Townships see a turnaround

Friday, April 26, 2019

It is often said that ‘a leopard never changes its spots’ - a phrase known to mean that changing one’s character is almost always impossible to do. However, as far as township economies go - the opposite is true, for these are being turned on their heads.

Through the Department of Trade and Industry’s (dti) Industrial Parks Revitalisation Programme, many townships around the country are shedding their coat of disadvantage in exchange for a brand new one.

Aspects of the programme include the attraction of investment, addressing inequality and supporting job creation in the manufacturing sector.

Recently the Ga-Rankuwa Industrial Park shed-off its old skin, becoming the eighth park to have benefitted from the programme’s first phase.

Located in the country’s capital, the first phase of the programme saw the installation of 8.5km of fencing as well as the installation of guard houses and closed-circuit televisions, among others.

These changes in the park’s “coat” are an essential detail in helping it not only to attract tenants that will bring much needed investment, but will also assist the park which is currently sitting at 210 tenants to reach full tenant capacity of 283 units.

The changes are not only of a cosmetic nature, but aid in South Africa’s efforts to quench high levels of unemployment.

Thabang Nonyane is among those who have since gotten a taste of the working world at one of the plants located in the park.

Hailing from the nearby Klipgat, Nonyane is a trainee dispatcher under the employ of GRE Industries.

Nonyane comes from a family of four whereby up until now, his father has been the breadwinner.

“My mom has been looking for work for a long time, so only my father has a job,” said Noyane who finished matric last year.

Not one to sit idle and the elder of two siblings, Nonyane could not get placement at a tertiary institution this year and decided to look for work in the meantime.

“Unemployment is making life for South African youth to be very difficult. Most of the time people turn to a life of crime in order to make ends meet,” said the 19-year old who aspires to become a mechanical engineer one day.

He sought work to stay out of trouble and to help his family.

The young Nonyane has been undergoing training at the company which manufactures metal pressings for the automotive industry.

GRE Industries has heeded government’s call for companies to employ young people as a way of growing the economy.

In his Youth Day message last year, President Cyril Ramaphosa called on companies, both in the public and private sector, to make an effort to employ graduates - a message which he re-emphasised in his State of the Nation Address (SONA) earlier this year.

GRE Chief Executive Officer Elton Marshall said while the industry in which the company operates in requires expertise, his company is doing what it can to help fight unemployment which lessened to 27.1% in the fourth quarter of 2018.

In the proverbial sense, while one can lead a horse to water, you can’t make it drink.

“Labour is a concern, as most young people have no [work] experience and in an industry like ours expertise is needed but we also train people. We had a guy who came in as a builder at a time when construction was declining and we taught him the relevant skills needed here,” said Marshall.

The company which initially traded in tool manufacturing at one of the smallholdings in the area, has evolved to a staff complement of 190 of which 25% of the workforce are skilled workers.

While mindful of government’s call, he has also highlighted the challenges of employing a younger workforce which often demand instant results.

 “The youth want to start off with bigger salaries, bigger everything and it becomes a challenge,” he says as his eyes widen in one of the factory’s quieter rooms while work carries on a short distance away.

GRE Industries whose core business is in the automotive sector, counts American automaker Ford among its customers.

Growth in South Africa’s automotive sector has allowed the father and son outfit, to take on employees like Nonyane.

“It’s very nice to see a person uplifting themselves. Living off government grants is not a good thing. It’s not good either for the taxpayer.  Rather give people the opportunity to work so they can improve themselves,” said Marshall who took SAnews on a tour of their facilities.

Contributions by companies like GRE, are helping industrial parks around the country to turn over a new leaf, changing the old adage that a leopard never changes its spots.

The dti has invested in industrial parks not only to change their “nefarious history” but also to garner investment into them.

 “We have spent about R111 million on the rehabilitation of industrial parks and I think there’s definitely been an improvement in the investment environment in the ones where we have already rolled out phase one,” said Minister Rob Davies.

The department has spent R28 million on the first phase of the rehabilitation of the Ga-Rankuwa Park. Other phases of the programme involve the rehabilitations of buildings and working with businesses themselves.

Davies is of the belief that the parks—which are owned by entities reporting to provinces-- have a potential to expand and increase their economic activities.

“By rehabilitating industrial parks with relatively small investments I think there’s been decent returns in terms of improvements in the investment climate on the one part.”

“The other part is that it also forms part of the township renewal economy initiative of government because we want to achieve a degree of industrial decentralisation. We want to ensure that industrialisation does not just take place in the long established areas,” he said in an interview following his visit to the area.

The location of the Ga-Rankuwa park is in close proximity to the Rosslyn area where several automotive firms including the likes of Nissan have set up shop. The Japanese automotive giant recently announced a R3 billion investment at its plant which will now produce the new generation Navara pick-up van.

South Africa’s automotive industry contributes 7.1% to the country’s Gross Domestic Product (GDP).

This bodes well for South Africa’s manufacturing sector which has a bearing on the country’s ability to industrialise.

Davies agrees with this, saying industrialisation is a critical medium-term challenge that not only South Africa but the African continent has to address.

“So you will hear from everybody on the continent that they’re looking to industrialisation as the essential part to development. Everyone’s who’s gotten richer has passed through industrialisation.”

Over the last decade, the dti’s intervention through the Industrial Policy Action Plan (IPAP) has helped to cushion the decline seen in the manufacturing sector.

“I think that we can say that what we’ve managed to do is that we’ve managed to arrest the decline which had been evident for some time since liberalisation of the early 90s, the decline in manufacturing as a percentage of Gross Domestic Product.

“We have managed to arrest that but we haven’t yet got to the point where we’re taking manufacturing as a leader of a new growth path. We haven’t yet got to that point yet,” he said.

Davies was not one to shy away from the challenges the South African economy is currently facing, including electricity interruptions mentioned by Marshall.

“I think a lot of that has to do with a broader state of the economy. Some of the challenges we are confronting right now about the provision of electricity and interruptions becomes the major risk and the major issue that has got to be paid attention to,” said the Minister.

This in the face of South Africans having been subjected to load shedding incidents in the recent past.

In a country which this year commemorates 25-years of democracy, South Africa’s industrial parks which were established by the apartheid regime to support industrial activities in the then homelands, have and continue to shed off their old history  in exchange for something new.

“Properly functioning industrial parks should create job opportunities as well as more opportunities for small and large companies. [This is] part of the overall approach by government to support more productive activity in our country,” said Davies. –