Economic Development Agency: Designing for Economic Growth by @andrewboraine #WDC2014


From the wide range of studies and assessments, as well as stakeholder consultations, and despite the existence of many centres of excellence and a huge amount of effort, we have identified a range of reasons why the Western Cape and Cape Town are not performing optimally in economic development:

  • Lack of leadership on economic issues – economic development is not taken seriously, especially when compared to delivery of household and social services and environmental protection and growth management efforts
  • No common economic development agenda. In fact, persistent polarisation of views and approaches (i.e. pro-growth vs. pro poor; urban vs. rural; town vs. township; environment vs. development; big business vs. small business; formal vs. informal business, etc.)
  • Overemphasis on ad hoc flagship projects and events, rather than building a consistent reputation as an economic location with a well-organised business, investment and labour market system, including good economic infrastructure, an appropriate skills base and in-time decision-making
  • Economic development has, in practice, not been the top priority of provincial and local government, and budget allocations for economic development are generally below those of other metropolitan and provincial governments
  • Non-integration of a combined growth, development and inclusion agenda, with limited focus on building the conditions for economic growth and only small-scale and mostly ineffectual efforts to enhance economic inclusion
  • Poor coordination between municipalities, Provincial Government and entities and agencies on economic issues
  • Length of time for decision-making by public bodies, inconsistent policies and a lack of certainty, which has undermined business confidence
  • Over-emphasis on supply-side measures that are not backed by sufficient economic and market intelligence on demand trends
  • Culture of disaggregation of effort – lots of ‘churn’ in areas such as skills and enterprise development but little ‘traction’
  • Regional business associations are not particularly strong or strategic or united, and collectively represent less than 50% of all businesses
  • Weak municipal development strategies; persistence of political and technocratic ‘wish-lists’ and parallel policy processes instead of evidence-led vision and strategy
  • No single organisation looking after the overall regional business and investment climate
  • Many (if not most) important economic ‘levers’ are at national level, but there is insufficient ability to successfully influence national economic policy and decision-making processes and to leverage national resources
  • Preoccupation with ‘global’ and ‘world class’ rather than growing local firms and domestic market share
  • Over-reliance on ‘quality of life’ as a differentiating territorial asset
  • Overemphasis on promoting leisure tourism in particular and destination marketing in general rather than on promoting the region as an economic location, leading to dilution of business brand and underfunding of trade and investment promotion
  • Lack of integration between sector support organisations and programmes and trade and investment promotion
  • Complicated and bureaucratic reporting requirements for agencies and entities receiving public funds
  • Duplication of effort (and sometimes competition) between public sector departments and agencies they fund