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Presented at the DDP Conference 21 October 2014 By Dr. Ajiv Maharaj
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Late 1980s & early 1990s – city in turmoil 1989 The Planning Forum issued a report -Manufacturing is the most important sector in terms of economic output, followed by Commerce and Transport 1990s Study undertaken of Durban’s economy -Manufacturing contributed 36% to the region & 27% to employment -Strategy to promote tourism, support economic restructuring, support SMMEs, develop infrastructure -GDP 1.2% and Population growth 2% Looking Back: Reflecting on eThekwini - Pre 1994
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Liberalisation & threats to major textile and garment employers Withdrawal major tenants from CBD Formal employment growth subdued The downscaling of assets of major hotel groups on the city’s beachfront Loss of direct international flights to DIA Failure of schemes to rehabilitate township areas Congestion and poor performance in the port Growing pollution pressures in the SDB Lack of progress in transforming business and employment opportunities for Black South Africans The Journey: 1994 - 2000 Many large companies and new players in the economy National government support to enhance the Port and its infrastructure Increased interest from foreign investors Growth in investment in previously disadvantaged areas. E.g. Umlazi, PINK Small businesses were being formed and supported Dialogue between business and political leaders started to yield results e.g. Best Practice City Commission Increased demand for green-field commercial and industrial estates Momentum started to build in major public sector service delivery projects
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Key Developments THE DURBAN ICC Opened in 1997 by former President Nelson Mandela R395 million development 12 000 construction jobs, 23 000 permanent jobs Contributed R16.3 billion to the GGP of KZN since 2007 Over the past 7 years, a total of 53 475 people have been employed as a result of the Durban ICC’s activities The Pavilion Shopping Centre – Westville Hilton Hotel Umhlanga Town Centre and Tourism Node Urban Renewal The Journey: 1994 – 2000
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Newly formed eThekwini Metropolitan Council Monitor Consulting Report: Durban at a Crossroads - Series of aggressive programmes were initiated by the Municipality High growth between 2002 – 2007 Persistent socio-economic challenges City’s economic footprint changed drastically after 1 st decade of democracy Increase in marketing of the city for tourism promotion 2008 recession hampered growth and employment - But, there was boost in tourism and other sectors as a result of the 2010 FIFA World Cup The Journey: 2000 - 2010
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Key Developments RIVERHORSE VALLEY BUSINESS ESTATE 180 businesses with a market value of the properties estimated at R3.2 billion R1.6 billion construction costs Approx. 12 000 construction & 4 000 new direct permanent jobs created Rates contribution was estimated at R83 million pa MOSES MABHIDA STADIUM One of the City’s main showcases during the FIFA World Cup 2010 62 760-seater stadium has a 105-metre arch R3.2 billion asset Approx. 24 000 construction jobs and 14 000 jobs created in the broader economy The Journey: 2000 – 2010
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Key Developments USHAKA MARINE WORLD Part of the wider Point development, opened in 2001 R872 million development cost Contribution to local GDP amounted to approximately R1.9 billion Over 3000 direct permanent jobs created The Journey: 2000 – 2010 Greater Warwick Redevelopment Kingsmead Office Park Bridge City Durban Point Precinct Mahogany Ridge Durban Central Beachfront Upgrade Inanda Heritage Route Town Centre Renewal Clermont Township Redevelopment Gateway Theatre of Shopping – Umhlanga Umlazi Mega City – Umlazi Suncoast Casino & Entertainment World Sibaya Casino & Entertainment World
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Key Developments DUBE TRADEPORT R6 billion investment During the construction phase, 58 972 jobs were created nationally – 34 157 were in eThekwini Est. that R6 billion in household income has been generated across the country - 26.5% going to low-income households throughout SA Impact on SA’s GDP during construction - about R8.4 billion KING SHAKA INTERNATIONAL AIRPORT R6.8 billion asset Opened in May 2010 Monthly average of approximately 2,600 Int arrivals 4000 permanent jobs created In 2013 Skytrax award for best airport in the world handling under 5 million passengers 2014 - third best domestic airport in the world in Skytrax’s World Airport Awards The Journey: 2000 – 2010
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0 The sector contributing the most to GVA is the manufacturing sector, closely followed by the finance sector, especially in the last 5 years The Journey: Key Indicators
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Since 1996 there was a steady increase in the percentage of matric and post-matric achievements, however a major challenge for eThekwini is to ensure that the enrolment numbers also increase. The Journey: Key Indicators
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Durban Film Office Durban Automotive Cluster Durban Chemicals Cluster KZN Clothing and Textiles Cluster EThekwini Maritime Cluster KZN Fashion Council EThekwini Waste Materials Recovery The Journey: Key Programmes Driving Development Edamame Development Programme Durban Green Corridor Investment Promotion Agency Durban Tourism Eventing strategy
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Economic Development and Job Creation Strategy (2013) to work as a roadmap for the City Sustainability of City financially, spatially, economically – one city plan Some key developments planned: - SIP 2 (port & logistics) - Cornubia - Dig out Port - Infrastructure - Hammarsdale, Cato Ridge - Dube TradePort, Inyaninga, - Inner City & World Trade Centre Moving Forward: The Road Ahead for eThekwini Durban to leverage its competitive advantages: -Port of Durban -Tourism & Lifestyle - Trade -Manufacturing capabilities -Focusing on sectors (auto, green, innovation, ICT, maritime, etc) “Africa’s southern gateway destination to trade and travel”
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* City has played proactive role in intervening & Impact * Tourism bias * Industrial has yielded greatest return on investment * Need greater investments into the productive capacity * Retail bias in former townships – localisation of supply chains * Role of Cities is evolving * Projects drivers: not from an overarching strategy – lack of integrated planning * Lack of systematic M&E and learning * Need better statistics at local level * Lots of planning little action (post 2010) City has become compliance driven * Infrastructure * City finances depends on citizens having an income * Interventions have fundamentally influenced the economic context.
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