for tomorrow

George Campus

The Garden Route has traditionally sustained itself mainly through tourism, but this is no longer enough, says a George academic who believes a ‘knowledge economy’ could reverse the area’s economic slump.

Words: Nicky Willemse & Janine Oelofse

The Garden Route is in a depression because tourism and the region’s other traditional economic drivers, the services and construction industries, are all in a downturn and can no longer sustain the region on their own. Also, further challenges await over the next decade or so, including unemployment and a dwindling percentage of skilled and educated inhabitants.

Prof Christo Fabricius, principal of Nelson Mandela Metropolitan University’s George campus, believes there is a solution. “Knowledge, underpinned by quality education, should be one of the central economic drivers for the George and Garden Route areas. A few well-thought initiatives could be the catalyst for a great future built on a ‘knowledge economy’ – underpinned by information, education and innovation.”

Key elements would include skills development, improved access to communication technology, focusing on quality education at all levels and investing in research and development.

“George is a city small enough to make such a vision a reality, but not so small that it is insignificant.” This is a unique concept in South Africa, one which Fabricius is confident will work and eventually be replicated elsewhere. He cites global research that links education and economy. For instance, a 2004 report by the Upjohn Institute in Michigan indicates that a one percent increase in the proportion of people with higher education qualifications raises the income of everyone – including those without higher education – by 1,4 percent. “This is because of higher wages, an increased supply of skilled labour and the attraction of new employers to the area.”

In George, only 37 percent of the population is skilled or highly-skilled. In fact, the number of young people who have completed high school has dropped significantly over the past four years, despite an increase in primary school enrolment. Between 2001 and 2007 the number of residents with matric decreased from 22 100 to 17 700 – a drop of 20 percent.

“If one takes into account that having Grade 12 instead of Grade 11 increases a person’s chances of finding employment by 11 percent, as indicated by a recent Stellenbosch University research report, then it is easy to imagine the economic impact of this skills gap.”

 A drive towards quality education would reverse the city’s growing unemployment rate, which in 2007 included almost 20 percent of George’s economically active population, more than half of them aged between 15 and 30. Ironically, the tourism industry is experiencing severe shortages in skilled personnel.

 Education would fill that gap. Fabricius says implementing a ‘knowledge economy’ is all about capitalising on existing education resources.

 “Conditions are ideal for George to become a pioneering educational hub. It has a large number of top primary and secondary government schools with committed, highly-qualified teachers. It is also one of the few small cities with its own campus of one of South Africa’s top 10 universities, the Nelson Mandela Metropolitan University, which offers comprehensive qualifications, from diplomas all the way through to post-graduate degrees. The city is home to South Cape College, one of the country’s best-performing Further Education and Training Colleges (FETs). There is a growing School of Culinary Art and an emerging hospitality school under the auspices of the Francois Ferreira

Academy, and there are a large number of highly qualified people, including many retired academics and school teachers. This highly qualified corps of senior academics and educators offers great untapped potential.”

 But it will require innovation and the participation of stakeholders who have the power to make a difference by “aligning their budgets with the knowledge economy dream”.

Fabricius suggests that the municipality could join forces with provincial and local government to establish a network of small community learning centres where students could study in a safe environment and have access to internet facilities. These centres could be linked by a bus network and bicycle paths to enable students to move safely from one to another.

“Institutions of higher education could work with schools to provide in-service training of teachers, as well as winter and summer schools for pupils.

“Municipalities, government departments and the business sector could establish a database of service-learning opportunities and internships, for which students and pupils could apply.

“Provincial, national and local government could also pool their funding to establish science parks, agri-parks and technology hubs which could be hives of activity and entrepreneurship. Churches and charity organisations could put their weight behind these initiatives, all in pursuit of one dream: sustainability through knowledge and quality education.”

Education is already a major priority in the Western Cape, so not much new investment is required.

‘The Western Cape government is already investing heavily in education (more than 36 percent of its R13,3-billion budget was spent on education in 2011, equating to R4,7-billion). It should be easy to align funding priorities with the goals of education in a combined effort, with George as a pilot project,” says Fabricius.

“Education is a major contributor to local and national economic development. Research by

Stellenbosch University has found that South Africa’s GDP could be between 23-30 percent higher if more people could be literate and better educated. The more people are educated, the greater the increase in economic activity and entrepreneurship. This leads to more jobs, greater buying power and economic growth.”

Returns for investors in education are also high. “A 2004 project shows that in sub-Saharan Africa, the rates of return range from 11 to 18 percent for society as a whole, while private rates of return could be as high as 28 percent.” 

Fabricius’s vision, shared by many partner organisations, that George will be viewed as a pilot initiative in coordinated planning for quality education, can eventually be rolled-out to other towns “once lessons have been learnt”.

“Can you imagine a future where George and the Western Cape take the lead in positioning South Africa as a beacon of prosperity and growth through quality education?

“Success is within an arms-length, right here on our door-step.”

This article first appeared in South magazine

Photographs: Colin Stephenson /Create Photography

Thinking outside the box in George

By Janine Oelofse

George, the capital of the Garden Route, is the fastest growing metropole in South Africa, but while people are flocking to the city for a better lifestyle, some serious changes will need to be made if its economy is going to keep apace.

Role players in economic growth say that while tourism and construction have long been the Garden Route’s main economic drivers, other ways will have to be found to keep the regional economy bubbling.

 Western Cape Finance, Tourism and Economic Development MEC Alan Winde says business process outsourcing (BPO) ventures, including call centres, are one of his government’s key priorities.

“They are high growth and job creating industries. We also have a competitive edge in these industries because we are in the right time zone, speak the right language and have a ready workforce,” Winde says.

The Western Cape government is working with Business Process Enabling SA (BPeSA ) to promote the call centre industry.

 According to BPeSA official Patrick Gordon, the industry is working well in Cape Town, creating 28000 agent jobs, excluding back office and support staff, and contributes R8 billion to the provincial economy.

 “The majority of the sector is made up of local companies, but there is an important offshore sector that generates new jobs for the country.” 

Gordon says international brands outsourced to Cape Town included Shell, Amazon, Lufthansa, iiNet and Bloomberg, while talks were in progress to see George benefit from the same type of venture.

“We are currently in talks with a couple of companies from the region which include Solluco, and Eden Connect, both in George, to see how we can set up a BPO hub for the region,” he says.

Solluco is a financial services provider in the insurance industry and specialises in outbound telesales for major insurance corporations and banks, while Eden Connect offers BPO and call centre services.

“BPeSA is always looking to bring jobs to the Western Cape, whether it’s to Cape Town, George or any other relevant centre. George has a very competitive offering in terms of property prices and staff salaries which potentially makes it an attractive BPO or call centre destination for both local and international companies,” Gordon says.

 George executive committee councillor for finances, Leon van Wyk, says the town needs to look into changing from a consumer to a manufacturing based economy, with plans afoot to investigate the development of a science and technology park.

 There is massive unemployment and poverty in George, making economic growth vital.

“George must become an exporter of goods rather than just importing,” Van Wyk told a local newspaper. Van Wyk said council was in favour of developing so-called clean industries, such as computer businesses. There was also potential for agriculture and education and training ventures.

 George mayor Charles Standers says a project team has also been established to gather information and prioritise ways in which more jobs can be created.

“A number of projects were forwarded which could deliver quick and visible wins, and more importantly, they are not big budget items in these tough financial times. These projects will all be driven by private sector champions and we as the municipality will do our utmost in co-operating, whether it is in reducing red tape, accelerating approvals or relocating resources.”

 This article first appeared in South magazine


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