Too much promise, too little action

There is no doubt that the Eastern Cape is a region of great promise. It has three ports, two industrial development zones, vast agricultural potential, a globally competitive automotive industry – and not much else. As the home of the Struggle, the Eastern Cape was punished by being pretty much ignored by the National Party. Its two homelands – Ciskei and Transkei – were propped up economically through generous incentives that attracted Taiwanese and other manufacturers to rural towns. Post 1994 the incentives were dropped, and the businesses moved on to more profitable climes. Unfortunately, all that has taken their place in the Transkei and Ciskei is an economy based largely on government grants. The job creation potential of the Coega and East London Industrial Development Zones (IDZs) has also been limited by the unwillingness of the Department of Finance to provide meaningful incentives. In a world with hundreds of IDZs and their equivalents offering generous tax holidays to investors, in addition to competitive logistics, cheap land and skilled labour, the two IDZs face serious handicaps over which they have little control. Ironically, therefore, it can be argued that the ANC government is doing less than the previous regime to create and sustain jobs. Yes, billions have been invested in the IDZs and the port of Ngqura, but that is not enough. Economic growth in the old Transkei and Ciskei, as well as the new Buffalo City Metro, is stymied by logistical isolation – the port and rail links are outdated. So much so that shipments in and out of East London are routed through Port Elizabeth, over 300 kilometres away. Without government intervention through its parastatals, the region is condemned to economic stagnation at best. The situation in the western half is a little brighter, with some investment flowing in for Ngqura and its supporting rail infrastructure from the Northern Cape. However, compared to the billions being spent on the Durban- Johannesburg corridor and infrastructure, it is minimal. It is not only central government that has an approach best described as “benign neglect” to the Eastern Cape. Corporates also tend to regard their Eastern Cape branches and facilities as the poor cousins. Pinning down the reasons for the inability of the province to turn its huge potential into action and delivery is difficult. But, essentially, it boils down to lack of leadership. Eastern Capers are way better at bemoaning their lot than taking control and lobbying and fighting for what is needed. This malaise is found at the political, corporate and social society levels. But, dig a little and one finds businesses led by managers who are in the Eastern Cape because they want to be there – and who are running good operations by exploiting the weaknesses and strengths. Some are featured in this focus on the Eastern Cape. Their innovative approaches have the potential to disrupt the logistics industry way beyond the borders of the province. INSERT ‘Without government intervention through its parastatals, the region is condemned to economic stagnation at best.’ CAPTION Billions have been invested in the IDZs and the port of Ngqura, but that is not enough.