The Nelson Mandela Metro’s economic development policy came under close scrutiny by local organised business in Port Elizabeth.

The metro’s new economic development policy, now in final draft, focuses on the policy’s “2020 Economic Development Strategy” thrust and how it will lay the foundation for rapid but sustained economic growth and social development in the light of several challenges and constraints facing the region.

The main challenges, as outlined in the document prepared by the Metro’s economic division, include the necessity to restructure a sub-regional economy upon which the rest of the Eastern Cape province is dependent - the economy is largely dependent on manufacturing, specifically the motor sector and its export programme, low levels of direct foreign investment; poor infrastructure and a low human resource skills base coupled with rapidly growing unemployment rates.

One of the strategies identified in addressing the challenges includes diversification of the local economy through strengthening of existing sectors and development of others. Key economic sectors seen as important for future sustainable growth include the manufacturing sector, specifically the fuel, petroleum, rubber, wood and related products sub-sectors, in addition to the motor and related sub-sectors.

Of equal importance for future development, according to the draft policy, is development of tourism and the hospitality industry, together with the agriculture, construction and logistics sectors.

The draft policy also identifies human resource development, infrastructure rehabilitation, development and expansion, as well as investment, trade, exports and tourism promotion as vital to sustainable development, poverty alleviation and reduction of unemployment.

The metro economic division says “a key challenge for the city is how to balance a short-term job creation with laying the platform for industries which will provide economic sustainability.”

“To halve the unemployment rate (estimated at 42 per cent) by 2020 will require a job growth of 3,5 per cent a year or 227 962 new jobs over the next 17 years.”

“The city also had to make choices about the economic platform in order to inform which skills to be prioritised for development,” says the division.

Current economic development initiatives largely in support of the intended diversified economic base in the metro include Coega IDZ and Ngqura deep-water port, the Madiba Bay Safari World development, the Greater Addo Elephant national park, the Motherwell Urban Renewal Project, the Uitenhage Despatch Development Initiative, Njoli Square Development, and Downtown Planning Project.