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Cape Town is one of Africa’s most vibrant city destinations

Interview - October 2, 2014
Voted the World’s must visit destination of 2014 we take a deeper look at the secrets of Cape Town. Mayor Patricia de Lille speaks with United world about her ambition and vision to address poverty through economic growth and jobs, and a strategy of sustained poverty reduction through economic development which will ensure that every resident has the means for a better life and create a truly inclusive city.
How is the Integrated Development Plan working alongside the National Development Plan in Cape Town and what are the steps that you envisage taking within this plan over the next number of years?

We started developing our integrated development plan in 2011. The five pillars that inform our integrated development plan are to build an inclusive, caring, well-run and safe city that can provide opportunity. Those are the main broad framework that is contained in our Integrated Development Plan for the next five years (2011-2016). When the National Development Plan was adopted in 2013, we became one of the first cities to align our Integrated Development Plan with it. In a way, what Cape Town is doing could be seen as the only city in the country that has started to implement the National Development Plan, based on the competencies that are there for local government. One of the key pillars of the National Development Plan is to roll out infrastructure. In South Africa we have a backlog of infrastructure, of skewed development through centuries, whereby the bulk infrastructure was more or less the same to cater for a minority because of apartheid. So we have a backlog of infrastructure that we must deal with and also maintain existing infrastructure. The strategy that we adopted as the city of Cape Town in line with our Integrated Development Plan and the National Development Plan is to promote economic growth through infrastructure development. Our contribution to growing the economy in Cape Town is investing into infrastructure. For instance, this year we have a budget of R6.5 billion. We divided that to spend R3.5 billion on new infrastructure such as new waste water treatment plants, transport infrastructure, and the provision of housing. That is our contribution to the growth of the economy in Cape Town. And we hope that we will have a crowding in effect by the private sector to grow the economy of Cape Town further. That is why we are the fastest growing part of the South African economy inside Africa. Even though you have a national picture of economic growth of less than 1.5%, in the city of Cape Town our growth has been around 3.6% in the most recent financial period. Even though it seems like doom and gloom inside our national economy, there is still this pocket of excellence where things are happening. Things are happening here because we as government create a conducive climate for investment to grow. We must make sure that the water is running, that the lights can be switched on, that there is good economic growth and public transport. That is where we have excelled over the past 5 years. Overall, the City of Cape Town still has a long way to go. However, the major challenge for the City of Cape Town is urbanization. Urbanization is a worldwide phenomenon because, for the first time in the history of the world, you now find more people living in cities than in rural areas. Cape Town is no exception. We are the fastest growing city in South Africa. Due to urbanization, the challenge becomes the pressure on our existing infrastructure. This gives us the catalyst to roll out more infrastructure to deal with urbanization but also to deal with economic growth in our city.

You mentioned the crowding in effect and the need for the private sector to come on board. What kind of a reaction are you getting from the private sector because it is clear that you have been hugely successful in this province and this city in service provision? What do you expect from the private sector and what are the indicators from you to them that it is time to come on board now?

We certainly went out to the private sector and expressed to them that we cannot do it alone in light of the backlog of infrastructure and the maintenance of existing infrastructure. We derive our income from a rate’s base which people pay. That amount is limited. Therefore we need partnerships. We have entered into partnerships with the private sector. For example, we have taken the risk when it comes to the roll-out of broadband because that is the future of the world. We decided on a strategy where we will invest in the insertion of fiber-optic broadband. We have more than 500km of underground fiber-optic cables. This is more than any other city on the entire continent. After investing in that we then used some of the system’s capacity for us to link our buildings internally. This saves millions on telephone costs in our clinics, schools and government buildings. Now we also rent out the extra capacity to the private sector. By doing this we create competition amongst the independent service providers to buy this capacity from us and develop it. Already we have more than twenty companies taking up some of this extra capacity for their own use. Telkom (the state-owned telecom provider), Vodacom and Neotel are all buying capacity from us. We now want to connect to this fiber-optic which is in the Atlantic Ocean. This can connect us with the West Coast of Africa, because we are aiming to become the gateway into Africa. Once we achieve that we will deal with the speed problem. The speed of our internet is painfully slow because in Cape Town we are not competing with Johannesburg or Durban. We want to be competing with the best in the world. Therefore we are working very hard to increase the speed of our internet. We have a number of free Wi-Fi spots around the city. A major project that we are working on is with Mayor Bloomberg. I have been friends with him even since he was Mayor of New York. When I last saw him in October 2013 he told me that he wanted to make New York City the digital city in the USA. I replied by saying that I would make Cape Town the digital city on the continent of Africa. We are working closely on that and we are following what he has done in New York. I was in New York in July of this year and I met with Mr. Bloomberg. We are collaborating on the digital side of the project. Therefore we are also striving to make Cape Town the digital city on the continent. We try to put the bar very high and not compete with Johannesburg and Durban. We live in a global village. And to be competitive you must compete with cities like Singapore, Vancouver, New York and Sydney.

You described Cape Town as ‘a pocket of excellence’. For example, in terms of quality of education Cape Town ranks very highly. How difficult and important has the challenge of raising the skill-set of the people here to be able to meet the jobs that you’re trying to create been?

We are very blessed in Cape Town with four world class universities. The bulk of our industry is in IT and Finance. Our relationship with the universities is such that we match the skills needed in our economy to what we are producing. In cases of a mismatch of skills, we link up with the university and they design specific courses to produce the skills that are needed in our economy. That is why you find the highest skilled people in Cape Town. Over the last five years a number of companies have moved their headquarters to the city of Cape Town. This is because of the lifestyle conditions and quality of life that we can offer to companies. Part of my campaign is to attract more companies to open their headquarters in Cape Town and from there be able to access the rest of Africa. I am also am involved in a sister-city agreement with Accra, Luanda, and Dar es Salaam. Later this year there will be an African cities mayor’s conference in Accra, Ghana organized by the Mo Ibrahim Foundation. When I went to a conference organized by The Economist magazine two years ago, their front page cover was a cover of The Economist from the early 90s or late 80s which said: ‘the hopeless continent’. They now have a different cover which reads: ‘the continent of hope’. Seven of the fastest growing economies in the world are in Africa. It might be from a low baseline. However, the fact that some of these economies can grow by 6 or 7% shows us that there are significant opportunities in Africa right now. That is why I want to cater for the international companies who want to get into Africa by launching their base here in Cape Town.

One of the great things about the Cape Town economy is the tertiary and sustainable nature of the economy. Has that been the focus of yours and are you looking at the green industry as sustainable models?

We are also pitching Cape Town to have a strong green economy within our broader economic growth strategy. We have done several things to stimulate the green economy. For example, the city owns some large pieces of land. In an area called Atlantis (around 40km outside Cape Town) we have made land available which would be dedicated to green cluster technology. We developed an incentive scheme attracting that any company that is interested in any aspect of the green economy and for those companies we will make land available at less than 10% of the market price in that particular space. We took it further as part of our incentive policy to say that we will give out financial and non-financial incentives. The financial incentives include the significantly reduced cost of the land. Furthermore, if any company is set up in terms of government laws, that company must pay a development facilitation fee which the municipalities then use to invest in bulk infrastructure. Due to the fact that we already have enough bulk infrastructure in that area, we will waive the development facilitation fee. That is a big chunk of the set-up cost of a new company. Also, if the company is set-up in 2016 then we will charge electricity at the price of 2015. Those are some of the financial incentives that we have put together. On the non-financial side, if a company wishes to construct a building, we can approve building plans within five days. There is no more need in that area for environmental impact studies. Therefore, we can complete this within five days. There are a number of non-financial incentives. We have started this as a pilot project in Atlantis in 2013. By the end of 2014 we are going to evaluate the impact of this. Twenty-one companies have already benefitted from these financial and non-financial incentives. Depending on the results we will see whether we can roll this same scheme out in other areas of Cape Town. Unfortunately, we have had an unexpected consequence because of this scheme. For example, some companies are closing their operations in Cape Town and moving to Atlantis. We don’t want companies to go there only for the incentives. We want these companies to stay here and create more jobs in the city of Cape Town.

We recently spoke to Premier Helen Zille. One thing she discussed was the governance of this province and this city. You are businesswomen and running this at top international standards. Have you had the reception from investors that you were hoping for? And what do you think is still holding them back?

The other strategy that I started when I first took office three years ago was to actively pursue the promotion of the city of Cape Town as part of the broader South Africa rather than to wait for national government to take action. Yes, I am a loyal South African and I love my country. However, due to these differences, we decided to promote Cape Town ourselves. I created a post for a Head of Trade and Investment in our office. The first port of call for any investor arriving in Cape Town will be the mayor. We will not send you from pillar to post. We have cut a lot of red tape out of the system. I have repealed and updated over two hundred laws, legislation and bylaws. In the mayor’s office you find a one-stop shop. And about three months ago I filled the post with Tim Harris who used to be the shadow minister of finance and economic affairs for the Democratic Alliance in parliament. Mr. Harris is now setting up the office and the logistics of it. He is also driving together with an assistant in Mayor Bloomberg’s office the digital city project. They are helping us deal with the digital divide in our society. Even if you are ignorant as to national incentives for establishing a business here, we will support you throughout that process. Yesterday I met with a company from Singapore. I was in Singapore around four months ago. During that visit we promoted Cape Town and the value of doing business here. This particular company is in the high-technology industry. We took this company out to Atlantis and they were blown away with what they saw. We connected them with a person in Cape Town who is setting up a similar company. They have extended their stay and decided to set-up their headquarters here. They are particularly interested in training and creating more skills for our workers. This is fantastic for our workforce. Recently I have been giving out certificates to graduates of a program that I started in 2011. It consisted of opening up the cities’ utilities department for apprenticeships. We teamed up with Falls Bay College and Northlink College. And we decided to have the students learn theory at the college and then open up our utilities departments in water, electricity and solid waste for apprenticeships. We also pay these students a stipend while they carry out the apprenticeship. I had tears in my eyes when I was handing out these certificates because I was so proud to see we now have qualified boilermakers, welders, plumbers, and carpenters. The beauty of it is that there are also around 30% of women in what usually is a male dominated workforce. I felt so proud that we are breaking away from stereotypes of these jobs. We want to develop the ship building and repair industry here in Cape Town. The single reason for which boats do not come here for repair, besides the Cape Town Port Authority that does not fall under us unfortunately, is because it has not been promoting ships to come around for repairs and we have shortage of welders. Often companies will even fly in welders from South Korea. With the program that we are doing we have employed more than 60% of artisans and scarce skills in the economy and the city. The other 30% is going to the private sector. Therefore that is our contribution towards skills development. The aforementioned Singaporean company is also prepared to latch onto that. I also personally go to the private sector and ask them for funding in order to carry out more apprenticeships which can help us to pay their stipend during their two-years of practical training. This is something that we must try to do more. I don’t mind that we invested R42.6 million in the past three years because this is investment into human capital. Regardless of whether they stay in the city or work in the private sector, it is part of our contribution to bringing those skills into the economy. Yes, we are working well with the private sector. Nevertheless, there is still room for improvement. I try to address them personally and give them my cell number so that they can call me whenever they have a problem. There is now much better coordination between us and the private sector. Businesses will look for opportunities and pursue that goal. Due to this improved coordination and communication we know where businesses intend on developing and consequently we can adapt the design of our bulk infrastructure to meet their needs in whichever area. We have a good relationship.

You have had a wonderful career. You started off in trade unions and worked your way up into mainline party politics. At this stage in South Africa’s development you are hugely positive and delivering a great message. How have you remained so positive and what is your motivation?

I remain positive because I believe humans must never give up hope. We must keep the flame of hope alive. It is also because I love my country. I want to see my country succeed. Therefore, when you see some negative signs or red lights flickering, your duty is to speak up. I have, in the forty years that I have been involved in politics, always spoken up as to where I felt things were wrong. We have one of the most wonderful constitutions in the world. The challenge becomes making this constitution a living document, where all of the rights inside it are claimed. Yes, I fight with people all the time. However, I mostly fight with people that want to mess up my country. I will not allow anybody to mess up my country. I don’t care station of office that person holds, a minister or anybody else. If I think that you are attempting to mess up my country I will speak up. That is how I keep the balance of trying to move forward. In a way, I sometimes feel that on a personal level this was not what our struggle was about. Only a few of us are tasting the fruits of our new democracy, which is only twenty years old. And there are many people who are not tasting the fruits of our new democracy. I would like to grow the base so that more people can feel that the freedom we fought for benefits them as an individual. This is where we are currently falling short. The benefits and the fruits of our democracy are only tasted by a small group of people. The more they have, the more they want. You see greed and corruption which steal from poor people. And I will indefinitely fight against corruption because it has now become endemic in our society. Some people only steal because they see other people stealing. We need leadership which will lead by example. In the Western Cape you do not see the same kind of corruption as you might in the rest of the country and this is because our leadership always speaks up about it. If someone goes to the Public Protector and complains about the city of Cape Town, and they come with recommendations and the remedial actions, I say: ‘Thank you very much for helping us!’ I meet with the Auditor General at least four times a year. He complained that you can never have a municipality with unqualified audits. It is only in South Africa that you have clean audits. Last year we had a clean audit in the city of Cape Town. It is not cumbersome but you must make sure that you comply with a range of legislation. It is doable and that is what keeps me going. When I was a member of parliament I used to wake up in the morning wondering what I would say and fight for on that day. I had many campaigns because I was like a rebel without a cause. I just wanted to keep busy. At one stage I decided to take on the cell phone companies which have turnover of billions of rand, and I won singlehandedly. In government as I am now, I wake up in the morning wondering what I am going to do on that day. You can actually see the difference in what you are doing and the impact it has. That is what keeps me going. I work sixteen hours a day, but it is because I love my city and I love my country.

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