City’s Economic Action Plan up and running

STATEMENT BY THE CITY’S MAYORAL COMMITTEE MEMBER FOR ECONOMIC OPPORTUNITIES AND ASSET MANAGEMENT, ALDERMAN JAMES VOS .

There are no quick fixes and one thing is clear, this crisis calls for partnerships, innovation and smart solutions as we brace ourselves for the economic and social impact of the outbreak. We have a plan and we urge you to be part of it. 

In my statement of 20 March, right at the beginning of this Coronacoaster ride, as some pundits have named the COVID-19 impacts, I stated that I had, together with my officials, established two vital task teams. Namely, the Economic Task Team (ETT) and the Tourism Task Team, established to co-ordinate and streamline our response to the impact of the pandemic on Cape Town’s economy.

The first work-product of the ETT has been to devise an Economic Action Plan (EAP) that serves as the City of Cape Town’s economic response and as a contingency plan for the anticipated short-term crisis facing the city’s local economy in the wake of the spread of COVID-19. It must be noted that this is a living document which will be updated on an ongoing basis as the situation develops and in line with changing directives and regulations from national government.

This plan has been endorsed by the Mayoral Committee and this plan details our progress and the next steps on the road to getting our workers back to work and our businesses back to business.

With this in mind, and from the City’s perspective, the EAP has been compiled on the premise of three stages: response; adaptation and recovery; and lastly, stabilisation.

Economic Action Plan’s response stage

There is no way of knowing when these stages will begin or end. With flexibility and practicality as the founding principles, the EAP, to date, has primarily focused on the first stage – our response.

I am proud to say that during the past six weeks, we have demonstrated not only our ability to respond and adapt but also to take bold decisions.

We have succeeded in:

• The re-purposing of the City’s Enterprise and Investment Department to operate optimally in the ‘new normal’ brought about by this crisis. We have done this in partnership with the Western Cape Government, Wesgro and our Strategic Business Partners
• Assisting High Growth Sectors with business continuity during lockdown
• Together with our partners, interpreting essential services regulations and lobbying national government for amendments where needed
• Assisting with the re-purposing of companies to pivot towards meeting the needs of the health crisis
• Refocussing the deliverables of our Strategic Business Partners to allow them to assist in the health and economic spheres
• Investigating and recommending possible City economic relief measures, many of which have been implemented

Some notable milestones achieved by my team include:

• Rapidly instituting business continuity measures such as moving operations online, including the Business Hub.
• Strengthening linkages with other government structures to coordinate the flow of accurate, up-to-date information to businesses. Collaboration has been key in this crisis. We have been a part of the economic cluster set up by the Western Cape Government and have participated in the world-class COVID-19 Content Centre set up by Wesgro, which has provided timely and accurate information to businesses. Businesses can send their questions to supportbusiness@wesgro.co.za and visit www.supportbusiness.co.za
• Facilitating business to business communications to enable urgent capacity to manufacture Personal Protective Equipment (PPE) as well as critical medical supplies like ventilators. The City has assisted the Western Cape Government in identifying local companies that could pivot their normal manufacturing to meet these health needs. (www.supportbusiness.co.za ) Through our refocused efforts, we aim to help as many companies as possible to adapt to this new normal and to navigate the immediate to medium-term future until the virus has been brought completely under control.

Guided by the EAP, I am reassured by some of the successes already achieved as we enter day 35 of lockdown:

• The Cape Clothing and Textile Cluster (CCTC) and the Craft & Design Institute (CDI) have, through consultation with their members, provided critical insight into the sourcing and supply of cloth masks from both large manufacturers and small to micro enterprises.
• Through the responsiveness and generosity of the hospitality industry (working with Cape Town Tourism and Wesgro) a list of tourism establishments that are willing to rent out their rooms for isolation and quarantine sites has been compiled. This is being shared with both the City and Provincial Health Services to assist with their operations.

r

Ongoing engagements with businesses key to EAP

The EAP highlights the need for the City to continually engage with its business network to identify the full impact of the crisis, determine their immediate needs, and assist with channelling them towards the appropriate sphere of government.

As part of this action step, the Investment Facilitation Unit in Enterprise and Investment Department is moving into the second phase of their industrial survey. The City’s Special Purpose Vehicles have also been requested to conduct similar surveys with the companies in their respective sectors so that we can obtain real-time data on how this crisis is impacting on their businesses. I urge you to participate and become part of the plan. Keep an eye out on our social media platforms and website for the latest trends and current happenings.

As we face the shift from Level 5 lockdown to Level 4, one of the primary tasks of the ETT will be to assist as many businesses as possible to have better business continuity plans in place to lessen the economic impact of the phased lifting and return to full capacity. This will also help businesses become lockdown ready in case the health crisis requires a sudden shift up to Level 5 again.

While the full impact of the COVID-19 crisis is yet unknown, the City sees the above initiatives as the first step towards a recovery. Building on the framework identified in the EAP, and learning from responses and recoveries from other cities ahead of us on the crisis clock, I am confident that Cape Town will be well placed to rebuild its economy and ensure inclusive economic growth in a ‘post-COVID’ economic landscape.

r

Economic Recovery Plan

On the dawn of the easing of restrictions we are casting our eye to the future. The following components which may make up an Economic Recovery Plan are, among other things, currently being investigated:

Innovative solutions and business support key going forward

The rapid onset of the COVID-19 crisis and the national government’s swift introduction of a lockdown to contain its health impacts has undoubtedly caused huge economic disruption to the Cape Town economy.

It is clear that, as a City government, we do not have the power or the resources to mitigate all the negative economic impacts that will be felt over the coming months. We will however continue to partner with as many stakeholders as possible to find innovative solutions to these difficult economic challenges.

This will be a difficult time for many of our companies and as a City we also want to find ways in which we can best support those companies and their employees in sectors that are going to be particularly hard hit.

It is for this reason that the City’s Finance Department has put out various measures that can help ease the financial burden over the next few months. The City’s Department of Enterprise and Investment will be redoubling its efforts in business retention and expansion through partnering with entities like Productivity SA.

Despite all these measures, we anticipate that there will unfortunately be inevitable closures of some businesses and corresponding retrenchments. We will therefore be exploring ways in which we can retrain those workers and place them in those sectors which are showing high growth potential in this new economy.

The way forward together

However, it’s not all doom and gloom. Through the Enterprise and Investment Department we are continuing to invest in upskilling, training and sourcing talent for Small, Medium and Micro-sized Enterprises (SMMEs).

We intend on redoubling our efforts during the easing of lockdown. We don’t train just for training’s sake. The training we have done has created a better link between demand and supply for skilled people.

The City of Cape Town appointed Lulaway Holdings as our service provider in 2018 for a placement initiative and I am immensely proud of the successes achieved.

Our partnership with Lulaway has seen 6 000 unemployed residents trained in basic work readiness to date, with a majority of these residents being placed in work opportunities in sectors such as transport, wholesale, retail, and call centres. I am convinced that if we focus on retraining and upskilling our youth, we will be in a position to take advantage of this global levelling of the economic playing field. South Africans are truly resourceful people and the youth of today must have access to the portal of opportunity.

These unprecedented times call for a radically new approach and robust decision making. As a City government we stand ready to partner with the other spheres of government, our Strategic Business Partners, and most importantly our private sector stakeholders to devise sustainable pathways through this economic crisis.

The Cape Town economy is a diverse and resilient economy and by bringing its adaptability and innovation to the fore, I am convinced we will overcome these new challenges.

For more detailed information:

• The full EAP can be accessed  here.
• Summarised version of the EAP can be accessed here.