Gauteng Business 2020/21 edition

christoffscholtz

The 2020/21 edition of Gauteng Business is the 12th issue of this highly successful publication that has established itself as the premier business and investment guide for the Gauteng Province. In addition to the regular articles providing insight into each of the key economic sectors of the province, there are special features on infrastructure investment programmes and plans for the establishment of Special Economic Zones (SEZs) as a means to boost economic growth. Another feature on construction and property underlines the importance of spatial planning in the region’s future. Ambitious plans for the City of Johannesburg are outlined, both in the journal's editorial pages and by the Johannesburg Development Agency (JDA).

GAUTENG

BUSINESS

SPECIAL FOCUS: INFRASTRUCTURE

INVESTMENT IN GAUTENG

2020/21 EDITION

THE GUIDE TO BUSINESS AND INVESTMENT

IN THE GAUTENG PROVINCE

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CONTENTS

CONTENTS

Gauteng Business 2020/21 Edition

Introduction

Foreword 5

A unique guide to business and investment in Gauteng.

Special features

Regional overview of Gauteng 6

Special Economic Zones and expanded infrastructure are

central elements to the strategies being devised to grow

the Gauteng economy.

Spatial planning and infrastructure

underpin Gauteng’s growth plans 10

GDP growth is directly related to infrastructure investment.

Builing mega-cities 16

Ambitious construction plans are afoot in Gauteng.

Economic sectors

Agriculture 26

A major starch business is changing hands.

Mining 27

AngloGold Ashanti has sold its last South African asset.

Energy 28

Companies are generating their own power.

Oil and gas 29

Various types of gas are available as fuels.

Transport and logistics 34

Achieving ambitious export goals will boost the logistics sector.

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CONTENTS

Manufacturing 36

The OR Tambo Aerotropolis is attracting manufacturing.

Tourism 38

Tourism operators are determined to rise again.

ICT 40

Financial services is leading the way in ICT investment.

Banking and financial services 41

Banks are looking at insurance and funeral policies.

Development finance and SMME support 44

Government pledges to spend R4-billion with SMMEs annually.

Education and training 46

Skills training is a public and private priority.

References

Key sector contents 24

Overviews of the main economic sectors of Gauteng.

Index 48

ABOUT THE COVER:

Arnold Petersen/iStock by Getty Images.

Sandton at night. With the Liberty Group

among the financiers, Sandton City shopping

centre, with 50 000m² of lettable space,

opened in 1973 and sparked fantastically fast

growth around it, transforming farmland to

the richest square mile in Africa. Several new

corporate headquarters have been built in

recent years in the town that drew its name

from two of its well-known suburbs, Sandown

and Bryanston.

GAUTENG BUSINESS 2020/21

4


Gauteng Business

A unique guide to business and investment in Gauteng.

FOREWORD

Credits

Publishing director:

Chris Whales

Editor: John Young

Managing director: Clive During

Online editor: Christoff Scholtz

Designer: Simon Lewis

Production: Lizel Olivier

Ad sales:

Gavin van der Merwe

Sam Oliver

Jeremy Petersen

Gabriel Venter

Vanessa Wallace

Shiko Diala

Administration & accounts:

Charlene Steynberg

Kathy Wootton

Printing: FA Print

The 2020/21 edition of Gauteng Business is the 12th issue

of this highly successful publication that has established

itself as the premier business and investment guide for the

Gauteng Province.

In addition to the regular articles providing insight into each

of the key economic sectors of the province, there are special

features on infrastructure investment programmes and plans for

the establishment of Special Economic Zones (SEZs) as a means

to boost economic growth. Another feature on construction and

property underlines the importance of spatial planning in the

region’s future.

Ambitious plans for the City of Johannesburg are outlined,

both in the journal’s editorial pages and by the Johannesburg

Development Agency (JDA).

To complement the extensive local, national and international

distribution of the print edition, the full content can also be viewed

online at www.globalafricanetwork.com under e-books. Updated

information on Gauteng 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 titles, African Business, which

was launched in 2020. ■

Chris Whales

Publisher, Global Africa Network Media | Email: chris@gan.co.za

DISTRIBUTION

Gauteng 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.

Member of the Audit Bureau

of Circulations

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

ISSN 1990-0621

COPYRIGHT | Gauteng 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 | Arnold Petersen/iStock by Getty Images, ACSA,

Boogertman and Partners, Coega Development Corporation (CDC), Diesel

Electric Services, Commvault, CNG Holdings, 5M2T, Harmony, Knight

Piésold, Marriott International, Mark Hillary/Flickr, Gauteng Partnership

5

Fund (GPF), Johannesburg Development Agency (JDA), Tongaat Hulett,

Venter Consulting Engineers, Wits Business School.

DISCLAIMER | While the publisher, Global Africa Network Media (Pty)

Ltd, has used all reasonable efforts to ensure that the information

contained in Gauteng 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.

GAUTENG BUSINESS 2020/21


A REGIONAL OVERVIEW OF

GAUTENG

Special Economic Zones and expanded infrastructure are

central elements to the strategies being devised to grow

the Gauteng economy.

By John Young

One of the plans to boost Gauteng,

“Growing Gauteng Together” (GGT

2030) prioritises the economy, jobs and

infrastructure, with the manufacturing

sector earmarked as a key driver.

Gauteng accounts for 45% of the South Africa’s

manufacturing capacity, so the province is wellplaced

to expand an already strong and diverse

sector. Manufacturing makes up 14.5% of formal

sector output in Gauteng, making it the fourthlargest

sector. One in nine jobs in the province are

created in the sector. According to the Gauteng

Growth Development Agency (GGDA), six out

of 10 foreign direct investment (FDI) projects in

Gauteng have flowed to the manufacturing sector

and its subsectors.

In the five years to 2019, the Gauteng City-

Region attracted 447 FDI projects valued at

R264-billion, which created more than 69 000

jobs (FDI Markets).

The GGDA is an implementing agency which

aims to facilitate business enablement, develop

small, medium and micro-enterprises (SMMEs)

and to promote investment and job creation.

Focussed support for these specific subsectors is

intended to spur other investments: automotive

sector, mineral beneficiation, capital equipment,

agro-processing, pharmaceuticals and tertiary

GAUTENG BUSINESS 2020/21

6


SPECIAL FEATURE

Tech SEZ (Tshwane), the Vaal SEZ (Sedibeng), and

the Tshwane Automotive SEZ.

The National Department of Trade, Industry and

Competition (dtic) is the lead agent in the creation of

SEZs, which are part of the national Industrial Policy

Action Plan (IPAP). SEZs are designed to attract

investment, create jobs and boost exports.

The Provincial Government of Gauteng

has identified 10 “high-growth” sectors where

it intends concentrating its efforts to build

infrastructure and to attract public and private

sector investment:

• Energy: new technologies and a diverse

Transportation and logistics.

• ICT, media and digital services.

• Tourism and hospitality.

• Agricultural value chain.

• Construction and infrastructure.

• Automotive, aerospace and defence.

• Financial services.

• Cultural and creative industries.

• Industrialisation of cannabis.

Credit: ACSA

services such as the BPO, ICT services, tourism

and the knowledge economy.

GGDA subsidiaries include The Innovation

Hub (technology), the Automotive Industry

Development Centre (AIDC), which manages

the Automotive Supplier Park (ASP) and InvestSA

Gauteng (red tape remover for investors).

The Johannesburg Development Agency

(JDA) plays a similar role as the City of

Johannesburg’s development agency. JDA’s

focus is on helping create resilient, sustainable

and liveable urban areas in identified transit

nodes and corridors. In 15 years, 387 projects

have been implemented.

Special Economic Zones (SEZs) are being

created and expanded across the province to

support manufacturers, providing them with the

necessary infrastructure and access to related

businesses. This has seen the expansion of the

OR Tambo International Airport (ORTIA) SEZ

(Ekurhuleni) and the establishment of the High-

These priorities were announced before the onset

of the Covid-19 global pandemic, so obviously

there will be some major adjustments, especially

with regard to tourism and hospitality which

has suffered major setbacks during the local and

international lockdowns.

It could be that the focus shifts more strongly

to another one of the priorities of local and regional

government, affordable housing. Much has been

done to provide housing since the dawn of the

democratic era in 1994, but much more needs

to be done in response to rapid urbanisation.

Gauteng Province has pledged to provide 100 000

service stands to qualifying Gauteng residents who

want to and are able build their own homes and

it wants an additional 250 000 people to be able

to recent “decent accommodation” over the next

five to 10 years. This is in addition to facilitating the

development of mega-cities, one to the west of

Lanseria and the other to the south of Vereeniging.

Vaal River City will span the Orange River and

eventually link up with Sasolburg in the Free State,

according to the blueprint.

Another housing initiative will see provincial

funds ring-fenced to formalise informal settlements

7 GAUTENG BUSINESS 2020/21


SPECIAL FEATURE

and to upgrade hostels into family units. All of

these programmes should provide a boost to the

construction and property sector and to small

businesses in both sectors.

15 Alice Lane Annex. Image: Andrew Bell/Paragon Architects

Overview of the province

Gauteng is South Africa’s smallest province in

terms of landmass but in every other respect it is

a giant. The province is the nation’s key economic

growth engine.

At 18 176km², the province makes up just 1.5%

of South Africa’s territory, but even that aspect

showed growth in 2018 when the territory

of Ekangala was formally transferred from

Mpumalanga Province to Gauteng Province.

Theland had previously been part of the

KwaNdebele homeland.

The 14.3-million people living in Gauteng in

2017 generated a gross domestic product of R1.59-

trillion, about a third of South Africa’s GDP (StatsSA).

Gauteng shares borders with four provinces, the

Free State, North West, Limpopo and

Mpumalanga. The southern border of

the province is the Vaal River and most of

the province is located on the Highveld.

The Witwatersrand, which runs through

Johannesburg, marks the continental

divide: rivers running to the north drain

into the Indian Ocean, rivers running

south drain into the Atlantic Ocean via

the Vaal into the Orange River. Gauteng

draws its water from a series of interconnected

river transfer systems. A major

source of water is the Lesotho Water

Highlands Project.

The Witwatersrand was the source of

the gold that drew so many thousands of

people to the area in the late 19th century

and was the origin of the word for South

Africa’s currency, the “rand”.

Gauteng is a leader in a wide range of economic

sectors: finance, manufacturing, commerce, IT and

media among them. The Bureau of Market Research

(BMR) has shown that Gauteng accounts for 35% of

total household consumption in South Africa.

The leading economic sectors are finance, real

estate and business, manufacturing, government

services and wholesale, retail, motor trade

and accommodation. The creative industries

(including advertising and the film sector) employ

upwards of 180 000 people and contribute more

than R3.3-billion to the provincial economy. This

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sector is seen as a driver of future growth.

In Johannesburg, financial services and

commerce predominate. The JSE, Africa’s largest

stock exchange, is in Sandton and several new stock

exchanges have recently received licences.

Tshwane (which includes Pretoria) is home

to many government services and is the base

of the automotive industry and many research

institutions. The Ekurhuleni metropole has the largest

concentration of manufacturing concerns, ranging

from heavy to light industry, in the country. The

western part of the province is concerned mainly

with mining and agriculture, while the south has a

combination of maize farming, tobacco production

and the heavy industrial work associated with steel

and iron-ore workings.

Individually, the biggest Gauteng cities

contribute to the national GDP as follows:

Johannesburg (15%), Tshwane (9%) and

Ekurhuleni (7%).

Gauteng is not just an important centre of

economic activity it is also an important launching

pad for local and international businesses to enter

Nelson Mandela Bridge at night. Image: SA Tourism

the African market. The country’s biggest airport,

OR Tambo International Airport, is at the core of the

province’s logistical network. Other airports include

Rand Airport (Germiston), Wonderboom (Pretoria)

Lanseria and Grand Central (Midrand).

The Gauteng Division of the High Court of

South Africa (which has seats in Pretoria and

Johannesburg) is a superior court with general

jurisdiction over the province. Johannesburg is also

home to the Constitutional Court, South Africa’s

highest court, and to a branch of the Labour Court

and the Labour Appeal Court.

The province has several outstanding universities,

and the majority of South Africa’s research takes place

at well-regarded institutions such as the Council for

Scientific and Industrial Research (CSIR), the South

African Bureau of Standards (SABS), Mintek, the

South African Nuclear Energy Corporation (NECSA),

the Human Sciences Research Council (HSRC) and

several sites where the work of the Agricultural

Research Council (ARC) is done. ■

9 GAUTENG BUSINESS 2020/21


SPECIAL FEATURE

Spatial planning and infrastructure

underpin Gauteng’s growth plans

GDP growth is directly related to infrastructure investment.

Credit: Coega Development Corporation

Infrastructure spending and areas dedicated to

specific kinds of manufacturing are intended

to drive economic growth in the Gauteng

Province.

Both concepts fall within broader national plans

to boost industrialisation through various kinds of

Special Economic Zones (SEZs) and infrastructural

initiatives. A number of national and provincial

planning frameworks inform the planning of

Gauteng’s economic future. These include the

National Development Plan, Growing Gauteng

Together (GGT 2030), Gauteng 2055 Vision and

the City of Johannesburg’s Growth Development

Strategy and Spatial Development Framework.

The Gauteng Provincial Government will

spend R60-billion on building and maintaining

infrastructure in the five years to 2025. The

provincial authorities further estimate that about

R100-billion will be spent on infrastructure

projects in the province by a variety of stateowned

enterprises (SOEs) and national

departments in the next decade. The overall

estimate for the injection of capital related to

infrastructure, including private initiatives, is

calculated at R760-billion in the period to 2030.

A 15-year Gauteng Infrastructure Master

Plan has been adopted but multiple sources

of funding are needed for the plan to succeed

in areas such as the provision of water,

logistics, broadband connectivity, public

transport, energy and the reshaping of cities to

accommodate citizens in a better way than was

the case under apartheid. A World Bank report

has shown that a 10% increase in infrastructure

spending results in a 1% growth in GDP.

Gauteng began laying the groundwork for

GAUTENG BUSINESS 2020/21

10


SPECIAL FEATURE

creating a research base for urban planning as

far back as 2008 when the Gauteng City-Region

Observatory (GCRO) was established. A partnership

between the University of Johannesburg (UJ), the

University of the Witwatersrand, Johannesburg

(Wits) and the Gauteng Provincial Government,

the GCRO does research on which planners can

base their projections.

A Township Economic Development Bill is to be

introduced in the provincial legislature to reduce

the amount of red tape faced by small businesses.

Growth strategies are to be integrated to ensure

that township SMMEs and black industrialists are

considered when programmes such as the focus

on 10 “high-growth sectors” are implemented. Youth

employment will be factored in to plans to support

those sectors.

Corridors and SEZs

Five corridors have been identified for development

purposes. Each has core existing economic activities

which will be supported and expanded. In addition,

new activities will be encouraged to diversify the

area’s economic potential and create jobs.

The Gauteng City-Region will have three fully

operating Special Economic Zones (SEZs) by

2025. These will be based in Ekurhuleni, Tshwane

and Sedibeng with an additional Special Agro-

Processing Zone located in the West Rand. The

province intends reviving 15 industrial parks and

creating 12 agri-parks and five agro-processing

facilities across the province.

By 2030, Gauteng will have the biggest inland

logistics hub and dry port in Africa – the Transnet

Tambo-Springs Logistics Gateway.

These area-based infrastructure and logistics

projects are expected to contribute to giving the

province a competitive edge in the 10 economic

sectors that have been identified as “high-growth”.

This in turn will create opportunities for small,

medium and micro-enterprises (SMMEs) and

township businesses.

The Tshwane Automotive Special Economic

Zone (TASEZ) (pictured) is a key project within the

Northern Corridor. It is a project of the Gauteng

Province, the Department of Trade, Industry

and Competition, and the City of Tshwane. The

implementing agent is the Coega Development

Corporation (CDC), the developer and operator of

the Coega Special Economic Zone (SEZ).

The TASEZ, branded as “Africa’s First Automotive

City”, has a mandate to promote economic

participation for SMMEs and create employment

in the region. Sectors targeted include security, ICT

maintenance, facility maintenance, construction,

automotive supply chain, marketing and

advertising, catering and events.

The benefits that arise from clustering of

businesses in related sectors is a key element of an

SEZ. Both the Nissan and BMW plants are expanding

and Ford is investing in Silverton. An Incubation

Centre for SMMEs has been launched at Nissan’s

assembly plant in Rosslyn. The facility supports

small enterprises through subsidised rental and

mentorship and training. Management of the centre

is done by the Automotive Industry Development

Centre (AIDC), a subsidiary of the Gauteng Growth

and Development Agency (GGDA). The Jobs Fund

contributes to financing the project.

Other focus sectors in this corridor include

agriculture and agro-processing, defence, the

aerospace and aviation industries together with

the innovation, research and development cluster

anchored around the Gauteng Innovation Hub,

universities and research institutes.

The OR Tambo SEZ is at the centre of the Eastern

Corridor, which underscores Ekurhuleni’s strengths

in manufacturing and logistics. The OR Tambo

SEZ has launched the biggest food processing

operation in the southern hemisphere (and the

world’s second-largest refrigeration plant). With

a special focus on export-oriented value-added

industry, the OR Tambo SEZ leverages its connection

to the country’s busiest airport. The focus of this SEZ

is on agro-processing, jewellery manufacturing and

mineral beneficiation as well as the development

of hydrogen fuel cell technology. This is another

subsidiary of the GGDA.

Other Eastern Corridor sectors include rail and

bus manufacturing (including the PRASA-Gibela

rail manufacturing hub in Nigel), defence and

aerospace and food and beverages.

The Western Corridor encompasses the

economy of the West Rand and has been targeted

11 GAUTENG BUSINESS 2020/21


SPECIAL FEATURE

Credit: Mark Hillary/Flickr

for the creation of new zones for development,

housing, and industry. The aim is to diversify away

from mining towards renewable energy, tourism,

bus manufacturing and agro-processing. The

release of 30 000 hectares of land by Sibanye Gold

has unlocked the potential for major investment

projects. A Smart City is envisaged for Lanseria

and the area to its west.

Where steel used to be the anchor industry in

the Southern Corridor, today the aim is to build

new industries through an SEZ that will cover

both sides of the Vaal River and thus extend into

the Free State Province. Among the investments

that will create impetus are the Savannah City

development, Vaal River City development, a

cargo airport and logistics hub, the AB InBev

investment project, the Gauteng Highlands

water project, the Vaal Marina development and

logistics and mining investments in the Lesedi

Local Municipality, which includes Heidelberg

and Nigel.

Metropolitan drivers

The Central Development Corridor revolves around

the City of Johannesburg as the hub the of financial

services, information and communication technology,

services and pharmaceutical sectors.

New investments are planned for the Joburg

Inner-City and the South, from Soweto, N12

which includes Masingita City, Southern Farms to

Orange Farm.

The City of Johannesburg has recently

completed a review of its policy of nodal

development with a view to creating a fairer

spatial framework for the city than that created

by the racist planning laws of the apartheid era.

As Member of the Mayoral Committee

Lawrence Khoza puts it, “Nowhere is the legacy

of our painful past expressed more vividly than

in the racially divided spatial character of South

Africa’s cities.”

Johannesburg has designated eight zones:

Inner-city: high-intensity use.

Metropolitan: mix of land uses which currently

includes Sandton and Rosebank and will expand

to include parts of Soweto.

General urban: designed to be transformative,

mix of economic and residential use.

Local economic development: interventions

planned to create economic opportunities in

areas with poor facilities (Zandspruit, Orange

Farm, parts of Soweto).

Suburban: lower density with local mixing of

land use (homes, offices, offices, shops).

Dark green: a limit of 8% coverage of buildings.

Peri-urban/agriculture: low density.

Another transformative initiative being

undertaken in Johannesburg is the use of

Transit-Oriented Development (TOD) to drive

investment and development. Implemented by

the Johannesburg Development Agency (JDA),

the TODs are another attempt to improve the lives

of people living in previously neglected areas.

GAUTENG BUSINESS 2020/21

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SPECIAL FEATURE

One such TOD is the Jabulani TOD in Soweto

where a seven-phase project is underway that

includes a multi-purpose hall, a library, counselling

facilities, sports facilities, offices and meeting rooms.

A pedestrian bridge over a railway line and new

roads underscore the transport element, with the

facilities near the Bus Rapid Transport (BRT) route

that runs through Soweto to central Johannesburg.

TODs are designed to attract further investment and

are supported by the Neighbourhood Development

Partnership Grant from National Treasury.

Other projects undertaken by the JDA range

from the upgrading of Constitution Hill, the Faraday

Station precinct, work on the Fashion District and

pavements of the inner city, renovation of the Drill

Hall and the big Newtown make-over.

Johannesburg has been the focus of a major

tax incentive initiative, the Urban Development

Zone (UDZ). The inner city of Johannesburg,

comprising just less than 18km², is the largest

UDZ in South Africa and it is expanding its

footprint in response to significant successes that

have been achieved.

The Johannesburg Social Housing Company

(Joshco) has plans to provide affordable rental

accommodation in 12 inner-city buildings that

were recently identified for that purpose. But the

main target for the UDZ is private investors.

The City of Johannesburg has identified the

following nodes for development:

• Carlton Precinct: Johannesburg’s tallest

building attracts tourists; undergoing revamp;

Sky Rink TV and film studio being developed;

conference centre planned.

• Park Station: intermodal node catering for

cars, buses, rail commuters and taxis; Gautrain

link to OR Tambo International Airport; wide

variety of users.

• Central park: JDA has worked on greening and

community engagement and wants the park to

be a symbol of the successful city.

• Doornfontein/Ellis Park railroad corridor:

planned retail hub and student village.

• Fordsburg: interior design focus; more offices

and accommodation can be built.

• Newtown: cultural precinct with the potential

to cater to students and university departments

with specialised offices and spaces.

• Hillbrow, Berea, Parktown, Bellvue,

Yeoville: creation of new public open

space; opportunities for office and hotel

developments.

National Infrastructure boost

An Investment and Infrastructure Office has

been created in the Presidency. It is headed

by the former Gauteng MEC for Economic

Development, Dr Kgosientso Ramokgopa. In 2020,

51 infrastructure projects with a total investment

value of more than R340-billion were gazetted.

Ten of the 18 affordable housing projects

listed are located in Gauteng. These include

Malibongwe Ridge, Green Creek, Mooikloof

Mega Residential City, Fochville Extension 11

and Germiston Ext 4 Social Housing Project. A

large project is underway in Tshwane, Salvokop

Precinct, to house government

departments and commercial

buildings.

The energy projects identified

by national government will

have an impact on Gauteng,

the country’s biggest consumer

of energy. Priorities include

embedded generation and

the huge water supply project,

Phase 2 of the Lesotho Highlands

Water Project, will create many

opportunities. ■

13 GAUTENG BUSINESS 2020/21


FOCUS

Selby Bus Rapid Transit depot

is taking shape

The Johannesburg Development Agency (JDA) is building infrastructure

to make the city more resilient, liveable and sustainable.

Selby BRT depot, which will service two Rea

Vaya BRT operating companies, will be utilised

for major and minor maintenance of

buses for maintaining in-service buses and

out-of-service buses. The centrally-located depot

will minimise dead mileage as well as minimise the

time lost by buses in traffic congestion between

depots and route starting points.

The JDA is a wholly-owned area-based

development agency of the City of Johannesburg

with an emphasis on the development of resilient,

sustainable and liveable urban areas in identified

transit nodes and corridors. This means that as an

area-based development agency, we are more

than just a project management agency or an

economic development agency.

The JDA operates within the context of the

spatial transformation of South African cities

to correct the spatial and systemic inequalities

created by past regimes of segregation. This

is the foremost goal of urban development

in the coming years. A more equitable, more

just city is one that extends access to a range

of opportunities and services to all of its

citizens. This is aligned to the City of Johannesburg’s

Growth and Development Strategy

(GDS) 2040.

One of the GDS 2040 outcomes is to

provide a resilient, liveable and sustainable

urban environment – underpinned by smart

infrastructure supportive of a low-carbon

economy. The JDA is currently revamping the

existing Selby bus depot in the Johannesburg

inner city, to turn it into a state-of-the-art Rea

Vaya Bus Rapid Transit (BRT) depot for Phase 1B

and Phase 1C operations.

The JDA, on behalf of the City of

Johannesburg’s Department of Transport, is

undertaking the construction of the Selby BRT

in three phases, namely phase 2A, phase 2B and

phase 2C.

The Selby BRT depot, which will service two

Rea Vaya BRT operating companies, will be utilised

for major and minor maintenance of buses by

maintaining in-service buses and out-of-service

buses. The centrally-located depot will minimise

dead mileage, as well as minimise the time lost by

buses in traffic congestion between depots and

route starting points.

An Intelligent Transport System monitors traffic via

multiple screens.

GAUTENG BUSINESS 2020/21

14


FOCUS

In 2013, the JDA developed the first depot

in Meadowlands in Soweto. The Selby BRT

depot is being revamped to be on par with the

Meadowlands depot, which is environmentally

friendly and custom-made for Rea Vaya buses.

Phase 2B, covering the construction of the

bus depot workshops and refuelling garages and

Phase 2C, which involves the construction of the

administration building, are currently underway.

The scope of work for Phase 2B includes

extensive alterations, refurbishments and additions

to an existing workshop building. This includes

the construction of a new refuelling building,

a new double-volume wash-bay building, two

new refuse buildings, a new gate house, civil

works, stormwater infrastructure, concrete paving

panels with layerworks, and mechanical and

electrical installations.

This construction also plays a role in job creation

and skills development, with 30% of the contract

value being awarded to SMMEs.

Environmentally-friendly features include lights

controlled by sensors, a robust, mild-steel sheeting

for the roof, cladding to help with climate control,

and a noise-wall barrier erected around the

premises. The roof structures will also allow direct

sunlight into the building to reduce the need for

artificial lighting. Water is recycled for reuse in the

buildings and the wash bay.

Work planned for Phase 2C includes the

redevelopment and refurbishment of an existing

administration building. This comprises demolition

works to various areas, the refurbishment of

workshop areas, construction of a new canteen

and gymnasium, the construction of new

offices, administration rooms, boardrooms and

storerooms, the construction of a new main foyer

and reception areas and the refurbishment of

courtyard spaces.

The construction of additional toilet blocks,

new lifts to aid accessibility, service ducts, new

pedestrian and vehicular access with security

offices, external works and the installation of

electrical and mechanical infrastructure will also

be undertaken.

Phase 2A, now complete,

entailed the construction

of the perimeter fence, bus

parking area platform, site

access road, main parking

area driveway upgrade and

the construction of the main

entrance road into the depot

(along the Pat Mbatha Road

intersection with Ignatius

Street).

Once completed, the

Selby BRT depot, which was

formerly used by Putco Bus

Company, will accommodate

up to 270 buses and feature an administration

building, maintenance building, washing and

refuelling bays and an Intelligent Transport System

(ITS) control centre. The administration block

features ablution facilities, a canteen, offices and

staff and visitors parking.

Contact details

Physical address: The Bus Factory No 3, Helen

Joseph Street Newtown, Johannesburg

Postal address: PO Box 61877, Marshalltown 2107

Tel: + 27 11 688 7851 | Fax: +27 11 688 7899

Email: info@jda.org.za | Web: www.jda.org.za

15 GAUTENG BUSINESS 2020/21


SPECIAL FEATURE

Building mega-cities

Ambitious construction plans are afoot in Gauteng.

Housing at Fleurhof Ext 2, sponsored by the Madulamoho Housing

Association. CREDIT: Gauteng Partnership Fund

The fourth quarter of 2020 and the first half of 2021 must

be growth periods for the construction and property sectors

– for the simple reason that they barely functioned

during the lockdown caused by the global pandemic.

South Africa is fortunate in that it is emerging from the

lockdown at the same time as summer days lengthen and the

national government is getting down to brass tacks with its

long-awaited infrastructure programme. With a dedicated unit

within the Presidency, a conference has been held and more than

200 hundred possible projects have been whittled down to 51

projects that have been gazetted.

By 2030 Gauteng will have two huge new cities, socially

diverse, digitally connected and ecologically responsible and

sustainable. That’s if the Provincial Government of Gauteng brings

to fruition its plans for the west (Lanseria to Haartbeespoort

Dam) and in the south, where Vaal River City will stretch from

Vereeniging to Sasolburg in the Free State.

In the 25 years since South Africa has been a democracy,

more than 1.2-million subsidised houses have been built by

government in Gauteng. Provincial government has pledged to

release 10 000 serviced stands as part of its Rapid Land Release

programme and it intends

finishing incomplete housing

projects in Alexandra, Evaton,

Kliptown, Bekkersdal and

Winterveldt.

Bodies such as the National

Housing Finance Corporation,

Indlu and Umastandi (social

capital entrepreneurs) are

working together with

provincial authorities to find

ways to formalise and monetise

the township market so that

sustainable incomes can be

generated and affordable

housing and rental stock

becomes more readily available.

An important concept for

developers in Johannesburg

is the tax incentive that

accompanies the Urban

Development Zone (UDZ).

The City of Johannesburg and

the South African Property

Owners Association (SAPOA)

have developed a database

for all UDZ properties.

Information about the owner

of the plot, the valuation and

zoning rights is available for

every stand.

Various “improvement

districts” have also been created,

for example the RID (Retail

Improvement District) where

businesses in a designated area

pay levies to secure improved

cleaning and security services.

The Johannesburg City

Improvement District Forum

shares information among

the CIDs. Expenditure by CIDs

GAUTENG BUSINESS 2020/21

16


SPECIAL FEATURE

collectively on supplementary

public space safety, cleaning and

maintenance is estimated to be

about R61-million annually.

The Gauteng Partnership

Fund (GPF) has attracted more

than R3.5-billion in private

sector funding for affordable

housing in the province since

2012. The Brickfields housing

and rental development in

Newtown was funded by the

GPF and implemented by

the Johannesburg Housing

Company (JHC) as one of the

first inner-city rejuvenation

projects. JHC is a leader in

converting bad buildings to

useable rental space.

The Johannesburg

Development Agency (JDA)

projects range broadly across

many areas within the city, and

include plans to use transport

hubs to improve the lives of

residents living in previously

neglected areas.

Private developer

Indluplace Properties

has purchased nine large

apartment blocks, taking

its total buildings in central

Johannesburg CBD, Berea and

Hillbrow to 23: 33% of the units

are bachelor pads, 22% are

two-bedroomed flats. The listed

company (its major shareholder

is Arrowhead) intends to

“aggressively grow its portfolio”

of high-yielding properties as it

believes the rental market has

huge potential.

Property developments

Quite what the future of office space will be remains to

be seen in the wake of Covid-19. Investment and pension

funds are heavily invested in commercial and residential

property so this is something that will be closely

monitored in the early 2020s.

The hugely successful Sandton model of office and

accommodation development is being replicated across

the province. Sandton’s 10 000 businesses and 300 000

residents are spoilt for accommodation choices, but

city-like developments are springing up in other parts of

Gauteng as well.

The newest is Castle Gate Lifestyle Centre, which is being

built in Pretoria as the first phase in a multi-use development

that will eventually comprise offices, medical facilities, a hotel

along with a retail centre and more than 1 000 residential

units. The R6-billion project is being undertaken by Atterbury

and the Carl Erasmus Trust.

The biggest is Menlyn Maine in the eastern suburbs of Pretoria.

Not only is this a huge multi-use project, it also aims to be South

Africa’s first “Green Precinct”. Professional services and consulting

firm PwC has chosen the Waterfall City estate near Midrand as

the site for its R1.5-billion headquarters, housing 3 500 employees

with a total of 40 000m² of lettable space. The building is owned

by Attacq and developed by Atterbury.

Rosebank’s popularity as an office node continues to

grow and Melrose Arch has proved a popular development,

but none of this has stopped Sandton continue to expand

and it remains first choice as the national base for several

large companies. Recent new headquarters have been

constructed for Discovery and Sasol.

The trend called “semigration” has been having a

downward effect on Gauteng’s residential property prices

for some time. Semigration refers to people moving within

the country – not quite emigrating – to the Western Cape.

Pam Golding Properties CEO Andrew Golding told the

Sunday Times in November 2019 that the Cape drought

had led to other areas such as the Garden Route and the

north coast of KwaZulu-Natal becoming more popular as

destinations. ■

17 GAUTENG BUSINESS 2020/21


10 REASONS

WHY YOU SHOULD INVEST IN SOUTH AFRICA

01.

HOT EMERGING

MARKET

Growing middle class, affluent consumer

base, excellent returns on investment.

02.

MOST DIVERSIFIED

ECONOMY IN AFRICA

South Africa (SA) has the most industrialised economy in Africa.

It is the region’s principal manufacturing hub and a leading

services destination.

LARGEST PRESENCE OF MULTINATIONALS

ON THE AFRICAN CONTINENT

SA is the location of choice of multinationals in Africa.

03.

Global corporates reap the benefits of doing business in

SA, which has a supportive and growing ecosystem as a

hub for innovation, technology and fintech.

05.

FAVOURABLE ACCESS TO

GLOBAL MARKETS

ADVANCED FINANCIAL SERVICES

& BANKING SECTOR

SA has a sophisticated banking sector with a major

footprint in Africa. It is the continent’s financial hub,

with the JSE being Africa’s largest stock exchange by

market capitalisation.

The African Continental Free Trade Area will boost

intra-African trade and create a market of over one

billion people and a combined gross domestic product

(GDP) of USD2.2-trillion that will unlock industrial

development. SA has several trade agreements in

place as an export platform into global markets.

YOUNG, EAGER LABOUR FORCE

09.

SA has a number of world-class universities and colleges

producing a skilled, talented and capable workforce. It

boasts a diversified skills set, emerging talent, a large pool

of prospective workers and government support for training

and skills development.

07.

04.

06.

08.

PROGRESSIVE

CONSTITUTION

& INDEPENDENT

JUDICIARY

SA has a progressive Constitution and an independent judiciary. The

country has a mature and accessible legal system, providing certainty

and respect for the rule of law. It is ranked number one in Africa for the

protection of investments and minority investors.

ABUNDANT NATURAL

RESOURCES

SA is endowed with an abundance of natural resources. It is the leading producer

of platinum-group metals (PGMs) globally. Numerous listed mining companies

operate in SA, which also has world-renowned underground mining expertise.

WORLD-CLASS

INFRASTRUCTURE

AND LOGISTICS

A massive governmental investment programme in infrastructure development

has been under way for several years. SA has the largest air, ports and logistics

networks in Africa, and is ranked number one in Africa in the World Bank’s

Logistics Performance Index.

10.

SA offers a favourable cost of living, with a diversified cultural, cuisine and

sports offering all year round and a world-renowned hospitality sector.

EXCELLENT QUALITY

OF LIFE

Page | 2

19

SOUTH AFRICAN BUSINESS 2020


Sectoral strengths of of

South South African provinces

SECTORAL SECTORAL STRENGTHS STRENGTHS OF OF

SOUTH SOUTH AFRICA’S AFRICA’S PROVINCES PROVINCES

A wide A wide variety variety of investments of investments are available. are available.

FOCUS FOCUS

Mpumalanga: Mpumalanga:

Gauteng: Gauteng:

• Mining • Mining

• Financial • Financial and business and business services services

• Tourism • Tourism

• Information • Information and communications

and communications

• Forestry, • Forestry, paper and paper paper and paper

technology technology

products, products, wood and wood wood and wood

• Transport • Transport and logistics and logistics

products products

• Basic • iron Basic and iron steel, and steel steel, products steel products Limpopo: Limpopo: • Agriculture • Agriculture and agroprocessinprocessing

and agro-

• Fabricated • Fabricated metal products metal products • Mining • Mining

• Motor • vehicles, Motor vehicles, parts and parts accessories and accessories • Fertilisers • Fertilisers • Metal • products Metal products

• Appliances • Appliances

• Tourism • Tourism

• Machinery • Machinery and equipment and equipment • Agriculture • Agriculture

• Chemical • Chemical products, products, pharmaceuticals pharmaceuticals • Agro-processing • Agro-processing

• Agro-processing • Agro-processing • Energy, • including Energy, including

North West: North West:

renewables renewables (solar) (solar)

• Mining • Mining

• Agriculture • Agriculture and agro-processing

and agro-processing

KwaZulu-Natal: KwaZulu-Natal:

• Tourism • Tourism

• Transport • Transport and logistics and logistics

• Metal • products Metal products

• Tourism • Tourism

• Machinery • Machinery and equipment and equipment

• Motor • vehicles, Motor vehicles, parts and parts and

• Renewable • Renewable energy (solar) energy (solar)

accessories accessories

• Petrochemicals • Petrochemicals

• Aluminium • Aluminium

• Clothing • Clothing and textiles and textiles

• Machinery • Machinery and equipment and equipment

• Agriculture • Agriculture and agroprocessinprocessing

and agro-

Northern Northern Cape: Cape:

• Mining • Mining

• Forestry, • Forestry, pulp and pulp paper, and paper,

• Agriculture • Agriculture and agro-processing

and agro-processing

wood and wood wood and products wood products

• Fisheries • Fisheries and aquaculture and aquaculture

• Renewable • Renewable energy (solar, energy wind) (solar, wind)

• Jewellery • Jewellery manufacturing manufacturing

Eastern Eastern Cape: Cape:

Western Western Cape: Cape:


• Motor vehicles, parts and

Tourism •

• Motor vehicles, parts and

Tourism

accessories accessories

• Financial • Financial and business and business services services


• Forestry, wood and wood products

Transport •

• Forestry, wood and wood products

Transport and logistics and logistics


• Clothing and textiles

ICT• • Clothing and textiles

ICT

Free State: Free State:


• Pharmaceuticals

Agriculture •

• Pharmaceuticals

Agriculture and agro-processing

and agro-processing

• Agriculture • Agriculture and agro-processing

and agro-processing


• Leather and leather products

Fisheries •

• Leather and leather products

Fisheries and aquaculture and aquaculture

• Mining • Mining


• Tourism

Petrochemicals •

• Tourism

Petrochemicals

• Petrochemicals • Petrochemicals


• Renewable energy (wind)

Basic •

• Renewable energy (wind)

iron Basic and iron steel and steel

• Machinery • Machinery and equipment and equipment

• Clothing • Clothing and textiles and textiles

• Tourism • Tourism

• Renewable • Renewable energy (solar, energy wind) (solar, wind)

FOCUS

Source: Industrial Source: Industrial Development Development Corporation Corporation (IDC); The (IDC); Case The for Case

Source: Industrial Development Corporation (IDC)

Investing for Investing South in Africa, South Africa, Executive Executive Summary Summary

Source: Industrial Development Corporation (IDC)

(South African (South Investment African Investment Conference, Conference, 2018). 2018).

(South African Investment Conference, 2018).

Page | 40 Page | 40

19

23 23 SOUTH SOUTH GAUTENG

AFRICAN AFRICAN BUSINESS

BUSINESS BUSINESS 2020/21

2020 2020


ADVERTORIAL

see money differently

RELATIONSHIPS AND

UNDERSTANDING CLIENT

NEEDS ARE KEY, SAYS EXPERT

Pedro Rhode, Nedbank’s Provincial General Manager for Gauteng

East, explains how brand values built on the bank’s expertise can

benefit Nedbank clients, especially in what is now ‘the new normal’.

Our client-centred strategy and digital

innovation enabled us to continue

serving clients in the comfort of their

homes through the Covid-19 lockdown. It

brought convenience to clients and helped

them to comply with lockdown regulations,'

he says.

Rhode says that for small- and mediumsized

business clients, Nedbank continues to

deliver end-to-end solutions through a

dedicated business manager. ‘Our biggerpicture

business approach ensures that

we are able to take a holistic view of each

business by understanding the vision,

cashflow cycle, and transactional and

capital expenditure needs. This way, we

become trusted advisors to the business

owners who strive to grow their business.’

Small businesses often lack formalisation, as

shown by many not qualifying for Covid-19

assistance due to out-of-date records and

not meeting regulatory requirements.

Rhode says that Nedbank’s experts are

available to provide all the support small

businesses need, beyond affordable

banking solutions. ‘We offer value-added

services to get and keep your business

going, such as our free-to-join networking


helps clients with debt

consolidation to ease their

financial difficulties …


portal, SimplyBiz.co.za, The Essential Guide

for Small-business Owners, business

registration services and free smallbusiness

seminars.’

Rhode adds that the current economic

climate has highlighted low financial literacy

levels among South Africans who find

themselves highly indebted. 'Nedbank Retail

Banking helps clients with debt consolidation

to ease their financial difficulties, and

financial literacy programmes and tailormade

solutions to empower them to save

and make better financial decisions for the

future.'


Nedbank Retail Banking

To take your financial wellness to the next

level or for more information about Nedbank’s

specialised service offering, email

Pedro Rhode at pedror@nedbank.co.za or

visit www.nedbank.co.za/business.


ADVERTORIAL

see money differently

NEDBANK OFFERS

SPECIALIST SUPPORT

IN POST COVID-19

ENVIRONMENT

Brigitte Ryder, Nedbank’s Provincial

General Manager for Gauteng North,

says that Nedbank believes that

clients need a flexible, resilient financial

partner who understands their

circumstances and aspirations, and provides

relevant solutions and a banking experience

that is hassle-free.

Ryder says that, as South Africa progresses

through the various stages of Covid-19,

Nedbank is working through recovery

scenarios with its clients and prospective

clients while staying true to its brand promise,

which is to use its financial expertise to do

good for individuals, families, businesses and

communities in which it operates.

‘Through the Covid-19 pandemic, we have

elevated our client engagement and

extended tailor-made relief assistance to

many of our clients, equipping and enabling

them to benefit from the various digital and

remote solutions available. This ensures

uninterrupted transactional and

informational access while not

compromising on security,’ says Ryder.

Ryder says that Gauteng North Business

Banking has, over the years, established


Through the Covid-19

pandemic, we have elevated

our client engagement and

extended tailor-made relief

assistance to many of our

clients …


itself as a leader in providing banking

solutions to various sectors. ‘These include

the professional services industry, which

values our bespoke funding, investment and

transactional solutions, large manufacturing

concerns covering various sub-sectors, and

the information technology industry. As a

result, we have been shielded from specific

industry slowdowns, while adding to the

financial and business acumen and ‘street

cred’ of our frontline sales and service staff.’

To find out more about how Nedbank can

partner with your business togrowa

greater South Africa, please email

Brigitte Ryder at brigitter@nedbank.co.za

or visit www.nedbank.co.za/business.


ADVERTORIAL

see money differently

SOLUTIONS AIMED AT

CREATING JOBS AND

GROWING THE ECONOMY

Nedbank’s Provincial General Manager for Gauteng West,

Mawande Shugu, explains how Nedbank is committed to

partnering with businesses and the youth for growth.


Small businesses are the mainstay of

the economy. Nedbank has, over the

years, instituted various interventions

aimed at giving support to the smallbusiness

sector. Over and above our Small

Business Services solutions, we provide

small-business owners with support that

goes beyond banking – freeing up their time

to truly focus on running their businesses,’

he says.

Nedbank has built a solid reputation as a

bank for small businesses through initiatives

such as its free-to-join networking portal,

SimplyBiz.co.za, The Essential Guide for

Small-business Owners, business

registration services and free smallbusiness

seminars – all geared to support

small- and medium-sized enterprises.

Shugu is passionate about supporting

South Africa’s youth. ‘I believe it is important

for the business community to invest in our

youth as they are our future. Investing in this

market is crucial for the sustainability of any

business and requires an extensive investment

in agile technological development. At

Nedbank we pride ourselves in developing

products that provide lifestyle benefits and

offerings that enable the financial


I believe it is important for

the business community to

invest in our youth as they

are our future …


aspirations of our youth market. For

example, our Unlock.Me Account offers a

zero monthly maintenance fee, with

additional lifestyle benefits perfect for

clients between the ages of 16 and 26,’

he says.

Shugu says that, through an evolving and

agile digital strategy supported by the

Nedbank Money app and the Nedbank

Contact Centre, Nedbank remains

committed to bringing convenience to its

clients by making essential banking services

available 24 hours, seven days a week.

If you wish to tap into our expertise to reach

your personal and business goals, please

email Mawande Shugu at

mawandes@nedbank.co.za or visit

www.nedbank.co.za.


ADVERTORIAL

see money differently

MONEY EXPERTS SERVING

THE TSHWANE BUSINESS

COMMUNITY

Mohammed Salim Kadoo, Nedbank’s Provincial General Manager for

Tshwane and North West, says that a deep commitment to partnership

is what underlies the team's personal and professional values.


Our bigger-picture banking approach

enables us not only to provide you …

with the banking solutions you need,

but also to give you a holistic view of how

our products are connected to create a

framework that yields maximum impact

across every facet of your business and

beyond. We know that success in business is

about partnerships, so we put the building

of deep, lasting, value-adding relationships

at the centre of everything we do. This

means your goals are our goals, your vision

is our vision, and your success is our success

– while you rely on our additional support

that is most needed in times of change and

uncertainty,’ he says.

The bank caters for all industries, but the

Tshwane team has many clients in the

franchising and agricultural sectors. 'The

banking products and services tailored

specifically for these sectors and designed

to achieve overall business efficiency,

profitability and sustainability make Nedbank

one of the most franchise-friendly banks in

South Africa and one of the market-leading

banks in the agricultural space,' says Kadoo.

Nedbank’s highly competitive pricing is

structured to the needs and individual risk


business efficiency, profitability

and sustainability make Nedbank

one of the most franchise-friendly

banks in South Africa …


profile and track record of each franchise

business. Products include point-of-sale

(POS) devices and Nedbank’s POSPlus

management system, e-commerce solutions

and cash acceptance devices, as well as a

broad spectrum of tailored financing options.

Nedbank understands that if the various

challenges faced by the agricultural sector

are not addressed, it will threaten economic

growth, food security, employment and

investment. To this end Nedbank has

developed innovative funding solutions

designed to support farmers with sustainable

farming interventions, ranging from water

efficiency mechanisms and cutting-edge

irrigation to renewable-energy financing.

If you are interested in taking your

business to the next level, please email

Mohammed Salim Kadoo at

mohammedk@nedbank.co.za or visit

www.nedbank.co.za/business.

Nedbank Ltd Reg No 1951/000009/06. Authorised financial

services and registered credit provider (NCRCP16).

SPO6013


KEY SECTORS

Overviews of the main economic sectors of Gauteng

Agriculture 26

Mining 27

Energy 28

Oil and gas 29

Transport and logistics 34

Manufacturing 36

Tourism 38

Information and communications

technology 40

Banking and

financial services 41

Development finance

and SMME support 44

Education and training 46

CREDIT: Boogertman and Partners


OVERVIEW

Agriculture

A major starch business is changing hands.

SECTOR INSIGHT

An alternative market

opened in double-quick

time in Midrand.

Tongaat Hulett, best known as a sugar producer, is selling

its starch business (with three milling plants in southern

Gauteng) to the KLL Group, a wholly-owned subsidiary of

Barloworld Logistics Africa. The Meyerton plant is pictured.

The R5.3-billion transaction was in doubt because of concerns

about the value of the business expressed by the buyer in the

context of Covid-19 but the Competition Tribunal in July 2020

approved the deal.

The temporary closure of the Tshwane Market due to the pandemic

brought a quick reaction from RSA Group and Freshling. Within 48 hours

a new facility in Midrand was up and running and on the first day, more

than 340 pallets of fresh produce were available for sale.

The Fresh Produce Market in Johannesburg is South Africa’s

biggest market. The region’s other metropolitan areas, Tshwane

and Ekurhuleni, also have busy markets. The Springs Fresh Produce

Market accounts for 3% of South African market share.

Gauteng’s agricultural sector is concentrated on producing

vegetables. There is commercial farming in the southern sector of

the province (part of South Africa’s maize triangle) and the farming

of cotton, groundnuts and sorghum is undertaken in areas near

Bronkhorstspruit (east) and Heidelberg (in the south).

The province is home to some of South Africa’s biggest

agricultural companies, including AFGRI. Africa’s largest feedlot for

cattle is located in Heidelberg: Karan Beef’s facility can accommodate

120 000 cattle. The feedmill processes 1 400 tons per day and the

associated abattoir in Balfour in neighbouring Mpumalanga

sometimes deals with 1 800 head of cattle per day.

The Kanhym Agrimill in Vereeniging is one of three in the

ONLINE RESOURCES

Agricultural Research Council: www.arc.agric.za

AgriSA: www.agrisa.co.za

Red Meat Producers’ Organisation: www.rpo.co.za

South African Poultry Association: www.sapoultry.co.za

company’s portfolio, which

collectively processes 250 000

tons of animal feed annually.

Kanhym Estates is the largest

producer of pigs in the country.

There are many poultry farm

and production facilities in

Gauteng. Companies include

Astral Foods, RCL Foods and

Daybreak Farms.

A R400-million agro-processing

plant was launched in 2019 in the

Gauteng Industrial Development

Zone (GIDZ). The GIDZ is located at

OR Tambo International Airport and

is intended to encourage exports of

high-value goods.

The Provincial Government

of Gauteng has set up Action

Labs to focus on agriculture

and agro-processing with a

focus on land tenure issues and

improving food security. If food

producers can be linked to the

value chain then township

economies can benefit.

In almost every aspect of the

spatial planning being carried

out by the Gauteng Provincial

Government, agriculture

and agro-processing are key

components, either of Special

Economic Zones (SEZ), industrial

parks or agri-parks. Plans for the

Western Corridor, for example,

include an agro-processing park

and logistics hub. ■

GAUTENG BUSINESS 2020/21

26


OVERVIEW

Mining

AngloGold Ashanti has sold its last South African asset.

The sale in 2020 by AngloGold Ashanti of its Mponeng mine and

Mine Waste Solutions to Harmony Gold for $300-million (about

R4.4-billion) marks the end of an era.

Although the company’s headquarters will continue to be

in Johannesburg and it will be listed on the JSE, its mines are in Ghana,

the Americas and Australia. AngloGold Ashanti was the

successor to the mining company formed by Ernest

Oppenheimer in 1917.

Harmony Gold’s acquisition strategy, including the

purchase from AngloGold of Moab Khotsong mine in 2017,

will result in it being the country’s biggest gold producer.

With 350 000 new ounces coming from Mponeng, it could

produce an annual total of 1.7-million ounces.

Cullinan diamond mine produced 30% more in the

first half of 2019 than it did the year before. Run-of-mine

production increased to 785 444ct. The company is

engaged in an expansion programme called the C-Cut

Phase 1 project. Cullinan is famous for its rare blue diamonds.

The University of the Witwatersrand started life as the South African

School of Mines. The School of Mining Engineering at Wits is now one

of many at the university, but it is the highest ranked in terms of the QS

World University Rankings.

Gauteng is home to most of the research and training bodies

associated with mining. Sibanye-Stillwater is one of many companies

supporting research in the province: the Wits Mining Institute’s Digital

Mining Laboratory (Digimine) is the focus of its funding. AECI, the

explosives and chemicals company, sponsors the Virtual Reality Mine

Design Centre at the University of Pretoria.

The Mandela Mining Precinct is a joint venture between three

government departments and the Minerals Council South Africa

which aims to develop research into mining, showcase the country’s

manufacturing abilities and to continue to create jobs and wealth as ore

bodies are depleted.

Mintek is an autonomous body based in Randburg which receives

about 30% of its budget from the Department of Mineral Resources.

The balance comes from joint ventures with private-sector partners,

ONLINE RESOURCES

Council for Geoscience: www.geoscience.org.za

Minerals Council South Africa: www.mineralscouncil.org.za

Mintek: www.mintek.co.za

National Department of Mineral Resources: www.dmr.gov.za

SECTOR INSIGHT

Harmony Gold’s purchase

of Mponeng mine boosts

its overall volumes.

or is earned in research and

development income, the sale

of services or products and from

technology licensing agreements.

Pretoria University has

a Department of Mining

Engineering, the University of

South Africa offers three national

diplomas in mine-related fields,

the University of Johannesburg

has mine-surveying courses and

the Vaal and Tshwane universities

of technology have engineering

faculties.

The national government’s

Phakisa programme is to be

applied to mining. Intended

to fast-track solutions to

development problems, an

Operation Mining Phakisa Lab has

been set up to create concrete

plans. Similarly, the Provincial

Government of Gauteng has

initiated Action Labs in the

mining sector. ■

27 GAUTENG BUSINESS 2020/21


OVERVIEW

Energy

Companies are generating their own power.

SECTOR INSIGHT

Energy zones could boost

old mining areas.

Credit: Knight Piésold

Areas in the Gauteng province that can no longer rely on

the mining industry to drive their economies could become

focus zones for solar PV projects. Renewable Energy

Development Zones (REDZs) have been allocated in other

provinces (two for solar, one for wind) but the potential for REDZs

in Gauteng is huge, because vast amounts of energy are needed to

drive the country’s biggest economy.

These zones would be developed in line with the national

Integrated Resources Plan (IRP 2019) which the Gauteng Provincial

Government is hoping will enable it to unlock several renewable

energy projects. Other projects include promoting gas usage,

the development of hydrogen fuel-cell technology and the

recommissioning of power stations.

National power regulator, NERSA, has been asked by the National

Minister of Energy to consider granting licences to small-scale power

producers to sell any excess power. The likely granting of these

licences will open up the market and help small manufacturers to

cover the cost of installing generating capacity.

Many companies and institutions are generating their own power. In

Johannesburg, the Northern Wastewater Treatment Works (pictured) has

its own electricity source in a 1.1MW biogas plant. It produces electricity

using cogeneration, which is combined heat and power.

A landfill site at Robinson Deep in Johannesburg has started

generating 3MW of gas. This is the first of five renewable energy projects

that Energy Systems SA has lined up in Johannesburg. At the Cavalier

abattoir in Cullinan, biowaste conversion company ibert provides about

ONLINE RESOURCES

National Energy Regulator of South Africa: www.nersa.org.za

South African Photovoltaic Industry Association: www.sapvia.co.za

South African National Energy Development Institute:

www.sanedi.org.za

a quarter of the power that the

abattoir needs to function.

Absa Bank has followed

up on its decision to take its

central Johannesburg campus

off the national electricity grid.

Investments in a 6 000-panel

rooftop solar system (which cost

R10-million), the synchronisation

of gas and diesel generators

and sophisticated water and

underfloor heating systems

have all contributed to massive

energy savings.

The rooftop solar installation

at Absa’s Pretoria office provides

17% of its electricity needs and

the bank intends rolling out solar

solutions for another five offices

soon in addition to investigating

battery solutions in pursuit of

what it calls “net zero offices”.

One of the biggest roofs

in South Africa is to get one of

the largest solar installations.

Mall of Africa, a joint venture

by Attacq and Atterbury in

Waterfall City, Midrand, will

produce about 7 800 MWh/y

from panels on 45 000 m² of

roof space.

Vukile Property Fund has

decided to equip all of the malls

in its portfolio with rooftop

solar panels. Retrofitting of light

fittings has also taken place, to

improve energy efficiency. ■

GAUTENG BUSINESS 2020/21

28


OVERVIEW

Oil and gas

Various types of gas are available as fuels.

SECTOR INSIGHT

Rebranded Total petrol

stations will sell liquified

natural gas.

Renergen, which owns rights to a field of liquified natural gas

(LNG) in the Free State, has started taking orders for its product

from logistics companies. Bulk Hauliers International Transport

(BHIT) has signed an agreement to take LNG to fuel 50 of its

trucks, which should lead to lower operating and maintenance costs.

South African Breweries is another client.

The first two dedicated filling stations will be Total stations in

Johannesburg and Durban that will be rebranded in green. One station

is planned for Harrismith on the busy N3 highway which links the cities.

Delta Natural Gas (DNG) Energy announced in 2019 the rollout

of 400 natural gas refuelling sites across South Africa with a focus

on the taxi and logistics sectors. The first sites will be Johannesburg

and Tshwane.

The Provincial Government of Gauteng has announced that it wants

to take “decisive steps” to increase the availability and use of gas.

NGV Gas, a subsidiary of CNG Holdings, is promoting compressed

natural gas (CNG) as a versatile alternative across all sectors. Another

subsidiary, CNG Technology supplies equipment for filling stations and

distributions, converts petrol and diesel-powered vehicles and advises

companies on conversions.

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. National policy is driving a switch to the use of gas. A

national Gas Utilisation Master Plan (GUMP) is being developed.

Transnet Pipelines has completed a sophisticated new multiproduct

pipeline (NMPP) between the coast and Gauteng which is

ONLINE RESOURCES

National Energy Regulator of South Africa: www.nersa.org.za

South African Oil & Gas Alliance: www.saoga.org.za

South African Petroleum Industry Association: www.sapia.co.za

bringing a range of products to

the manufacturing heartland

of South Africa. The company

operates a 3 800km network

of underground, high-pressure

petroleum and gas pipelines

throughout the eastern parts of

South Africa.

The country’s biggest supplier

of industrial heating fluids, FFS

Refiners, supplies this product

out of a plant at Chloorkop while

the company’s Evander site is

responsible for heavy fuel oils.

Evander also has a tank with

installed capacity of 8 500m³.

Egoli Gas has a pipeline

network that extends over

1 200km in and around

Johannesburg and the company

has 7 500 domestic, industrial

and commercial customers.

Vopak completed a new storage

terminal in Lesedi on the East

Rand in 2017 to receive product

from the NMPP. The company

that owns Egoli Gas, Reatile, has a

30% stake in Vopak and a stake in

CNG Holdings.

The regulator and promoter

of oil and gas exploration in South

Africa, Petroleum Agency South

Africa, has awarded coalbedmethane-gas

and natural

gas rights in the provinces on

Gauteng’s border, Free State and

KwaZulu-Natal. ■

29 GAUTENG BUSINESS 2020/21


a key

As stated in the National Development Plan (NDP), the government’s intention

is to “enable exploratory drilling to identify economically recoverable

coal seam and shale gas reserves, while environmental investigations will

continue to ascertain whether sustainable exploitation of these resources

is possible: “If gas reserves are proven and environmental concerns

player

alleviated, then development of these resources and gas-to power projects

should be fast-tracked.” The plan also calls for the need to incorporate a

greater share of gas in South Africa’s energy mix, through importing liquefied

natural gas (LNG), using shale gas if reserves prove commercial, and

developing infrastructure

for the import of

n a vital sector

LNG, mainly for power

production, over the

short to medium term.

South Africa’s oil and

gas exploration and

production sector offers

an excellent investment

Petroleum Agency SA plays an important role in developing South Africa’s gas

market by attracting qualified and competent companies to explore for gas in

the country, as well as monitoring and regulating their activities. In addition

to ensuring operators always comply with the law, a major area of focus is

increasing the inclusion of historically disadvantaged South African-owned

entities in the upstream industry. South Africa needs large discoveries of indigenous

gas as well as fair access to opportunities and social licence to develop

a healthy gas market.

Currently, natural gas supplies about just 3% of South Africa’s primary energy.

A significant challenge facing the development of a major gas market in South

Africa is the extreme dominance of coal as

a primary energy source, and industry’s historic

reliance on coal-generated electricity.

A lack of extensive gas transport and reticulation

infrastructure goes hand in hand

with this, while other challenges include

uncertainty about volumes of indigenous

gas available to industry; security of supply;

switching and conversion costs; gas pricing;

and negativity around the ongoing use of

fossil fuels. End users require certainty before

committing, while explorers look for a

guaranteed market. On a more positive note,

opportunities for gas lie in the realisation

of South Africa’s NDP and the Integrated


Resource Plan (IRP). Both call for indigenous hydrocarbons – conventional

and unconventional – and independent power production to play an

increasing role in the nation’s energy mix.

The national power utility also intends to replace coal-fired power stations

with gas-fired counterparts, in line with the vision of the NDP. The advent

of gas-fired power stations will represent a ready, indigenous market for

operators that make discoveries of gas in South Africa, ensuring it will be far

easier to monetise smaller discoveries that may otherwise have remained

undeveloped. As custodian, Petroleum Agency SA ensures that companies

applying for gas rights are vetted to make sure they are financially qualified

and technically capable. Applicants also need to have a good track

record in terms of oil and gas exploration activity, as well as regard for

the environment. This applies to both local and foreign companies. Oil and

gas exploration requires enormous capital outlay and can represent a risk

to workers, communities and the environment. Applicants are therefore

required to prove their capabilities and safety record and

must carry insurance for environmental rehabilitation.

SOCIAL AND LABOUR PLANS

In addition, all planned activities can only be carried out

after completion of an environmental impact assessment

and under an approved environmental management

plan, after consultation with the public as well

as interested and affected parties. Explorers are also

required to contribute to skills development through the

agency’s Upstream Training Trust. Oil and gas exploration

in South Africa is regulated in terms of the Mineral

and Petroleum Resources Development Act (MPRDA) of

2002, which stipulates that applicants for production

rights are required to submit social and labour plans

(SLPs) to assist in transforming the industry, promoting

employment and advancing social and economic welfare in South Africa.

Applicants must develop and implement, where applicable, comprehensive

SLPs that cover human resources-development programmes, community

development, housing and living conditions, and employment equity. In

addition to the MPRDA, other acts also regulate the sector – including

the National Environmental Management Act, the Royalties Act, the

Mining Titles Registration Act and the National Water Act. These acts and

regulations have served the upstream industry well and are all in line with

international standards.

Minister of Mineral Resources Gwede Mantashe and President Cyril

Ramaphosa have recently stated that oil and gas exploration and production

activities should have their own standalone legislation, separate from

that applicable to hard mineral mining. This legislation is being drafted and

the Agency is part of the team at the Department of Mineral Resources

working on it. In today’s world, oil and gas remain the most critical of energy

resources, and Petroleum Agency SA is in full support of those entering

the South African oil and gas exploration and production industries. The

Agency is fully committed to ensuring that our government and policy-makers

sustain the sector for the benefit of all involved and will do everything

in its power to advance the industry.

OUR VISION

A diverse upstream industry con-

tributing to energy security through

sustainable growth in exploration

and development of oil and gas.

OUR MISSION

To promote, facilitate and regulate

exploration and sustainable devel-

opment of oil and gas contributing

to energy security in South Africa.

ABOUT PETROLEUM AGENCY SA

Petroleum Agency SA was established in

1999 by Ministerial directive and is

mandated through the Mineral and

Petroleum Resources Development Act,

2002 (Act No.28 of 2002) together with

the National Environmental Management

Act, 1998 (Act No.107 of 1998).

These Acts provide for Petroleum Agency

SA to evaluate and promote oil and gas

potential exploration and production

activities in South Africa, to regulate oil

and gas exploration and the production

industry and to archive all geotechnical

data produced through oil and gas

exploration. The Agency acts as an

advisor to the government on issues

regarding oil and gas exploration and

production and carries out special

projects at the request of the Minister.


OVERVIEW

Transport and logistics

Achieving ambitious export goals will boost the logistics sector.

SECTOR INSIGHT

An African free trade

agreement is certain to

increase transport volumes.

Plans to expand exports in a variety of sectors will rest heavily

on the transport and logistics sector being up to the task of

handling increased volumes.

A total of 82% of South Africa’s air cargo is transported

through OR Tambo International Airport and Gauteng has several

cargo and freight handling facilities well-equipped to deal with rail

and road deliveries and despatches.

A specific goal of the Provincial Government of Gauteng is to

make the Transnet Tambo-Springs Logistics Gateway the biggest

inland logistics hub and dry port in Africa by 2030.

The Tambo-Springs Gateway near Katlehong is an inter-modal

facility which can transfer containers from rail or road to storage

facilities and ultimately to the customer. Existing freight rail lines run

through the site and link it to the seaports of Durban, Cape Town and

Ngqura (Port Elizabeth). The aim with this new facility is to improve

efficiency. It is run by the Tambo Springs Development Company.

The intention is to add to the port:

• a logistics park (transportation, processing, manufacture,

warehousing and distribution).

• a business park with a retail element.

• a residential component.

• an agro-industrial section.

At an Innovation in Transport Seminar held in 2019, the provincial

government stressed the importance of digital competence (“smart

mobility”) in the transport sector as ever-more complex transactions

take place across international borders. This will only grow as the

effect of the African Continental Trade Agreement (AfCTA), signed

in 2019, comes into effect, allowing for greater and freer trade across

the continent.

The health of the transport

and logistics networks of the

province is key to any economic

growth plans. The provincial

government has identified

logistics hubs, the road network,

intermodal facilities, rolling

stock, and buses and taxis as

key components of the drive

to transform, modernise and

reindustrialise the regional

economy.

Road infrastructure projects

are intended to bring in other

major investments and connect

new economic nodes such as

the Tambo Springs Logistics

Gateway, the planned new

megacities (Vaal River City

and Lanseria), the new Special

Economic Zones with current

economic nodes and existing

townships. In the short term, 18

major roads will be rehabilitated,

upgraded and constructed,

especially in Sedibeng and the

West Rand.

The concept of a Gauteng

City Region is key to much

of the planning for the area’s

economic future. Infrastructure

development is underway

along corridors, each of which

has a specific focus and it is

instructive that each of them

has a transport and/or logistics

element.

GAUTENG BUSINESS 2020/21

34


OVERVIEW

The corridors and focus areas are:

• Thami Mnyele: transport, BRT, M&T Development and Plumbago

Industrial Park.

• OR Tambo Aerotropolis: creative sector, technology, research and

development and logistics.

• Thelle Mogoerane: logistics, Carnival Junction, OR Tambo inland

port, Prasa rolling stock manufacturing facility run by Gibela Rail

Consortium.

The OR Tambo International Airport Special Economic Zone (ORTIA

SEZ) has diversified beyond the existing Jewellery Manufacturing

Precinct in the shape of a R400-million agro-processing plant.

The concept of an aerotropolis is for the airport to become a

hub of economic activity in the same way that cities anchor various

economic sectors that grow up around the centre.

Airports

OR Tambo International Airport caters for more than 20-million

passengers every year.

Lanseria Airport has grown in importance with kulula, FlySafair

and Mango using the airport located to the north of Johannesburg.

It is a convenient landing point for travellers bound for regional

centres like Rustenburg in the North West.

Four airlines continued to offer flights during the Covid-19

lockdown: FlySafair, Airlink, Cemair and Mango. Three airlines went

into business rescue: SAA, SA Express and Comair (which is a British

Airways franchisee and runs the low-cost kulula brand).

Gauteng has several smaller airports that host mostly

commercial aircraft:

• Rand Airport in Germiston.

• Grand Central Airport in Midrand.

• Wonderboom Airport in Pretoria North.

• Waterkloof Air Force base, south of Pretoria.

The Commercial Aviation Manufacturing Association South

Africa (CAMASA) reports that 50 companies are active in the

sector, employing more than 3 000 people in highly skilled

jobs. Almost all the activity is around Johannesburg and Cape

ONLINE RESOURCES

Airports Company South Africa: www.acsa.co.za

Road Freight Association of South Africa: www.rfa.co.za

South African Association of Freight Forwarders: saaff.org.za

South African National Road Agency: www.sanral.co.za

Tambo Springs Logistics Gateway: www.tambosprings.co.za

Town and the sector (which

encompasses aero-structures

and systems, manufacturing,

design and engineering) is

responsible for R3-billion in

exports every year.

Rail

The Gautrain, a high-speed

train linking the centre of

Johannesburg, Sandton, ORTIA

and Pretoria, has been successful

in terms of its original brief.

But the Gautrain is expensive

and not designed to cater for

mass public transportation.

A feasibility study has been

completed on the expansion

of the Gautrain and its full

integration into the public

transport system. New areas

that will be covered according

to the plan include Mamelodi

in Tshwane, Boksburg in

Ekurhuleni, Randburg-Lanseria

in Johannesburg, Mogale City

and Syferfontein in the West

Rand and Roodepoort/Jabulani.

The Gautrain has reactivated

property development in

many areas around its stations

and made sites near stations

attractive to developers and

investors.

Transnet Rail Engineering

(TRE) has a major presence in

Gauteng and the metropolitan

lines that ferry commuters

are run by the Passenger

Rail Agency (PRASA). The

Wits Metrorail system serves

Johannesburg and its surrounds.

Park Station, in the north of the

central business district, is the

largest station in Africa and acts

as the metropolitan hub. ■

35 GAUTENG BUSINESS 2020/21


OVERVIEW

Manufacturing

The OR Tambo Aerotropolis is attracting manufacturing.

The Eastern Corridor of Gauteng, centred on the metropole

of Ekurhuleni, is consolidating its leading position in

manufacturing by leveraging the advantages of hosting

the OR Tambo International Airport and related Special

Economic Zones and industrial parks.

Ekurhuleni Metropolitan Municipality has the greatest

concentration of manufacturing enterprises, especially between

Wadeville and Alrode, south-west of Alberton. Germiston is the

country’s biggest rail junction and Transnet Engineering has invested

hundreds of millions of rands in new equipment at its facility there.

The Provincial Government of Gauteng has tabled plans to

bolster manufacturing capacity in the province’s western areas. The

priorities are mining and mineral beneficiation, capital equipment

and machinery, agriculture and agro-processing, tourism, retail

and economic development in townships. The industrial parks at

Babelegi, GaRankuwa and Ekandustria are to be renovated.

Manufacturing contributes 14% to Gauteng’s real economy

output and provides 40% of South Africa’s manufacturing overall.

Manufacturing related to the mining industry, historically the

lynchpin of the Gauteng economy, is still important.

Employer organisations like the Manufacturing Circle and

government at national and provincial levels are engaging in

initiatives to grow the sector, including incentives such as the

Manufacturing and Competitiveness Enhancement Programme

(MCEP) of the Department of Trade, Industry and Competition (dtic).

Sectors that have received support include plastics,

pharmaceuticals, chemicals, metal fabrication, transport equipment

and agri-processing. The Support Programme for Industrial

Innovation (SPII), run by the Industrial Development Corporation

(IDC) on behalf of the dtic, promotes technology development.

Another IDC initiative has allocated R23-billion over three

years to support the Black Industrialist Programme to help existing

entrepreneurs grow their businesses.

Venter Consulting Engineers, manufacturer of precision

engineering equipment, recently attracted the attention of Italian

company Danieli and won a contract to create two sophisticated

globoid gear sets. Also called the hour-glass gear, this technology

allows for an increased number of teeth that are simultaneously in

mesh and improves the conditions of force transmission. A handful of

firms globally are in a position to make these gears, which can stand

massive amounts of stress.

SECTOR INSIGHT

A precision engineering firm

is gearing up for international

contracts.

Packaging company Nampak,

which in 2019 celebrated its 50th

year as a listed company on the

JSE, has metals, plastic, paper

and glass operations at various

locations. It is the market leader

in beverage cans. The country’s

biggest glass producer, Consol

Glass, has facilities in Clayville,

Wadeville and Nigel.

Household products

manufacturer Unilever

represents an example of the

lighter industrial capacity of the

East Rand. Kellogg’s, Kimberly-

Clark South Africa and Procter

& Gamble all have significant

manufacturing capacity in

the area. Corrugated paper

manufacturer Corruseal has

purchased the Enstra Mill in

Springs from Sappi, giving it

greater control of production.

The southern portion of

Gauteng around Vanderbijlpark

and Vereeniging is synonymous

with steel production. Flat iron

is made at the large plants

of ArcelorMittal. Scaw Metals

has a chain-making factory in

Vereeniging.

There are 35 aluminium

processing firms in Gauteng,

involved in both secondary

processing to produce foils,

GAUTENG BUSINESS 2020/21

36


OVERVIEW

cans, bars, rods and sheets, with final

fabrication in the form of die-casting

and sheet metal work. Within Gauteng,

the automotive and packaging

industries are the chief consumers of

these products.

AECI is a large manufacturing

company with its roots in the mining

industry. It comprises two principal

divisions: AEL Mining Services (with

a large factory site at Modderfontein

south of Johannesburg) and Chemical

Services, which presides over 20

separate companies (including Senmin,

the group’s mining chemicals company).

More than half of the companies

operating in the food and beverage

sector in South Africa are in Gauteng,

including Nestlé, Tiger Brands, Pioneer

Foods, RCL, AVI and Astral. There are

approximately 4 000 food-processing

companies in the province, employing

more than 100 000 people.

Although there are more than 200 pharmaceutical firms in

the country, large companies dominate the field, with Aspen

Pharmacare (34%) and Adcock Ingram (25%) the two key players,

followed by Sanofi, Pharmaplan and Cipla Medpro. Among the

other big international brands active in Gauteng are Merck, which

has a 55 000m² plant at Modderfontein, and Pfizer SA, which runs a

laboratory in Sandton amongst its facilities in South Africa.

All of Gauteng’s large automobile manufacturers are investing

in new model production. Nissan is spending R3-billion on

production of the Navara pick-up vehicle. Other major investments

include R3-billion by Ford at Silverton, R6.1-billion by BMW at

Rosslyn, R260-million by BMW on an expanded campus at Midrand.

UD Trucks, a part of the Volvo group, will assemble the Croner

heavy commercial vehicle at Rosslyn.

Gauteng is also home to a strong automotive components

industry, together with several bus and truck assembly plants.

ONLINE RESOURCES

Centre for Advanced Manufacturing: www.cfam.co.za

Chemical and Allied Industries’ Association: www.caia.co.za

Gauteng Department of Economic Development:

www.ecodev.gpg.gov.za

Manufacturing Circle: www.manufacturingcircle.co.za

CREDIT: Venter Consulting Engineers

These include Scania, TFM

Industries and MAN Truck and

Bus South Africa, as well as the

Chinese truck manufacturer

FAW, which owns an assembly

plant in Isando. Beijing

Automotive Works (BAW)

assembles taxis at Springs.

Armoured cars are also

produced. The Paramount

Group has signed a contract

to supply the United Arab

Emirates with its latest

armoured personnel carrier, the

Mbombe 4. Paramount South

Africa has been created to work

in the local market.

DCD Protected Mobility

manufactures armoured cars in

Boksburg, which are branded

as Vehicle Mounted Mine

Detectors. In nearby Benoni,

BAE Systems OMC designs

and manufactures protected

vehicles. ■

37 GAUTENG BUSINESS 2020/21


OVERVIEW

Tourism

Tourism operators are determined to rise again.

Credit: Marriott International

When the Marriott International hotel group closed three

of its South African hotels during the Covid-19 lockdown,

Tsogo Sun Hotels, which owns a controlling stake in all

three hotels, stepped up its commitment by agreeing to

bring them into its portfolio, keep them open and run them.

One of these hotels is the The Mount Grace in the Magaliesberg

which was developed by the Brand family and was the sister hotel to

The Grace in Rosebank. Tsogo bought and restored The Grace in 2015

and it currently operates as 54 on Bath. The Tsogo group believes that

demand for conferencing, weddings and shorter family getaways

will grow and that The Mount Grace, with its close proximity to

Johannesburg, is in a good position to respond to those markets.

Tsogo Sun Holdings split its casino and hotel operations in 2019

in order to unlock value in the two sectors. With a market cap of

R25-billion, Tsogo is the country’s biggest hotel group. It has 36

hotels and three casinos in Gauteng. The hotel brands cover four

market segments, and they include a handful of stand-alone hotels

such as the Palazzo (at Montecasino) and the boutique hotel in

Rosebank. SunSquare, Southern Sun Hotels, Southern Sun Resorts,

Garden Court and StayEasy are among the group’s brands.

SECTOR INSIGHT

Tsogo Sun Hotel took over The

Mount Grace during lockdown.

The move by Marriott

International into the South

African market was seen as

significant, and it retains most

of its properties. In partnership

with the Amdec Group, Marriott

spent about R1-billion on the

Marriott Hotel Melrose Arch and

Marriott Executive Apartments

Johannesburg Melrose Arch.

Buying into Protea Hotels

has also given Marriott access to

other African countries.

Although all projections

about the tourism sector and

GAUTENG BUSINESS 2020/21

38


OVERVIEW

its potential for growth and for job creation were short-circuited by

the Covid-19 pandemic, the fact remains that the sector can grow

quickly and it is a good job creator.

Growing Gauteng Together (GGT2030) is a plan of action

formulated by the Gauteng Provincial Government which intends to

transform, modernise and industrialise the provincial economy. The

expansion of the tourism sector is seen as one of the key methods of

achieving those goals. This was emphasised when the 2020 State of

the Province Address included Tourism and Hospitality as one of 10

“high-growth” sectors.

In June 2020, as part of preparation for the reopening of the

sector, the Gauteng Tourism Authority (GTA) launched its first

webinar in a four-part series of targeted engagements. It was agreed

that local tourism would have to take up the slack that occurred with

the collapse of international arrivals and that safety protocols were

vital to restoring confidence.

Virtual tours have been taken up by heritage operators such as

Constitution Hill and Liliesleaf Farm and this option is likely to grow

as people in other countries seek out a South African experience free

from any worries.

Founder and CEO of the heritage site honouring the South

African liberation movement, Nicholas Wolpe, said, “There are

now over 1 400 hours of archive material that we will be taking

online and through virtual tours and information banks that can be

accessed off-site.”

The CEO of Emerald Resorts, Mark Hands, commented, “We are

repackaging our strategy for visitors to include more digital offerings

as we will have to limit physical numbers as social distancing may

well be with us into 2022 to manage infections brought about by

large groups of people.”

A strong theme at the webinar was solidarity. “We have to adapt

to the new normal even as it is unknown at the moment,” said Fezile

Ngqobe, acting CEO for GTA. “What we do know is that as a sector, we

are all in this together.”

The Legacy Group was one of the first to introduce apartments

to the hotel development mix in South Africa when it added the

Davinci Hotel on Nelson Mandela Square to its portfolio just before

South Africa hosted the soccer World Cup in 2010. The effects of the

Covid-19 pandemic may lead to this trend growing within other

hotel groups.

The Legacy collection includes the Michelangelo Hotel and

Michelangelo Towers. The Davinci was designed with 166 hotel

ONLINE RESOURCES

Cradle of Humankind: www.maropeng.co.za

Gauteng Tourism Authority: www.gauteng.net

Johannesburg Tourism Company: www.joburgtourism.com

rooms, 54 apartments in the

upper reaches, with a further

four luxurious penthouses

above that.

Culture and history

Heritage tourism is a strong

component of the tourism

offering in Gauteng. The

Cradle of Humankind is a

UNESCO World Heritage

Site and attracts thousands

of visitors every year to the

interactive visitor’s centre at

Maropeng. The Sterkfontein

Caves have extraordinary

displays, showing the origins

of humanity through artefacts

such as the 2.1-million-yearold

skull known as Mrs Ples.

The Origins Centre at the

University of the Witwatersrand

provides insights into the

origins of mankind through art

and science. The Centre hosts

superb representations of Khoi

and San rock art.

History relating to the

struggle against apartheid

centres on attractions such

as the moving exhibitions

housed at the Apartheid

Museum and the history of

the battle for human rights

and democracy embodied in

Constitution Hill.

Kliptown in Soweto is

the site of the signing of the

Freedom Charter. Another

site where South Africa’s

history is on display is at

Freedom Park, a sprawling

complex of museums, open

spaces and memorials on a

hillside overlooking Pretoria in

Tshwane. ■

39 GAUTENG BUSINESS 2020/21


OVERVIEW

Information and

communications technology

Financial services is leading the way in ICT investment.

The biggest investors in new technology are banks and other

players in the financial sector, where technology is rapidly

lowering the barriers to entry for new businesses. This trend

is illustrated by the rapid development of new exchanges

which are based on sophisticated ICT hardware and software.

One of the provincial government’s stated goals is to get several

ICT initiatives to work together. If the work of the Innovation Hub,

several Ekasi laboratories, the Tshimologong precinct, universities and

research institutes could be integrated, a more powerful ecosystem

would be the result.

A High-Tech

Special Economic Zone

(SEZ) is another idea that

is being pursued. Making

broadband connectivity

and free Wi-Fi available

Actonville Primary School in Benoni has received

a donation of laptops from data protection and

management company Commvault.

to poor households in

the province is another

task. Gauteng’s Premier

will appoint a Digital

Transformation Advisory Panel to assist in driving these initiatives.

Various large spatial plans for the province include an element

whereby these new cities or settlements will be built as “smart cities”.

Johannesburg is now one of two South African cities to host a

Microsoft Azure data centre.

The Industrial Development Corporation (IDC) estimates that

spending on cloud services in South Africa will reach R11.5-billion

by 2022, nearly three times its level in 2017 (Tech Central). This trend

could generate more than 100 000 new jobs.

The Council for Scientific and Industrial Research (CSIR) in Pretoria

hosts a new body aimed at preparing South Africa for the Fourth

Industrial Revolution (4IR), the South African Affiliate Centre of the

World Economic Forum.

With several global companies choosing to station their

South African headquarters in Gauteng, the province is well

ONLINE RESOURCES

eKasiLabs: www.theinnovationhub.com

Independent Communications Authority: www.icasa.org.za

Technology Innovation Agency: www.tia.org.za

SECTOR INSIGHT

Smart cities are planned.

connected. More than 1 500

kilometres of network fibre has

been connected throughout

the province, with 1 066 sites

such as schools, health facilities,

libraries and community centres

giving community members

and entrepreneurs the chance

to be connect with the digital

world. A Gauteng Growth and

Development Agency (GGDA)

subsidiary, the Innovation Hub,

has a programme called eKasiLabs

which supports entrepreneurs

and young people with good

business ideas.

The “Tshepo 1 Million”

campaign links the provincial

government with the successful

Harambee Youth Employment

Accelerator and more than 40 large

companies. Both Johannesburg

and Tshwane have free Wifi

networks with Tshwane’s covering

780 zones in places such as libraries,

educational institutions and clinics.

The Small Enterprise Development

Agency (Seda) runs

the SoftstartBTI ICT incubator

in Midrand and Tuksnovation, a

high-tech incubator, at Pretoria

University.

Private mobile communications

company Vodacom has

pledged to spend R50-billion

on network infrastructure in rural

areas. ■

GAUTENG BUSINESS 2020/21

40


Banking and financial

services

Banks are looking at insurance and funeral policies.

OVERVIEW

The financial-services industry contributes 21% to Gauteng’s

gross domestic product.

The revitalised African Bank, which was put under

curatorship in 2014 by the Reserve Bank, is making a play

for new customers with an interesting offering that does not rely

so much on digital wizardry as on presenting the customer with

enhanced banking facilities.

African Bank has created an account that allows up to five

additional accounts to be created in the name of the main

account. Fees are only charged for drawing cash or at the time of

a transaction. There are no monthly fees for any of the accounts

which can be either for saving or transactional. Each user has his

or her own card and monies can be moved between accounts,

ideal for families.

Sanlam has entered two partnerships in the insurance market.

African Rainbow Life has launched life cover policies in the low and

middle-income market, in association with Sanlam and African

Rainbow Capital. Sanlam is also in a venture with Capitec. Financial

Mail quoted Capitec CEO Gerrie Fourie in 2019 saying that the bank

was selling 3 000 funeral policies a day.

In 2017 Tyme Digital received a licence to run a bank. By

early 2019, TymeBank was available in 500 Pick n Pay and Boxer

stores and more than 50 000 customers around South Africa

had an account.

Second to market among the country’s new banks was

Discovery Bank, which officially launched in March 2019. Discovery

Bank applies the behavioural model it uses in its health business to

reward good financial behaviour.

The decision by pharmaceutical giant Aspen Pharmacare

to conduct a second listing on one of South Africa’s newest

exchanges, A2X, suggests good timing by the people behind the

latest trend in the country’s financial services sector.

SECTOR INSIGHT

Discovery Bank is using

the behavioural model

pioneered by its health

business.

A2X has attracted nearly

20 companies in a wide range

of sectors in less than two

years, with a primary focus

on secondary listings. Patrice

Motsepe’s African Rainbow

Capital is an investor in A2X.

Of the four new exchanges,

Equity Express Securities

Exchange (EESE) trades in Black

Economic Empowerment

(BEE) while ZARX and 4AX are

targeting companies that are

not listed elsewhere. ZARX has

agricultural holding companies

like TWK and Senwes among

its first clients. The newcomers

all promise to use the latest

technology to make trading

simpler, quicker and cheaper.

The JSE is the world’s 19thbiggest

exchange and nearly 400

companies are listed on the JSE

or AltX, the JSE-owned exchange

for smaller companies. ■

ONLINE RESOURCES

Association for Savings and Investment South Africa: www.asisa.org.za

Chartered Institute of Government Finance, Audit and Risk Officers: www.cigfaro.co.za

Financial Sector Conduct Authority: www.fsca.co.za

41

GAUTENG BUSINESS 2020/21


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OVERVIEW

Development finance and

SMME support

Government pledges to spend R4-billion with SMMEs annually.

Credit: 5M2T.

In a drive to spur economic development in Gauteng’s

townships, a Township Economic Development Bill will do away

with restrictive bylaws. At the same time, taxi ranks are going

to be rezoned and developed to allow for the growth of retail

outlets and services such as mechanics and panel-beaters.

Data company 5M2T (Five minutes to town) has started offering

sophisticated information about the township market. From how

many spazas in Soweto have refrigeration units (4 700) to brand

loyalty, 5M2T covers 60 000 spazas, salons, barbers and other

informal trade outlets in an “in-market audit”.

Gauteng has 14 registered co-operative banking institutions

serving over 16 000 member-owners, with over R100-million in

savings and R150-million in assets. The township market of about

250 000 township households holds enormous potential for

collective buying.

The Gauteng Growth and Development Agency (GGDA) is

linking large companies with small businesses at Special Economic

Zones (SEZs). The aim is to create a pipeline for SMMEs and to

entrench localisation in sectors such as the automotive industry.

The Incubation Centre at Nissan’s assembly plant in Rosslyn

north of Pretoria hosts eight new businesses at a time. They receive

support through subsidised rental and mentorship and training.

The Automotive Industry Development Centre (AIDC), a subsidiary

of the Gauteng Growth and Development Agency (GGDA),

SECTOR INSIGHT

A Township Economic

Development Bill aims to

reduce red tape.

manages the centre. The Jobs

Fund contributes to financing

the project.

The City of Johannesburg

runs seven SMME hubs where

office space, WiFi and advice

and training are available for

small business operators.

About half of South Africa’s

formal SMMEs operate in

Gauteng and more than half

are in the wholesale and retail

sector and the accommodation

sector. The next most popular

sectors are community, social

and personal services.

The Provincial Government

of Gauteng has pledged to

GAUTENG BUSINESS 2020/21

44


OVERVIEW

spend R4-billion per annum on goods and services through 2 000

township businesses. Over the five years to 2025, there will also be

support for 500 co-operatives and for 50 emerging black farmers

and 20 black agro-processors to scale up their businesses.

The National Department of Small Business Development

(DSBD) has several programmes to assist SMMEs and co-operatives.

These include:

• The Black Business Supplier Development Programme, a costsharing

grant to promote competitiveness

• The Co-operative Incentive Scheme, a 100% grant.

The Small Enterprise Development Agency (Seda) is a subsidiary

of the DSDB and gives non-financial support to entrepreneurs

through training, assistance with filling in forms, marketing and

creating business plans. It helps small businesses draft applications

for loan finance. Several of Seda’s technology incubators

are in Gauteng.

The National Gazelles is a national SMME accelerator jointly

funded by Seda and the DSBD.

Businesses can receive up to R1-million for training, productivity

advice, business skills development and the purchase of equipment

on the Gazelles programme. The Industrial Development

Corporation (IDC) supports SMMEs either by disbursing loans or by

taking minority shares in enterprises and giving advice.

The National Department of Labour has a programme to

support people with disabilities, the Sheltered Employment

Factories initiative.

The Enterprise Investment Programme (EIP) of the National

Department of Trade, Industry and Competition (dtic) is another

support programme. The Shanduka Black Umbrellas incubator helps

entrepreneurs convert their good ideas to sustainable business practice.

Private sector

Agribusiness and agro-processing are among the sectors that are

targeted by the Masisizane Fund for loan financing. The others are

franchising/commercial and supply chain/manufacturing. Training

is offered through a Business Accelerator Programme. As a nonprofit

initiative of the Old Mutual Group, the fund focusses on the

cash flow of potential businesses rather than insisting on security

in the form of property.

ONLINE RESOURCES

Gauteng Growth and Development Agency: www.ggda.co.za

National Empowerment Fund: www.nefcorp.co.za

Small Enterprise Development Agency: www.seda.co.za

All the major banks have

SMME offerings. Standard

Bank’s Community Investment

Fund (CIF) initiative extends

loans to informal businesses.

The CIF has distributed more

than R7-million to more than

630 businesses through its six

funds in three provinces.

Nedbank has an enterprisedevelopment

product that

supports businesses with a

turnover up to R35-million

with at least 25% black

ownership.

Private companies also

support SMMEs through their

buying chain. Woolworths

is funding TechnoServe to

ensure that small tomato

growers can grow produce

that will meet the demanding

standards of the retailer,

and to help them expand

production. A regular supplier

to Woolworths, Qutom, assists

with the project.

The Shanduka Black

Umbrellas incubator helps

entrepreneurs convert their

good ideas to sustainable

business practice. DRA Minerals

is putting R3.8-million into the

programme over two years.

Anglo American Zimele,

which runs four enterprise

development and investment

funds, helps start and

expand SMMEs. Since the

introduction of enterprise

hubs, the number of projects

has grown very quickly and

Zimele has processed more

than R500-million in loans and

two applications are received

every day. One of Zimele’s

small business hubs operates

out of Vanderbijlpark. ■

45

GAUTENG BUSINESS 2020/21


OVERVIEW

Education and training

Skills training is a public and private priority.

Wits Business School

In response to a demand for a more skilled workforce, the Provincial

Government of Gauteng has promised by 2025 to establish in every

district at least two schools of specialisation linked to the 10 highgrowth

sectors that have been identified.

Public libraries and community centres will become places

where online courses in artisan and digital skills will be readily

available. The possibilities of two large institutions being harnessed

in the creation of a university-based economic complex are being

explored in Sedibeng where the Vaal University of Technology and a

campus of the North-West University are already major contributors

to the district.

The rapid expansion which characterised the early stages of the

development of the Curro Group has been halted by Covid-19 but the

private education company has still committed itself to expenditure

of R1-billion in 2020. This money will be spent on expanding existing

infrastructure. Curro will continue to acquire schools and focus on

newer brands such as DigiEd and Curro Private Colleges, which offer

vocational courses.

A focus on water and energy underpins the newly-established

Knowledge Pele Academy in Kramerville, Johannesburg. Independent

SECTOR INSIGHT

Curro Group will spend

R1-billion in 2020.

power producer Pele Green

Energy aims to develop skills and

entrepreneurship in rural, periurban

and township communities.

The KP Academy has formulated

energy and water SETA-approved

courses and runs artisan training

programmes, learnerships, short

courses and workshops.

Technical and Vocational

Education and Training (TVET)

colleges are concentrating on 13

trade areas, including bricklayers,

millwrights, boilermakers and

riggers. Gauteng has eight TVET

colleges.

C

M

Y

CM

MY

CY

CMY

K

GAUTENG BUSINESS 2020/21

46


OVERVIEW

The National Skills Authority (NSA) works

with Sector Education Training Authorities

(SETAs) in carrying out the National Skills

Development Strategy (NSDS). The Human

Resource Development Council of South Africa

(HRDCSA) is an over-arching body working on skills

development and training.

Tertiary

Three of South Africa’s top five business schools are

in Gauteng: the Wits Business School, the University

of South Africa’s (Unisa’s) Graduate School of

Business Leadership and the Gordon Institute of

Business Science, on the Sandton campus of the

University of Pretoria.

Eighty percent of the 1 230 lecturers and

researchers at the University of the Witwatersrand

(Wits) have post-graduate degrees, and 27 A-rated

scientists work there. The university offers studies in

more than 40 schools in five faculties.

Pretoria hosts the head office of distance

university Unisa, which has almost a quarter of a

million students. The University of Pretoria (UP) is

renowned for research. One of the most famous

faculties is veterinary science, which is located at

Onderstepoort.

The University of Johannesburg (UJ) is a comprehensive

institution offering diplomas and degrees

through a mix of vocational and academic

programmes. The Tshwane University of Technology

(TUT) and the Vaal University of Technology

(VUT) have several campuses. ■

ONLINE RESOURCES

Council of Higher Education: www.che.ac.za

Gauteng Department of Education: www.education.gpg.gov.za

National Research Foundation: www.nrf.ac.za

UFSBS-FM BS survey 8026.pdf 1 2020/06/19 13:50

UFSBS-FM BS survey 8026.pdf 1 2020/06/19 13:50

UFS Business School

UFSBS-FM BS survey 8026.pdf 1 2020/06/19 13:50

Management Development | Leadership Development

UFSBS-FM BS survey 8026.pdf /06/19 13:50

1 2020/06/19 13:50

UFSBS-FM BS survey 8026.pdf 1 2020/06/19 13:50

UFSBS-FM BS survey 8026.pdf 1 2020/06/19 13:50

UFSBS-FM BS survey 8026.pdf 2020/06/19 13:50

UFSBS-FM BS survey 8026.pdf 1 2020/06/19 13:50

UFSBS-FM BS survey 8026.pdf 1 2020/06/19 13:50

Executive Development | Advanced Project Management

Various short learning programmes

Available online and as inhouse programmes countrywide

Contact Ansie Barnard

T: 051 401 3204 | C: 082 900 1080 | barnardam@ufs.ac.za | www.ufs.ac.za/bus |

| UFSUV | UFSweb | UFSweb |

47 GAUTENG BUSINESS 2020/21


INDEX

INDEX

Africa Biomass Company (ABC) ...................................................................................................................... 3, 8

Chartered institute of Government Finance,

Auditing and Risk Officers (CIGFARO) ....................................................................................................... OBC

Johannesburg Development Agency (JDA) ..................................................................................... 14-15

Metropolitan ................................................................................................................................................IFC, 42-43

Nedbank .................................................................................................................................................................. 20-23

Petroleum Agency South Africa ................................................................................................................ 32-33

Randburg Chamber of Commerce and Industry (RCCI) ..................................................................IBC

Transnet Pipelines .............................................................................................................................................. 30-31

UFS Business School ...............................................................................................................................................47

GAUTENG BUSINESS 2020/21

48


Randburg Chamber of

Commerce and Industry

Promoting and representing businesses in the economic powerhouse.

INTERVIEW

What is the geographic footprint of the Chamber?

The areas we cover are: Randburg, Sandton, Fourways, Midrand

and Lanseria.

Linda Blackbeard, CEO

BIOGRAPHY

Linda Blackbeard ran her own

interior design and hospitality

company before taking up the

reins as CEO of the RCCI. She is

the SACCI Chamber Forum chairlady

and a member of the South

African Chamber of Commerce and

Industry board of directors. She was

awarded the Pan African Award

in 2018 in recognition of her

achievements in the Continental

Lifetime Achiever sector, CEO Global

Most Influential Women in Business

& Government 2018 Awards.

What are the key functions of the Chamber?

Primarily to promote business, to facilitate introductions, to be the voice

of business at municipal, provincial and government levels, in defending

business in areas of poor decision-making or unintended consequences

of various acts that are passed. We also facilitate opportunities into the

SADC regions and work very closely with many embassies regarding

trade and tourism.

What does the Chamber do to support SMMEs?

One of the Chamber’s primary focus areas is the development of SMMEs,

finding opportunities for them, business enhancement in training,

helping with business plans, company registrations, giving direction

to ideas that entrepreneurs might have. Teaching them to form joint

ventures with other small businesses and have an opportunity then to

tender for work. We promote our local businesses being awarded work

in our areas.

Does the RCCI interact with government?

RCCI is affiliated to the only national chamber body, South African

Chamber of Commerce & Industry (SACCI). Through SACCI important

issues are dealt with directly at government level. We are also heard at

provincial level and the Chamber works with the City of Johannesburg,

Trade and Investment SA as well as various national government

departments responsible for economic development.

Are there particular challenges?

Randburg Chamber would love to embrace more businesses. There is

so much opportunity around and we could facilitate more if businesses

joined. The more businesses stand together with their local chamber of

commerce, the stronger our voice will be at municipal, provincial and

government level.

What does the future hold?

Our Electronic Certificate of Origin programme for export saves time and

is designed for South African markets. Businesses and members can look

forward to renewed focus, positive opportunities, and facilitation in the

SADC region for business growth and opportunity. www.rcci.co.za


CPD

CONTiNUOUS PROFESSiONAL DEVELOPMENT

“ Attending CIGFARO Training

and webinars has allowed me to

earn CPD points while

participating in Technical

discussions to help improve my

professional capacity. This is a

great time to be associated with

a SAQA recognised Professional

Body. ”

Ms Zanele Malaza

(PGFO), CFO City of

Mbombela

CONTACT US:

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