Rethinking Economic Development Strategies

Economic Development Programme
Terms of Reference
To increase national economic growth and development by strengthening the
competitiveness of major South African cities through mutual support, learning and
cooperation on economic development.
To define economic development within the metropolitan, national, regional and global
To rethink economic development strategies for major cities.
To build capacity of municipal economic practitioners.
To promote public and private partnerships based economic development.
To promote inter-city co-operation.
To share relevant information and measure relevant economic indicators between cities,
other spheres of government and the private sector.
To share best practices.
To identify sources of funding for economic development projects and initiatives.
To monitor economic development in major cities.
To investigate the advantages related to global city regions;
To establish the function of economic development as the key integrating institutional
principle in each municipality;
To ensure that social cohesion and poverty reduction is part of the overall economic
development strategy.
Due to the global and national importance of major cities and the complexity related to city
agglomeration and dynamics, an integrated approach is required for this programme. This
necessitates the establishment of a robust economic development network consisting of the
major cities, which is able to effectively engage with other spheres of government and the
private sector. This network is to be developed on the basis of strong commitment, mutual
cooperation, sustained action and defined outcomes.
An economic development working group, consisting of representatives of all the major
cities which form part of the SA Cities Network, will be responsible for the activities
contained in this terms of reference.
The City of Johannesburg, in conjunction with the network-appointed Programme Coordinator, will act as convenor and secretariat of the working group.
Meetings of the working group will take place on a quarterly basis and will be rotated from
one city to the next according to a procedure determined by the members of the working
Understanding economic development within the metropolitan context
The first step of the programme is to come to an understanding of what exactly is meant by
economic development within the metropolitan context. This will entail issues such as:
(1) the difference between traditional definitions of local economic development and the
strategic interventions required in creating an environment geared towards
promoting investment efficiency, job creation and economic growth for a city as a
(2) the particular roles and responsibilities required of the players within major cities;
(3) the skills required within municipalities;
(4) institutional arrangements for effective economic development; and
(5) public-private partnership arrangements
(6) economic infrastructure investment; and
(7) global city regions.
Rethinking Economic Development Strategies
An audit of existing strategies, plans and policies of the major cities needs to be undertaken.
A study is to be commissioned which identifies from this audit, generic best practice
strategies and principles which can be replicated, localised best practice strategies which
may offer opportunities for adaptation and subsequent replication, and areas of weakness
which exist.
A study is to be commissioned which identifies or alternatively confirms comparative
advantages as well as disadvantages of the various cities. Extensive consultation with the
private sector needs to be a part of this process.
Based on all of the above, the requirements for each city in terms of strategy development
are to be identified. This will include options such as the revision or alternatively the
complete redesign of an existing city-wide economic strategy, and the revision or complete
redrafting of geographic and/or sector specific strategies.
Building Capacity
Capacity Audit: An audit of each of the major cities is to be undertaken to firstly establish
the status quo in respect of the issues identified as part of the first area of focus of this
terms of this document, i.e. understanding Economic Development in the Metropolitan
Context. Secondly the audit will identify areas of improvement in order to establish the
necessary conditions for all municipalities to act as effective agents for economic growth.
Training: A training course for city economic practitioners is to be developed including
relevant theoretical content, best practice and principles underlying effective economic
development within the city context, monitoring tools and indicators etc.
The training shall be provided to economic practitioners from the major cities. This can be
implemented on a country-wide once-off basis or alternatively within the different
geographic clusters, either once-off or staggered.
Following the training it is proposed that a project be identified by a multi-disciplinary team
and implemented as part of the practical component of the training course. Although the
project will be located in one of the cities and be managed on a day-to-day basis by the
particular city’s staff, quarterly project meetings will be held by the persons whom attended
the training course. These meetings will set the direction for the project for the ensuing
The final stage in the education programme is to undertake an assessment of the project by
a multi-disciplinary team to enable further learning from practice. This information will be
included in the course material and be disseminated to students.
Skills Transfer: An outcomes-based approach to the the implementation of mentoring and
shoulder-to-shoulder programmes should be developed to improve the quality of economic
development practice of municipalities. Mentors should be considered from both the private
and public sectors, as well as from the international arena.
Best Practice: All best practices which have been acquired via this initiative and research
aimed at accessing best practice from the international experience, are to be disseminated
to the cities by means of various methods. This will include workshops, posting of the
information on a network website and other forms of dissemination.
As part of the best practice programme certain projects and initiatives, which are currently
being implemented within the cities, are to be identified and documented for distribution.
Periodic site visits can also be arranged.
Inter-City Co-operation
This entails the identification of city-to-city linkages that provide opportunities for mutual
benefit to two or more cities. Workshops will be held and documentation developed with
respect to possible prospects, such as inter-city sector clusters, value chain linkages,
transportation and logistics possibilities. Examples of this include the automotive industry
cluster in Gauteng between Tshwane, Ekurhuleni and Johannesburg; and the linkages
between City Deep container terminal in Johannesburg and the Durban port.
The above phase will be followed by implementation in cities where such initiatives have
been agreed upon. Representatives of the relevant governmental departments at the
relevant spheres, as well as representatives from relevant private sector industries will drive
these initiatives.
Monitoring of the inter-city initiatives will remain a function of the Economic Development
Working Group.
Information Programme
One of the collective problems facing cities is the lack of reliable, accurate and appropriate
data and information to enable proper policy formulation, project implementation and
resource allocation.
An audit of existing data and information is required in the first instance. This audit needs
to determine the quality and appropriateness of city-based data and information within both
the public as well as private sectors.
Following on from the above the next step will be the identification of new data and
information required to meet the objectives set out earlier in this document.
A plan is to be devised that prioritises the acquisition of information for each city, including
the resources required to enable this. Joint private-public funding should be utilised in this
The information programme also needs to incorporate data and information that will be
required for this initiative.
A strong linkage with the Urban Indicators Programme will be maintained in order to coordinate information management.
There are various funding and incentive schemes available both nationally as well as
internationally. An assessment of these are to be made and documented for use by the
cities. A dedicated resource to assist cities make maximum use hereof is to be established.
An investigation into appropriate monitoring tools and performance indicators is to be
undertaken with a view to measure progress on a city, national, regional and global basis.
The emphasis will be on strategic monitoring tools, such as performance management and
return on investment.
A strong linkage with the Urban Indicators Programme is to be established and maintained
in order to create the appropriate synergies and to avoid any possible duplication of efforts.
In order to establish the extent of financial, human and technological resources required for
the metropolitan economic development programme, it is proposed that following the
approval of the terms of reference, a consultant be appointed to undertake a study in this
This information can then be utilised by the working group to make recommendations
regarding priorities, scheduling and other relevant matters to the SA Cities Network.
Revised on 20 June 2002