs, improved quality, a more secure supply chain or a more skilled or productive workforce. The principle of striving towards shared value in our work with the local community, existing industrialists and new investors is underpinned by commitment to positive contribution towards the United Nation’s Sustainable Development Goals (SDG). The SDGs form a blueprint of addressing global inequities and achieving a more sustainable future for all. Working in close collaboration with the Infrastructure team, the IES team supports the Atlantis community through skills and enter pr ise development, coupled with

References https://sharedvalue.org.au/about/shared-value/ https://www.un.org/sustainabledevelopment/ sustainable-development-goals/

WESTERN CAPE BUSINESS 2022

MESSAGE

Innovation is the competitive currency of the future Jacques Moolman, President of the Cape Chamber of Commerce and Industry.

Jacques Moolman

f there is one thing in which private enterprise and the profit motive excel above all its other virtues, it is in its flexibility. Unlike large institutions and state-owned enterprises, the private sector’s small, medium and micro enterprises are quick to react to market demand and indeed to all sudden changes. The Covid-19 pandemic is a case in point. It demanded swift changes to operating methods, often making the difference between survival and shutting up shop.

The Cape Chamber is an example. Its team made a change to remote working within 24 hours of the first lockdown. It then concentrated on help and support for its members, ending its first financial year of the pandemic better off, despite taking a hit from a depleted customer base. Now, having made the transition to a new normal, we and everyone else have to accept that the economy has changed. The country is essentially bankrupt – financially and morally. Unemployment, crime and corruption are now permanent attributes of the country. That means not simply hoping that things will get better but making sure that we will get better at dealing with reality. The Chamber is now better positioned for doing so because of decisions we made in the years before lockdown. Since we are not state-sponsored, we were determined to retain our fierce independence, so we made revenue generation key. That meant a single-minded concentration on engagement with our customers, our members. Because we recognise the competitive currency in the future will be innovation, we have a mantra at the Chamber, “If no one dies, the risk is acceptable.” We also abandoned three-year plans. We set our strategy for two days ahead. What we are getting good at is planning the strategy – that’s more than 150 strategy sessions a year – and we get to monitor and respond to each one. It is this practice of planning that is invaluable. The plan itself is just the outcome. Learning is indeed the greatest gift the universe can give us. As long as we can learn, “We are alive.” That is why I am confident that the private sector in the Cape will bounce back and survive whatever challenges are presented. The entrepreneurial spirit in the Cape goes back at least 217 years as the Chamber itself proves since it is now entering its 218th year. That resilience is not unique to us. Nor is innovation. Both are in the very marrow of the private sector of the province.

WECBOF

makes it happen! T

he Western Cape Business Opportunities Forum (WECBOF) provides a platform for businesses to establish and maintain contact with fellow entrepreneurs; to have access to opportunities, information and training; and to have representation on a number of relevant forums of government and other associations focussed on growing and enhancing the commercial sector, with a specific focus on small, medium, and micro enterprises (SMMEs).

WECBOF is widely recognised and respected as a powerful voice for business in the Western Cape; we are a provincial service organisation with our focus and attention firmly on the national and international business pulse. CALL US TODAY.

+27 21 946 2519 office@wecbof.co.za www.wecbof.co.za www.facebook.com/wecbof/ @wecbof

A powerful voice for business. Where entrepreneurs excel.

SPECIAL FEATURE

Bio-pharmaceutical company lands Covid vaccine contract The Western Cape is a centre of medical innovation.

Credit: studioMAS

he Biovac building in the Cape Town suburb of Ndabeni is wedged between the railway line and Alexandra Road. Contributing to the medical setting are the nearby facilities of Life Vincent Pallotti Hospital and the Valkenburg (psychiatric) Hospital. The bio-pharmaceutical company’s headquarters are themselves a fine piece of architecture (pictured) but the number of prefabricated offices lining the property’s fence suggests that the facility is bursting at the seams. A contract to produce Covid vaccines will make Biovac even busier, but there’s a plan in place to build a new facility, for R2-billion. Biovac is a joint venture between the state and the private sector which started in 2003 and now produces more than 15-million doses of vaccine every year, most of which are in the paediatric category. An agreement with Pfizer and BioNTech to produce their vaccines will see Biovac making 100-million doses of the vaccine on an annual basis in the final phase. The only other manufacturer of Covid vaccines in South WESTERN CAPE BUSINESS 2022

Africa is Aspen in Gqeberha, which is making the Johnson & Johnson product. Biovac is looking to international development finance institutions to fund its latest expansion plan as it believes the facility could ultimately produce up to 500-million doses annually, which would open up the African market. Biovac has a host of partnerships with academic institutions and other entities. These include: the University of Cape Town, Council for Scientific and Industrial Research (CSIR), World Health Organization ( WHO), Programme for Applied Technologies in Health (PATH), Sanofi Pasteur of France, BioFarma of Indonesia and Pfizer of USA. More than 320 highly-qualified people are employed at Biovac. Innovation Asthma pumps are wonderful things but what if you are too weak to squeeze the pump hard enough to make it work? Enter two UCT Master’s students with a passion for gadgets, Giancarlo Beukes and Gokul Nair.

SPECIAL FEATURE focusses on non-invasive medical diagnostics, is a company that received seed funding from PATH. The Western Cape Medical Devices Cluster is a grouping recognised and funded by the Department of Trade, Industry and Competition’s Cluster Development Programme (CDP). According to Wesgro, 93% of medical device products are currently imported. The cluster was founded in 2016 with the assistance of several bodies: Wesgro, the Western Cape Department of Economic Development and Tourism, the National Department of Science and Innovation and Kaiser Economic Development Partners. The cluster is the first of its kind in the province. Several companies are engaging in cuttingedge work. Research on radiation treatment of cancer using Gold Nano particles is happening at iThemba LABS, a National Research Foundation facility. In 2017, iThemba LABS celebrated three decades of operating the Separated Sector Cyclotron (SSC). The SSC produces acceleratorbased radiopharmaceuticals and enables the study of the internal structure of atomic nuclei. Real World Diagnostics makes rapid In Vitro Diagnostics (IVD) test kits for drugs, pregnancy, malaria and HIV in Brackenfell. The Real World Development Ser vice does research and development and feasibility studies. A cheap plastic heart valve was developed by the Christiaan Barnard Cardiothoracic Surgery Department of UCT and the company making the valves is Strait Access Technologies, with headquarters in Observatory. The valve is inserted through a small incision and travels into position propelled by a balloon. It will assist millions of people with rheumatic heart disease. ■

They came up with an attachment fitted over the standard inhaler and they called it The Easy Squeezy. Since then, the company that the pair of biomedical engineering and mechanical engineering graduates created, Impulse Biomedical, has come up with something the world badly needs, a reusable auto-injector that accepts epinephrine cartridge refills and lasts for five years. They want the long-lasting injector to retail for about R1 000 as opposed to something like seven times as much for a twin-pack of injectors that have a short shelf life. The pair have won several competitions for startups and placed a very creditable second at the Emerging Medical Innovation Competition at the Design of Medical Devices Conference. This earned them a full technical and market evaluation by the Medical Industry Leadership Institute (MILI), a giant step towards being able to get into the US market where the tough approval standards of the US Food and Drug Administration (FDA) need to be met. The company is one of several nurtured by UCT’s Medical Devices Lab and Nair and Beukes have had support from Research Contracts and Innovation (RC&I), the university’s office that authorises and negotiates research contracts with funders. Stellenbosch University also promotes the transition of its graduates into the biomedical world. An example is AzarGen Biotechnologies. The company’s website lists two lead therapeutic candidates: a biosimilar version of an anti-cancer monoclonal antibody and a recombinant human surfactant protein targeted for various respiratory disease conditions. AzarGen has also developed proprietary synthetic DNA promoters for various expression platform applications in plant-made pharmaceuticals, synthetic biology and GMOcrop improvement. A number of initiatives are supporting this growing sector. The South African Medical Research Council (SAMRC) and PATH, a global non-profit organisation, have teamed up to create the Global Health Innovation Accelerator (GHIA). Based in Cape Town, GHIA aims to support the development of high-impact health innovations such as finding a way to test for anaemia without drawing blood. PATH is supported by the Bill & Melinda Gates Foundation. Thinta Diagnostics, which

The ZiBiPen. Credit: Impulse Biomed

WESTERN CAPE BUSINESS 2022

KEY SECTORS Overviews of the main economic sectors of the Western Cape Agriculture 24 Oil and gas 26 Energy 34 Manufacturing 36 Construction and property 37 Tourism 38 Education and training 40 Banking and financial services 44 Development finance and SMME support 46 Business process outsourcing 47

It has been a long winter. One of the Western Cape’s strongest growth industries is film and animation. Covid-19 meant less travel for international film crews in search of a wide variety of plausible locations, but Cape Town could still easily be mistaken for New York, even if the snow had to created by a machine. Credit: The Big Picture Company

OVERVIEW

Agriculture Rooibos is now a protected asset.

he long battle for protected status for rooibos in the EU is over. The best-known products that are forever linked to their home regions are champagne and port, and France and Portugal have fought hard for those rights. Now the Western Cape’s herbal tea product (pictured) enjoys the same privileges, which is great news for the roughly 450 farmers working with rooibos (350 commercial plus 100 small-scale farmers). The sector produces about 15 00 tons of rooibos every year, about half of which is exported. Covid-19 increased the international demand for citrus, resulting in 146-million cartons being exported in 2020. In 2021, new records were set with more than 161-million cartons being shipped, mostly out of the Port of Cape Town. Assessed independently from the country, the Western Cape is the world’s fifth-largest exporter of citrus fruits. Oranges are the province’s number one citrus export (54% in 2017) and soft citrus (19%) is growing steadily. Europe remains the most important market but the Asia and Oceana markets are growing. Exporters were introduced to some digital innovation in 2020 in the form of the Cape Export Network. CEN, a joint initiative of the Western Cape Provincial Government, Wesgro and Wines of South Africa (WoSA), is a platform that connects wine producers, buyers and importers. Agribusiness and agro-processing are vital parts of the provincial economy with about 45% of South Africa’s agricultural exports moving through the province. The value-add in the sector amounts to more than R14-billion per annum (Invest Cape Town). Berries are a growing subsector and two-thirds of production occurs in the Western Cape. More than 70% of the crop is exported and the major production companies are Berryworld South Africa, United Exports and Haygrove SA. Berries thrive between George and Swellendam and sales of chippers have grown because blueberries have to be vigorously pruned. There is plenty of scope for exports to grow. Current annual exports are 13 500t compared to over 200 000t for table grapes and about 300 000t for apples (South African Berry Producers’ Association). Once producers pass muster with Chinese import authorities, volumes can be expected to grow. ONLINE RESOURCES Citrus Growers’ Association: www.cga.co.za South African Rooibos Council: www.sarooibos.co.za Western Cape Department of Agriculture: www.elsenburg.com

WESTERN CAPE BUSINESS 2022

SECTOR INSIGHT Citrus was exported in record quantities.

Credit: SA Rooibos Council The Covid-19 lockdown had a big impact on wine exports and not only because a liquorexport ban was in place for five weeks. Logistics at the Port of Cape Town were reduced to a crawl and with fresh fruit and vital supplies taking priority, wine exporters were at the back of the queue. South Africa produces about 4% of the world’s wine. The wine industry contributes R36-billion to the country’s gross domestic product (GDP) and employs nearly 290 000 people. ■

The future of smart farming in South Africa Standard Bank is looking at how data can better inform financing options.

echnology has completely transformed agriculture over the last few decades. These days, farmers are integrating everything from drones and satellite sensing to genetic modification and, more recently, Artificial Intelligence into their operations to reduce costs and enhance yield.

Fredox Carvalho from Pexels

In the South African context, a dualistic agricultural economy exists with highly-developed commercial players on the one side and those that practice farming for subsistence purposes on the other. This differs from other regions across the continent where there is a greater focus on small-scale producers. Therefore, a fair amount of technology has already been successfully applied in South Africa, specifically within the commercial sector. The implementation of smart farming technologies over the years has helped farmers and growers to achieve the highest potential in whichever farming activity they choose to undertake. South African farmers now apply everything from regenerative agriculture – which relates to the use of smart technologies to improve efficiency – right through to gene technology. The use of the latter has showed great results in increasing yields with genetically modified maize production now making up about 80% to 90% of the total.

The more recent introduction of AI is also significantly increasing not just the quantity but the quality of produce that we see on our supermarket shelves. Standard Bank recently financed a citrus producer that is now using robotics in its packhouse. This has greatly reduced the time that is used to pack the oranges. The use of robotics and camera technologies has also been applied in the packing and producing of eggs to identify “bad eggs” in the process. The role of technology and data in finance In the old days, a farmer’s banking partner would be one of the institutions that sat at the end of information chain regarding the crop, while the supplier of pesticides might be closer to what is happening at any given time. It was only when the client started repaying loan facilities that there would be some indication of a shortfall, or any indication of a problem of some sort. Standard Bank is currently assessing the extent to which we can better track and trace the development of a crop over a period. We could then identify a possible early intervention or a requirement to do something differently where something might be going wrong with a crop. It might be that some additional treatment was needed for that crop. If that was the case, the bank would know about it and would be in a position to finance the remedial treatment when it’s needed. ■

Oil and gas A maritime cluster will help to create focus in the energy sector.

The Mossgas facility at Mossel Bay could be revived if feedstock in the form of gas is delivered from new discoveries. Credit: PASA

he Western Cape Maritime Cluster has been established by private companies and is supported by the government of the Netherlands and the Western Cape Department of Economic Development and Tourism. The group is planning to strengthen the industry by focussing on an integrated approach. Regional steering committees for Saldanha Bay on the west coast and Mossel Bay on the east coast have been set up. There are nine focus areas for the cluster, including energy (offshore), logistics and shipping, marine services and metal and machine-working (shipbuilding, marine equipment). The Saldanha Bay Industrial Development Zone Licensing Company (SBIDZ-LC) has announced the start of phase one of the development of the main infrastructure of the IDZ. Located within the southern hemisphere’s deepest and biggest natural port, the company will spend R3.5-billion on developing 356ha of space to enable the port to offer a wider variety of services. A floating dock, ship-lift facilities and marine service jetties will be among the new services created. Ultimately, the seven-part development plan will see the SBIDZ become a South African Freeport, a Special Economic Zone and customs-controlled area within a port, dedicated to the oil, gas and marine sector. The three main exploration and production customer groups being targeted are: Drilling companies: Office space, warehousing, logistical facilities and support services. Petroleum companies: Office and warehousing space for an operational base close to active fields. Oilfield service companies: 24-hour operational nodes along the coast, in the form of office spaces and warehousing bases. In sites such as Offshore Supply Bases [OSSBs] and/or quaysides for supply and re-fuelling purpose. WESTERN CAPE BUSINESS 2022

SECTOR INSIGHT R3.5-billion is to be spent on the first phase of the Saldanha Bay Industrial Development Zone. The SBIDZ-LC has established the Saldanha Bay Innovation Campus which aims to promote collaboration between academic institutions, industry, government and the local community specific to marine and energy research, development and innovation. It also intends supporting entrepreneurs and new ventures through incubation and acceleration programmes. In 2019 Total and its partners created a stir with the announcement that gas condensate had been found at a site called Brulpadda off the coast of Mossel Bay. In 2020, the nearby Luiperd prospect in Block 11B/12B delivered more exciting news. The block, in the Outeniqua Basin 175km off the southern coast, covers an area of about 19 000km². The exploration

OVERVIEW was done by the semi-submersible rig Deepsea Stavanger, which journeyed twice from Norway to lead the exploration projects. The two finds raise the odds of Total investing in what it calls a “world-class” offshore gas site. The drilling campaign employed 195 South Africans with specialist skills but the potential spinoff is enormous for the Western Cape and South Africa, if the find leads to drilling and commercialisation. If Total goes ahead, the PetroSA GTL refinery at Mossel Bay (Mossgas) could be revived and the idea of creating a gas market in South Africa would get a massive boost. Commissioned in 1992 as the world’s first gas-to-liquids (GTL) refinery, Mossgas was due to close in 2020, because, as President Ramaphosa announced, it had practically run out of feedstock. PetroSA is South Africa’s national oil company. Petroleum Agency SA (PASA), which encourages exploration and regulates the oil and gas industry, has noted the significance of international oil companies committing to exploration off South Africa’s coast. Increased confidence by such companies can only lead to growth in the industry, and with the massive gas finds in the Rovuma Basin off Mozambique in 2020, there are sure to be more companies interested in South Africa’s potential. In addition to adjudicating on coastal fields, the agency has awarded coalbedmethane-gas exploration rights in KwaZulu-Natal and natural gas exploration permits in the Free State. Natural gas lies also lies offshore to the west of South Africa in the Atlantic Ocean (Ibhubesi). Block 2A of the Ibhubesi gas field northwest of Saldanha is estimated to have reserves of 850-billion cubic feet of gas. The Western Cape’s status as an oil and gas hub has been enhanced with the opening of an open-access liquefied petroleum gas (LPG) import and storage terminal at Saldanha Bay.

Oil Cape Town’s oil refinery changed hands in 2018 when Off The Shelf Investments (OTS) completed a $973-million purchase of Chevron’s downstream assets in South Africa. Chevron has been rebranded as Astron, but the Caltex service-station brand has been retained. OTS is the Black Economic Empowerment (BEE) partner of mining giant Glencore, who financed the deal.

ONLINE RESOURCES Petroleum Agency South Africa: www.petroleumagencysa.com Saldanha Bay Industrial Development Zone: www.sbidz.co.za South African Oil and Gas Alliance: www.saoga.org.za Western Cape Maritime Cluster: wcmc.org.za

The refinery in Milnerton produces petrol, diesel, jet fuel and liquefied gas for the Western Cape and for export to other African countries. The Western Cape spends R76billion annually on crude oil imports and exports refined petroleum to the value of R13.2-billion. Large quantities of oil are transported around the Cape of Good Hope ever y year: 32.2% of West Africa’s oil and 23.7% of oil emanating from the Middle East. Problems in the container ship market have caused some stress in the local sector but the l o n g - t e r m p r o s p e c t s fo r shipping and oil and gas are still strong enough for national government to pursue Operation Phak isa (which includes a strong maritime economy push) and for Transnet National Ports Authority to spend heavily on upgrading the nation’s ports. T h e B e rg u n te r m i n a l, comprising 12 tanks located on the Eastern Mole of the Port of Cape Town, has added to the port’s fuel storage capacity and is connected by pipeline to the Astron refinery. The Council for Geoscience (CGS) is doing an intensive study of South Africa’s potential shale gas resources in the Karoo area around Beaufort West and the report is expected to be released in 2022. The major economic sectors using gas are the metals sector and the chemical, pulp and paper sector. Brick and glass manufacturers are also big consumers. ■ WESTERN CAPE BUSINESS 2022

FOCUS

Massive offshore gas finds could put South Africa on the path to net zero Gas has the ability to boost the national economy and to help the country make a just transition towards cleaner energy, argues PASA CEO Dr Phindile Masangane.

oday the biggest threat to humanity is climate change and the biggest threat to South Africa’s social stability is the high unemployment rate, which has primarily been caused by economic stagnation. As the global economy recovers from the devastating effects of Covid-19, demand for oil and gas has gone up significantly. If there was ever a need for proof that oil and gas still drive the global economy, recent statistics demonstrate the trend. T h e w o r l d ’s d e v e l o p e d e c o n o m i e s industrialised on the back of oil and gas production and use. Now, just as Africa is on the cusp of being a significant gas producer and is making plans to use such gas for power generation, industrialisation and economic growth, the negative effect of greenhouse gas emissions on the environment has become undeniable. The urgency for action to mitigate the risk of climate change is no longer debatable. Between 1990 and 2018 the top five emitters have WESTERN CAPE BUSINESS 2022

produced more than 50% of greenhouse gas emissions. During the same period South Africa has contributed 1% to global emissions. This is by no measure insignificant, and as a responsible global citizen South Africa must take steps to reduce its carbon footprint. The UN Framework Convention on Climate Change was established in 1992 to coordinate the global response to mitigate the threat of climate change, and specifically to get countries to commit to policies and plans that will ensure that the average global temperature rise is kept less than 1.5°C above pre-industrial levels. The International Energy Agency (IEA) proposes that to achieve this goal the world’s energy sector must reach net zero emissions by 2050. In its global energy net zero 2050 pathway, the IEA acknowledges that there is no single pathway to this goal, as developed and developing countries face different socioeconomic challenges and have contributed disproportionately to greenhouse gas emissions to date. What a number of environmental interest groups seem to be ignoring in the IEA “Net Zero by 2050” report is the acknowledgment that there will be a differentiated approach to a clean energy future, taking into consideration the cost of the new clean energy technologies and the economic consequences of transitioning for each country. The IEA emphasises that each country must develop its own pathway to a net zero emission future. South Africa’s economy has been predominantly powered by coal, which is also a significant contributor to the country’s economy in terms of

GDP as well as employment. Of all primary energy resources coal is the most carbon-intensive, and South Africa therefore has a relatively high carbonintensive economy, contributing about 1% of annual global greenhouse gas emissions. Discoveries in Outeniqua basin In addition to coal, South Africa imports oil, gas and petroleum products for its energy needs as the upstream petroleum industry is still at a nascent stage. The two recent world-class gas discoveries in the Outeniqua basin off the south coast of the country are the biggest petroleum discoveries made in South Africa. The development of these discoveries has the potential to replace more than 2 300MW of diesel-fired electricity generation in Gourikwa, Dedisa and Ankerlig, thereby reducing the carbon emissions from these plants by more than 50% while eliminating sulphur oxide and nitrogen oxide emissions, which are also harmful to the environment. Gas is therefore an obvious bridge to a lower carbon future in South Africa. Importantly, these gas discoveries could restore the gas-to-liquid refinery in Mossel Bay to full production and profitability, saving about 1 200 direct jobs. A complete shutdown and abandonment of this refinery would not only lead to job losses at the refinery, but the effects would reverberate throughout the town of Mossel Bay and the Southern Cape region, since the refinery contributes about R2-billion a year, or 26% of the Mossel Bay economy, and 6% to the Southern Cape economy when producing at full capacity. The Petroleum Agency South Africa awaits the licensee of these gas discoveries submitting its production right and environmental authorisation applications when the exploration right expires, or earlier. The agency expects the licensee to use world-class technologies and standards to minimise the effects of the gas and gas condensate production on the environment, while maximising the in-country benefit or local content from this development to support South Africa’s economic recovery. These discoveries could indeed support both the country’s economic recovery and its transition to a clean energy future. ■

The Stavanger oil rig has passed Cape Point several times on its way to making discoveries off Mossel Bay. Credit: Anton Swanepoel VALUE STATEMENT

Petroleum Agency SA aspires to be a world class organisation, committed to: • Professional excellence • Integrity • Direct, open, consultative communication • Transparency • Respect • Teamwork • Active regard for our natural environment • Corporate social responsibility in an empowering, vibrant workplace where diversity is valued. MISSION

To promote, facilitate and regulate exploration and sustainable development of oil and gas contributing to energy security in South Africa. VISION

A diverse upstream industry contributing to energy security through sustainable growth in exploration and development of oil and gas.

CONTACT DETAILS Telephone: +27 21 938 3500 Email: plu@petroleumagencysa.com Website: www.petroleumagencysa.com

WESTERN CAPE BUSINESS 2022

RVIEW

INTERVIEW

A study on gas potential in the Karoo has been completed

nding new ways of ducing and reusing carbon

Council for Geoscience CEO Mosa Mabuza believes that shale gas could have a huge impact on the national fiscus and that the marine economy holds great potential. What is the status of the exploration for gas in the Karoo?

cil for Geoscience CEO, Mosa Mabuza, is excited about new research on The geo-environmental baseline study for gas in Beaufort on capture and is intent on expanding his relevance thewritten. We West hasorganisation’s been completed and the report isto being had a plan to drill up to 3 500m but we reached technical h African economy. limits at 2 978m. We intercepted a huge white hill formation which is the shale horizon that contains shale gas. Shale is a geological formation and in that there capture is gas. Methane How will the Council for Geoscience (CGS) carbon and theis present and other forms of gas as well. We have taken a lot of storage project in Mpumalanga expand South Africa’s energy mix and samples and they are being analysed. decrease the country’s carbontofootprint? It is important note that ours was an environmental baseline We abbreviated thenot project to CCUS: Carbon Capture for the model two Cs, U study, an economic model. You can’t do an economic from for utilisation, storage theyou last stage. Once the carbon captured it has one holeasbut can extract information. It willisgive you an idea of what is there, this will be taken in the course of carbon 2022. numerous applications. Notsoonly would youtobecabinet able to reduce the

content that is emitted into our climate, but you can also apply it in fertiliser background toapplications. this study? manufacturingWhat and inisathe number of other the 1960s Soekor (the government-owned Mosa Mabuza, CEO We see it asIna scientific intervention that gets us as a countryexploration to breathe company) drilled a number of boreholes but they were looking life into the climate mitigation measures, in terms of the international for oil, not gas. They took samples for storage to the Council for climate protocol that weand have to.very If the proven, Geoscience we committed have kept them well.science We wereisvisited by not only will South Africa meet but will beyond an energy geologist fromitthe USgo justfar before 2010the whominimum had a look commitments that we rocks have and made a country. at these he as was very excited. The president announced But we’ve got toState let the science place, we’ve got to gas let the at the of the Nationtake address in 2010 that shale maypilot be a BIOGRAPHY game-changer Africa.scientific intervention, that the project prove that indeed, it for is aSouth sensible After qualifying as a geologist from We received big gas are companies but economics make sense, that applications science andfrom the the intentions met. Only Wits University, Mosa held various society revolted. “Don’t frack in my backyard. ” At the time I was once we have proven all of those three attributes, would we be confident positions at De Beers and Anglo in the Department of Mineral Resources responsible for policy that, indeed, we can continue. We think that, if it is proven, Mabuza, CEO American and worked inenough jurisdic- to say formulation. We started engaging with these communities and thenand coal can continue to play a critical role in our energy mix. tions as varied as West Africa the then minister placed a moratorium on processing of those

Canada. From his appointment as applications and instituted a team of technocrats including Is this pilot at one or CSIR, is it multiple sites? of Science and Technology the Director of Mineral Economics CGS, site PASA, the Department first one is on onetime site.and Wedepartments have chosenresponsible a pilot veryforclose toenergy the major in the former Department The of Minerat the water, and als and Energy, he was promoted to sites environmental affairs. Our brief was engageconcentration with communities. emission in Mpumalanga where there is to a higher of asI led thatasprocess, and we engaged Deputy Director-General ofpower Mineralstations, well the Sasol plant. If wewith getcommunity that rightmembers we can across many in the Karoo. The biggestby concern then60% was Policies and (Investment) Promotion have our contribution to areas carbon pollution reduced between that the decision was being taken without a scientific base. I said, ifying as a geologist Witsbeen CEOand in 2012. from He has of CGS 80%. “Good shot.” We went back to the minister and said we think that 2017. , Mosa heldsince various positions

RAPHY

rs and Anglo American and What are the other priorities of the CGS in Mpumalanga? n jurisdictions as varied The CGS mandate is that30 we are the custodians of geoscientific information WESTERN CAPEasBUSINESS 2022 ca and Canada. From his and knowledge in the country so we have quite a number of programmes in ment as the Director of Mineral Mpumalanga. One of them which is really very exciting and is at an advanced

you will gain trust if you remove the politics and invest in the science to do the research. People were concerned about water safety, a legitimate concern. The second concern was environmental pollution: what measures are you going to put in place to secure the environment? We could not provide answers at that time. While we were busy developing regulations based on other jurisdictions that were extracting shale gas as a benchmark, we did not have anything that was specific to South Africa, so the CGS was tasked to do this environmental baseline study. We needed to characterise shallow groundwater and establish what it would take to protect the water in those aquifers in the event that we were to proceed with shale gas extraction. We now have an answer to that question. The second question was, do we have gas? We have got gas. How much is still to be determined. Do you have an idea of the volume? If you look at our balance of payments, I think the largest chunk of it is the importation of crude oil. If we have the amount of shale gas that we think we have, this may have a huge impact on our national fiscus. Mossgas was opened on a motivation of one trillion cubic feet. The original projections in the Karoo were that we have 490tcf, a figure in which I don’t have much confidence. But even if we had 20tcf, can you imagine what impact that would have?

Drilling for information near Beaufort West. A geoenvironmental baseline study for gas in the Karoo has been completed and the report is being compiled. will be mounted on their boats. That will help us to accelerate the mapping and help us to catch up.

What new projects is CGS involved in? There was a huge excitement around 2013/14 with announcements being made around Operation Phakisa and the Blue Economy. This opened our eyes to a whole frontier economy right under our noses which we have not exploited optimally. There is some fishing, we have our ports and there was some excitement around petroleum exploration recently, but we have not even begun to look at the marine prospects. There is limited geological information so we have put together a very aggressive plan to map offshore. We have struck a partnership with the navy so that we can have a collaboration to leverage their vessels to fast-track the mapping. While they are moving around doing their work our gadgets

And you have your own vessel? We have recently launched one, but it is a small one that is only to do work near-shore in the interim. We have named it RV Nkosi after a world-class mineral separation technician who worked for CGS and who passed away in 2019. Research Vessel (R/V) Nkosi. Our team has been collecting data and this year’s weather has been much better than last year. I am comfortable with how it is going. Are there other projects relevant to the Western Cape? We are looking at numerous things, including geotourism. There is outstanding geoscience here. Our

WESTERN CAPE BUSINESS 2022

INTERVIEW

decisions for authorities, we can only come to you and say Minister, MEC, Your Worship, we have done this work and here is what it says and these are the options that you have. You can’t just sit on your hands while the community is in danger.

The borehole cores of the Karoo Supergroup in the Karoo Deep Drilling site in Beaufort West. teams are making major discoveries of fossils and there are fantastic stories to tell. We will take those stories to the authorities in the Western Cape so that they can think about how to make it part of the tourism package. We are also looking at the mineral potential in the Western Cape. Can the council play a role in climate change mitigation? One of the things that almost made my heart stop was when Cape Town was heading for “Day Zero” of water supply. That would have been a national disaster. With these things you have to work on them well in advance, outside of the political cloud. We scientists don’t like that space. How does geoscience and Day Zero come together? We are looking at characterising the aquifers quietly and understanding them and their potential. Then we can take information to the water authorities and the infrastructure authorities. To municipal and provincial authorities we can say, this is how you can complement your infrastructure to make it better. To give people the information they need to make policy? To make developmental decisions. Our job is to use the science as a basis for informed policy and human development choices. However, we don’t make WESTERN CAPE BUSINESS 2021

What is land susceptibility mapping? If we do a study of a stretch of land today, not when it rains, we can give a report to authorities telling them either not to develop in a particular place, or if they do, then to make sure to reinforce the infrastructure in that area. We are also doing work on tsunami early-warning detection in support of the Koeberg power station. We want to characterise any faults and understand them properly. There is a huge fault structure that goes over Table Mountain. It can lie dormant for 100 years, which is a short time in geological terms, and a fault stretches a long way. If something happens at a distance it might reactivate the fault and when it does then our study comes into play. The affected municipality will know the risks upfront. How many staff does CGS have in its Bellville office? We have a staff of 35.

The Council for Geoscience runs a variety of programmes such as testing for air quality and asbestos residue in soils.

What are their main fields of work? They work in a wide variety of disciplines, including geoscience mapping (onshore and offshore), palaeontology, geophysics, remote sensing, economic geology, marine geoscience and engineering geology. What potential for mineral discoveries are being made in the province? We see potential in industrial minerals, some precious and critical minerals and various energy-linked minerals. These are still being characterised and evaluated.

The Western Cape was the site of the launch of the RV Nkosi in 2021. The Council for Geoscience’s vessel is named after a renowned mineralseparation technician who passed away in 2019. The project to map the oceans is in support of the national Blue Economy programme.

How does the brief of the CGS fit into national priorities? The Council for Geoscience undertakes activities of national strategic importance that support government programmes such as the NDP 2030 (Economy and Employment, Economic Infrastructure, Inclusive Rural Economy focus areas), the New Growth Path and the Integrated

Pleistocene cliffs along False Bay.

Resource Plan, which seek to eradicate poverty, to promote the creation of employment, energy security, diversification of the economy, including the promotion of the green economy and to promote growth by identifying six priority sectors focussed on infrastructure and rebuilding the productive sectors of the economy, including mining. ■

OVERVIEW

Energy The Atlantis Special Economic Zone is attracting greentech investors.

SECTOR INSIGHT The Koeberg nuclear plant’s steam generators are due for replacement.

Koeberg nuclear power station. Credit: Eskom

he potential of renewable energy is being realised through the national independent power producer programme and there is a strong lobby to build a gas-toenergy plant in the province. In September 2018 the City of Cape Town launched a resilience assessment, the first step in a larger process. The Rockefeller Foundation chose the city as one of 100 around the world in which programmes would be tested to improve the ability of the city to withstand shocks such as severe droughts. The city wants to expand the lessons it learnt in the period of water shortage into other areas such as energy generation and energy efficiency. The Western Cape Provincial Government is also investing in resilience. A market intelligence report covering energy, renewable energy, water and waste was created by GreenCape to map the assets and challenges in these areas. In addition to trying to attract green investment into the province, the Western Cape is working for improved regulations related to small-scale embedded generation (SSEG). The City of Cape Town also wants to be able to rent out its infrastructure to a power producer who can supply a user via that infrastructure. This is known as “wheeling”. A start was made with the Darling wind farm, but more work needs to be done on the legislative framework. Much of this work is being done by a unit called the Sustainability Energy Markets within the Energy Directorate. Another area of WESTERN CAPE BUSINESS 2022

focus for this group is to investigate energy use by lowincome households. President Ramaphosa’s announcement in 2021 that companies wanting to create power plants up to 100MW need no longer apply for licences will encourage and accelerate this trend. T h e We s t e r n C a p e i s lobbying hard for the national Depar tment of Energy to allow Saldanha Bay to be a site for a gas-to-power plant. If a gas plant is built at Saldanha, then it could be a catalyst for the use of gas in many other sectors such as manufacturing and residential. The early rounds of the Renewable Energy Independent Power Producer Pro c u re m e n t Pro gr a m m e (REIPPPP) continue to produce regular dividends. In October 2020, another wind farm started commercial operations. The Paardekraal East Wind Farm, which is located about 80km north-east of Ceres, is in the Witzenberg Local Municipality. The 110MW project was constructed by the Concor and Conco Consortium, Siemens Gamesa Renewable

OVERVIEW

Energy supplied and installed the wind turbines, the towers were built by GRI in Atlantis and Mainstream Asset Management South Africa will manage the operations. The support of two of South Africa’s biggest institutional investors, the Industrial Development Corporation (IDC) and the Public Investment Corporation (PIC), has been crucial in getting the renewable energy sector off the ground. They have also helped communities fund their participation in community trusts. Typically, a community trust is established to represent the interest of the local community. Investment by black people into the renewable energy programme is not limited to community trusts. Pele Green Energy is engaged with a photovoltaic plant at Touwsrivier in the Western Cape as a shareholder and as a provider of construction management services. The Western Cape Provincial Government has a four-point energy plan: 1. Help municipalities to procure energy from IPPs. 2. Increase small-scale embedded generation like solar PV to decrease reliance on the national grid. 3. Increase the greening of government buildings. 4. Increase efforts to import Liquefied Natural Gas through Saldanha Bay and enable Eskom’s Ankerlig plant to operate on LNG rather than diesel. Recent gas finds by Total off the coast of Mossel Bay will accelerate the drive to switch to gas. The idea of home-owners being able to sell surplus electricity from rooftop solar systems was previously restricted to the Cape metropolitan area. The application of the provincial government’s Energy Security Game Changer has expanded this provision (via bylaws) to the whole province. There are 19 municipalities where rooftop solar PVs are connected to the electricity grid, 13 of which have nationally-approved tariffs in place. The City of Cape Town has signed an agreement with the United States Agency for International Development and the Southern Africa Energy Programme to look for ways to make solar PV more accessible. High costs of installation often preclude residents from taking the solar PV option for their homes.

The Wester n Cape is positioning itself as a green business hub and is working to find energy alternatives for households and businesses. Greater Cape Town is home to 70% of South Africa’s manufacturers of renewable components. GreenCape is an agency that does research and runs projects in areas such as energy efficiency, waste, water and sustainable agriculture. It is a joint initiative of the City of Cape Town, Wesgro and the Provincial Government of the Western Cape. GreenCape states that nearly R700-million in green technology investments has already been attracted to the Atlantis Special Economic Zone, creating 300 jobs. A further R3.7-billion is anticipated by 2030, which will add more than 3 000 new jobs. Spanish wind tower manufacturer Gestamp Renewable Industries was an early investor in the zone. The Koeberg nuclear power station 30km north of Cape Town is South Africa’s, and Africa’s, only nuclear power station. The 1 840MW plant is due to have its steam generators replaced in 2022, a necessary condition for having its licence extended beyond 2024. It was commissioned in 1985. ■

ONLINE RESOURCES Atlantis Special Economic Zone: www.atlantissez.com GreenCape: www.greencape.co.za South African Renewable Energy Technology Centre: www.saretec.org.za South African Wind Energy Association: www.sawea.org.za

WESTERN CAPE BUSINESS 2022

OVERVIEW

Manufacturing Boatbuilders are busy. SECTOR INSIGHT Hayden Cobra cars are on the road again.

he need for security at sea is driving demand among boatbuilders. Patrol vessels for the South African Navy are being produced by Damen Shipyards Cape Town and Paramount Maritime Holdings is busy with orders for vessels to protect other ships from pirates in the Gulf of Guinea. Bloomberg reported in 2021 that the subsidiary of the Paramount Group was building 26 boats for a combined value of $60-million. The keel-laying ceremony for the third MultiMission Inshore Patrol Vessels (MMIPV) that Damen Shipyards was contracted to deliver to the Navy was held in October 2021. Invest Cape Town reports that the city’s boatbuilding industry is the second-largest producer of recreational catamarans in the world, after France. The city’s companies export 80% of the products that they produce and attract a positive trade balance of approximately $73-million annually. Boatbuilding exports have grown by 20.5% annually year-on-year since 2014 in Cape Town (Quantec, 2019). Robertson & Caine’s facility in Woodstock produces three boats a week for the international market. With a staff complement of 1 350, the company is a leader in power catamarans and sailing catamarans. Nautic Africa makes larger vessels, including patrol, defence, oil and gas platform and commercial vessels while companies such as Smit Amandla Marine and De Beers Marine offer a wide range of services. The Whisper Boat Building Academy is located at the False Bay TVET College. The Manufacturing and Competitiveness Enhancement

ONLINE RESOURCES Cape Clothing and Textile Cluster: www.capeclothingcluster.org.za Invest Cape Town: www.investcapetown.com Wesgro: www.wesgro.co.za Western Cape Maritime Cluster: www.wcmc.org.za

WESTERN CAPE BUSINESS 2022

Programme (MCEP) of the Department of Trade, Industry and Competition (the dtic) has disbursed grants which have resulted in 230 000 jobs being sustained. Because of the Clothing and Textile Competitiveness Programme, that sector currently now employs around 95 0 0 0 workers, contributing 8% to manufacturing GDP and 2.9% to overall GDP. In the leather sector 22 new factories have been opened, supporting 2 200 jobs. In the Western Cape, this revival is reflected in member companies of the Cape Clothing and Textile Cluster hiring 35% more staff in four years. About 23 600 people are employed in the province and exports from the Cape amounted in 2017 to R4.4-billion with sales up by 34% above inflation. A new investor has breathed new life into the manufacturing business of Hayden Cobra (pic tured). The maker of replica cars is operating out of Montague Gardens and building for the local and export markets, primarily the US and the Middle East. Three models are manufactured: the Classic 427, the Evo and a Cobra with an electric drive which promises “instantaneous torque”. ■

OVERVIEW

Construction and property An affordable housing scheme in Ottery will reduce the housing backlog. SECTOR INSIGHT The Waterfront is expanding again.

he Amdec Group has been in the headlines in recent years for large and very expansive projects in highlydesirable areas. Johannesburg’s top-end Melrose Arch project was going to be replicated on Cape Town’s Foreshore with the Harbour Arch. Plans for that development are still going ahead, but the development group broke ground on a very different kind of project in 2020, an affordable housing project in Ottery (pictured). Named the Golden Grove Estate, the R500-million project will have 1 000 affordable residential apartments available for rent where the joint household income does not exceed R22 000 per month. The estate will include a retail centre, communal gardens, children’s playground, crèche and a communal clubhouse. The Provincial Government of the Western Cape’s “Better Living Model” will deliver 3 602 residential units in an affordable, mixeduse and residential-led development on the site of the old Conradie Hospital on the edge of Pinelands. The integrated, mixed-income housing development aims to reverse the spatial planning that was put in place under apartheid. With the state putting in the bulk infrastructure, costs for developers are significantly reduced. The quid pro quo is that the developer must set aside a certain number of housing units (49%) to grant-funded housing. The Belhar CBD is the site of 4 188 assorted residential units, including student accommodation, social housing units and military veterans’ units. Building was well-advanced in the course

ONLINE RESOURCES Cape Town Transport and Urban Development Authority: www.tda.gov.za Construction Industry Development Board: www.cidb.org.za SA Institute of Architects: www.saia.org.za

of 2021, despite Covid-19 interruptions. One section of the development, Paarl Rock, had sold out by November 2021. The Vic toria & Alfred Waterfront is continuing to invest in more space. Owned by the Public Investment Corporation and Growthpoint Properties, plans are being rolled out to add 80 000m² to the available space within the Waterfront’s precincts. The Financial Mail reports that recently completed additions include new buildings for Ninety One and Deloitte food market (Makers Landing). Artists will soon have their own market too. FNB, which publishes a regular property barometer, has done an in-depth analysis of previous crises to understand the post-Covid property market. According to John Loos, a property strategist at FNB Commercial Property Finance, the most vulnerable sector is likely to be Retail Property. Smaller neighbourhood shopping centres, with more essential items and greater convenience, will be less vulnerable. The lockdown accelerated the trend for people to work from home, and so the Office Property sector will come under pressure. Many companies will be reducing office space, but this is merely a speeding up of an existing trend. ■ WESTERN CAPE BUSINESS 2022

OVERVIEW

Tourism Covid-19 waves are causing uncertainty. SECTOR INSIGHT The Winchester Hotel has reopened under new management.

ith uncertainty about exactly who could travel to South Africa, occupation rates for the 2021/22 season could not be accurately predicted but everyone agreed that having a good season would be vital for the health of the sector. City Lodge Hotels reported 60% occupancy rates over the Heritage Day long weekend, a signal that domestic tourism was picking up. December bookings at many of South Africa’s resorts were good but at the end of November, all signs were that a fourth wave was descending. Many tourism operators in the Western Cape were pinning their hopes on the 2021 tour by the British and Irish Lions, but Covid-19 allowed for no spectators or followers. A hoped-for tax benefit to South Africa of about R450-million did not materialise. A landmark on the Sea Point boulevard, the Winchester Hotel (pictured), reopened in 2021 after new owners Newmark spent R90-million on a major revamp. Having been built to house residential apartments, what became Winchester Gardens was famous for its jazz and Sunday teas. The 76-room hotel is now a luxury boutique hotel. In 2019, Cape Town Tourism projected that the value to the Western Cape of the cruise-ship industry between 2017 and 2027 would be about R220-billion. And then Covid-19 hit. Major investments have been made in the Cruise Ship Terminal, near the Cape Town International Convention Centre (CTICC), and the Cape Town Air Access programme. Air Access created more than 750 000 new inbound seats between its inception in 2015 and 2020, adding something like R6-billion to the provincial economy. In ONLINE RESOURCES Cape Nature: www.capenature.co.za Garden Route and Klein Karoo: www.visitgardenrouteandkleinkaroo.com Wesgro: www.wesgro.co.za

WESTERN CAPE BUSINESS 2022

2019/20 the CTICC secured 52 conferences with an estimated economic impact of R2.3-billion. Unfor tunately, the conferences and events sector is likely to be hit as badly as the cruise-ship industry. Fo l l o w i n g t h e m a j o r drought experienced by the Western Cape, the Westin Cape Town has taken steps to reduce its dependence on the municipality for water. The hotel’s position on reclaimed land in the CTICC precinct of the Foreshore means that about 1.2-million litres of seawater have to be taken out of the basement every day. This water is converted into 441 000 litres of clean water by reverse osmosis which saves more than 100-million litres of municipal water annually. The Westin has also created an organic roof garden, from which it supplies its restaurants with vegetables. The Western Cape Provincial Government wants to promote education in the arts. Based on research which found that 6% of employment in South Africa is in the cultural sector, the Western Cape will expand the traditional STEM emphasis to include two additional As: Arts and Agriculture. There are 60 000 people employed in the culture sector in the province. ■

FOCUS

Save our Beach Huts A campaign is underway to restore Cape Town’s colourful landmarks.

Credit: A Gorman Photography he Beach Huts of Cape Town have been around since the late 1800s. Over their lifetime they have changed significantly, eventually becoming the colourful huts we see today.

They have always been a feature of our beaches. These structures have risen to iconic status, outgrowing their practical usefulness. Their true value lies in being an instantly recognisable image and arguably South Africa’s most iconic man-made structures. They occupy a significant portion of South Africa’s global brand image. The importance of this for attracting tourism to our country cannot be overstated. Tourism, a large source of foreign direct income, has an important role to play in alleviating poverty and creating opportunities for all South Africans. Tourism is everybody’s business. The Beach Huts have been falling into disrepair for some time. A harsh environment, complex

municipal structures and more pressing socioeconomic issues have resulted in the nearcollapse of this iconic infrastructure. The Beach Huts are as important to South Africa as the Statue of Liberty or the Eiffel Tower is to New York and Paris. The SAVE OUR BEACH HUTS campaign, run by The Beach Hut Trust, is a public and private collaborative initiative. The objectives are to Preserve, Protect and Promote the Beach Huts, Cape Town’s most iconic structures. To us, they represent opportunity and hope for South Africa. To the world, they represent a reason to travel here. We aim to create employment, restore an icon, promote tourism and generate a Beach Beach Huts-inspired industry that will sustain them indefinitely. The opportunities are endless and we are calling on all businesses to see how they can help support the programme to #SaveOurBeachHuts. ■

Contact details The Beach Hut Trust: Angela Gorman Mobile: 079 504 1933 Email: info@beachhuts.org.za

Daniel Blaauw Mobile: 081 776 6522 Email: info@beachhuts.org.za

WESTERN CAPE BUSINESS 2021

OVERVIEW

Education Online schools are booming.

The new School for Climate Change at Stellenbosch University has faculty status. Credit: SU

he University of Cape Town announced the establishment of an online high school in 2021 with virtual classes due to start in January 2022. The school hopes to close the opportunity gap for poor students in under-resourced areas. UCT is partnering with the Valenture Institute, a South African education technology company specialising in high school education. By September 2020, the school had received more than 4 000 applications. Online learning is one of the world’s fastest-growing sectors and the investment of $3-million by Construct in a new Cape Town office is evidence that the trend is well and truly established in the Western Cape. The Construct Learning Lab supports universities in Boston, Doha and Oxford as well as companies and government bodies. The company expects to increase its staff complement by 150 over three years. Tuberculosis continues to affect the lives of thousands of South Africans so the efforts of UCT Professor Keertan Dheda and a team of researchers is a most welcome and relevant application to local conditions. They have developed a new method of diagnosing tuberculosis from skin which is non-invasive, fast and highly accurate. Another relevant piece of work by a UCT academic won for Associate Professor Gina Ziervogel the institution’s Social Responsiveness Award. As a climate change adaption expert and geographer, Ziervogel played a key role in a team that advised the City of Cape Town during the severe drought WESTERN CAPE BUSINESS 2022

SECTOR INSIGHT Stellenbosch University has established a School for Climate Studies. that threatened water supplies. An important contribution was to stress the importance of community understanding and involvement. She and renowned environmental journalist Leonie Joubert have produced a book called Day Zero: One city’s response to a record-breaking drought. Another climate adaptation has been obser ved at Stellenbosch University where a School for Climate Studies has been launched in response to growing interest in climate resilience and trying to move away from fossil fuels. It is the first such institution in the country to enjoy the status of faculty and it

OVERVIEW will work in an interdisciplinary way. The school has joined an illustrious set of international universities known as the Global University Alliance on Climate (GUAC) which includes the Massachusetts Institute of Technology (MIT), Berkeley and Oxford and Cambridge. A R386-million campus is to be built by False Bay TVET in Mitchells Plain to serve that suburb, Strandfontein and surrounding areas. It will eventually cater for more than 5 000 students. The new Mitchells Plain Campus will complement the College’s existing campus presence in Khayelitsha, Fish Hoek, Westlake and Muizenberg. Programmes will be offered in tourism, creative media, business BPO, wholesale and retail and the services sectors. Bridging classes will also be presented for young people who do not meet entry requirements. The province’s I-CAN centres allow for public access to digital skills programmes, WiFi and business services. The centres are divided into zones (including Create, Study and Learn) and printing, graphic design and laminating services are available. The University of Cape Town has more than 21 500 students, 720 permanent staff and 39 A-rated researchers (40% of South Africa’s total). Stellenbosch University is linked to Stellenbosch’s growing reputation as a technology hub. The University of the Western Cape is home to several national research bodies. These three institutions, plus the Cape Peninsula University of Technology, produce approximately 12 000 science, technology, engineering and mathematics graduates every year and host 11 000 students from other African countries. University education is available in George through the Nelson Mandela University (NMU): Saasveld is home to the School of Natural Resource Management and the York Street Campus delivers courses in business and social science, accounting and business management. SARETEC offers industry-specific training in a new economic sector. The South African Renewable Energy Technology Centre is managed by the Cape Peninsula University of Technology (Bellville campus) but it collaborates with several other institutions and private companies. Unisa, the country’s biggest distance learning institution, has a campus in Cape Town and a service centre in George. Airports Company SA (ACSA), the City of Cape Town and the False Bay TVET College in Westlake have combined to offer residents of Blikkiesdorp a chance to learn skills in brick-laying, house-building, scaffolding and health and education. ACSA is investing R5-million in the 12-month certification project and the Construction Education and Training Authority (CETA) will channel funds to False Bay College for training.

Centres of Specialisation Programme A Centres of Specialisation Programme has been introduced by the Department of Higher Education and Training to tackle priority skills. The Swar tklip campus mentioned above will focus on training riggers and mechanical fitters. With the oil and gas sector expected to grow rapidly in the near future, trained artisans can expect to find employment quickly. The College of Cape TVET is concentrating on plumbing and automotive motor mechanics. The College of Cape Town has seven campuses from the city centre to Guguletu and Wynberg. A new welding academy in Thornton was opened with support from the merSETA (Manufacturing, Engineering and Related Services SETA). Northlink College is in the northern suburbs of Cape Town. Outside of the Cape metropole, Boland College looks after Stellenbosch, Worcester, Paarl and Caledon, while the Southern Cape College covers a wide area, from George to Beaufort West. The West Coast College also has a big catchment area. Boland College participates in an Expanded Public Works Programme (EPWP) run by the South African Chefs’ Association. ■

ONLINE RESOURCES Apprenticeship Game Changer: www.westerncape.gov.za Centres of Specialisation: www.dhet.gov.za SA Renewable Energy Technology Centre: www.saretec.org.za TVET colleges: www.tvetcolleges.co.za

WESTERN CAPE BUSINESS 2022

FOCUS

Sustainable skills development College of Cape Town is the preferred provider for education and training.

We have recently launched a Power Partnerships campaign (Power Partners) to acknowledge and grow our existing partnership base. The programme works by leveraging the power of workplace base learning through the Power Partnerships Programme to improve people’s skills and livelihoods, in particular, our youth in the following areas: • Student placements (in-service training, internships and workplace-based learning) • Apprenticeships • Skills training • Course design • Workplace mentorship

he College of Cape Town for T VET is strategically aligned through the Linkages and Partnerships Department of the College to establish and maintain strategic partnerships as well as to secure new projects, funding, equipment and other training and development resources. The College continuously expands and maintains a broad link with industry, various SETAs, provincial and national government sectors, other TVET Colleges and stakeholders within the training environment. The College boasts an impressive partnership list on which the names of both local and international partners appear. We welcome new partnerships with the private and public sectors, especially for occupational skills development. The College has longstanding partnerships and relationships with the private sector, various government depar tments and institutions, industry, SETAs and other postschool institutions, particularly for WorkplaceBased Learning or Exposure. Most of these partnerships have been formalised through Memorandum of Understandings (MoUs) lodged with our Linkages and Partnerships Department which serves as a support area for the Centres of Specialisation, Occupational Development and delivery. WESTERN CAPE BUSINESS 2022

The power of partnerships The Power Partners campaign was officially launched in April 2021 at the Gardens Campus, in an auspicious event for the Centre of Specialisation (CoS) Power Partners. The event was for the College of Cape Town for TVET and affiliated project partners of the Department of Higher Education and Training (DHET ); Energy and Water Sector Education Training Authority (EWSETA); Institute of Plumbing South Africa (IOPSA); Manufacturing, Engineering and Related Services SETA (merSETA) and Retail Motor Industry (RMI) to acknowledge the role demonstrated by these partners. The College expressed appreciation for the unwavering support and commitment demonstrated by these partners in recognition of the partnership agreement to collectively address the skills development needs in the Western Cape. All partners successfully accomplished the rollout and implementation of the the CoS Apprenticeship Programme for Automotive Motor Mechanic and Plumbing. When CoS was developed, the Department of Higher Education and Training had two objectives: address demand for priority trades and contribute towards capacity building of the public TVET

College system in delivering occupational trade qualifications with employers as partners. Out of the 13 Centre of Specialisation trades identified and developed, the College started with Automotive Motor Mechanic and Plumbing. The College expressed gratitude to all the partners and host employers and acknowledged sponsors (Autobooks, HaynesPro, Ford Motor Company ZA and Geberit ZA) for their meaningful contributions. Thirty Automotive Motor Mechanic apprentices were recruited and 10 host employers contracted, namely: Car Smart Service Centre, Taylor’s Auto Services, Automax Service & Fitment Centre, German Autoworks, Riaan’s Auto Repairs, Super Group, Unitrans, Canterbury Motors, Barloworld Barons Tokai and McCarthy. In addition, there are 20 plumbing apprentices and one contracted host employer, Peninsula Plumbing and Engineering Works. The College of Cape Town for TVET is not just the “Coolest College in South Africa”, but a Skills Battleground, with a strong army, made up of the best soldiers (affiliated partners) to collectively address the skills development needs of the Western Cape and South Africa. Our motto for the year is “EXCELLENCE STARTS WITH ME”.

We strive for excellence and quality in everything we do and this is commensurate with our mission of being “committed to being an institution of excellence that develops the potential of clients through quality Education and Training in response to the skills development needs of the country”. ■

Specialised skills are practised in excellent facilities at the Collge of Cape Town.

WESTERN CAPE BUSINESS 2022

OVERVIEW

Banking and financial services Cape Town has a stock exchange again. SECTOR INSIGHT Stockbrokers can stay in the Stock Exchange Hotel.

Credit: The Woodstock Exchange

ape Town last had a stock exchange when the Anglo-Boer War chased financiers out of Johannesburg. This time, the owners of the 4AX stock exchange have willingly chosen Cape Town for its growing reputation as a home for tech startups and its traditional strength as the home of big asset management firms. Remarkably, the exchange has set up in The Woodstock Exchange directly opposite the Stock Exchange Hotel. Lebashe Investment Group owns 45% of the company. The choice to rebrand as Cape Town Stock Exchange also serves to set it apart from competitors such as A2X and ZAR X. Equity Express Securities Exchange is the other new exchange which has appeared on the South African financial landscape since 2017. The Western Cape’s evolution into a technology hub is also persuading banks, insurance providers, asset managers and venture capitalists to choose to relocate. There are more than 40 000 jobs in the technology sector (more than double the total of Nairobi and Lagos combined, Wesgro) and formal employment in the financial sector exceeds 50 000. Together with business services, the financial sector comprises the biggest contributor to the provincial economy. According to Wesgro, 75% of the venture capital deals that happen in South Africa originate in the Western Cape. Most financial firms based in Cape Town have a long history, some going back as far as 1845 when Old Mutual started. One of the most successful disruptors in recent times has been Stellenbosch-based Capitec Bank, which is steadily increasing its

ONLINE RESOURCES Financial Sector Conduct Authority: www.fsca.co.za Insurance Institute of South Africa: www.iisa.co.za South African Institute of Chartered Accountants: www.saica.co.za

GAUTENG BUSINESS 2020/21

customer base by providing banking for business and individual customers in what it describes as a simple manner. Discovery Bank officially launched in March 2019 and is experiencing rapid growth with deposits of R3.7-billion. Discovery Bank is applying the behavioural model it uses in its health business to reward good financial behaviour. The African Institute of Financial Markets and Risk Management (AIFMRM) aims to meet the demands for skills by developing local talent. It is supported by the Western Cape Provincial Government, the University of Cape Town, Barclays Africa Group, FirstRand and Liberty. The head offices of financial firms are dotted all over Cape Town. These include Old Mutual and Foord (Pinelands), Futuregrowth and Coronation (N ew lan ds), Pr u d ential (Claremont), Sygnia (Green Point), Sanlam (Bellville) and Allan Gray (Waterfront). PSG has its headquarters in Stellenbosch and is well represented in rural towns. Insurers such as Santam and Metropolitan Life are based in Bellville. Nomura, a Japanese financial holding company, has a presence in the Cape through Nomura South Africa which offers investment banking services. ■

Bank on Standard Bank Trade to grow your business

Building a secure and trusted environment for trade and traders.

rade is a key cornerstone of economic growth and prosperity. The revitalisation of trade, both locally and internationally, will be integral to South Africa’s economic recovery from Covid-19. Trade allows for the flow of cash in our economy and as a result helps to drive economic prosperity, job creation and long-term stability.

Cameron Venti on Unsplash

With Trade by Standard Bank, we aim to be a partner in your growth journey and can help create a secure and trusted environment for you to trade. This includes the following: • Introductions to new vetted potential buyers – locally and around the globe. • Assistance with diversifying your supplier base and products through access to new international, vetted suppliers. • The provision of working capital finance. • Mitigation of risks of non-delivery and non-payments from customers and foreign currency fluctuations. • A single point of contact to assist in all your importing needs, including all-in costing, logistics facilitation, product track-and-trace services, payments, foreign exchange covers and customs clearing. Banks play a critical role in helping small and medium businesses trade either their services or goods, both in the local and international markets. The importance of digital transformation in trade, as in most other sectors, cannot be overstated. It creates efficiencies and breaks down barriers to entry – linking suppliers and customers all over the world and allowing for the creation of new supply

chains. It is through digitisation and the growth enablement it allows, that has led Standard Bank trade to devise new and differentiated solutions for customers: Trade Club There are two big environments where technology can help businesses: access to information and access to funding. It also increases the efficiency and the speed with which you can gain this access. Often the biggest inhibitor of trade is the ability to find trusted and vetted counterparts to trade with. Trade Finance Standard Bank’s Trade Finance allows you to expand and mitigate risks that could stand in your way. This service will help to maximise your profit by bolstering your cash flow, collecting outstanding payments and strengthening your working capital cycle. Trade Suite Local regulations and compliance issues can be inhibitors to trade. Clients are often unaware of the complexities of the movement of goods, including engaging with shipping lines and harbour officials on the import and export process. These solutions allow Standard Bank to play a vital strategic role in our clients’ sustainable business growth – both locally and internationally. We are able to leverage this position and knowledge of our clients’ businesses and local markets to give them the bespoke advice they need ■

OVERVIEW

Development finance and SMME support Craft designers are preparing for US markets

he Cape Town US Consulate General office is sponsoring an initiative to help creative businesses approach the US market. More than 80 Western and Eastern Cape businesses were exposed to a week-long programme of information sharing and networking in 2021 when the Craft and Design Institute (CDI) partnered with Aid To Artisans (ATA) to roll out the e-Market Readiness Programme (eMRP). On the programme, entrepreneurs learn about trends and the requirements of the US market through direct engagement with industry experts and retail buyers. For 10 selected businesses there is a five-month Business Intensive process. Jehan Jones-Radgowski, Acting Public Affairs Officer at the US Consulate, says, “The Expanding to Export Market Access Programme will prepare South-Africanbased entrepreneurs in the creative sector to enter the US handmade retail market.” Among the participants were Kingsdale Emporio and Dimzique Jewellery. Two of the Western Cape’s universities, Stellenbosch and Cape Town, are among the first collaborators with the University Technology Fund which aims to commercialise innovations and inventions coming out of tertiary institutions. The UTF has financial clout as it is a part of the South African SME Fund, an offshoot of the CEO Initiative which brought together 50 major corporations, the Public Investment Corporation, the Unemployment Insurance Fund and the Compensation Commission. Among the businesses receiving support from the SA SME Fund are Masisizane which helps black entrepreneurs buy petrol stations and Hyrax, a company which emerged from research done at the University of the Western Cape into which HIV-positive people were resistant to certain drugs. The National Department of Small Business Development (DSBD) has several programmes to assist SMMEs and cooperatives. The Small Enterprise Development Agency is an

ONLINE RESOURCES Craft and Design Institute: www.thecdi.org.za SA SME Fund: sasmefund.co.za Small Enterprise Development Agency: www.seda.co.za Small Enterprise Finance Agency: www.sefa.org.za

WESTERN CAPE BUSINESS 2022

SECTOR INSIGHT University student’s bright ideas are getting business funding.

Credit: Dimzique Jewellery

agenc y of the DSBD and gives non-financial support to entrepreneurs through t r a inin g , assis t a n ce w i t h filling in forms, marketing and creating business plans. Seda runs a Rapid Incubator in partnership with the Centre for Entrepreneurship (CFE) at False Bay T VET College, Westlake Campus. Many startups find the cost of finding and hiring premises prohibitive. Flexible working spaces such as those offered by Workshop17 offer a solution. The company has sites in Paarl, the Gardens and at the Watershed at the V&A Waterfront. ■

OVERVIEW

Business Process Outsourcing BPO growth is bolstering employment. SECTOR INSIGHT Amazon added 3 000 employees in 2020.

Credit: iContact BPO

200-seat call centre opened in Paarden Island in 2021, further evidence of Cape Town’s attractiveness as a business process outsourcing venue. iContact BPO, which also has a centre in Johannesburg, is part of Alefbet Holdings Group, an international company with more than 1 000 full-time employees. The company’s CEO, Clinton Cohen, believes that South Africa offers speed to market, flexibility and professional delivery. Cohen gives an example of hiring 100 skilled agents in less than 100 hours to meet the exacting brief of a US-based automotive client. “There are few BPO sectors in the world that can provide this sort of agility and rapid scaling while maintaining quality and compliance requirements,” said Cohen. The BPO sector’s continued growth is good news for youth employment in the region and the country. According to McKinsey’s South Africa Big Five report, the BPO sector currently employs over 270 000 people in six cities, of which 65 000 serve international clients. This total could grow to over 775 000 jobs by 2030, with up to two-thirds of these servicing overseas markets. The UK makes up 61% of offshore business in South Africa, the US and Canada 18% and Australia 11%. In the course of 2020, Amazon increased its total South African recruitment to 7 000 with the addition of 3 000 new employees to service its North American and European markets. Significantly lower costs than European competitors and growth rates in the Business Process Outsourcing (BPO) sector that outstrip the global rate make the Western Cape an extremely competitive

ONLINE RESOURCES Business Process enabling South Africa (BPeSA): www.bpesa.org.za Contact Centre Management Group: www.ccmg.org.za National Department of Trade, Industry and Competition: www.dtic.gov.za

destination. According to the Everest Group Study (2018), Cape Town’s costs for contact centre work are between 20% and 30% lower than the costs in Eastern and Central Europe. South Africa’s BPO industry is growing twice as fast as the world’s and three times faster than India and the Philippines (Invest Cape Town). UK shop Asda and online retailer Amazon have large customer service centres in Cape Town. Other big brands include British Gas, IBM, KLM, Lufthansa, Mastercard and Microsoft. Global and local BPO investors with operations in Cape Town include TutorABC, CSC, Collinsons Group, Bloomberg, Shell, AskOsca, JTC Group, Wonga, SimplyTalk, Ambition 24 Hour Group and Buongiorno. Inbound customer service (55%), inbound sales (15%) and debt collection (13%) comprise the biggest subsectors of the BPO sector in the Cape (Wesgro). Greater Cape Town is home to three universities, a university of technology and two technical colleges. Other factors in favour of the area are the relatively neutral accents, good financial and telecommunications infrastructure and the time zone being the same or close to Europe’s. ■

WESTERN CAPE BUSINESS 2022

INDEX

INDEX Atlantis Special Economic Zone (ASEZ)....................................................................................12-15, OBC Beach Hut Trust.............................................................................................................................................................39 Cape Chamber of Commerce & Industry...........................................................................................2-3, 16 College of Cape Town.................................................................................................................................. 9, 42-43 Council for Geoscience.................................................................................................................................... 30-33 Petroleum Agency South Africa................................................................................................................. 28-29 Standard Bank.............................................................................................................................................. IFC, 25, 45 Vinpro...............................................................................................................................................................................IBC Vodacom................................................................................................................................................................... 20-21 Wesgro....................................................................................................................................................................... 10-11 Western Cape Business Opportunities Forum (WECBOF)..................................................................17

WESTERN CAPE BUSINESS 2022

FOCUS

SA wine industry set to rebuild and bounce forward Wine and wine tourism will remain resilient. By Rico Basson, Vinpro MD

espite setbacks brought on by Covid-19 over the past two years, South Africa’s wine and brandy industry is ready to not only bounce back to where we were before the Covid-19 pandemic hit, but to bounce forward. This sector, which provides job opportunities to close to 269 000 people and contributes R55-billion to the economy, is on a path to rebuild. To achieve our vision of being robust, adaptable and competitive, the industry focuses on boosting exports and local sales, promoting inclusive growth and responsible consumption, and striving for sustainability in all facets of business. Apart from cutting off wine businesses’ revenue in excess of R8-billion, trade restrictions in 2020 and 2021 resulted in a wine surplus, which drove down producer and cellar pricing and placed further pressure on the finances of wine businesses. To remedy this situation, the industry will have to continue to implement measures to reduce the surplus, including allocating grapes for grape juice concentrate and finding new markets. South Africa could seize export opportunities due to lower global wine production in 2021. East Africa, the UK and USA, Canada, China and Europe remain key markets. Logistical challenges at the Cape Town Port Terminal are urgently being addressed to support these exports while negotiations to secure preferential trade agreements with China and African countries continue. Wine tourism is an important driver of growth in the local market, but its success will depend on no further alcohol trade restrictions. Therefore, the wine industry continuously engages with more than 10 national government departments to ensure fact-based decisions are made regarding

Rico Basson, Vinpro MD trade restrictions, together with various targeted initiatives to promote responsible consumption and legal trade. We anticipate that transformation and the development of new businesses will gain momentum through dedicated funding and strategic initiatives. Furthermore, South Africa is a world leader in climate change and in line with Sustainability 360 as the theme of the Cape Wine 2022 international trade exhibition from 5 to 7 October 2022, we believe that sustainability in its various facets will become even more inter twined in the activities of wine businesses. The road to recovery will be long and hard, but the wine and wine tourism industries will remain resilient, celebrating milestones along the way towards a stronger and more sustainable industry. About Vinpro Vinpro represents 2 600 South African wine grape producers, cellars and wine-related businesses, while providing strategic direction, rendering specialised services and supporting people development. ■

Contact details Vinpro Tel: +27 21 276 0429 | Email: info@vinpro.co.za | Website: www.vinpro.co.za

Atlantis Special Economic Zone Africa’s first Greentech hub

Atlantis SEZ capitalises on the province's booming renewable energy and green technology sector. The SEZ has already attracted investments of R680-million and created over 312 direct jobs to date, paving the way as Africa’s only Greentech hub. The Atlantis Special Economic Zone (ASEZ) for Green Technologies is located on the West Coast of South Africa, in the Cape Town Metro. The zone is dedicated to the manufacturing and provision of services in green technology. Wind turbines, solar panels, insulation, biofuels, electric vehicles, materials recycling and green building materials are examples of green technology that are welcomed. If you are a manufacturer, service provider or supplier to green tech value chains, the ASEZ may be a great place to locate. It offers the benefits of co-location, access to strong markets, a development-ready area, great support and incentives, and an attractive skills base to recruit from.

Contact details Address: 60 St George’s Mall, SA Reserve Bank Building, 7th floor, Cape Town, South Africa 8001 Tel: +27 (087) 183 7017 Emails: info@AtlantisSEZ.co.za Jarrod@AtlantisSEZ.co.za Website: www.atlantissez.com