Why invest in Buffalo City?
East London is the centre of the Buffalo City Municipality and home to one of the areas identified by the government for its Industrial Development Zone programme, which is aimed at providing platforms for business and investors to improve global competitiveness.
Buffalo City is an attractive centre for import-export business and its strategic location makes it an important investment destination. It is well placed for trade with the rest of Africa as well as with the markets of America, Europe and the Pacific Rim. It is also equidistant from South Africa's major market centres, Johannesburg, Durban and Cape Town.
The attraction of East London lies in its low input costs and its excellent infrastructure, including an airport and a port. It is also well connected to the rest of the country by rail and road. It has a deep-water port, which has spare capacity to deal with future growth.
East London is in the Eastern Cape, South Africa's second largest province. Its manufacturing sector is already quite well integrated into the world economy. For example, nearly half of the 120 large-scale manufacturing enterprises in the Eastern Cape are part of international corporations. More than 50% of the large-scale enterprises are exporting more than 25% of their output.
The motor industry is evidence of how investor confidence is growing in this area. Mercedes-Benz SA, which is based in East London, is one of the largest foreign investors in South Africa. In 1998, it made a R1,4-billion investment in South Africa. It has recently bid for the contract to manufacture the new generation C-Class Mercedes Benz. According to the Border-Kei Chamber of Business, Mercedes-Benz SA won the C-Class contract, more jobs will be created and R10-billion will flow into the province from spin-offs and investments. Mercedes-Benz SAcurrently manufactures the world's right-hand C-Class Mercedes Benz vehicles.
The Eastern Cape has a large pool of skilled and trainable labour. With high rates of unemployment, people in the area are keen to work. In general, costs are lower in Buffalo City than in other industrial areas and there are a number of regional and municipal incentives available to interested investors. Contact Buffalo City Municipality's Development Planning Directorate on (043) 705-2253 for more information.
Apart from everything else, Buffalo City has an excellent, temperate climate and exceptional scenic beauty. These all add up to offer residents a high quality of life.
The Eastern Cape:
the provincial picture
According to Statistics South Africa
, the Eastern Cape has shown growth of 13,5% between 1998 and 2001, the highest in the country. The national average was 8,6%.
The national government is spending substantial amounts on the development and growth of the region's infrastructure.
Other positive signs for the province include:
- Continued export-led growth of the manufacturing sector (eg investment planned by the motor manufacturers).
- Growth associated with the IDZs at Coega and East London.
- Growth associated with currently underutilised agricultural assets in the former Transkei and Ciskei through the R350-million Mass Food Production strategy.
- Growth associated with improved public sector productivity and delivery (increased spending in the province by national departments on the provision of water, electricity and sanitation).
The Industrial Development Corporation has identified a number of growth areas in the Eastern Cape. These include:
- the motor vehicle industry;
- the East London Industrial Development Zone;
- agri-tech and food processing;
- service sectors that incorporate tourism and call centres; and
- activities linked to the integrated sustainable rural development strategy and urban renewal programmes of the national government.
Read more about the Eastern Cape
Major companies already in Buffalo City
The East London Industrial Development Zone
IDZs are purpose-built industrial sites linked to an international port or airport, and are specifically designed to attract new investment in export-driven industries. The intention is to support these industries with world-class infrastructure, services and logistics networks. The East London Industrial Development Zone is one of only two IDZs that have been granted a licence so far.
Read more about the East London Industrial Development Zone
Click here for the East London Industrial Development Zone Corporation site
The Mdantsane Urban Renewal Programme
The underlying objective of the South African government's urban renewal programme is to ensure that the programmes of the South African government on poverty alleviation, economic growth and environmental sustainability are implemented in an integrated way. Mdantsane was identified as one of the nodes for urban renewal by President Thabo Mbeki in his state of the nation address in February 2001.
Click here to read more about the Mdantsane Urban Renewal Programme
Spatial Development Initiatives
Spatial Development Initiatives (SDIs) aim to unlock inherent economic potential in specific locations by attracting private-sector investment to economically depressed areas. Public-sector resources will be aimed at developing physical and social infrastructure to facilitate change and growth.
These initiatives facilitate integrated planning that is sensitive to the environment while, at the same time, boosting investment and kick-starting development.
The Wild Coast Spatial Development Initiative
The Wild Coast SDI integrated development corridor comprises a 280km stretch of coastline, beginning at Port Edward on the border of Kwa-Zulu Natal and extending to East London in the south.
The main focus of this SDI is on stimulating the region and economy through forestry, agriculture and tourism.
Click here for the Wild Coast SDI site
The Fish River Spatial Development Initiative
This stretches from the west of East London to Port Elizabeth. Taking in two harbours, two airports and a good road and rail network, this initiative highlights the sophistication of the region's infrastructure. The focus of this initiative is industrial, commercial and tourism industries.
Click here for the Fish River SDI site
The Eastern Province in general and Buffalo City Municipality in particular have actively sought international partnerships and twinning relationships. For example, the Executive Council of the Eastern Cape has signed a twinning relationship with Saxony, a province in Germany, which encourages funding and assistance for various executive and political projects.
After new demarcation of local government, the US county of Milwaukee reaffirmed their twinning partnership that it had previously agreed on with the King William's Town local council.
In 2000, a twinning relationship was signed between East London and the city of Leiden in the Netherlands, which supports integrated rural development in the Eastern Cape. The development plan agreed on by the two cities includes future links in tourism, business, education, sport and culture, policing and health. A staff and student exchange agreement programme was also signed.
A recent agreement pledges stronger relations between Buffalo City and the Chinese city of Jinhua, which already has a relationship with King William's Town. The idea is to extend this relationship to include the whole of Buffalo City. Jinhua is a city specialising in machinery, electronics and chemicals.