Unaccustomed to the limelight, Limpopo may revel in its rating as SA's fastest-growing province, but new premier Sello Moloto finds little cause for celebration.
Within three months of his appointment after April's general election, he called on public, private and community leaders to define what his government must do to attract more investment in Limpopo's main economic sectors - agriculture, mining and tourism - and to reduce unemployment, which hovers at an alarming 50% in the largely rural province.
Limpopo, he told them, was too long on policy and too short on delivery. "Our main weakness," he said, echoing President Thabo Mbeki, "has been on policy implementation.
"In the next five to 10 years, the focus will be on how best to implement these policies."
His sense of urgency might seem misplaced in a province that, according to StatsSA, has sustained the highest average real growth rate among SA's nine provinces: 4% from 1995-2002, peaking at 6,3% in 2001, compared with the national average of just more than 2% during that period. This boosted Limpopo's contribution to the national economy from 5,7% in 1995 to 6,5% in 2001.
Much of this growth has been obtained off a low base and driven by large-scale investment in new platinum mines: more than R7bn, with prospects of as much as R20bn. Construction by Anglo Platinum of a smelter near the provincial capital of Polokwane has been particularly heartening: for too long people in the province have watched their raw materials being carted away for processing elsewhere in SA and beyond.
But one of Limpopo's great strengths - its rich store of metals and minerals - is also a weakness. Though every R1m invested in agriculture creates 50 jobs and the same investment in tourism generates 17 jobs, the equivalent investment in mining creates only eight jobs, according to Limpopo finance & economic development MEC Thaba Mufamadi.
And, more than most provinces in the country, Limpopo needs jobs. Though its growth has been impressive, according to government projections, Limpopo needs to maintain long-term real growth rates of 7%/year and more if it is to cut unemployment.
"At the present rate of job creation and population growth," a government report warns, "the unemployment situation is likely to worsen to more than 53% by 2010."
So the challenge is huge. Limpopo, says the report, has to achieve growth of 8% by 2006, 9% from 2007 and 12% by 2020. Unrealistic as this may seem, a start must be made. The solution that emerged during four conferences convened by Moloto is to step up implementation of the "cluster" strategy that the Limpopo government has been pursuing for some time.
The approach is based on improving infrastructure - roads, water and electricity supply - in areas with strong primary industries or other competitive advantages, such as raw materials or natural assets. The improved investment climate will hopefully attract private investors to these areas where they will add value to primary products and raw materials through processing and manufacturing, or by providing supplies and services.
The provincial government has identified numerous cluster opportunities in Limpopo's vital agriculture, mining and tourism sectors and, in most cases, set out what it is doing, or prepared to do, to improve the investment climate. Working groups for each cluster will soon be established to accelerate the process.
The cluster strategy is being accompanied by more purposeful commercialisation of state-owned agricultural and tourism assets through public-private-community partnerships, and initiatives to improve local skills levels.
Signalling the Limpopo's government's intention to deliver its side of the deal, Moloto told the final of four conferences he convened that the province has allocated, over and above present budgeted expenditure, an additional R190m for infrastructure development. This is an achievement in its own right. The Limpopo government, explained Moloto, was able to allocate the funds because it had finally paid off debt inherited from the three bureaucratically bloated bantustans that existed in the province during the apartheid era.
Of the R190m:
- R150m will be invested in the further upgrading and maintenance of roads, particularly in areas with good investment potential.
- R30m will be used towards the development of Limpopo's capital city, Polokwane, into what the provincial government describes as "the Gateway to Africa": a regional business, trading and transportation hub closer to Southern African Development Community nations and sub-Saharan Africa than any other SA city. The funds will contribute towards the upgrading of Polokwane International Airport into an African cargo hub and a feasibility study on establishing an international convention centre in the city. The Limpopo government also hopes to establish an industrial development zone around the airport. As the most northern province, says Moloto, government will also bid to host the Pan-African parliament in Limpopo.
- In addition, R10m will be contributed to further development of an extensive IT community empowerment initiative launched by Hewlett Packard in the Mogalakwena municipality, near Mokopane (formerly Potgietersrus).
Moloto says: "The issue of developing secondary industry based on our competitive advantages in agriculture, mining and tourism, both upstream and downstream, has never been as clearly defined and illustrated as it is now."
