Alderman James Vos from Invest Cape Town talks to SA Business Integrator about current and future plans for the city.
What do you attribute Cape Town’s continued progressive economic growth to?
Cape Town’s success is due in large part to the resilience of our people and the agility of businesses in the region. Innovation is at the heart of everything we do. The City works hard to establish a collaborative, forward-looking environment where big companies, as well as entrepreneurs and small start-ups, thrive.
We’ve spent substantially on IT infrastructure, particularly the rollout of fibre-optic cable; have initiatives to make doing business in the city easier; and fund and promote skills development programmes.
One of our flagship projects is The Business Hub initiative, which provides practical solutions to simplify starting and developing a small business. Through a single point of access, we help you navigate various processes and reduce possible red tape that businesses may encounter.
On a practical level, the metro’s physical infrastructure, stable government, and fibre-optic telecoms make it a sensible destination for businesses to establish their operations. International companies benefit from the large pool of available skilled professionals and the relatively low labour and living costs.
In addition, Cape Town is the only metro in the country able to protect City customers from up to two stages of Eskom load-shedding, a huge help for businesses. Between February and July 2022, the city protected its customers from 722 hours of load-shedding in total. To sustain this, we have also recently announced the construction of a solar megawatt plant in Atlantis, with more planned for other parts of the city.
How does tourism link in with driving other business growth opportunities?
Travel connects the world and through specific tourism markets, we are unlocking economic opportunities in the metro. We invest in platforms that increase our aviation profile because this is critical to international trade. For a similar reason, we work to raise Cape Town’s brand as a cruise destination because of the business it creates in terms of ship maintenance, the hospitality sector, and other downstream and upstream markets.
This is also the case for our MICE (meetings, incentives, conferences, and events) profile. Travellers might visit for the wines or the beaches, but investors stay for the opportunities. Through tourism, a local delicacy becomes a global trend; a design goes from Khayelitsha’s streets to London’s catwalks; or investors realising the potential of Atlantis’s green-tech developments, go from curious, to signing on the dotted line. Thus, more livelihoods are sustained.
How is Cape Town’s brand as a lifestyle and efficiently run city opening doors?
It’s made our city extremely attractive. The advantage of lifestyle, natural beauty and wide-open spaces position Cape Town as a wonderfully liveable metro that supports a healthy work-life balance.
Skilled professionals are also enticed by our offering. Last year, Cape Town was hailed as one of the best cities in the world for remote workers by global housing rental platform, Nestpick. Scoring 16th out of a list of 75 cities, Cape Town ranked higher than locations such as New York, Athens and Barcelona. The index score was based on a range of factors, including the cost of living, infrastructure, leisure activities, and overall liveability.
We’ve worked hard to promote Cape Town as a world-leading city, and the perfect place to visit, live, work, study, play and invest. Our approach to communicating the destination offering is both holistic and specific as we highlight Cape Town’s value to different target markets.
What is the City doing to enable SME growth in the tourism sector?
The City of Cape Town offers several programmes to support and encourage SME growth. One such support service is the City’s Business Hub, established to provide practical solutions to simplify starting and developing small businesses.
Through a single point of access, we help SMMEs to navigate various processes and reduce possible red tape they may encounter. We also host skills development workshops for entrepreneurs across industries.
In addition, Cape Town Tourism, the City’s official destination marketing organisation, has rolled out a Neighbourhood Experience Development training manual to help guide SMEs in developing their businesses, and to encourage neighbourhood readiness for travellers. They also host regular workshops and networking sessions for their 1 000+ members. These platforms in turn help businesses to sustain and grow.
What do you feel are the major challenges from a tourism perspective?
Challenges on a global and macro-economic level include the geo-political situation in the Ukraine and the economic constraints in our key source markets due to rising fuel and energy prices.
Diminishing disposable income and the movement from long haul tourism purchases into a luxury purchase may dampen the demand in the short term.
Macro political challenges include the slow progress in terms of an e-Visa, as well as red tape hampering fast turnaround time on applications and approvals. On a micro level, our challenges are to ensure water and energy resilience.
To this end, the City has embarked on the rollout of an extensive Resilience Strategy to ensure that we achieve our growth and sustainability objectives. The strategy, developed in partnership with 100 Resilient Cities, was the outcome of significant engagement with stakeholders across Cape Town and followed an extensive resilience evaluation that attempted to identify the most critical vulnerabilities and the most relevant shocks.
Key opportunities are vested in property developments that range from hotel investments, both in management contracts and property acquisitions as well as new built properties.
With the increase in airlift and rapid growth in the cruise industry, e.g., the bounce back post-Covid currently surpassing 2019 peak season figures for 2022/23, affiliated services are unlocked in retail, freight forwarding and technical services.
Our events calendar is also picking up momentum and we see a keen interest in Cape Town for conventions and general business tourism. We are also proud to have the head office of Travelstart based in the city, which says a lot for the trust in our ICT and technology services. Our international airport has an extensive expansion plan, and this brings about opportunities in construction and affiliated services.
What are some of the key sectors and projects in the pipeline that the City is pushing to usher in further development?
To ensure further development, the City has recently approved the Inclusive Economic Growth Strategy (IEGS) for Cape Town. This plan, which is a successor to the 2013 Economic Growth Strategy, will serve as the foundation on which the City will further develop the economic growth systems, and create economic opportunities for more citizens.
It recognises that Cape Town comprises diverse industries that provide a range of job and growth opportunities, from clothing and design, to call centres and green energy, marine manufacturing and information technology.
By collaborating with our many valued business partners to support and grow these industries, the City has secured billions of rands in investments, created employment opportunities for thousands of people, and helped to improve the prospects of thousands more through work readiness training. Through the IEGS, the City will expand on this work, and breathe more life into these and other economic growth and opportunity-creation mechanisms.
Ongoing initiatives include the Ease-of-doing-business Programme, which focuses on creating an enabling business environment; the Workforce Development Initiative, to create training and employment opportunities for Capetonians; and the Growth Coalitions Project.
There has been sustainable responsiveness calls for collaborative partnerships between all sectors – government, business, communities and academia in the form of growth coalitions within Cape Town’s most high-value industries. These structured and outcome-driven stakeholder engagements are critical for sharing knowledge, planning and implementing together, ensuring alignment for the realisation of growth opportunities and resolution of challenges.
The implementation plan, flowing from the Inclusive Economic Growth Strategy, will be implemented, monitored and evaluated over a five-year period. However, it is expected that the effects of the initiatives will stretch beyond the economic horizon of the strategy. The plan consists of 189 action steps, driven by clear implementation plans and deadlines.
Tell us a bit about this the City’s plans regarding renewable energy investment.
Our goal is to take full advantage of the solar and wind energy opportunity, while simultaneously empowering Capetonians with job and business opportunities in a market that is booming.
In the green-tech sector, the City works closely with partners such as the South Africa Renewable Energy Business Incubator (Sarebi) and the Atlantis Special Economic Zone Company (AsezCo) to enable small businesses and individuals with knowledge and skills to create meaningful opportunities in this market.
What are your thoughts on legislation for investment opportunities in SA? , and how does Cape Town tackle this to drive economic success?
One of the most important matters that I have advocated for is the reduction of red tape, which stifles foreign investment and growth of local businesses.
As part of our plan to drive foreign investment into Cape Town, the City has established a special Investment Facilitation Branch (IFB) within the Enterprise and Investment Department dedicated to helping businesses of different sizes, across industries, land and expand their operations in Cape Town.
Since its establishment in 2017, the branch has engaged hundreds of businesses and has assisted more than 20 companies, unlocked investments worth billions of rand and created thousands of job opportunities.
To what extent is Cape Town’s reputation as an investor-friendly city driving fintech?
Cape Town is home to Africa’s oldest tech incubator, the Cape Innovation and Technology Initiative (CiTi), through which over 3 000 entrepreneurs have been trained.
The City’s partnership with CiTi, the Western Cape Government, and Wesgro – the Trade and Investment Promotion Agency – has ensured over the years, that efforts to improve and strengthen the business environment produce the successes that are seen today.
It is by no accident that the Western Cape is home to 47% of South Africa’s tech start-ups, with only 44% located in Gauteng, most of which are based within the boundaries of the city.
The investor-friendliness reputation is because of the deliberate programmes that the City drives through several partnerships, and the objective is always to attract the international talent pool, and to provide quality business-ecosystem support.
Another important point to mention is that Cape Town accounts for 75% of South Africa’s venture capital deals – this is a clear indication that Cape Town is doing something right.
According to Fintech Times, of the more than 500 entrepreneurial companies in Cape Town’s tech sector, about 20% are in ecommerce and software as a service (SaaS), while 15% is in fintech.
Additionally, Cape Town fintech is supported by the financial services sector, which was the largest contributor to GDP in 2018, contributing R43 billion, having grown by 1.3% on average, over the period 2014 to 2018.
A large proportion of private investment and asset management services, as well as insurance and personal service companies are located in Cape Town thus contributing to the enablement of the fintech industry in Cape Town.
It must also be pointed out that semigration to Cape Town by entrepreneurs, including those in the fintech industry, has been underpinned by the allure of the Mother City to semigrants.
According to Spear REIT Limited – a real estate investment trust,factors pointing to the increase in semigration include safety and security, lower pollution and a better quality of life as well as the fact that Western Cape and Cape Town’s municipal districts have earned a reputation of being well-run and effectively administrated.
Maintaining current infrastructure and rolling out future projects, such as current efforts of reducing reliance on Eskom, make a great investment case for the region. The Western Cape government’s policy is to ensure that the city and province have the necessary infrastructure and technology to support business and investment to the region.
What are three key aspects to drive growth in the city?
During my time in government, I have learned that empathy, collaboration, innovation and consistency are key to growth.
With empathy, we listen to our communities so as to understand their needs and then respond to it. Through collaboration, we successfully enact programmes that drive change and empower people. With an innovative mindset, we can better respond to shocks and trends.
For example, in the midst of the pandemic, we helped tourism sector workers find jobs in call centres. We must be consistent and focused in our efforts so that we build and sustain the trust of Capetonians, existing and aspiring entrepreneurs, and potential investors from near and far.
What does the future of Cape Town look like?
Our goal is to position Cape Town as the easiest place to do business in Africa. The City is committed to increasing jobs and investment in the Cape Town economy by simplifying regulations and processes so that it is easy for businesses to start and grow. To this end, the City will work with partners to increase economic participation and reform regulations, and so allow for more opportunities for Capetonians to enter the job market and start a business in both the formal and informal economy.
We want to create an economy of hope and confidence in Cape Town. Our objective is not to compete with other municipalities, but to prove that it is possible to have a city in South Africa where anyone’s dreams of success can be realised. We have had numerous engagements with other municipalities, where we’ve shared ideas. We are working towards the same goal: a better South Africa for all who call her home.
Additionally, I have had many engagements with foreign delegations who are keen to trade with us and invest in Cape Town. I meet Capetonians every day who eagerly participate in our workshops and go on to use what they have learned in their businesses, or to get a much-needed job.
I have to be a champion for Cape Town because of my job but engaging with people in every corner of this city makes me feel invigorated and I want to be a champion for Cape Town. The future of Cape Town is bright because we are making it so.
Alderman James Vos
Alderman James Vos is the Mayoral Committee Member for Economic Growth in the City of Cape Town. With a portfolio that covers matters of trade, tourism, investment, and business support, Vos heads up a team that is instrumental in driving meaningful economic opportunity in Cape Town.
During his time as a public representative, when he also served as a Ward Councillor, Member of Parliament and Shadow Minister of Tourism, James received numerous civic awards, including the International Merit Award.
He is also among the youngest public servants to receive the life title of Aldermanship. Vos believes that the most powerful instrument for improving the quality of life and create jobs is economic growth. To achieve this, his mission is to drive travel and trade to Cape Town and make the metro the easiest place to do business.
Vos oversees various programmes that support workforce and entrepreneurial development. He loves spending time in the outdoors with his wife and two daughters and has a passion for aviation.