sectors are not specialised enough to give it a competitive advantage over others. It therefore needs to diversify and specialise its economy to compete with other global cities.”
However, since the days of the gold rush until now, Joburg has become less reliant on mining and industry, and has grown and diversified into a tertiary economy. According to Professor Ronald Wall, who holds the Chair of Economic Development of the City of Johannesburg in the School of Economic and Business Sciences (SEBS) at Wits, Joburg is a real global city – but we don’t even know it. “Psychologically, we don’t think globally,” he says. “Our mainly ‘local newspaper’ mentality has to change into a more global one. We need to become more engaged with Africa and the rest of the world and internationally diversify our economic and social connections. This will depend on aspects like innovating and specialising our industrial sectors, curbing socio-economic inequality, increasing the participation of women in the labour market, and developing food security in the Gauteng region.” As an economic geographer and urban planner, Wall uses big data on roughly 15 000 world cities to analyse the strength of their economic connectivity, for example, foreign direct investment (FDI). What he found would surprise us all: Joburg is right up there with the best. It ranks 69th in terms of inward FDI, and in Africa is second only to Cairo. With strong investment connections to London, Tokyo and Paris, Joburg competes better in the rest of the world than many cities in the US, like Atlanta and Washington DC, but it is shadowed by New York, and Vancouver and Montreal in Canada.
INTERNATIONALLY SPECIALISED ECONOMY
One example of how Joburg could specialise services – and thereby revitalise the inner city – is to follow the advice of former Reserve Bank Governor and Honorary Professor at SEBS, Tito Mboweni, to turn the inner city into an International Finance Centre. This Centre, envisaged between Empire Road, Joe Slovo Road, the M2 highway and Hillbrow, should allow for special incentives to operate in the area. “This place will be transformed in a very short space of time, which will minimise the flight of companies from Joburg to Mauritius,” he said. Professor Barry Dwolatzky of the Wits Joburg Centre for Software Engineering, however, believes that Joburg – specifically Braamfontein – could be Africa’s first Silicon Valley. According to Dwolatzky, the establishment of a Silicon Valley has certain prerequisites: It has to be connected, be close to a major research hub, have an existing business hub, be supported by government, and be located where people want to live and work. While Braamfontein was not that place several years ago, it now has all the right ingredients. “We’re in close proximity to both Wits and UJ, with 80 000 students, over 50 000 residents live in the area, there is an existing business hub and there are lots of businesses still in the area that work in the digital space and we are well connected,” says Dwolatzky.
“In sub-Saharan Africa FDI, Joburg is king – but statistically speaking, we underperform to what would be expected of us, and should be much more powerful,” he says.
In agreement, Wall believes that we also need to comparatively study which local skills and technologies we need to produce to match the demand of international and domestic firms, which in turn will boost inward FDI.
One of the important keys to the city’s future wellbeing and sustainability lies in its ability to attract foreign direct investment, and to increase the diversity of international cities investing in it. This will make it a truly global player.
“Therefore, for Joburg to become a truly Smart City, it will need to technologically connect local supply – skills , technologies, services, knowledge and creativity – to the changing demand of firms in the global economic system,” he says.
“South Africa is increasingly subjected to global changes, but our government is not assertively participating.”
FOOD SECURE BASKET OF THE WORLD
While a large part of Joburg’s business community is internationally active and competitive, uncertainties in politics, high crime levels and high levels of wage inequality negatively impact our ability to attract FDI. “Compared to other global cities, Johannesburg’s international industrial sectors are not specialised enough to give it a competitive advantage over others. It therefore needs to compare itself to top global cities and form this understanding, smartly diversify and specialise its economy so as to compete with them,” says Wall, whose analysis for the UN State of African Cities 2017 report showed that Joburg’s closest global competitor is Bogota in Colombia, followed by Chicago in the US, then Istanbul, Delhi and Buenos Aires, while our closest African competitor is Cape Town, followed by Casablanca.
One of the future critical sectors where South Africa – and Africa in general – could play a massive role is in contributing to continental and even global food security. According to Wall, “Africa has some of the most arable land in the world, yet we are vulnerable in that we import most of our staple food, while 60% of Africa’s youth are unemployed. We have the potential and opportunity to flip this around and become the food secure basket of the world,” he says, adding that we should invest in capacity building in the agriculture sector, create low-tech, medium-tech and high-tech agriculture hubs (products, services, processing, logistics) in and especially around the city, and establish the business collectives to support it.
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“Compared to other global cities, Joburg’s international industrial