World Report

Hosting football’s 2010 World Cup will boost the profile of South Africa’s powerhouse province

A spectacular landmark in Gauteng, the new Nelson Mandela Bridge in Johannesburg, is part of a Blue IQ inner city renewal project.

hile Johannesburg and Pretoria are internationally recognised cities, the name of their province, Gauteng, is less familiar. That will change in five years time, however, when Gauteng becomes the focus of worldwide attention as the host of football’s 2010 World Cup. With more than half a million visitors expected to come to the province for the event, preparations are already under way and the drive to improve the local transport system has upped a gear.

The smallest but most densely populated of South Africa’s nine provinces, Gauteng is the country’s economic powerhouse. The highest contributor to the economy, it accounts for 33 percent of South Africa’s gross domestic product – and 10 percent of Africa’s GDP. Gauteng’s economy has expanded by 3.7 percent per year for the last five years. Foreign direct investment in the province has been rising rapidly and tourist numbers are increasing – up by 3.1 million in 2004.

Paul Mashatile, the province’s Minister for Finance and Economic Affairs, says the provincial government is focused on improving infrastructure in order to attract more foreign investment. “We are looking at a lot of initiatives. The economic outlook is very positive. We are predicting economic growth of close to 3.5 percent over the next 2 to 3 years, and if that growth continues there will be more resources coming into the economy, especially for infrastructure provision.”

Paul Mashatile
Gauteng provinces’s Minister for Finance and economic Affairs

“Improving infrastructure and attracting foreign investment will aid strong growth”

Construction of a multi-billion rand bullet train – the Gautrain – is scheduled to start by November and to be completed in time for the World Cup. The 80km (50 mile) project will link Johannesburg, Pretoria and Johannesburg International Airport, easing the congestion between Gauteng’s two principal cities and creating thousands of jobs. Further examples of investment-oriented projects include the Gauteng automotive cluster, an innovation hub for knowledge-intensive hi-tech industries and an industrial development zone (IDZ) at Johannesburg International Airport.

All are part of the provincial government’s multi-billion rand Blue IQ programme, designed to act as a catalyst for market-driven growth in technology, tourism, transport and high value-added manufacturing. The programme is aimed at providing investment opportunities both for local and international investors, and it is estimated that R100 billion worth of investment (£8 billion) could be generated within the next ten years, with more than 100,000 jobs being created.

“We see ourselves as the first investor, taking the first risk and opening the gateway for private sector involvement,” says Blue IQ’s Chief Executive Officer, Nomhle Canca. She describes Blue IQ as a brand-building initiative, designed to win the confidence of the private sector and create public private partnerships. “We needed to build a sufficient level of credibility and confidence with the private sector,” she says.

Charles Jonker
CEO of GEDA

“A highly skilled workforce is one of Gauteng’s key selling points”

Nomhle Canca
CEO of Blue IQ

“Gauteng will become South Africa’s first high-tech cluster”

Spearheading the attraction of investment into the province is the Gauteng Economic Development Agency (GEDA) whose Chief Executive Officer, Charles Jonker, says his job is to sell Gauteng as the smart centre of Africa. “Wherever we get involved, we look at cost structures, smart technologies and technologies where our labour force will fit in well, because Gauteng has a very highly skilled labour force.”

Among the leading sectors for investment that he identifies are telecommunications and information technology, automotive parts and components, aluminium products, pharmaceuticals, food processing, carbonated soft drinks, and beer and malt beverages.

Particular potential is seen in call centres and business process outsourcing. “Gauteng is very cosmopolitan with very diverse languages. We are well positioned to provide top technology, low infrastructure costs and round-the-clock services.”

Job creation is a priority for the provincial government, which is committed to reducing poverty and improving the quality of life for the poor. About 80 percent of Gauteng’s R33.5 billion (£32.7 billion) budget this year is earmarked for social services such as health, education and social development.