Ocean economy, major boost for coastal cities

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The Malaysians called their highly successful economic transformation programme and government transformation programme “Big Fast Results”. Ours is called “Operation Phakisa”.

As President Jacob Zuma announced at its launch, the programme “is designed to answer that fundamental implementation question”. To find solutions, we have decided to learn from other countries where possible, which have done well in implementing policies and programmes.

“In August 2013, I undertook a state visit to Malaysia, during which we observed what the country had achieved within a very short space of time, using the Big Fast Results methodology. We expressed an interest in the use of this approach and the Malaysians were ready to provide support. Operation Phakisa is an adaptation of that Big Fast Results methodology.

“We renamed the Malaysian Big Fast Results approach as Operation Phakisa to highlight the urgency with which we want to deliver on some of the priorities encompassed in the National Development Plan 2030. It will initially be implemented in two sectors, the ocean economy and health, especially clinics.”

The objective of the first is to bring together representatives from government, industry, labour, civil society and academia to collaborate in unlocking the economic potential of our oceans. “We chose the ocean economy with good reason. South Africa is uniquely bordered by the ocean on three sides – east, south and west. With the inclusion of Prince Edward and Marion islands in the southern ocean, the coastline is approximately 3 924 km long.”

This vast ocean space is relatively unexplored in terms of its economic potential. In 2010, the ocean contributed approximately R54 billion to South Africa’s gross domestic product and accounted for approximately 316 thousand jobs.

An analysis was conducted of nine sectors that comprise South Africa’s ocean economy. The ocean has the potential to contribute R177 billion to the gross domestic product. It also has a potential to contribute between 800 000 and one million direct jobs. These growth levers reflect at least 4% annual growth in both gross domestic product contribution and job creation.

Four priority sectors have been selected as new growth areas in the ocean economy with the objective of growing them and deriving value for the country. These are:

(a) Marine transport and manufacturing activities, such as coastal shipping, trans-shipment, boat building, repair and refurbishment;

(b) Offshore oil and gas exploration;

(c) Aquaculture; and

(d) Marine protection services and ocean governance.

A key step in the Operation Phakisa approach is the delivery laboratories or intensive work sessions. Multiple stakeholders work full-time in one location for about five weeks. At the end of this period, they deliver complete and signed-off action plans for presentation to the Cabinet.

“Delivery labs create transparency and help to remove bottlenecks and resolve the most critical challenges facing a sector,” the President elaborated.

The work stream on marine transport and manufacturing will explore the country’s natural advantage in maritime transport and manufacturing. South Africa aims to capture the benefits of growing volumes of cargo handling, sea and coastal shipping and supporting transport activities such as storage and warehousing.

In addition, South Africa can utilise its location and expertise to increase its share of the global marine manufacturing market, including ship-building and repair, rig repair and refurbishment or boat-building. Against this backdrop, the aspiration of this work stream is to grow the marine transport and manufacturing sector over the next five years, to increase the contribution to GDP and multiply the number of jobs in South Africa.

The work stream on offshore oil and gas exploration takes forward issues that the government has previously tackled. Recent developments have included the merging of Mossgas and Soekor to form a new national petroleum company, PetroSA, there has also been  the establishment of Petroleum Agency SA, and the introduction of enabling legislation such as the Minerals and Petroleum Resources Development Act, Royalties Act and Schedule 10 of the Income Tax Act.

These developments are major steps forward and contribute to increasing South Africa’s attractiveness as an investment destination for international oil and gas companies.

The aspiration of this work stream are to further enhance the enabling environment for exploration of oil and gas wells, resulting in an increased number of exploration wells drilled, while simultaneously maximising the value captured for South Africa.

Mechanisms for achieving this include:

(a) Providing an enabling policy and legislative environment;

(b) Promoting inclusive economic growth;

(c) Addressing the skills gaps; and

(d) Overcoming infrastructure challenges.

The third work stream focuses on the relatively underdeveloped area of aquaculture. The country’s aquaculture sector has an increasingly important contribution to make globally in food security. Despite its relatively small size, aquaculture has shown strong growth of 6.5% a year.

By generating jobs, especially in fish processing and marketing, employment in aquaculture can enhance the economic and social status of individuals in multiple coastal communities.

The aspirations of this work stream include enhancing growth in the sector through increasing the value contribution of all segments across the aquaculture value chain. The second important focus area is to create jobs and improve participation across the industry in supporting the transformation agenda.

“The objective of inclusive economic growth permeates all four work streams,” Zuma said.

The fourth and last works tream namely, marine protection services and governance, recognises that South Africa needs to continuously balance the economic opportunities which our ocean space affords while maintaining its environmental integrity.

The aspiration of this work stream is to develop an incremental and integrated approach to planning, monitoring and execution of ocean governance and enforcement in the next few years. This will be achieved by:

(a) Developing an institutional framework for the management of South Africa’s ocean space;

(b) The implementation of marine spatial planning of South Africa’s oceans;

(c) Improving the protection of South Africa’s oceans particularly around critically endangered ecosystems;

(d) Sustaining environmental integrity; and

(e) Addressing the skills gap.