Massive investments into the Eastern Cape's aquaculture industry, running into billions of rands, have placed the province in pole position to challenge the Western Cape's dominance of this infant industry.

Perhaps the most prominent is the Coega IDZ's prawn farming venture with its ambitious plans to turn this into a R7 billion project. The pilot phase is already complete using American super-intensive farming technology. SeaArk is the only operating shrimp farm in South Africa to have land-based operations of white shrimp culture.

Irvin & Johnson (I&J) in Port Elizabeth last year began its finfish project using experimental fish cages which have been stocked with kob and yellowtail. These are the first cages using indigenous fish in South Africa.

There is also a kob hatchery in the East London Industrial Development Zone (IDZ). Espadon Marine has been driving kob farming technology, using recirculating systems.

Seatek has been running a pilot abalone farm for two years in the East London IDZ and Wild Coast Abalone at Haga Haga is in the process of expanding its farm in order to take advantage of the strong demand for abalone from Asia.

The Eastern Cape Development Corporation (ECDC), the province's economic development agency, recently completed a Strategic Environmental Assessment to identify sites conducive to sea based fish farming off the Eastern Cape coast so that it could look to bolstering the province's aquaculture production. These include looking at the possibility of offshore mariculture operations in Algoa and St Francis Bay.

Aquaculture has emerged as a boom industry around the globe, driven by declining harvest fisheries and growing demand which has resulted in approximately 47% of the world's fish production being farmed.

Rhodes University professor of Ichthyology and industry expert Peter Britz explains that the recent decline in the supply of traditional fishery products, such as hake and linefish, is driving up prices and making aquaculture increasingly attractive.

"Expect to see aquaculture products becoming standard commodities and wild harvested fish an occasional delicacy at your fish counter over the next few years.

"Already the menu's of seafood restaurant chains are substituting hake with farmed fish such as Vietnamese catfish, and in sushi bars Norwegian salmon is now the standard. Fresh tuna is increasingly scarce and expensive," says Britz.

Currently the industry contributes 0.005% to the country's gross domestic product (GDP) and provides 1 200 direct jobs.

Last year the Department of Environmental Affairs and Tourism said that aquaculture is one of the fastest food production systems in the world, growing at an annual rate of 8,8% from 1950 to 2004. However, Africa's contribution is less than 1% of global production, and South Africa only contributes about 1% of Africa's production.

ECDC aquaculture specialist Rory Haschick believes the Eastern Cape is well positioned to capitalise on the opportunities presented by the aquaculture industry.

"This is an emergent industry which presents huge growth opportunities. ECDC is actively identifying and developing investment opportunities in this sector throughout the province, says Haschick."

Britz says that although oyster farming has been around for a long time, "operations in Hamburg, Port Alfred and Port Elizabeth are set to expand significantly on the back of firm demand from the local market."

Haschick believes the Eastern Cape has several advantages which make it a viable investment destination for finfish mariculture. The price of suitable land in the province is, on average, lower than that of the Western Cape. Warmer sea temperatures allow the fish to reach market size in a shorter time than in the Western Cape. There is the potential to develop two mariculture nodes in the province and the province is also home to the leading mariculture research institute in Africa, i.e. the Rhodes University Ichthyology and Fisheries Science in Grahamstown.

Haschick adds that although there has been an increase in the number of finfish operations, there are high barriers for entry into shrimp and abalone. These barriers manifest themselves in the form of high start-up costs including the purchase of the site. There is a lack of suitable sites and they are expensive.

The minister of Environmental Affairs and Tourism Marthinus van Schalkwyk in September last year released the Policy for the Development of a Sustainable Marine Aquaculture Sector in South Africa. Amongst other things, the policy seeks to ensure that a range of financial incentives that are routinely employed by government to improve the competitiveness of South African industry are designed and managed to benefit the marine aquaculture industry.

"The mechanisms may include tax breaks, duties, grants, credit and other available government fiscal measures," says van Schalkwyk.

"The department will facilitate access to finance for emerging aquaculture and farmers, community initiatives in collaboration with the DTI and other relevant agencies," says Van Schalkwyk.

In addition, the government last year gazetted its decision to issue rights to aquaculture activities for 20 years in order to further stimulate local and international investor confidence.

Currently the Eastern Cape's most dominant economic sector is manufacturing driven by a vibrant and established automotives sector which is based in the port cities of East London and Port Elizabeth.

Many know the province as the "Detroit" of South Africa due to its coastal location and heavy reliance on the automotives sector. It produces about 40% of South Africa's car sales and 60% of exports by unit. Together with the components industry, the Eastern Cape accounts for 26% of South Africa's auto sector value add and 30% of provincial employment.

The Department of Environmental Affairs and Tourism agrees that "marine aquaculture presents an opportunity to substantially increase the diversity of economic activity in the coastal areas."

It adds that aquaculture presents an opportunity to diversify fish production to satisfy local demand, export opportunities, and the creation of new jobs.

The growth of the inland aquaculture sub-sector is hampered by a lack of suitable water and sites and a marginal climate which is either too hot for cold water species or too cold for warm water species.

However, Haschick says there are exciting prospects because of cluster developments led by the private sector such as Jagido Holdings which aims to cultivate catfish and other products for local and export markets. There are also small ornamental fish producers, producing koi, goldfish and warm water tropical fish.

Haschick agrees with Britz who explains that "while aquaculture is not likely to become a dominant activity on the East Cape Coast, it is set to go through a growth phase and become an established industry."

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For more information contact:

Rory Haschick

ECDC aquaculture specialist

Telephone: +27 43 704 5710

Cellphone 083 410 3099

Email rory@ecdc.co.za

For ECDC media relations:

Lunga Mtshizana

Telephone 043 726 8833

Cellphone 083 618 7557

Email lunga@smgafrica.com

Antoinette Panton

Telephone 043 726 8833

Cellphone 083 419 8939

Email antoinette@smgafrica.com