NMB Business Chamber calls for stability and collaboration to get the Bay working in 2022
The benefits of a gradual recovery from the economic impact of the Covid-19 pandemic forecast for next year will be lost if Nelson Mandela Bay cannot offer business a stable operating environment with reliable basic services.
Looking back on the year in business in the Metro, Nelson Mandela Bay Business Chamber CEO Denise van Huyssteen called for increased collaboration amongst stakeholders in 2022 to work together in solving the challenges facing the city, and a focus by local government on service delivery, stability and getting the basics working.
Unemployment in the Bay increased to over 40% in the third quarter of 2021, while the municipality’s Trade and Investment division estimates that the real (inflation-adjusted) GDP of the metro declined by 8% in 2020, down to the level of a decade ago.
“Although it is positive that slight annual increases in GDP are forecast for 2021 onwards, with a return to 2013 levels of production in the Bay by 2023, there is still much to be done to achieve the stable operating environment that will enable business to reap the benefits of an economic upturn.
“The operating environment for business was likely the toughest ever this year, with the impact of the drought and water leaks on security of water supply; electricity outages due to loadshedding, ageing infrastructure, vandalism and cable theft. This led to sharp increases in the costs of doing business in the city as business had to install their own solutions to address shortfalls in the basic infrastructure and services needed to keep their operations running,” she said.
A volatile national environment, particularly the civil unrest in July and its indirect impacts on the Bay’s economy, coupled with instability in the local political environment, also contributed to the challenges for business in 2021.
“We continue to operate in a coalition environment in local government, and we appeal to the role players to prioritise stability. Council resolutions need to be passed timeously, requirements must be met in terms of passing budgets and there must be a focus on taking action to get the basics such as security and cleanliness right and achieve reliable, consistent delivery of services,” Van Huyssteen said.
The impact of unreliable services and political instability has been worsened by the socio-economic impact of the Covid-19 pandemic limiting business activity and increasing unemployment, with the tourism and hospitality sectors amongst the hardest-hit by lockdowns and restrictions on gatherings and travel.
Conferences, exhibitions, festivals and concerts are still largely on hold, while the Nelson Mandela Bay Municipality’s Trade and Investment division reports accommodation occupancy around the Metro at under 30% of capacity for most of 2021 and airport passenger numbers not yet recovered from the record lows of 2020. “This all adds up to at least a 40% decrease in direct tourist spend in the Bay in 2020. We need to protect this important sector, and our economy as a whole, by finding innovative solutions to doing business as well as by doing everything we can to limit restrictions placed on our economy through the acceleration of Covid-19 vaccinations.
We have a route to re-opening our economy and returning to normal operations, and it is incumbent on all of us to use it. We urge businesses to encourage and facilitate vaccination uptake among their employees, while continuing to follow all the hygiene protocols to limit the spread of the disease,” Van Huyssteen said.
She said the turbulence and challenges of 2021 had highlighted the need for business in Nelson Mandela Bay to be flexible, build resilience, and be open to innovation and collaboration.
By collaborating with each other as well as with local government, business had been able to make a difference in addressing the water and electricity challenges through the Chamber’s Adopt-a-School initiative to address water leaks and maintenance, and the Adopt-a-Substation initiative to secure vulnerable infrastructure against vandalism and theft.
While the Adopt-A-School initiative had helped to reduce water leaks and wastage at a number of schools identified for their high impact on water losses in the city. Van Huyssteen said the amount of water lost due to leaks was still unacceptably high and the municipality needed to accelerate its programme of attending to the leaks and other infrastructural related issue. At the same time, she urged businesses to heed the call to reduce water consumption by at least 20%.
Van Huyssteen said the Business Chamber’s key priority for 2022 was to “get the city working again, so as to retain existing investment while we work to attract new investment”.
In addition to basic service delivery, she said the ease of doing business in the city needed to be addressed. It was unacceptable that, for example, rezoning approvals have an average turnaround time of 2.5 years, and in certain cases has taken up to six years to secure. “Investors frustrated by the delays take their business elsewhere and much-needed job creation is lost to the city. The turnaround time on rezoning approvals should be no more than three months.”
The Business Chamber’s focus areas for 2022 will also encapsulate empowering small businesses and diversifying the local economy in order to reduce over-reliance on the automotive sector; as well as unlocking the Bay’s competitive advantage of being home to two ports.
The Chamber will also initiate a proposed action plan for the city to deal with the impact of climate change and preserve its natural assets, while she said that in addition to short-term measures to address water leaks the city needs to develop long-term solutions for sustainable water supply in a water-scarce environment.
“As business we know that we need to be more innovative than ever before to survive in these challenging circumstances. There is no end in sight to the Covid-19 pandemic and we need to learn to adopt hybrid models of working to adjust our operations through the various waves of the virus.
“Ultimately all the stakeholders need to collaborate in the best interests of the city and in creating a resurgence that allows Nelson Mandela Bay to achieve its full potential to the benefit of all,” Van Huyssteen concluded.