Economists and academics yesterday expressed delight at the announcement of General Motors’ R18-billion new export contract, predicting it would bring a range of social and economic benefits to the Eastern Cape.

New Eastern Cape Development Corporation boss Kevin Wakeford said the contract would not only benefit the motor industry, but the whole supplier chain.

It would also mean the city’s harbour facilities would be optimally used. He said the Eastern Cape was fast establishing itself as the automotive and export hub in South Africa.

“Anything involving trade is positive. This means more capital investment and income as well as investment confidence in the Eastern Cape,” he said.

Rhodes University economics department head, Professor Hugo Nel, said the contract showed an improvement in the country’s competitiveness and “an increased integration into the world economy”.

The motor industry was the backbone of the local economy and for that reason the export contract would directly boost developmental backlogs the region was experiencing.

Nelson Mandela Metropolitan University economics department head, Professor Stephen Hosking, said the contract would have a positive spin-off on other industries as well as employment in the region, and was an indication of confidence in the industry.

Hosking’s colleague, Professor Charles Wait said the contract would have a multiplier effect on all companies in the industry and beyond. He said the eventual benefit would be more than the R18-billion.