The Presidential Imbizo
The Presidential Imbizo – broadcast on 1485 Radio Today.
Did you listen and what was your opinion?
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The Presidential Imbizo – broadcast on 1485 Radio Today.
Did you listen and what was your opinion?
Deathly silence, so here are some comments:
Joburg is growing faster than SA but may need to push GDP growth a bit more. Joburg makes up nearly 50% of the Gauteng economy
Finance and trade are the two most important sectors in Joburg, followed by transportation
Joburg is the financial capital of Africa.
The JSE & bond exchange and Africa’s biggest financial institutions are in Joburg.
Over the last decade Joburg grew at 4,7%, while SA as a whole averaged 3,2%
In 2005 and 2006, it is estimated that Joburg has grown at around 6%.
Joburg grew 47% faster than the SA economy as a whole. Based on this historical relationship, the Joburg Business Forum concludes that Joburg needs to achieve a growth of at least 9% for SA to grow at 6%.
The concerns:-
The cost of doing business.
The shortage and high cost of skilled staff
Generally poor government service delivery – primarily due to lack of capacity
Physical infrastructure
Poor delivery of support for SMMEs
Many small and micro businesses feel that BBBEE is too narrow is that the ‘broad’ aspect is not achieved
The Skills shortage is a big hurdle in Joburg’s growth path
Gauteng has the second lowest unemployment rate in SA at 23,2%.
From the vacancy pages in different newspapers, it is clear that job ads in Joburg are growing in excess of 60%.
More than 96% of people with degrees who want a job have one!
Joburg is likely to have full employment for people with degrees, technical diploma’s, artisans etc.
But people with less than a matric and more than primary school are likely to struggle to find work.
SMMEs and Micro Businesses can not hire the skills required as they cannot afford the pay, and they can also not access Seta training for their staff.
MORE TO FOLLOW
Only 3% of SA workforce have a degree -down from 3,8% in 1998.
Numbers of artisans completing their apprentices have fallen from 13 000 a year to less than 3 000.
Less than a third of SA degrees are technical and a third are business orientated.
The modern world economy is dominated by service -as is that of Joburg.
We need to get more people past matric into more specialised skills.
According to the World Bank, nearly 21% of Bangkok’s population had more than a high school diploma.
In Joburg, around 11% have more than high school education, while total SA only has 8,3% (LFS and our estimates based on LFS).
In Chile, 41% of young adults entering the work place have more than high school and in Santiago more than 50% who enter work for the first time have more than high school.
For Joburg to compete globally, we need to significantly increase the number of people completing MORE THAN MATRIC.
The process for acquiring land rights in Johannesburg is a long and difficult one due to the many and often overlapping processes.
The City is currently challenging in the Courts the Development Facilitation Act (DFA)( provincial process for granting Rights for development). The DFA process offers a more streamlined and efficient way of obtaining land development rights – presently not recognised by the City Council.
The current system can take 2/3 years to get a township application approved, thereby increasing the cost of land to the final buyer.
Many feel that telecommunication costs are too high (India proposes to have free broadband access!)
The cost of exporting and importing is also seen as high
High transport costs but also constraints in the Harbours, customs delays, rail and traffic congestion.
High cost of security, particularly for small and medium business.
Excessive government legislation
Labour & tax compliance – particularly SMMEs feel that general compliance costs are high.
Land costs are increasing as are rents.
Security costs are increasing.
Skilled staff costs are increasing.
Water and lights are increasing by more than the inflation rate.
Time constraints from road congestion are increasing costs.
Increased government regulation takes time and money.
SMEs unable to handle the tender process. (This is a REAL problem)
Roads, rail, electricity, gas, public transport, communications – all require attention.
Roads in Gauteng now carry 534 vehicles per 10 kilometer of road. (Around four times more than the Western Cape the next busiest province!)
Last year 238 621 new vehicles hit Gauteng’s roads – 13.4% more than in 2005.
By December 2006 Gauteng had over 2,7 million motor vehicles – more than the rest of SADC!
Joburg and the province desperately need more road capacity. Present budgets at provincial and metro level are totally inadequate. Traffic is already nearing gridlock during normal business/commuting hours
Whilst enhanced public transport plans are welcome, they will only stem, not reverse, growth of private vehicle utilisation and will make no impact on growth in road freight movement.
The major issue facing Business is the growing commuter time taken to reach the workplace – resulting in a decline in productivity and extended time away from families.
The last survey indicated that the average commuting time is now 72 minutes and increasing monthly.
Congestion impacts on trade/business deliveries -contributing to lack of competitiveness and adversely affecting the bottom-line of business and Joburg’s growth rate.
The road network and the public transport system need urgent attention before we get totally “grid-locked” by 2010 – a spectre raised by the Roads Agency.
Enhancing public transport to deal with the under-invested mass transit modes in Gauteng will not counter the growth in the use of private and taxi motor vehicles.
The cost of reliable Internet is high in SA as is the cost of a local call. Many sectors where Joburg is internationally successful could grow if basic costs declined and the level of service increased.
The ICT, larger Media, call centres, web design, music, research, accounting, etc are all becoming more reliant on the Internet/ communications and add more value.
Electricity usage is growing at around 10% for the year to February 2007.
At this rate, the Greater Joburg area can expect frequent electricity breakdowns in the next year!
If electricity usage growth continues at this rate, then Joburg alone will need two 2000MW power stations in the next decade!
What Business needs to achieve growth at 9%.
Less government regulation and lower cost of doing business
Urgent need to expand infrastructure, such as roads, electricity, telecommunications, rail, commuter transport etc.
Urgent attention to serious traffic congestion
Cheaper communication costs (making us more competitive to attract foreign investment, eg call centres)
Better transport links (road, rail, air, sea) within and between Gauteng and rest of SA and Africa to facilitate competitive trade.
Government should now focus more on facilitation and delivery
Spend more on specialised skills training and get SETAs to perform better or replace non-peforming SETAs with a more efficient and cost-effective system
Streamline process for the importation of needed skills– perhaps from places such as India or even other African countries.
Business wants to work together with government.
Can add value to attract investment.
The JBF is creating linkages between business from different areas of Joburg
Business wants enhanced communication with all levels of government to help Joburg grow on the above mentioned issues!!!
Better traffic management, such as better robot timing and more traffic information.
Get the BRT system going to more places.
Make it easier to import scarce skills.
Allow more broadband players to lower communication costs.
Implement the DFA for land development.
Allow extra BEE credits for SMMEs when implementing BBBEE.
Get SETA funds to work and allow business more say in what skills it needs.
More Roads should be built between regions and within the city itself.
Promote a second Airport by upgrading access to it, perhaps even a third airport.
Better communication between business and government, we already have the forums for it but maybe it should have more sub-chambers