Eastern Cape Baseline Snapshot November 2007


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Cofisa - Eastern Cape Baseline Snapshot for Innovation - November 2007

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Eastern Cape Baseline Snapshot November 2007

  1. 1. COFISA: Foresight for Provincial Innovation Eastern Cape A Baseline Data Snapshot Regent Hotel, East London, 1st November 2007 Peter Greenwood & Bob Day Non-Zero-Sum Development
  2. 2. Data sources • COFISA baseline data study – In progress for E Cape, W Cape and Gauteng (IsambuloAMI) – Meta-data for ~800 datasets, at different degrees of disaggregation – CeSTII innovation data disaggregated to provincial level by December • Eastern Cape baseline data – Only ~30 datasets currently (freely) available with data that is disaggregated down to the province or finer – Our sources for Eastern Cape: • Human Sciences Research Council • Eastern Cape Socio-Economic Consultative Council • Statistics South Africa
  3. 3. Topics • Population, Poverty and Basic Services • Education • Eastern Cape PGDP • Industry • Research and Development
  4. 4. Population, Poverty and Basic Services
  5. 5. Eastern Cape population growth 6.6 6.5 EC Population (millions) 6.4 6.3 6.2 6.1 6 5.9 1996 2001 2007 Year
  6. 6. Population by age group E. Cape and SA (2001)
  7. 7. Urban and non-urban distribution by province
  8. 8. Urban and non-urban distribution by district
  9. 9. People in poverty: Number
  10. 10. People in poverty: Percentage
  11. 11. %age of households with mains electricity
  12. 12. %age of households with access to piped water
  13. 13. %age of households using bucket or no toilets
  14. 14. %age of households with municipal refuse removal
  15. 15. Education
  16. 16. Percentage school attendance of 7-15 year olds
  17. 17. University growth points: Publications • Fort Hare – Biological sciences – Physical sciences • Rhodes and Nelson Mandela Metropolitan University – Biological sciences – Information sciences – Computing sciences – Communication sciences • Walter Sisulu University of Technology – Only shrinkage!
  18. 18. Eastern Cape Provincial Growth and Development Plan
  19. 19. Provincial innovation systems in South Africa “But what emerges from the work so far suggests that regional or local innovation systems exist, if at all, only in Gauteng and Western Cape, and possibly in KZN, but nowhere else.” REGIONAL AND LOCAL INNOVATION SYSTEMS A study on behalf of NACI March 2007 (unpublished) So: an innovation system does not yet exist in the E Cape
  20. 20. Eastern Cape PGDP • Emphasises – Linkages between sectors – Linkages within the region – Diversification of the manufacturing base • Calls for – Research partnerships – Capacity building for the development of technology – Participation of local universities – R&D funding to be made available • But – Little knowledge of the actual strengths (or lack thereof) of the institutions the PGDP wants to involve.
  21. 21. Industry
  22. 22. Industrial specialisations (Provincial share >20% of national total) • Gauteng • Western Cape – Manufacturing – Agriculture, forestry and • Metals, metal products, fishing machinery, equipment – Food, beverages and • Other non-metal mineral tobacco products – Textiles, clothing and • Electrical machinery and leather goods apparatus – Finance and business • Radio, TV, instruments, services watches, clocks • Furniture and other manufacturing – Construction • Eastern Cape – Wholesale and retail trade, – Transport equipment catering and accommodation – Finance and business services
  23. 23. Eastern Cape automotive industry • Worldwide, current and prospective automotive manufacturing capacity outstrips demand • Indian and Chinese plants have advantage due to size of domestic market • Therefore, motor industry in E Cape is vulnerable
  24. 24. Global supply chain and sustainability • Integration into global supply chains can be positive – Education, training, technology upgrading, innovation • But reliance on foreign investment is not a long- term strategy • The global economy may favour a specific location one day, and abandon it the next • Challenge: to organise industrial development sustainably, through harnessing the interactions that characterise a regional (i.e. provincial) innovation system • A HUGE task, to which the private sector will not rise without incentives and partners
  25. 25. Farming operations (2001)
  26. 26. Research & Development (R&D)
  27. 27. R&D specialisation in the Eastern Cape • Investment in R&D • Publications – below threshold – Manufacture of paper and paper products – Manufacture of motor vehicles, etc – Water transport – Advertising
  28. 28. Technology Achievement Index (TAI) The provincial TAIs ranking as follows: • Top: Gauteng, Western Cape, and KwaZulu-Natal • Average: Mpumalanga, Free State, and North West • Bottom: Eastern Cape, Northern Cape, and Limpopo (DST 2005, 28)
  29. 29. Summary These data seem to indicate that: • E Cape’s most productive (& innovative) people “abandoning ship” • Origin of poverty rural – urban poverty inherited • E Cape’s poor live in worst conditions of RSA • HEI researchers not playing a leadership role • Strengths and weaknesses of “growth/innovation relevant” institutions not mapped (PGDP) • “Star” automotive industry is vulnerable • E Cape has most farming units in RSA, but most failing both food security and export goals • Under-performing on main aspects of R&D
  30. 30. %age of households with access to piped water
  31. 31. %age of households with access to piped water
  32. 32. Black population E. Cape (2001)
  33. 33. White population E. Cape (2001)
  34. 34. %age of households living in informal dwellings
  35. 35. Educational attainment 20+ years (2001)
  36. 36. • Three provinces – Eastern Cape, Free State, and Northern Province – are not specialised in any economic activity where the provincial share in the national total reaches 20 per cent. Even if the threshold had been set at ten per cent, they would hardly show up, with the exception of community, social and personal services in the Eastern Cape and mining in the Northern Cape. Another three provinces – Mpumalanga, Limpopo, and North West – are specialised in one and the same activity, namely mining. The Western Cape is specialised in agriculture, forestry, and fishing, and in finance and business services. KwaZulu Natal has three specialisations and Gauteng four. These two provinces are the only ones with specialisations in manufacturing (see Figure 1). • When secondary activities are disaggregated, Eastern Cape and Western Cape contribute with specialisations in transport equipment, reflecting the automobile industry around East London and Port Elizabeth, and food and beverages as well as textiles in the Cape. Mainstays of KZN manufacturing with national importance are food, beverages, and tobacco; textiles, clothing, and leather goods; wood and paper; publishing and printing; and furniture. Gauteng is the only province with high-tech manufacturing; next to non-metal mineral products, metals and metal products, and furniture, it is specialised in electrical machinery and instruments.
  37. 37. • Provincial development authorities in the Eastern Cape pay a lot of attention to attracting new industrial investments, especially FDI, but there is a lot less focus – or maybe none – on retaining accumulated absorptive capacities in the form of multinational firms who for whatever reason extricate movable capital equipment and strategic assets such as group-internal core competences but who leave skills and also a fair amount of tacit production and process knowledge behind. In the context of the automotive industry – indisputably the primary technological and organisational core of economic upgrading in the region – this suggests at best a lucky midterm horizon with a high risk of running foul of events beyond the control of provincial or even national policymakers, namely the fickleness of the key players in global automotive assembly. In other words, local development strategies with enough foresight would accompany the justified courting of DCSA with at least some brainstorming in conjunction with industry and other stakeholders about a possible post-DC world. At numerous component supplier plants, this is certainly of interest to management and employees. It is not clear that public stakeholders in the Eastern Cape appreciate this, let alone guide attendant soul-searching. This implies that what may endanger the future of the regional economy is not so much local capabilities per se, but a failure to coordinate the setting of priorities, identification of linkages, and selection of public interventions within a larger vision for local development in the face of global change. In other words, it is the very absence of a regional innovation system that makes for trouble.
  38. 38. Percentage of households using electricity for lighting
  39. 39. Percentage of households using electricity for cooking
  40. 40. Number of unemployed people
  41. 41. Eastern Cape Provincial Growth and Development Plan Role of Systemic Innovation strategy innovation in requirements development Research Regional growth Capacity building in partnerships points; research and for technology Promotion of technology development linkages to other development; sectors, esp. Funding for R&D and agriculture and partnerships (e.g. agro-processing AIDC, ICT Development Programme)
  42. 42. Thank You bday@scientia.co.za