TOGETHER
LOOKING FORWARD
WITH RENEWED
CLARITY
BUS I N ESS UNLIMITED SPECIAL EDITION | 2010/11 FINANCIAL PERIOD
ECDC HIGHLIGHTS The Eastern Cape Development Corporation is the development finance institution for the Eastern Cape province. Business Unlimited is produced every six months. An electronic copy is available on www.ecdc.co.za. Editorial contact: Ikhona Mvaphantsi Tel: +27 43 704 5739 Cell: +27 83 451 1687 Email: ikhona@ecdc.co.za
HEAD OFFICE ECDC House, Ocean Terrace Park Moore Street, Quigney, East London PO Box 11197, Southernwood 5213 Tel:+27 43 704 5600 • Fax:+27 43 704 5700 KING WILLIAM’S TOWN 75 Alexander Road PO Box 498, King William’s Town 5600 Tel:+27 43 604 8800 • Fax:+27 43 642 4199 BUTTERWORTH 24 High Street PO Box 117, Butterworth 4960 Tel:+27 47 401 2700 • Fax:+27 47 491 0443 MTHATHA 7 Sisson Street, Fort Gale Private Bag X5028, Mthatha 5099 Tel:+27 47 501 2200 • Fax:+27 47 532 3548
IN 2010/11
After satisfying, honest and productive engagements with a range of stakeholders, such as employees, the board and our provincial custodians, ECDC’s five-year corporate strategy, 2011 to 2015, is now in place. The strategy is founded on a new certainty of role and purpose to be a development finance institution (DFI) which promotes economic growth in the Eastern Cape. This reviewed and focused mandate as a DFI gives clear direction that has resulted in a concomitant internal alignment process that allows ECDC to carry out and deliver on this promise. As an institution that promotes economic growth, particularly in the areas of most need, it is heartening to highlight that 42% of loan funding was disbursed to enterprises in the OR Tambo District, an area in the former Transkei that is in desperate need of jobs due to high poverty levels. This example, one of many, demonstrates ECDC’s commitment to expanding its reach and connecting people who live in the rural and poor areas of the province.
Successfully implemented development projects in 2010/11
Fly tying project Centane
Granite mining Butterworth
Tunnel vegetables Mthatha Bamboo trial Port Elizabeth, Stutterheim and Centane
Raspberries Molteno
QUEENSTOWN 22 Cathcart Road Private Bag X7180, Queenstown 5320 Tel:+27 45 838 1910 • Fax:+27 45 838 2176 PORT ELIZABETH 152 Cape Road, Mill Park PO Box 1331, Port Elizabeth 6000 Tel:+27 41 373 8260 • Fax:+27 41 374 4447
Cassava pilot Port St Johns
Cashmere fibre Tsolo Sithembe Women’s Enterprises Mthatha
MOUNT AYLIFF SEDA Building, Nolangeni Street, Mount Ayliff 4735 Tel:+27 39 254 0584 • Fax:+27 39 254 0599
Vegetable co-operative Ngqamakwe Guar Gum Butterworth, Ngqamakwe
ALIWAL NORTH 97 Somerset Street, P O Box 198, Aliwal North 9750 Tel:+27 51 633 3007
PAGE 02 | BUSINESS UNLIMITED
Hydroponics project Mthatha
Cassava pilot Bizana
Satellite offices
info@ecdc.co.za | www.ecdc.co.za
Poultry Mthatha
Amathole essential oils Hogsback & Middledrift
Cassava pilot Ncera (East London) Macadamia nuts East London Blueberries Stutterheim & Keiskammahoek
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
Funding SMMEs
JOBS CREATED 3,584 jobs created in 2010/11 accounts for 14% of jobs created by ECDC in the past five years (25,021 jobs).
1,797
Implementing projects
587
Supporting key sectors
732
Enterprise support
431 37
Facilitating trade
SMMEs FUNDED
MAP LEGEND
LOAN DISTRIBUTION BY DISTRICT
• ECDC disbursed R109 million to 451 enterprises. • 50.1% of total jobs (1,797 of 3,584 jobs) created by businesses funded by ECDC. • R212 million received in loan repayments.
451
enterprises RECEIVED FUNDING
OR Tambo District* Amathole District Chris Hani District Alfred Nzo District Nelson Mandela Bay Cacadu District Joe Gqabi District
42% 1%
4%
12%
34%
*Loan funding by its nature is demand driven. The greater proportion of loans by value was disbursed in the OR Tambo District, which is desperately in need of jobs due to high poverty levels
3% 4%
TRADE FACILITATED
VALUE OF EXPORTS (R’MILLION)
ECDC helped to create the conditions necessary to increase the value of exports from R502 million in the previous financial year to over R1 billion in the year under review.
2010/11
R1,060
2009/10
R502
2008/09
R202
ENTERPRISES SUPPORTED Registrations in 2010/11: 5,865 businesses and 205 co-operatives, now legally registered, can access government opportunities.
5,865
BUSINESSES REGISTERED
VALUE OF INVESTMENTS (R’MILLION)
SECTORS SUPPORTED • ECDC facilitated 25 new investments in 2010/11 compared with 19 in the previous year. • The total value of investments is R661,4 million compared with R590 million in the previous period.
18
PROJECTS IMPLEMENTED • The corporation attracted R64 million from third parties for new projects. • ECDC spent R3 million on 18 projects – nine new and nine expansions.
Tourism
R454
Plastics
R67.6
Agriculture & agro-processing
R46.3
Aquaculture
R42.5
Renewable energy
R33
Automotive
R18
PROJECTS FUNDED (9 NEW & 9 EXPANSIONS)
INVESTMENT PERFORMANCE
PERCENTAGE RETURN ON AVERAGE INVESTMENT PROPERTIES
ECDC recorded a stable return of 10.1% on its investment properties (commercial and residential) in Mthatha, Butterworth, King William’s Town and Queenstown.
2010/11
10.1%
2009/10
10.3%
2008/09
10.5%
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
BUSINESS UNLIMITED | PAGE 03
R4, 4 million from Imvaba Fund to boost skills
6
Patience, determination sets 7 GRAHAMSTOWN co-operative apart Interim steering committee to 8 ensure bamboo strategy takes root Economic development potential 10 in EASTERN CAPE natural fibre ELECTRONIC PEN TO CHANGE BUSINESS 11 Local demand pushes goal posts to 12 the fore in EC granite operation ECDC LOAN SUPPORT PUTS ELLIOT 13 b&b ON SUCCESS PATH ECDC to assist entrepreneurs 14 with dti incentives Exports grow exponentially as 15 ECDC records R1 billion in trade ECDC successes in 2010/11 16 Eastern Cape launcheS 18 EXCLUSIVE JOBS SCHEME Next stop – Glasgow and London 20 Ease up – ECDC news in summary 22 SPOTLIGHT FALLS ON CREATIVE INDUSTRY
23
MOHAIR MANUFACTURER INCREASES FOREIGN SALES, JOBS
24
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TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
ECDC DRIVES MORE
DOUBLES
TRADE The Eastern Cape Development Corporation (ECDC) at its annual results media briefing in October announced strong results for the 2010/11 financial year including investment and trade figures exceeding R1,6 billion. Releasing the financier’s annual results, ECDC chief executive Sitembele Mase says the corporation facilitated exports of more than R1 billion, double the R502 million of the previous year. This is in addition to investments of R661 million that ECDC attracted to the province. The development financier also stimulated intra-provincial trade worth R72 million, also up on the R39 million from last year. Mase says extensive research was conducted on provincial exports and this led to a review of the provincial trade promotion strategy.
The strategy has three goals: to increase the value of trade exports and number of exporters, explore new markets to broaden trade within the South African Development Community and improve BRICS trade relations. Efforts from the strategy resulted in the number of new exporters increasing to 39 from 26 of the previous review period.
Mase explains these results are crucial for the wellbeing of the economy, in particular small businesses which are influenced by domestic and foreign markets. “Foreign direct investments (FDI) are often catalytic and support the expansion and growth of small businesses. “Yet financial and non-financial support which improves their market readiness and competitiveness remain the key cornerstones for developing the small to medium businesses in the region. “ECDC financed 451 enterprises with R109 million, of which 45 percent are based mostly in the rural OR Tambo District Municipality which has towns such as Matatiele and Kokstad. Through these funds, 1,797 jobs were created,” says Mase. Furthermore, 28 percent of lending has gone to support youth and women-owned businesses. Other support has included ECDC assisting over 5,000 businesses to register as legal entities which gives these access to business opportunities in the private and public sector. “In further developing our position as an effective and forward-looking development finance institution (DFI), ECDC supported the landmark development of the R2 billion De la Vlei Wildlife Estate, west of Port Elizabeth. This project is likely to be high impact and catalytic for the local economy, creating business opportunities for
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
smaller businesses with potentially great knock-on effects for job creation.” An investment of R415 million has already been committed for the first phase of the project. ECDC lobbied for the passing of the environmental impact assessment, which was crucial to unlocking the development. He explains that ECDC’s future lies in providing development finance, attracting investments, providing non-financial support and establishing a research and innovation capability that ultimately translates into enhancing the economic livelihoods of the people of the Eastern Cape. “Our focus is to create solutions that bridge the economic divide between rural, peri-urban and urban communities in the Eastern Cape,” says Mase. In support of this vision, ECDC is reconfiguring its regional structure to improve access to its services and effectiveness of its operational mandate. “ECDC is also reviewing its balance sheet to unbundle non-core and non-performing assets. “The ultimate vision is to re-engineer and reposition ECDC as a reputable, high performing and professional entity and reduce our current dependency on the fiscal transfers from the provincial government, ” says Mase. Contact: 043 704 5611, zdukisa@ecdc.co.za
BUSINESS UNLIMITED | PAGE 03 05
In a bold step to boost emerging farmers’ skills base, THE Eastern Cape Development Corporation (ECDC) has set aside R4,4 million from the Imvaba Co-operative Development Fund to train co-operatives funded BY IMVABA.
The first group of beneficiary agricultural cooperatives was trained in partnership with the Fort Cox Agricultural College. Fort Cox College was established in 1930 and boasts an array of agricultural facilities for practical training of students on its 1,354 hectare campus.
“Currently, subsistence farming and high unemployment are prevalent features of Eastern Cape’s rural economy. Combined with human capital development, Eastern Cape’s natural resources present an opportunity to develop the Eastern Cape’s rural economy around agriculture,” Mase says.
Recently, ECDC top management joined in celebration as 59 members of co-operatives from 16 agriculture co-operatives funded by Imvaba received 132 certificates for technical and business skills training at the College.
Imvaba Fund manager Thabo Shenxane says an assessment study by the Fort Cox Agricultural College, on behalf of ECDC, also found that co-operatives in the province fall below legal requirements for occupational health and safety.
ECDC chief executive Sitembele Mase says training farming co-operatives lays the groundwork for agricultural sector growth and economic development.
The study also identified a technical and business skill gap which should be filled to transform rural agriculture from subsistence to commercial farming.
The training, conducted over a four week period, aims to elevate subsistence farming activities of cooperatives to commercial level. “Local initiatives to improve skills and food security contribute to the bigger picture and global movements such as the Millennium Development Goals (MDS) as set at the United Nations Millennium Summit in 2000,” Mase says. “This is what we call real development. Subsistence farming needs to get to a point of producing surpluses for trade in the market. “If rural co-operatives sell commercially, they can bargain with government and influence infrastructure development like roads, electricity and storage facilities and lay the groundwork for secondary sector development,” Mase adds.
“Co-operative members mostly live in rural areas, have an average age of about 45 years and are exposed to high levels of poverty and unemployment,” Shenxane explains. “It’s about understanding the profile of cooperatives. You don’t just throw money at the problem. We need to deal with non-financial interventions such as mentorship, technical skills, markets, safety, governance and then commercialisation capital,” says Shenxane. ECDC has ringfenced R4,4 million in the 2011/2012 financial year for technical skills training, mentorship and capacity building for all co-operatives currently funded and to be funded by Imvaba Fund, including manufacturing co-operatives, he adds. The agricultural co-operatives were trained in various technical aspects ranging from vegetable
production, maize production, piggery production, broiler production, dairy production, honey production, and tractor maintenance. These co-operatives also received mandatory farm business management and first aid training to comply with health and safety requirement as set out in the Occupational Health and Safety Act No.85 of 1993. Responding on behalf of co-operatives, a member of one of the co-operatives, Lulama Ngewana says the training sponsored by ECDC is about creating solutions to improve the state of farming cooperatives in the Eastern Cape. With skills in bookkeeping, pricing, record keeping as well as technical skills, Ngewana adds “the ball is now in the emerging farmers’ co-operatives court”. “We thought we knew all about farming because most of us grew up in farming communities, but what we’ve learnt at Fort Cox over the past four weeks changes the way we do business. It is now up to us to apply the skills we’ve learned,” says Ngewana. “The nature and depth of what we have learned has encouraged a shift from old entrenched methods to new efficient ways.” She adds that without the support and sanctions of the Honourable MEC, Mcebisi Jonas, there would be no funding from ECDC. Shenxane adds more training is on the cards for manufacturing co-operatives.
R4,4 million FROM IMVABA FUND
TO BOOST SKILLS PAGE 06 | BUSINESS UNLIMITED
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
SETS GRAHAMSTOWN CO-OPERATIVE APART It’s been 20 months since the Department of Economic Development, Environmental Affairs and Tourism (DEDEAT) launched the R50 million fund, targeting co-operatives in the province.
Since then, ECDC, which administers the fund, has approved commercialisation funds for 42 cooperatives, committing R26 million and organised technical skill training for 16 agricultural cooperatives. These initiatives follow confirmation by the 2008 DEDEAT baseline study that the province is home to the second highest number of registered cooperatives in the country, second only to KwaZuluNatal. This should be good news for Nobetswana Patala, chairperson of the Masikhutale Women’s Primary Co-operative in Grahamstown, about 100 kilometres from one of the province’s main economic hubs, Nelson Mandela Bay. Patala is one of the founding members of the cooperative which was first established 15 years ago. She says the co-operative began when nine local residents came together looking for ways to generate income to support their families. Since then, the co-operative has been involved in providing bread to local feeding schemes and a local hospital.
basic administrative systems, record keeping, bookkeeping and access to steady markets for the bread it bakes. The shiny new stoves, oven, proofer and other baking equipment lie in wait for the local municipality to finalise an industrial electricity feed to the premises which lie on the outskirts of the 199-year old colonial town. ECDC account manager Wayne Mahoney, who has helped the co-operative with its business plan and its application to the fund, admires the group of ladies. “This co-operative has been very patient and is determined to get where they want to be,” explains Mahoney. It is clear that the co-operative means to benefit more families in the community as Patala explains. “While we are looking to get our bakery going, we also want to start a garden which produces vegetables as well as a sewing group so that more people are involved,” says Patala who is expecting assistance from the departments of agriculture and arts and culture.
More recently, the co-operative is producing school uniforms and selling meat, using the premises provided by the Department of Sport, Recreation, Arts and Culture.
Local students from Rhodes University have also provided support by assisting the co-operatives with design and marketing.
However, the passion of the co-operative still lies with baking and it is here where ECDC has helped the five-member co-operative secure financing to purchase industrial baking equipment. ECDC is also in the process of appointing a mentor which will help the co-operative with
The Imvaba Co-operative Development Fund is a product of the provincial co-operatives strategy, adopted by the provincial legislature in 2009. It assists co-operatives in addressing their most pressing challenges of markets, mentorship, equipment, training and finance.
AIM OF THE IMVABA FUND • Enhancement and development • Promote entrepreneurship through co-operatives in order to create jobs • Contribute to poverty relief and alleviation efforts • Track the contribution of co-operatives to the provincial economy What IS THE BENEFIT? • Technical mentorship and capacity building support • Equipment and material finance support (seed capital) • Term loan finance • Co-operative governance training support TARGETED economic sectors • Agriculture • Retail • Manufacturing: Timber industry, textiles, chemicals, automotive activities and metal processing • Tourism activities • Transport • Creative industry • ICT and film production • Green economy: For example, bio-fuels and energy How TO APPLY Applications and further support are available from the regional offices of ECDC and the ECDC website, www.ecdc.co.za or alternatively contact the Imvaba Fund manager Thabo Shenxane on 043 704 5653 or email tshenxane@ecdc.co.za
From left to right, Xoliswa Mgoqi, Dorah Budaza, Zanele Kupiso and Nobetswana Patala TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
BUSINESS UNLIMITED | PAGE 07
INTERIM STEERING COMMITTEE
TO ENSURE
STRATEGY TAKES ROOT The Eastern Cape has moved swiftly to position itself as the premier location in South Africa for the lucrative bamboo industry, establishing trial and pilot sites throughout the province.
As a development financier, the Eastern Cape Development Corporation (ECDC) has already invested R1 million in three bamboo pilot sites near Port Elizabeth, Stutterheim and Centane, and assisted with social facilitation, planting and management for three years. Bamboo is the strongest and most versatile grass species known to man. It is found extensively in China, India, Indonesia, Bangladesh and Brazil. It can grow up to 20 metres high and its resistance makes it capable of growing in harsh environmental conditions. Bamboo is the fastest growing and sustainable renewable energy source available with commercial appeal and potential for downstream conversion and job creation.
For the Eastern Cape and South Africa, bamboo offers business opportunities and economic and environmental benefits. These include livestock feed, waste water remediation, erosion control, biomass renewable energy solutions, small scale manufacturing, low carbon energy and food source.
PAGE 08 | BUSINESS UNLIMITED
“Twelve people from the local communities have been trained in planting bamboo at two of the five-hectare pilot sites based in Centane and Stutterheim.
of developments while taking the initiative forward. IDC is looking at the business plan for identifying how best to process bamboo into products for the South African market.
“When the project goes full scale, it will cover a minimum of 500 hectares,” says ECDC project manager Ken Bern.
The committee is targeting bamboo as the source ingredient for construction, timber, flooring, crafts, food source and energy. Bern is to provide a secretariat function to the committee.
The province has also moved speedily to form a provincial bamboo interim steering committee which is expected to drive the development of the sector and place it at the forefront of industrial policy in South Africa. The formation of the committee in September comes only a month after ECDC and national development financier, the Industrial Development Corporation (IDC), hosted the first bamboo symposium and exhibition in the province. At the top of the in-tray for the committee will be the nomination of a bamboo working group to facilitate the development of a provincial bamboo strategy. The committee, which is to be led by ECDC’s development projects head Phakamisa George, will lobby for the inclusion of bamboo in the Industrial Policy Action Plan 3 (IPAP3). Collaboration with international players such as the World Bamboo Foundation as well as business is a high priority. The committee will keep industry players abreast
SA Bamboo was appointed by ECDC to implement and manage two of its three (5 ha) bamboo pilot projects, one at Ndakana Village near Stutterheim in the former Ciskei, and the other at Centane Village near Butterworth in the former Transkei. SA Bamboo’s core business is to facilitate the establishment of large scale bamboo plantations in South Africa. SA Bamboo says using bamboo for fuel on a large scale could have environmental benefits for South Africa. “Transition to a low carbon economy is imperative if we want to save this planet,” says SA Bamboo co-founder Pelo Gabaraane. “Direct job opportunities and those created through spin-offs in down-stream opportunities are possible with Bamboo,” says Gabaraane.
Contact: Project manager - Ken Bern 043 704 5606, kbern@ecdc.co.za
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
Quick • • • • • •
in the Eastern Cape
No formal bamboo industry currently exists in the Eastern Cape, providing an open door for first-movers Ongoing extension of bamboo product lines require additional supply on a local and global scale An established timber-processing industry well positioned for downstream bamboo value-addition Eastern Cape, as an agricultural province, enjoys readily available and affordable labour The bamboo industry will provide employment suitable for all people, including women and youth, and hence is of strategic importance to provincial government The growing of bamboo for commercial markets will enhance rural economies
Exhibitors at the exhibition which formed part of Bamboo Symposium.
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
BUSINESS UNLIMITED | PAGE 09
ECONOMIC DEVELOPMENT POTENTIAL FOR
THE Eastern Cape’s natural fibre cluster could lead the country’s initiatives in this area says Eastern Cape Development Corporation (ECDC).
ECDC, together with the provincial Department of Economic Development, Environmental Affairs and Tourism (DEDEAT), the Council for Scientific and Industrial Research (CSIR) and Cacadu District Municipality, are part of the team which is leading natural fibre development initiatives in the province. Already R21 million has been invested in research and product development in these fibres. Two hundred and six jobs have been created; 173 jobs in the cashmere industry in the former Transkei and 33 jobs in a hemp commercial pilot project. Dr Hugh Laue has been appointed as lead coordinator of the natural fibre committee coordination team. Laue is an experienced fibre expert and is responsible for coordinating the activities of the natural fibre cluster in the interests of a successful and sustainable natural fibre programme in the province. The cluster works with partners in research, agriculture, industry, government and higher education to map out the value chains for products in each industry and plan, with stakeholders. This involves looking not only at gaps in technology but also those related to social and economic issues. Eastern Cape pineapple fibre products are poised to
PAGE 10 | BUSINESS UNLIMITED
hit local and global markets in the near future as the sector branches out into natural fibre products as part of its turnaround strategy. The project kicked off in February 2009. Ndlambe Natural Industrial Products (NNIP) already produces dietary fibre at Summerpride Foods in East London on a limited commercial scale, with the first scale-up to industrial quantities due to be complete by February 2012 says NNIP general manager Anthony Albers. Pineapple fibre production comes at a time when the Eastern Cape economy needs to diversify into other sector streams to better withstand periodic economic upheavals. According to Industrial Policy Action Plan 2 (IPAP2), the agro-processing sector may be key to unlocking Eastern Cape’s economic potential in terms of job creation and diversifying the province’s economy, currently automotive sector dependent. “We are very excited about this development as it is the first value added project within the pineapple industry based entirely on factory waste that is ready for commercialisation. It will play a major part in achieving a zero waste industry,” says ECDC project manager Ken Bern.
ECDC and NNIP have funded the business plan and a 12-month trial using the mini production plant to produce samples for the market to test. To date, ECDC has contributed R1,67m for the business plan and pilot. Albers says the product got a warm reception from the market and the company is keen to introduce the product to the global market. “The reaction to the product by food processors, both locally and internationally, has been extremely encouraging, according to the project team,” says Albers. “Orders for the product have already been received in the local market and negotiations are at an advanced stage in Europe and the USA with companies that have large footprints in these markets.” “None of what has been achieved would have been possible without the proactive assistance of ECDC and the Department of Agriculture,” says Albers.
Contact: Project manager - Ken Bern 043 704 5606, kbern@ecdc.co.za
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
Currently five areas show potential for establishing a niche natural fibre linked industry: Cashmere Using the combed hair from the three million goats in the province to spin into luxury yarns and knit into garments. The development of the cashmere industry is one of the key action programmes in the Industry Policy Action Plan 2 (IPAP 2) for the clothing, textiles, leather and footwear industrial sector.
Hemp and flax Using crops new to SA, but with established uses in other countries, as the basis for a revitalised textile industry and as a source of seeds and oils.
Agave Americana Developing markets and a secure raw material supply base for several industrial uses of this sisal plant that grows in the Karoo (and has been used to make a tequila-type liquor).
Pineapple Learning from the innovative projects already under way to make commercial use of the leaves, stems and roots of the pineapple plant (which already has a solid base in plantations and the involvement of black commercial farmers).
Mohair and wool A new aspect to an old industry that will involve people previously (and currently) excluded from direct benefit in the beneficiation of the Eastern Cape‘s extraordinary resources of mohair and wool.
ELECTRONIC pen TO CHANGE BUSINESS
At the beginning of 2010, three ambitious entrepreneurs Fikile Kentane, Olwethu Hoyana and Jimmy Mathemane banded together TO bring A new product to the ICT market.
The Innopen is a new entrant into the market that will undoubtedly change the way business is done. With only one competitor in the country, Fikile believes an early entrance into the market will give them an advantage as well as market share. The pen allows users to automatically store their handwritten notes to a central server even from remote locations. This means that even when one loses a notebook, the information is available on a backup server at the office. The team joined ECITI’s incubation programme in 2010. ECITI’s incubation programme focuses on infrastructure and business support services to assist early stage development of ICT and film entrepreneurs. ECITI offers both a virtual and resident incubation programme. The former targets entrepreneurs located outside East London and those with premises but are in need for business development support services. The latter provides physical space for small businesses at ECITI premises in East London. ECITI’s executive manager Patricia Dlamini says: “Business incubation is designed to accelerate the successful development of entrepreneurial companies through various support resources and services offered in the incubation hub and through its network of contacts.” “We have also been exposed to BBBEE workshops to ensure we are compliant before we go to the market. In this respect, there has been substantial value add,” says Fikile. He says Innopen should take the market by storm. “I have no doubt in my mind that in five years’ time, everyone will be using this pen.” He explains that their pen allows a user to email information saved on the server as well as attach photographs. The business is in its early stages, currently focusing on business development, yet Fiikile is confident that in the next financial year the business will clinch significant deals. “Any new ICT solution takes time to penetrate the market. Innopen is focusing on attracting business from the public sector because of the economies of scale by sheer size which justifies high production volumes. The Innopen entrepreneurs are self-funding the business because there is no doubt that the invention will be a resounding success in the long-term,” he ends.
Fikile Kentane
BUSINESS: Innopen CORE BUSINESS: Development of an electronic pen which stores handwritten notes remotely ENTREPRENEURS: Fikile Kentane, Olwethu Hoyana and Jimmy Mathemane STARTED: 2008 KEY ECITI INTERVENTION: Business support, access to educational programmes, networking, Broad-Based Black Economic Empowerment (BBBEE) workshops Contact: fikilek@innopen.co.za
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
BUSINESS UNLIMITED | PAGE 11
A granite polishing factory is expected to open sooner than anticipated after a marketing drive revealed a gap and high demand in the local market says Bold Moves entrepreneur Monde Tabata.
Tabata says the demand for monumental stones and interior furnishings locally is set to increase revenue streams and the value of the business “exponentially” from the onset. This translates into more employment, training and skills transfer for the local people who will be trained by an experienced stone mason. “Opening the plant is now priority. It’s as important as starting the quarry which is expected to start full production by the end of the year. Servicing the local market increases the value of the business while there is also the potential for training and employing more people,” says Tabata. The plant was initially a long-term goal for the Butterworth-based granite project co-financed by the Eastern Cape Development Corporation (ECDC), while exporting granite blocks to the United States was an immediate pursuit. “When we started, we looked at the export market but it’s clear to us that there is huge demand locally,” says Tabata. “We conducted a marketing campaign and received an exciting response for Eastern Cape granite.
“In three months, we have identified 15 potential clients doing big business locally.” Existing granite suppliers are largely located in the North West province. “We strategically looked at areas like KwaZulu-Natal, Western Cape and Eastern Cape which are the furthest from existing granite suppliers since this is where we can exercise a competitive advantage,” Granite slabs require aesthetics and employees should have a keen eye for detail to identify flaws. “Between the quarry and the plant, we expect to employ about 50 people. Eventually, they will acquire the skills to cut and dress granite,” says Monde. The benefits to the community include infrastructure such as a bridge, upgraded roads and electricity, which will enable communities to access health and other public services. The community including the chieftaincy, women and Zagwityi and Mgagasi communities in the Amasaleleni locality around the mine, are also set to get 20,5% of the business. To date, ECDC has pumped over R1,5 million into
feasibility studies and trial mining. The projected investment outlay towards the project for trial mining is R30 million. “ECDC has invested R530,000 into feasibility studies and a further R990,000 for a trial mine and test quarry,” says ECDC’s Bowell Solwandle. Tabata adds that ECDC is a valuable force in the Eastern Cape economic sphere and fills a space left by commercial banks. “Firstly, ECDC came in at a critical point to finance the competent person’s report which included the business plan,” Tabata says. “Secondly, ECDC stepped in to assist in trial mining. One can’t emphasise enough that without such a development corporation, it would probably be difficult to do business. Commercial banks would not have given me the financing as ECDC did.” Bold Moves aims to inject R20 million into the poverty-stricken Butterworth economy.
Contact: Project manager Bowell Solwandle 043 704 5703, or email bsolwandle@ecdc.co.za
LOCAL DEMAND PUSHES GOAL POSTS TO THE FORE IN
OPERATION
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TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
ECDC LOAN SUPPORT PUTS
ON SUCCESS PATH A loan of nearly R2 million from Eastern Cape Development Corporation (ECDC) and a three-month mentorship programme, valued at R36,000, helped to establish the Langhurst Estate Bed and Breakfast business in Elliot. The B&B on a 39 hectare (ha) estate near the small town in the rural mountainous part of the Eastern Cape often hosts business representatives and tourists. Langhurst’s restaurant and bar has become the social spot where local doctors, farmers and a host of locals prefer to have their sundowners and meals at the end of a long day. The establishment also offers a child-friendly environment complete with a small touch farm with goats, cattle and chickens. “ECDC gave us a loan of R1,8 million to buy the property which helped a lot in getting the business off the ground,” says co-owner Marlene Ewers. The loan went towards buying the property, fittings for the bar and restaurant area and furniture for the rooms. Ewers, a novice when she initiated the business with her former partners, adds that it was the ongoing non-financial support that spelled success for the bed and breakfast.
“When we started we didn’t know anything and ECDC put us through a mentorship programme. ECDC held our hands, always checking on our progress and giving advice which ensured our success,” says Ewers. Ewers paid 10% of the mentorship programme fees and 10% of the business plan fee valued at R20,000 while ECDC paid the remainder. In addition, the development finance institution carried all the costs for customer care training for all staff members, and committed 85% of the costs for marketing material such as brochures, name tags and business cards.
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
A former community development worker, Ewers says she decided to demonstrate through her actions how people should create jobs and develop their local economies. “Often government gives people money and a few months down the line the project fails because most people see it as a quick solution to money problems and have no vision to make the project work. I wanted to make a difference and show that people should do things for themselves in order for development to happen.” Since taking over the business two years ago, Ewers says the staff complement has nearly doubled from six to eleven. Now Ewers is looking at plans to diversify into property development on her 39 ha property. For more information contact the ECDC head office on telephone +27 43 704 5600 or email info@ecdc.co.za
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ECDC TO ASSIST entrepreneurs
WITH the dti INCENTIVES In a partnership building exercise with national key stakeholders, ECDC has met with The Enterprise Organisation of the Department of Trade and Industry (the dti) to discuss improving access to incentives available for SMME development to Eastern Cape entrepreneurs. This is important because the province has a very low level of uptake of these incentives largely because SMMEs are unaware of their existence or how to access them. In order to create further awareness, ECDC and the dti are looking at presenting seminars throughout the province. The two organisations also intend signing a cooperation agreement. In order to reduce the barriers to entry for the SMME sector, the dti offers the following range of incentives to the SMME market:
Incentive description
Eligibility and benefits
Automotive incentive scheme: A taxable cash grant, designed to grow the automotive sector by investing in new models that increase plant production volumes, sustain employment and/or strengthen the value chain
• Light motor vehicle manufacturers who have achieved or demonstrate that within three years, at least 50,000 annual units of production per plant • Component or deemed component manufacturers that are part of the Original Equipment Manufacturer (OEM) supply chain and will achieve at least 25% of a total entity turnover or R10 million by the end of the first full year of commercial production as part of a light motor vehicle manufacturer supply chain, locally and/or internationally
Black business supplier development programme: A cost-sharing grant offered to black-owned small enterprises to assist them in improving their competitiveness
Provides grants to a maximum of R1 million: • R800,000 for tools, machinery and equipment (50:50 cost sharing) • R200,000 for business development and training per eligible enterprise to improve corporate governance, management, marketing, productivity and use of modern technology (80:20 cost sharing)
Business process SERVICES (bps): An incentive to help attract BPS investments that create employment opportunities via offshoring activities
• A base incentive as a tax exempt grant paid over three years for each offshore job created and maintained • A graduated bonus incentive paid as follows: - 20% bonus for more that 400 but less than 800 offshore jobs paid once off in the year in which the bonus level is reached - 30% bonus for more than 800 offshore jobs paid once off in the year in which the bonus level is reached
Capital projects feasibility programme: A cost-sharing grant meant to facilitate feasibility studies that are likely to lead to projects that increase SA exports and stimulate growth
The contribution is in the form of a cost-sharing grant, up to a maximum of 50% of the total feasibility study costs for projects outside Africa and 55% for projects in Africa • New projects, expansions and rehabilitation of projects • All capital goods sectors are eligible • Minimum local content 50% • Projects should be situated anywhere in the world (excluding South Africa), while projects in Africa will be encouraged
Critical infrastructure programme: A non-refundable, cash grant available to the approved beneficiary upon completion of the infrastructure project
Between 10% and 30% of the total development costs of the qualifying infrastructure • Private enterprises that are legal entities • Public entities • Private-public partnerships
Co-operative incentive scheme: A 90:10 cost-sharing grant for registered co-operatives
• Maximum grant to a single co-operative under the scheme is R350,000 • Plant and machinery costs • Start-up requirements at the dti discretion • Working capital requirements limited to initial stock requirements of start-ups
Manufacturing investment programme: Stimulate investment within the manufacturing industry; qualifying investment costs comprise machinery, equipment, land and buildings, and commercial vehicles
• Small projects (investment projects of R5 million and below) • Medium-to-large projects (investment projects of above R5 million): 15 - 30% of the investment cost payable over three years • Reimbursable amount of 30% of the investment cost payable over two years
Tourism support programme: Support the development of tourism enterprises that stimulate job creation and encourage a geographic spread of tourism investment
• Small projects (investment projects of R5 million and below) • Medium-to-large projects (investment projects of above R5 million)
Export marketing and investment assistance (EMIA): EMIA scheme develops export markets for South African products and services and recruits new foreign direct investment into the country
• Individual exhibition participation • Primary market research and foreign direct investment • Individual inward missions • Group participation incentive schemes
Sector Specific Assistance Scheme: A reimbursable 80:20 cost-sharing grant where financial support is granted to export councils, joint action groups and industry associations
• Covers costs such as market research, consultancy fees, other expenses, improving quality management systems for export promotion and product development • Most economic sectors identified in the industrial policy action plan qualify
Film production incentive: Incentive to attract foreign-based film producers to shoot on location in South Africa; the South African Film and Television Production Incentive (SAFTP) assists local film producers in the production of local content.
• SAFTP available to qualifying South African productions with total Qualifying South African Production Expenditure (QSAPE) of R2,5 million and above • Only one entity per film production, television drama or documentary series eligible for the incentive • Eligible formats: Feature films, tele-movies, television drama series, documentaries and animation
TAx allowance: To accelerate economic growth and support the implementation of the industrial policy which results in: • Energy efficiency • Job creation • Training
Qualifying applicant should manufacture products classified as Standard Industrial Classification 3. Excluded is alcohol (wine and beer), tobacco, arms and ammunition, and bio-fuels that impact on food supply • Greenfields (new projects) minimum R200 million investment • Brownfields (expansion project) minimum R30 million investment • Upgrade project - minimum R30 million investment
By Buhle Dlulane, chief operating officer for the Eastern Cape Development Corporation and Dr Nonceba Mashalaba, chief director of the Enterprise Organisation of the Department of the Trade and Industry.
More details are available from www.dti.gov.za PAGE 14 | BUSINESS UNLIMITED
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
EXPORTS GROW EXPONENTIALLY AS ECDC RECORDS
IN TRADE In 2010/11 the value of exports increased by a whopping 178% as the Eastern Cape Development Corporation assisted exporters AND recorded more than R1 billion worth of trade with overseas markets.
The significant increase in the value of exports, particularly over recent years, is an indication that previous selling missions are beginning to bear fruit. The development financier’s trade promotion efforts aim to increase trade, the number of exporters, focus on and explore new markets, maximise opportunities offered by various trade policies like Africa Growth and Opportunity Act, as well as trade within Africa. Using sectors with the highest production and manufacturing potential, the financier is prioritising three sectors: Agro-processing as it opens up new markets through the production of new crops and products, creative industries with increasingly creative and savvy cadre, and automotive with its proven export track record.
scheme, which helped the company expand the distribution of its value-added agricultural products to foreign markets. Based in the Coega Industrial Development Zone in Nelson Mandela Bay, the company produces a range of frozen fruit products, including sorbets. Through the same scheme, Momento’s of Africa (also see page 24) which is involved in the manufacturing of mohair-based products, expanded its factory space, boosted permanent employment by 45%, and opened outlets in all South African airports. This has been brought about by increased orders, mainly from overseas markets.
The approach by ECDC is simple. Connect those who are export ready with those who want to buy the product.
Using the platforms of export networking forums, stakeholder awareness workshops and trade missions to China, Scandinavia, North America and Europe, ECDC is also targeting businesses which are not yet export-ready, and together with Trade Point South Africa Nelson Mandela Bay will implement export readiness programmes this year.
One example is Dynamic Commodities, which used the Department of Trade and Industry’s export marketing and investment assistance scheme. Facilitated by ECDC, the winner of multiple global food innovation awards accessed the
Some of the programme achievements over the past five years include more than 100 new exporters being groomed to be a new generation of entrepreneurs, hungry for new opportunities in a world that is increasingly connected.
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
More recently, over 70 entrepreneurs accessed the export marketing and investment assistance scheme, which created opportunities for them to showcase their products at global shows in Hanover Germany, for example. ECDC also offers access to E-Platform, an online solution designed to connect the trade communities and help exporters, importers and service providers to reach new markets.
About export marketing and investment assistance (EMIA) ECDC is the provincial representative in the province for the EMIA scheme, which develops export markets for South African products and services and recruits new foreign direct investment into the country. Exporters who wish to participate at an international exhibition or inward mission and who require primary market research and foreign direct investment, or want to use an incentive scheme, may apply for EMIA support. Contact: Trade Promotion 043 704 5606, trade@ecdc.co.za
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R80 MILLION INVESTMENT
TO BOOST PRODUCTION
s e s s e c c Su SOME OF OUR IN 2010/11
ECDC FUNDS DELI Port Elizabeth delicatessen Angel Foods, located in the Perridgevale Shopping Centre, received financing from ECDC for equipment, which has helped the small business expand its menu range. Having first specialised in Greek cuisine, the shop now services a broader market with muffins, preserves, pastries and lunches. Items can be bought freshly baked or frozen for an easy meal. The specialty food store also caters for events and corporate functions. Angel Foods began operations two years ago.
South Africa’s marine finfish farming industry leader, Espadon Marine, has committed a further R50 million to expand its facility in the East London Industrial Development Zone (IDZ). Its kabeljou (or kob) production will be significantly expanded to 600 tons. The operator’s initial R30 million investment in 2009 for the first phase of the development is bearing fruit as the operator geared up for its first commercial harvest during the period under review. Espadon’s kob harvest is the first commercial harvest in the Eastern Cape. The establishment of the facility, which was a result of ECDC’s lobbying, was further motivated by East London’s suitable temperature for finfish farming. The area’s annual average minimum of 18°C and maximum of 22°C is suited to temperate finfish species.
REJUVENATION
OF MTHATHA CENTRAL BUSINESS
District In order to maximise the opportunities within the commercial property sector, ECDC has signed a long-term lease with KFC for use of its refurbished building which was once the Hillcombe Residential Complex. Hillcombe was previously an underperforming, dilapidated residential complex situated in the heart of the Mthatha Central Business District.
ECDC SUPPORTS
DAIRY FARMS
While agriculture remains a critical sector for unlocking the economic potential of the province, ECDC continues to promote further development into areas with high agricultural potential in the former Transkei and Ciskei. The expansion of three dairy farms through the revitalisation of closed irrigation schemes in Alice, Whittlesea and Cala demonstrates this commitment.
ECDC FUNDING
BOOST
BAKERY PRODUCTION
ECDC’s R350,000 loan has helped a Mount Frere bakery upgrade its energy infrastructure and buy additional equipment. This has allowed Door 2 Door Bakery to meet the increased demand for bread and baked goods in the town and surrounding area. The business, owned by Mabangula Langa, employs 15 locals and was started in 2009.
The farms form part of Amadlelo Agri, established in 2004, by 70 commercial farmers in the Eastern Cape and KwaZulu-Natal, along with partners as the University of Fort Hare. Targeting underutilised and fallow land, the aim is to develop it to its full potential and eventually milk 6,000 cows. The farmers seek to address some of the issues facing the dairy industry in South Africa, which includes a shortage of domestic production and increased milk imports. Amadlelo has facilitated a partnership between commercial farmers and communities within the targeted areas. A key focus of the partnership is the transfer of skills from commercial to emerging farmers so that local community members can run the farms and provide employment for community members on the farms. Alice-based Fort Hare Dairy Trust, which forms part of the programme, is an 800-cow commercial dairy operation and was established in 2007. Its teaching centres train students in farm management.
LONG TERM PARTNERSHIP
FLY TYING
in centane Ten fly tiers from Centane and Willowvale in the former Transkei will soon boast the age-old art of fly tying as result of ECDC’s R500,000 investment. Fly tiers, who will be mentored by an appointed trainer who will also help them establish a business, will undergo training and mentoring as they learn the art of preparing hooks for anglers and fly fishermen who visit the areas. Other opportunities for the business includes satellite fly tying, bait and tackle outlets, managing local fishing venues, and starting a training centre for future fly tiers and fishing guides.
YIELDS POSITIVE RESULTS
Nonkqubela Weaving Primary Co-operative at Ilinge near Queenstown makes high quality hand woven laundry baskets and magazine racks using steel frames and sisan or bundle twine. The co-operative was formed in 1999 and is now made up of 15 members, three of whom are disabled and 12 are women. Over the years, ECDC has assisted the group with loan financing. ECDC continues to provide the co-operative with support through the crafts and creative sector support programme, which assists small enterprises to take their products to the market. Exhibitions such as Decorex and the Grahamstown National Arts Festival are crucial channels for these types of businesses. ECDC has helped them with a presence at these events. ECDC also facilitated training for the group which focused on product development, basic financial management, basic business skills and co-operative governance.
eastern cape launches
EXCLUSIVE
JOBS SCHEME THE R50 million Eastern Cape Industrial Job Stimulus Fund (ECIJSP), managed by the Eastern Cape Development Corporation (ECDC), is set to drive the job creation by incentivising businesses across targeted sectors to create sustainable and decent new jobs.
Launched by the MEC for Economic Development, Environmental Affairs and Tourism Mcebisi Jonas, the fund aims to create jobs through stimulating and encouraging the diversification of the provincial economy. Exclusive to the Eastern Cape, the ECIJSP has a target to create a minimum of 30,000 new jobs in the next three years. “The programme is a direct response to government’s job creation drive and it will strengthen the sectors outlined in the Provincial Industrial Development Strategy (PIDS). It will further ensure a concerted effort to bring to fruition the goals of the New Growth Path (NGP) by creating strategic partnerships in all sectors for economic development,” says Jonas.
The new incentive programme will target companies in green industries, agro-processing, tourism, manufacturing, petrochemicals, capital goods as well as information communication technology (ICT), electronics and business process services (BPS). It will be controlled through an audit system that will see cash incentives paid to companies per proven job created.
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ECDC’s role is to manage the funds, as well as perform all administrative functions including receiving, processing and adjudicating applications on behalf of the provincial government. “The incentive will only be available to businesses which operate within the province. The businesses which apply for the incentive are required to create at least 10 new jobs in the Eastern Cape. The company will be expected to keep each job for a minimum of a year from the date of employment. “Qualifying businesses will be paid R10,000 taxable incentive payout in line with normal income tax legislation. The fund is meant to create sustainable new jobs located within the Eastern Cape by attracting sector-specific investments across the value chain,” says ECDC chief executive Sitembele Mase.
“The incentive will be paid out in two equal installments to the successful applicant. The first payment will be paid six months from the establishment date and the second 12 months from the establishment date. “The employer will receive the incentive if it has created all the promised jobs as per the contract with ECDC. If an employee resigns or has been dismissed for misconduct or incapacity during the contract period, the employer will be required to fill the vacancy within two months. If the employer fails to do this, the total incentive for all the jobs created by the employer will fall away,’ explains Mase. Additional questions can be directed to the fund manager, Thabo Shenxane on 043 704 5653, or e-mail tshenxane@ecdc.co.za
More than a quarter (26,4%), of households in the Eastern Cape rely on government grants as the main source of income. Nationally, youth unemployment rate is estimated at nearly 35% with more than three million young people out of work. Youth unemployment in the Eastern Cape averages 41,4 %. This is more than twice the adult unemployment rate (18,4%). A total of 695,175 young people have been without work every year in the Eastern Cape during the past decade as per an Eastern Cape Socio-Economic Consultative Council publication released in August 2010. Mase says applicants to the fund will be measured according to the strategic impact of the jobs created, sector prioritisation, location and on skills development. All successful applicants are expected to sign a contract with ECDC before any funds may be disbursed.
ECDC’s Thabo Shenxane will manage the fund.
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
1
WHO
2 WHAT 3 WHAT
A R E T H E CRITERIA CAN APPLY WILL BE USED TO PRIORITY FOR FUNDING? SCORE APPLICANTS? SECTORS? Any business operating within the Eastern Cape
Strategic impact of jobs created
Agro-processing
20 points
Green economy
Companies with South African and/or non-South African shareholders
Petrochemicals Spatial orientation/location
Tax and legislative compliant
5 points
R10,000
per job
Capital goods
10 points
ICT, electronics and BPS
Skills development
4 WHAT 5
IS AVAILABLE?
Manufacturing
20 points
Businesses which undertake to maintain each job for at least 12 months
FUNDING
Tourism
Sector prioritisation
APPLICATION
PERIOD
6
HOW
DOES ONE apply?
Applications for the fund will be accepted during the period
Applicants need to complete the Industrial Job Stimulus Programme application from www.ecjobsfund.co.za with the following documents:
20 October TO 30 November 2011
Latest financial statements together with its accountants report – close corporation
Latest audited financial statements – in the case of a company
Copy of latest Income tax assessment Latest management account - at least 2 months before date of application Tax clearance certificate
FURTHER INFORMATION AVAILABLE ON:
www.ecjobsfund.co.za TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
BBBEE rating certificate Most recent UIF UI-19 form Most recent payroll listing Confirmation of banking details
BUSINESS UNLIMITED | PAGE 19
GLASGOW & LONDON Eastern Cape From Above (ECFA), the four-year old photographic exhibition of the province’s most spectacular landscapes, opened at the Scottish Exhibition and Conference Centre in Glasgow in late September.
The Scottish city becomes the 12th city after a successful tour across Europe which included Portugal, Belgium, Sweden, France and Germany. The exhibition, showcasing 40 Eastern Cape destinations, runs until February 2012 in the city, which has close ties with South Africa and the Eastern Cape. The Glasgow Missionaries Society established the legendary Lovedale College in Alice, one of the first missionary learning institutions in the Eastern Cape. Its alumni include political activists Govan Mbeki and Steve Biko. Its subsidiary, Lovedale Press, published the works of well-known African writers such as Olive Schreiner, John Maxwell Coetzee, Zakes Mda and Nobel Prize for literature laureate, Nadine Gordimer. It appears that the beauty of the province still resonates with the Glaswegians. The exhibition in Glasgow is attracting rave reviews, according to Fiona Crichton from the Scottish Exhibition and Conference Centre: “We have had very complimentary feedback and indeed lots of interest. The images look fantastic.” The Scottish exhibition follows a successful run in Bristol where Jesse Stone, coordinator for this leg, hailed its success.
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“The exhibition had gone really well with about 5,000 postcards being snapped up each day. Everyone who has spoken to me has really enjoyed it. Some seemed keen to visit the Eastern Cape because of it.” This is exciting news for ECDC special projects manager Pierre Leppan who says that “the United Kingdom leg of the exhibition is part of the Eastern Cape Development Corporation’s (ECDC) plan to promote the province as a tourist and business destination”. He says that although tourism and trade between the two countries remains strong, there is room for growth.
what the province has to offer,” Leppan says. ECFA gives viewers a sneak peek into some of Eastern Cape’s iconic tourism destinations such as the Hole-In-the-Wall on the Wild Coast. Other locations profiled include Addo Elephant Park which hosts the big seven (the big five plus the southern right whale and great white shark) as well as more cosmopolitan offerings like Blue Flag beaches and night life in Port Elizabeth, East London and St Francis Bay. In London, the ECFA exhibition at Gabriel’s Warf at the Riverside Walkway on the south bank of the Thames River is also attracting exciting feedback says London landlord Deborah Crowhurst. “The stand was mobbed with people looking at the stands, taking photos of them as well as picking up postcards,” explains Crowhurst. The exhibition in London ran to 10 October 2011.
More details on the locations featured in the exhibition can be found at bit.ly/nLoKJ0 or Facebook (Eastern Cape from Above).
“EC From Above dispels myths and distorted perceptions of the Eastern Cape province as a destination exclusively suited for travellers with an appetite for adventure. It shows the full spectrum of
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
1.
2.
3.
4.
1. Bird Island, which forms part of the Addo Elephant National Park, is home to the world’s largest gannet population. 2. The imposing 1,400m high Spandaukop is a volcanic feature, just outside Graaff-Reinet. 3. Nelson Mandela Bay Stadium was one of eight host cities of the FIFA 2010 Soccer World Cup. 4. Eastern Cape is a dolphin territory with a number of conservation programmes in place to ensure that dolphins and whales are protected in the province’s waters.
The exhibition at Munich airport (top) and Luneburg (bottom) in Germany in 2008.
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
BUSINESS UNLIMITED | PAGE 21
EASE UP New directors for ECDC Former Amathole District Municipality executive mayor Sakhumzi Somyo, and former chief operations officer for the 2010 FIFA World Cup Organising Committee Nomfanelo Magwentshu, were appointed to the development financier’s 12-strong board. The appointments fill an existing vacancy and an opening following the resignation of John Cerff.
Somyo has a Bachelor of Arts degree and a teacher’s diploma from the University of Fort Hare. Magwentshu is an MBA graduate from the Gordon Institute of Business Science, University of Pretoria. The appointments were made in June 2011. The MEC for Economic Development, Environmental Affairs and Tourism appoints the board of directors, which is the accounting authority of ECDC.
Lower Saxony, Eastern Cape alliance celebrates
six years
Since entering into a twinning agreement in 1995, the Eastern Cape has shared a long-term development partnership with the province of Lower Saxony (Niedersachsen) in Germany.
The visit to Lower Saxony in July, which included ECDC, the Department of Economic Development, Environmental Affairs and Tourism, Coega Development Corporation and East London IDZ allowed the Eastern Cape government to present opportunities and investment potential in renewable energy, agro-processing, tourism, automotive, general manufacturing.
Sakhumzi Somyo
Nomfanelo Magwentshu
Entrepreneurial culture takes to the podium Tell us what in SMME summit you think
With global estimates suggesting SMMEs account for 40% of GDP and provide 57% of all jobs, the development of the province’s SMME community cannot be underestimated. The fifth Eastern Cape provincial SMME summit, which promotes the growth and development of this sector, will take place at the East London Convention Centre from 16 to 17 November 2011. The theme for this year’s summit is “growing business skills and strengthening an entrepreneurial culture for Eastern Cape SMMEs” and coincides with Global Entrepreneurship Week. Partnering with ECDC is the University of Fort Hare, SEDA and DEDEAT. For more information, go to www.ecdc.co.za or contact Dawne Adkins on tel +27 43 722 0771 or email dawne@intengu.co.za
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The partnership aims to expand into areas such as commercial vehicle and automotive parts production, shipbuilding parts production, steel production, environment technology and energy efficiency, food and beverages and solar and wind energy.
Business Unlimited is produced twice a year to keep you, a valued stakeholder, up to date on ECDC’s latest developments. Please contact Ikhona Mvaphantsi on email at ikhona@ecdc.co.za and let us know what you would like to see in the next edition of this publication.
TOGETHER LOOKING FORWARD WITH RENEWED CLARITY | SPECIAL EDITION 2010/11 FINANCIAL PERIOD
Spotlight falls on
industry The Eastern Cape creative industry is packed with success stories that have embedded Eastern Cape cultural icons into South Africa’s creative legacy that include Shweshwe, beading, weaving, pottery and fashion brands like Sun Goddess.
In recent months, ECDC assisted close to 40 designers and crafters with platforms to showcase their work. It also supported seven crafters to exhibit at Decorex in Johannesburg during August 2011. In July, the East London Your Home Expo, held annually in East London, featured 12 craft enterprises and their creations with the help of ECDC. Another group of 20 craft enterprises were assisted by ECDC to showcase their products at the National Arts Festival (Gahamstown) in July 2011. ECDC was one of the key players in bringing the 17th annual Vukani Fashion Awards to the province. Held at Hemingway’s Mall from 24 to 27 August, ECDC also supported 20 emerging designers to showcase their latest creations.
Founder and CEO of Vukani Fashion Awards Sonwabile Ndamase and winner Tozama Dyantyi
Tozama Dyantyi with models wearing her winning collection
ECDC chief executive Sitembele Mase says fashion is a labour intensive sector and the creative industry has been recognised as possessing potential to create jobs on a large scale and is part of the Industrial Action Policy Plan (IPAP 2). “Over the years, ECDC has been part of promoting the creative sector through various exhibitions and other market access programmes. Our involvement in the creative sector has shown us that indeed the Eastern Cape is endowed with untapped human capital and talent,” says Mase. Eastern Cape born designer Tozama Dyantyi took the top honours, walking away with prizes to the total value of R73,000. “The Vukani Fashion Awards are a significant icon of visual identity to a South African. They are a beacon of change, a spirit of inclusion and community building, after Madiba’s own heart. “They inspire, develop, and teach the youth beyond colour, history and religion and culture. Being a winner means that the possibility of beating poverty is visible, especially within the communities of the Eastern Cape,” says Dyantyi who hails from the small town of Cala in the former Transkei.
Local models showcase garments by young designers who entered the competition
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BUSINESS UNLIMITED | PAGE 23
SMGAFRICA_7104
MOHAIR MANUFACTURER INCREASES
FOREIGN
SALES, JOBS
World-class producer of luxury mohair textiles and apparel, Momento’s of Africa, continues with its success following its humble beginnings in the 1980s when British expert weaver Lin Smith taught unemployed people to weave Xhosa tapestries as a means of making a living. The company, which started off as a curio shop at the Port Elizabeth airport, has taken advantage of the Eastern Cape’s leading position in mohair production and now boasts an expanded factory with average annual increases of 30% in employment, and a chain of outlets including most South African airports. South Africa, which currently produces more than 60% of the world’s mohair, gave the company a competitive advantage regarding the sourcing of mohair produced. Over the past 30 years, Momento’s brand names have come to denote quality all over the world. These include BabyMo products, which are woven or knitted from the hair of kid Angora goats, and the original imiBoniso brand which features modern and traditional Xhosa mohair tapestries and wall hangings. More recently Momento’s have developed and trademarked new fabrics which include heavier apparel cloths
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