annexure d executive summary of bcm sector plans - Buffalo City

INTEGRATED DEVELOPMENT PLAN: REVIEW 2010/11ANNEXURE DThe main identified implications of the above strategies for the BC LEDS are as follows:(a) Buffalo City is classified nationally as having “medium potential” and is therefore not seento be a national development priority, with Coega and Nelson Mandela Metro receivingpriority I terms of the allocation of national infrastructure funding. This situation existspartly because of a lack of national understanding regarding the critical importance ofBuffalo City in servicing a broader regional and rural economy which contains about 4million people. The success of the BC and regional economy cannot be separated.(b)(c)International critics of the governments industrial development strategy have noted thatits major weakness is its failure to address what are termed “ small industrial policy” issueswhich related to the basic functioning of the business environment but which promise tosubstantially undermine the productivity and ease of doing business of existinginvestors/businesses in South Africa. Issues such as crime, home affairs proceduresregarding visas, government decision-making time-frames, general attitudes ofgovernment towards business, land availability, transport reliability and local municipalservices as seen to be just as important, if not more so, than big industrial supportprogrammes. This finding represents a major opportunity for Buffalo City to focus ongetting the basics right and differentiate it business environment from those of its biggerCity competitors by ensuring the existing businesses are treated well and that basicservices and decision-making process are efficient.The focus on addressing constraints to growth needs to be addressed at a local level andthe following opportunities are highlighted: The ASGISA Infrastructure Plan and national budgetary surplus represents a goldenopportunity for Buffalo City to tap into a massive infrastructure investment phaseafter years of neglect. If this does not happen, there is the danger that Buffalo Citywill not receive meaningful infrastructure investment required to ensure that itsport, airport, road and rail infrastructure are able to competitively service exportoriented activity. This threatens to undermine the economic sustainability of BuffaloCity. The EL IDZ will not attract much foreign direct investment if logisticsinfrastructure constraints are not addressed. The BC LEDS proposal must thereforeaddress this issue as well as consider different future economic scenarios for BuffaloCity. If logistics infrastructure is not expanded, the focus will need to be onproviding a supportive business environment for domestic investment. If capacity isaddressed, more focus on a foreign investment strategy will be required.National strategies and funds for agriculture, tourism, business process outsourcing,film, clothing and textiles, and automotive sectors mean that significant nationalfunds are being spent as well as the provision of an increasingly supportiveregulatory environment to accelerate the growth of these sectors and BC needs todevelop and adequately resource its own local strategies in these sectors tocapitalise on these opportunities. The lack of provincial strategies as well as sectorfocusedexpertise presents a challenge to Buffalo City in terms of the possiblemarginalisation of Buffalo City in terms of initiatives which maximise opportunities inthese sectors. The BC CDS does not identify detailed strategies for agriculture,manufacturing or services sectors and this is therefore a critical focus of the BCLEDS.The focus on advanced manufacturing must be supported, especially with respect toan automotives supplier development programme which assists suppliers toupgrade their technological capabilities.Future tourism growth will depend on a wide range of factors includingimprovements in logistics infrastructure, tourism infrastructure (e.g. beach front),branding and marketing and additional resources are required to implement anumber of priority initiatives which have already been identified.The increasing focus on regulatory constraints to economic growth must be pulleddown to the local level to inform refinements to priority municipal processes whichconstrain economic development (for example through a Red Tape ReductionProcess as well as through other continuous improvement processes).