Waterberg District Municipality
CONTENTS
CONTENTS .............................................................................................................1
MARKETING AND INVESTMENT STRATEGY ............................................4
1. INTRODUCTION ...............................................................................................4
1.1 PURPOSE ..........................................................................................................4
1.2 BACKGROUND ..................................................................................................4
2. BACKGROUND TO MARKETING AND INVESTMENT STRATEGY ...5
3. DEFINITION OF THE WATERBERG DISTRICT MUNICIPALITY .......7
4. WATERBERG DISTRICT MUNICIPAL PROFILE ....................................8
4.1 POPULATION SIZE ............................................................................................8
4.2 EMPLOYMENT STATUS...................................................................................10
4.3 INCOME STATUS .............................................................................................11
4.4 AGE GROUPS ..................................................................................................12
4.5 EDUCATION LEVELS ......................................................................................13
5. ECONOMIC PROFILE OF WATERBERG DISTRICT MUNICIPALITY
.................................................................................................................................15
6. INVESTMENT OPPORTUNITIES IN WATERBERG DISTRICT
MUNICIPALITY ..................................................................................................18
6.1 INVESTMENT OPPORTUNITIES IN TOURISM ...................................................18
6.2 INVESTMENT OPPORTUNITIES IN AGRICULTURE ............................................19
6.3 INVESTMENT OPPORTUNITIES IN MINING ......................................................20
7. THE POLICY AND LEGISLATIVE MANDATE .......................................21
7.1 LINKAGES WITH NATIONAL INITIATIVES .......................................................22
7.2 LINKAGES WITH PROVINCIAL INITIATIVES .....................................................24
7.3 FOCAL AREA STRATEGIES FOR MARKETING AND INVESTMENT AT WATERBERG
DISTRICT MUNICIPALITY .....................................................................................24
7.3.1 Rural Development Strategy ..................................................................24
7.3.2 Agricultural Strategy..............................................................................25
7.3.3 Transportation Strategy .........................................................................25
7.3.4 Poverty Reduction Strategy ....................................................................26
7.3.5 Cooperative Development Strategy .......................................................26
7.3.6 Sport, Art and Culture ............................................................................27
7.3.7 Economic Infrastructure Strategy ..........................................................28
7.3.8 Small, Medium and Micro Enterprise (SMME) Strategy ......................28
8. MARKET GROWTH ANALYSIS .................................................................29
All Rights Reserved
Page 1
Marketing and Investment Strategy
8.1 WATERBERG MARKET TRENDS .....................................................................29
8.2 MARKET GROWTH PROJECTIONS AND INDICATORS .......................................32
8.2.1 Capital Formation..................................................................................32
8.2.2 Economic Growth ..................................................................................33
8.2.3 Job Creation ...........................................................................................34
9. MARKETING AND INVESTMENT PRODUCT PORTFOLIO................34
9.1 PRODUCT PORTFOLIO IN AGRICULTURAL SECTOR ........................................35
9.2 PRODUCT PORTFOLIO IN MINING SECTOR ..................................................38
9.3 PRODUCT PORTFOLIO IN TOURISM SECTOR ..................................................41
10. PUBLIC-PRIVATE PARTNERSHIPS: THE VALUE CHAIN AND
CLUSTER CHAINS OF STRATEGIC SECTORS ..........................................44
10.1 THE CLASSICAL APPROACH.........................................................................45
10.2 CREATING VALUE .........................................................................................47
10.3. VALUE CHAIN CLUSTERS IN WATERBERG STRATEGIC SECTORS ..................49
11. ADOPTING APPROPRIATE CORPORATE STRATEGIES FOR
BLACK ECONOMIC EMPOWERMENT ........................................................55
11.1 LEGAL BASIS FOR PUBLIC-PRIVATE PARTNERSHIP, BLACK ECONOMIC
EMPOWERMENT AND SMALL MICRO-MEDIUM ENTERPRISES POLICY ................55
11.2 THE BEE AND THE ENTERPRISE OWNERSHIP ..............................................55
11.3 THE PPP CODE OF GOOD PRACTICE ............................................................57
11.4 PRINCIPLES FOR SUCCESSFUL PPP AND BEE VENTURES ...........................57
11.4.1 The PPP Feasibility Study ...................................................................58
11.4.2 The Scorecard Measures......................................................................59
11.4.3 Applying the BEE principles in PPP Mining Sector ............................60
11.4.4 Applying the BEE principles in PPP tourism Sector ...........................61
11.4.5 Applying the BEE principles in PPP Agricultural Sector ...................63
11.5 VERTICAL AND HORIZONTAL STRATEGIES..................................................64
11.5.1 Backward Vertical Integration ............................................................64
11.5.2 Forward Vertical Integration ..............................................................64
11.5.3 Horizontal Integration .........................................................................64
11.5.4 Vertical and Horizontal Strategic Integration .....................................65
12. OVERALL STRATEGY TO MARKET THE WATERBERG DISTRICT
MUNICIPALITY ..................................................................................................67
12.1 STRATEGIC FOCAL AREAS ............................................................................69
12.1.1 Strategic Focus 1: Encouraging Local Business Growth and
Retention .........................................................................................................69
12.1.2 Strategic Focus 2: Improving the Local Business Investment Climate
.........................................................................................................................70
12.1.3 Strategic Focus 3: Promoting Inward Investment ...............................71
12.1.4 Strategic Focus 4: Investment in Hard Strategic Infrastructure .........72
Page 2
All Rights Reserved
Waterberg District Municipality
12.1.5 Strategic Focus 5: Integrating Low Income or Hard-to-Employ
Workers ...........................................................................................................73
12.2 INTERVENTION STRATEGIES AND MARKETING ACTION PLAN: ...................74
12.2.1 Developing Business Retention and Expansion Programmes .............74
12.2.2 Corporate Liaison and Meeting With Investors ..................................74
12.2.3 Strategic Alliances ...............................................................................74
12.2.4 Investment Facilitation ........................................................................74
12.2.5 Free Trade Agreement Platform ..........................................................75
12.2.6 Establishment of Backward and Forward Vertical Business Unit ......75
12.2.7 Exposing the Waterberg BEE and SMMEs To Investment Trade and
Export Opportunities.......................................................................................75
12.2.8 Industrial Recruitment .........................................................................75
12.3 BRANDING AND POSITIONING .....................................................................76
12.3.1 Advertising in mass media ...................................................................76
12.3.2 Participating in investment exhibitions ...............................................76
12.3.3 Advertising in sector and industry media ............................................76
12.3.4 Conducting investment seminars .........................................................76
12.3.5 Utilising Waterberg District Municipality Website .............................77
12.3.6 Image Reputation .................................................................................77
12.3.7 Uniqueness Reputation Management ..................................................77
12.3.8 Management Informal Modes of Communication ...............................77
12.3.9 Dispelling Pessimistic Perceptions ......................................................78
12.3.10 Creation of Investor Friendly Climate ...............................................78
12.3.11 Follow-up Processes ..........................................................................78
12.4 OUTWARD AND INWARD MISSIONS ..............................................................78
12.4.1 Inward Missions ...................................................................................78
12.4.2 Outward Missions ................................................................................79
12.5 USING THE PRINCIPAL MEDIA TO MARKET WATERBERG ...........................80
12.6 ESTABLISHING AN INFORMATION SYSTEM ..................................................83
12.7 IMPLEMENTING THE STRATEGY ...................................................................86
12.8 THE ACTION PLAN .......................................................................................88
12.6 MONITORING AND EVALUATION PLAN........................................................88
12.13 FUNDING THE MARKETING AND INVESTMENT STRATEGY ........................89
13. SUMMARY AND OVERALL RECOMMENDATION FOR
IMPLEMENTATION ..........................................................................................92
REFERENCES ......................................................................................................94
All Rights Reserved
Page 3
Marketing and Investment Strategy
MARKETING AND INVESTMENT STRATEGY
1. INTRODUCTION
1.1 PURPOSE
The purpose of the Waterberg Marketing and Investment Strategy is to provide a tool that
promotes the District as a preferred investment and trade location in South Africa through
marketing the competitive advantages of opportunities in the area.
Waterberg seeks to offer international investors a wide-ranging service to support and
facilitate investment in the District and growth into Limpopo Province, South Africa and
other respective international markets. It also seeks to be a leading business development
network for the District businesses seeking to expand current operations into other parts of
the world.
The overall aim of the strategy is to promote local initiatives that contribute towards poverty
reduction and unemployment in the District, as much as attracting both national and
international investors in order to ensure that local human capital and resources are
effectively integrated.
1.2 BACKGROUND
Marketing and Investment Strategy is an integral part of the broader initiative of Waterberg
District Municipality to identify potential investment opportunities within the District in order
to improve the quality of life and the standards of living of its communities.
This is in consistent with the expectations set out in the White Paper on Local Government,
which prescribes that municipalities are responsible for “reviewing existing policies and
procedures to enhance employment and investment” and that:
...Municipalities need to develop a coherent infrastructure investment plan, which sets
out how they will achieve infrastructure targets, and mobilise public and private funding
sources for capital and recurrent expenditure.1
It is on the basis of this background that Waterberg District Municipality finds it necessary to
formulate a strategy that provide overall guidelines with regard to the general marketing of
the District’s opportunities and initiatives to attract potential investors in the area.
The major challenge for the Waterberg District Municipality is to generate opportunities,
which will create jobs and reduce the high levels of poverty and unemployment experienced
Page 4
All Rights Reserved
Waterberg District Municipality
by the majority of the people, especially those residing in rural areas. By using a Marketing
and Investment Strategy, the Waterberg District Municipality could identify investment
opportunities that can be marketed locally, nationally, and internationally as need arise.
The present strategy sets out the following:

First, it provides a broad definition of Waterberg District Municipality in terms of its
strategic location within the Limpopo Province and its significance in terms of
proximity to neighbouring countries such as Botswana, Zimbabwe and Mozambique;

The Waterberg District Municipality Profile, which includes the population,
employment status, income, age groups and education levels;

The economic profile of Waterberg as well as the existing opportunities in terms of
investing in agriculture, mining and tourism;

The Policy and Legislative Framework guiding the marketing and investment
strategies;

The Marketing Growth Analysis, its trends and projections of potential growth in
Waterberg area;

The Product Portfolio in the different strategic economic sectors of Waterberg;

The Value Chain Cluster of Waterberg Strategic sectors;

Adoption of corporate strategies such as vertical and horizontal integration to
advance the cause of BEE companies, PPP and SMME initiatives;

The overall Strategy for Marketing and Investment of Waterberg as a region; and

Essential guidelines of branding and positioning Waterberg as a preferred region for
investment.
2. BACKGROUND TO MARKETING AND INVESTMENT STRATEGY
Traditionally, municipalities in South Africa have always played a role in local investment.
Municipalities employ people from the local area, purchase goods and services, develop
infrastructure and regulate the use of land. All of these activities impact on the local
economy.
In addition to these ‘traditional’ roles of service provision and regulation, the Constitution
defines one of the objects of local government as the “promotion of social and economic
development.”
The White Paper introduces the concept of “developmental local government”, which is
defined as: 2
All Rights Reserved
Page 5
Marketing and Investment Strategy
Local government committed to working with citizens and groups within the community
to find sustainable ways to meet their social, economic and material needs, and
improve the quality of their lives.3
The advent of the post-apartheid government, the Reconstruction and Development
Programme (RDP), the New Constitution Act 108 of 1996, and new local government policy
framework and legislation have promulgated that municipalities should promote economic
development of communities, thus pushing local government structures beyond the narrow
role of service provision.
In view of the above, the Constitution of South Africa regards a developmental local
government as a municipality that is able to govern, which is equipped with the financial
and administrative capacity to:

Provide democratic and accountable government for local communities;

Ensure the provision of services to communities in a sustainable manner;

Promote social and economic development;

Promote a safe and healthy environment; and

Encourage the involvement of community in the affairs of local government.
The Municipal Structures Act of 1995 delineates the structures governing the municipalities,
which are bestowed with the authority to initiate developmental activities. 4
The Municipal Systems Act of 2000 entrusts local government with developing its
communities including the formulation of Integrated Development Plans (IDPs).5
Given this context, it has become clear that only a strong, synergetic partnership among
spheres of government, public and private institutions, donors and civil society
organizations, and respective local and international investors can bring about a desired
economic development within the Waterberg District Municipality. The District seeks to
provide communities with access to key resources needed to take control of their own
economic destinies through identification and packaging of local investment opportunities,.
Notwithstanding the above background, there is a need to put the Waterberg District
Municipality under context. In order to clearly ascertain the investment opportunities in
Waterberg District Municipality, it is best to begin at the beginning, and review the profile of
the area.
Page 6
All Rights Reserved
Waterberg District Municipality
3. DEFINITION OF THE WATERBERG DISTRICT MUNICIPALITY
In order to clarify reference to the area in the strategy, it is critical to provide a clear
definition of the Waterberg District Municipality. Waterberg District Municipality is located on
the western part in the Limpopo Province. It is a “Bushveld Region”, which is predominantly
rural in nature. The Limpopo Province shares borders with three countries: Botswana,
Mozambique and Zimbabwe, which makes it a very strategic contact between those countries
and South Africa.
In turn, Waterberg District Municipality shares its borders with Capricorn District
Municipality in the north and Sekhukhune in the east. In the southwestern and
southeastern are boundaries with the North West and Gauteng Provinces respectively.
The main entry roads to the Districts are N1 (national road) and 101 from Gauteng, N11
from Sekhukhune and R159 and R133 from the North-West. It is linked to Gauteng by one
of the best stretches of the N1 in South Africa.
Waterberg District Municipality is approximately 4 951 882 hectares and is composed of six
local municipalities namely:

Bela-Bela Local Municipality;

Lephalale Local Municipality;

Modimolle Local Municipality;

Mogalakena Local Municipality;

Mookgophong Local Municipality; and

Thabazimbi Local Municipality.
These municipalities are quite different in terms of their level of socio-economic
development and active economic sectors. Nevertheless, the Waterberg has the first
largest economy in the Limpopo Province, followed by the Capricorn District Municipality.
Given the above background, all references to “Waterberg District Municipality” in this
report imply the area defined above. All demographic information provided hereunder in the
report, unless otherwise stated, refers to the entire Waterberg District Municipality, not
limited to the local municipalities.
However, in order to assess the extent of economic development needs and investment
targeting within Waterberg, the section below reviews the municipal profile such as
population size, age structure, education levels, employment and unemployment rate,
income per household, and economic profile of the area.
All Rights Reserved
Page 7
Marketing and Investment Strategy
4. WATERBERG DISTRICT MUNICIPAL PROFILE
The challenges facing the Waterberg District Municipality as a “developmental local
government” are great. As part of the process, municipal profile providing for both spatial
and attribute information is crucial. It is hoped that the information supplied hereunder will
be of use to the Waterberg District Municipality as they attract both local and international
investors, implement the Marketing and Investment Strategy, to government and potential
investors as they promote the District and to those requiring information on the Waterberg
municipal system.
4.1 POPULATION SIZE
According to the Statistics South Africa, the total population of the Waterberg District
Municipality amounts to 614 155 persons (2001). The average Waterberg household is
home to 4,1 persons. Some households are home to more than ten persons. This varies
considerably by season due to migrancy. However, it should be noted that these figures are
only approximate. It is possible that the actual Waterberg population is above 614 155 due
to a large number of people also live on farms throughout the area. In fact since the Census
in 2001, the population has changed significantly. The Waterberg’s population changes with
the seasons, since many residents migrate to work elsewhere, especially in other provinces
such as Gauteng.
Compared to other Districts, the population density of Waterberg is significantly low, as
indicated in both Chart 1 and Table 1 below.
Chart 1: Limpopo Population and Density per District
Data Source: Statistics South Africa – July 2003
Page 8
All Rights Reserved
Waterberg District Municipality
The annual population growth is estimated at 2,3%, which represents the average
provincial population growth rate. This is slightly higher than the national average of 1,9%.
It is possible that the Waterberg area will be home to over one million people by the year
2015.
Table 1: Limpopo Population Density per District
District
Population
Density
Sekhukhune
Bohlabela
Mopani
Vhembe
Capricorn
Waterberg
Limpopo
745472
595202
964237
1199883
1154692
615155
5274641
6
5
8
10
9
5
7
Chart 2 and Table 2 represents population density and household average per local
municipality.
Chart 2: Population Size Per Local Municipality
Data Source: Statistics South Africa: Census 2001
Thabazimbi
63883
Mookgophong
30748
Mogalakwena
298439
Modimolle
72797
Lephalale
96074
52122
Bela-Bela
0
50000
100000
150000
200000
250000
300000
350000
It is apparent from the above chart that more than 43% of the district population lives in
Mogalakwena. The above scenario signifies that apart from outward migration, Waterberg
has been also experiencing a significant proportion of inward migration between local
municipalities, especially local towns perceived to have better economic opportunities.
All Rights Reserved
Page 9
Marketing and Investment Strategy
Table 2: Population Figures per Local Municipalities
LOCAL MUNICIPALITY
Bela-Bela
Lephalale
Modimolle
Mogalakwena
Mookgophong
Thabazimbi
Total
ESTIMATED
POPULATION
52122
96074
72797
298419
30748
63883
614041
NUMBER OF
HOUSEHOLD
12279
23401
17536
68010
6977
20280
148483
AVERAGE HOUSEHOLD
SIZE
4.2
4.1
4.2
4.2
4.4
3.2
4.1
% OF DISTRICT
MUNICIPALITY
8.49
15.64
11.85
48.58
5.05
10.40
100
Compared to previous statistics, there has been a decrease of almost 2%. Bela-Bela Local
municipality seems to be where such a decrease occurs. Some observations point to the
fact that decrease in population may be attributed to the fact that many people emigrate to
other urban centres such as Polokwane, Pretoria and Johannesburg in search for jobs.
While some of the emigrating persons do come back to support their families, most of them
emigrate permanently. This trend demonstrates how much local people invest in other cities
through expenditure they incur on travelling and subsistence, while residing in those cities.
This poses a challenge for the Waterberg District Municipality to generate means of minimising
the emigration trend through economic development strategies that promote growth and
investment.
4.2 EMPLOYMENT STATUS
The segmentation of employment status in Chart 4 suggests that over 140 000 people in
Waterberg are employed and over 62 000 are unemployed. This relatively good figure of
the employment status should be analysed with caution considering that there is no clear
definition of the 165 000 people who are not economically active and over 245 000 nonapplicable responses. Through previous household surveys and other studies conducted
by Waterberg, unemployment rate appeared to be a major challenge.
Chart 3: WDM Employment Status
Data Source: Statistics South Africa: Census 2001
Not economically active
165485
Unemployed
62624
Employed
140378
245670
Not applicable
0
50000
100000
150000
200000
250000
300000
Page 10
All Rights Reserved
Waterberg District Municipality
As clearly reflected in Table 3 below, high rate of unemployment is concentrated in the
Mogalakwena area, which represent a critical challenge for the District, together with the
local municipality, to ensure significant investment that stimulate economic growth and
generate employment.
Table 3: Employment Status Per Local Municipality
Status
Thabazimbi
Lephalale
Mookgophong
BelaBela
19712
14372
6965
11076
Mokgalakwena
Total
10731
11196
2649
6183
Modimoll
e
26723
22799
6992
16295
NA
Employed
Unemployed
Not Economically
Active
Total
18009
26249
7045
12618
37116
28672
5274
25040
133379
37090
33699
94272
245670
140378
62624
165484
63921
96102
30759
72809
52125
298440
614156
4.3 INCOME STATUS
According to the Census results released in 2003, an average annual individual income of
Waterberg is considerably very low. Chart 4 below clearly reflects the extent of poverty in
the Waterberg area in terms of an overall annual individual income profile.
Chart 4: WDM Income Category per Individual
Data Source: Statistics South Africa: Census 2001
All Rights Reserved
Page 11
Marketing and Investment Strategy
Table 4 below reflects the income category per individual according to local municipalities
within the Waterberg District Municipality.
Table 4: Income Status in Local Municipalities Per Individual
INCOME
No income
R1 – R400
R401 – R800
R801 – R1600
R1601 – R3200
R3201 – R6400
R6401 – R12800
R12801 – R25600
R25601 – R51200
R51201 – R102400
R102401 – R204800
R204801 – or more
Total
Thabazimbi
Lephalale
Mookgophong
34996
6456
6020
4507
6488
3287
1513
400
133
51
53
17
63921
59234
16307
10192
2659
3160
2695
1236
328
145
75
48
23
96102
16714
4526
4374
2198
1471
916
359
98
39
34
19
11
30759
Modimolle
43882
9036
9978
3585
2896
2111
954
204
72
63
24
4
72809
BelaBela
32989
3566
7326
3467
2331
1523
582
172
86
48
29
4
52123
Mokgalakwena
227157
14105
33725
8242
7016
5375
1946
506
174
88
86
18
298438
Total
414972
53996
71615
24658
23362
15907
6590
1708
649
359
259
77
614152
Over 414 000 people of Waterberg have no income. Just slightly above 199 000 have
income. This means that only 32% of people are employed. These figures suggest that
while 140 000 people are employed, but about 199 000 have income, then 59 000 get their
income from other sources than formal employment. This scenario reveals that local
people are also generating income from other economic opportunities that exist in the
Waterberg area.
4.4 AGE GROUPS
The chart below - indicates that over 44% of Waterberg’s population is under 19 years old.
Coupled with this figure is a high number of elderly residents in the area, as reflected
hereunder. This implies that many people in Waterberg are dependent on the income of
others.
Chart 5: WDM Age Group
Data Source: Statistics South Africa: Census 2001
Page 12
All Rights Reserved
Waterberg District Municipality
Table 5 below reflects the dependency ratio (age) according to local municipalities within
the Waterberg District Municipality.
Table 5: WDM Age Groups per Local Municipalities
Age
Group
0-4
5-9
10-14
15-19
20-24
25-29
30-34
35-39
40-44
45-49
50-54
55-59
60-64
65-69
70-74
75-79
80-84
84+
Total
Thabazimbi
6727
5243
4638
4800
5805
6738
6485
6600
5882
4040
2650
1659
1116
633
425
237
133
110
63921
Lephalale
10837
11158
11319
10729
9513
8497
6965
6503
5073
4165
3098
2060
2013
1499
1143
631
535
365
96103
Local Municipalities
Mookgophong Modimolle
3288
8027
2771
7434
2843
7530
2974
7728
2673
7015
2998
7207
2595
5869
2210
4915
1733
3740
1436
3383
1250
2312
969
1849
1017
1780
726
1308
594
1183
337
737
193
535
152
258
30759
72810
Bela-Bela
5437
5652
5816
5407
4440
4679
4000
3550
3021
2354
1767
1514
1396
1070
908
546
370
198
52125
Mogalakwena
32036
41104
42488
40173
25439
19931
15140
14796
12529
11019
9199
6898
8194
6079
5786
2973
2788
1803
298375
Total
66352
73362
74634
71810
54887
50050
41054
38574
31978
26397
20276
14949
15516
11315
10039
5461
4554
2886
614093
4.5 EDUCATION LEVELS
Education is a major challenge in the Waterberg jurisdiction. According to Table 6 and
Chart 6, over 111 000 of people are illiterate or have no formal education. Only over 51 000
have completed Grade 12, which means that only 8.3 have completed matric. This poses a
challenge regarding the skilled labour development. Similarly, the number of senior degree
graduate is very low. Senior degree graduates are critical since they contribute towards the
strategic human resource development. In order for Waterberg to attract potential
investments, a skilled labour force forms an integral part of the marketing and investment
strategy.
All Rights Reserved
Page 13
Marketing and Investment Strategy
Chart 6: WDM Education Levels
Data Source: Statistics South Africa: Census 2001
120000
100000
80000
60000
40000
20000
0
D
ith
Ph
gw
or
De
MA
r's
elo
2
ch
d1
Ba
12
hG
D
wit
nG
ha
Dip
st
les
0
Dip
d1
/S t
12
Gd
d8
/S t
10
6
Gd
d
t
8/S
4
Gd
d
t
6/S
2
Gd
d
t
4/S
B
Gd
b
u
1/S
ng
oli
ho
Sc
Gd
No
Dip
The following table has been compiled from the recent Census 2001 results, released in
July 2003. It reflects very low levels of senior education qualifications and high levels of
illiteracy. The labour market is demanding increasingly higher levels of education, which
implies that many unemployed persons are unlikely to qualify for recruitment even if jobs
can be created.
Table 6: Waterberg District Municipality Levels of Education Per Local Municipalities
Level of Education
No Schooling
Grade 1/sub A
Grade 1/sub B
Grade 3/STd 1
Grade 4/Srd 2
Grade 5/Std 3
Grade 6/Std 4
Grade 7/Std 5
Grade 8/Std 6
Grade 9/Std 7
Grade 10/Std 8
Grade 11/Std 9
Grade 12/Srd 10
Cert less than G.12
Dip less than Grade 12
Cert with Grade 12
Dip with Grade 12
Bachelor’s Degree
Bach. Degree & Dip
Local Municipalities
Thabazi
Lephalal
mbi
e
10244
17844
1916
5722
1623
4082
2748
4907
3299
5379
3634
5167
3739
5380
4877
6674
4600
5654
3890
4620
4811
5388
2575
3813
7228
7249
97
176
63
148
432
682
904
1436
227
431
165
293
Mookgophong
Modimolle
6193
1427
1129
1490
1511
1468
1555
1917
1869
1430
2047
1300
2971
74
48
230
434
162
130
13268
3955
2939
3879
3981
3910
4035
5024
4474
3130
4492
2502
6343
58
78
344
1423
371
284
BelaBela
7141
2993
2305
2713
3006
2934
3141
3539
3488
2433
3166
2076
5213
90
66
597
1117
293
179
Mokgalkwena
Total
57034
20143
11514
14802
15469
14310
14950
18377
17974
15075
17017
16997
22299
372
365
2010
5172
1252
694
111724
36156
23592
30539
32645
31423
32800
40408
38059
30578
36921
29263
51303
867
768
4295
10486
2736
1745
Page 14
All Rights Reserved
Waterberg District Municipality
Honours Degree
Master’s or Doctorate
NA
Total
53
70
6727
63922
119
104
10837
96105
37
52
3288
30762
116
175
8027
72808
73
122
5437
52122
364
214
32036
298440
762
737
66352
614159
5. ECONOMIC PROFILE OF WATERBERG DISTRICT
MUNICIPALITY
The magnificence of the Waterberg District Municipality is self-expressed in its cultural
diversity, history and natural environment, and is endowed with a range of habitats, tourist
attractions and wildlife. Its economic profile is characterised by its six local municipalities
and it revolves around agriculture, commerce, manufacturing, mining and quarries,
residential development, smallholdings, water-bodies, etc. Despite high levels of
unemployment, Waterberg District Municipality is among the highest contributors to the provincial
economy and has a relatively good infrastructure.
However, many people and households in Waterberg District Municipality earn a living from
the informal sector, spaza shops, hawking, and street vending. Many households would
plan their informal merchandising opportunities around specific events such as old-age
pension pay days, holiday seasons, Christmas and new period as travellers and tourist
abound in the region.
Economic indicators state that the Waterberg District Municipality has the largest economy
compared to other District Municipalities in Limpopo. It contributes over 26% of the total
production in Limpopo and the mining sector is the largest contributor as presented in Table
7 and Chart 7 respectively.
All Rights Reserved
Page 15
Marketing and Investment Strategy
Chart 7: WDM Employment Status by Economic Sector
Source: Statistics South Africa: Census 2001
100000
33793
13078
10000
8352
6996
21132
16757
3324
20962
5314
1231
1000
100
10
M
an
uf
ac
tu
El
ri n
ec
g
tri
ci
ty
&
W
at
er
C
on
st
ru
W
ct
ho
io
n
le
sa
Tr
an
le
&
sp
Tr
or
ad
t&
e
co
m
m
ui
Fi
ca
na
tio
nc
n
e
C
&
om
Bu
m
si
un
ne
ity
ss
So
ci
al
Se
Pr
rv
iv
ic
at
e
e
H
ou
se
ho
ld
s
U
nd
et
er
m
in
ed
M
in
in
g
Ag
ri c
ul
tu
re
an
d
Fo
re
st
ry
1
Table 7 below reflects the economic contribution made by different sectors in different local
municipalities under the Waterberg District Municipality.
Table 7: Economic Profile: Employment by Sector Per Local Municipalities
Sectors
Agriculture,
hunting, fishing &
Forestry
Mining &
quarrying
Manufacturing
Electricity, gas &
water
Construction
Wholesale & retail
trade
Transp. Storage
& Communication
Financial, &
business services
Community,
social & services
Private
households
Undetermined
Total
BelaBela
3348
Lephalale
Modimolle
Mokgalakwena
Mookgophong
Thabazimbi
Total
9488
7177
3735
4358
5687
33793
51
1726
93
1597
79
9532
13078
542
81
1178
739
1609
113
3021
202
668
18
1334
78
8352
1231
819
2655
1015
2365
1535
2689
2105
6148
470
1411
1052
1489
6996
16757
381
611
400
1302
267
363
3324
642
906
719
2106
325
616
5314
2714
3249
3766
8399
1222
1782
21132
1938
5710
3548
5192
1573
3001
20962
1201
14373
1676
28663
1141
22790
3282
37089
770
11188
1305
26239
9375
140342
Page 16
All Rights Reserved
9375
Waterberg District Municipality
Chart 8 below summarises the contribution of various sectors, which constitute the District
economy of the Waterberg area.
Chart 8: Average Growth Rate of Sector Contribution to WDM Economy, 1995-2000
Data Source: Statistics South Africa – July 2003
100
25.9
13.9
10
14.5
11.5
7.7
14.3
7.2
3.6
an
uf
ac
tu
rin
El
g
ec
tri
ci
ty
&
W
at
er
C
on
st
ru
ct
io
Tr
n
ad
e
Tr
&
an
C
sp
at
or
er
t&
in
g
C
om
Fi
m
na
un
nc
ic
e
at
&
io
Bu
n
si
ne
ss
Se
C
rv
om
ic
e
m
un
ity
Se
rv
ic
es
M
0.1
0.21
M
Ag
ric
ul
tu
re
an
d
Fo
re
st
ry
in
in
g
1
The information in Table 8 forms part of the Limpopo Provincial Growth and Development
Information Database (2001) and it shows the trends of gross geographic product from
1995-2000. This close analysis of trends from 1995 to 2000 is critical so as to see changes
and the average growth of each sector.
Table 8: Average Growth Rate of Sector Contribution to WDM Economy, 1995-2000
Economic Sectors
Agriculture& Forestry
Mining
Manufacturing
Electricity & Water
Construction
Trade & Catering
Transport & Communication
Finance & Business Service
Community Services
Total
1995
342394
2035090
122973
1086409
18364
513904
142320
476617
771785
5509856
1996
365685
2299016
147289
1178710
21363
565311
252782
513878
795514
6139548
YEARS
1997
1998
392390
378937
2457691 3010003
156534
171187
1283476 1357812
22797
21389
666172
818224
270842
351979
554965
591459
848641
1144146
6653508 7845136
1999
370207
3457856
181522
1483432
20832
910748
409968
628280
1236281
8698696
2000
408141
3904606
211855
1577327
18554
1009756
450968
674851
1325377
9581435
Average
Growth (%)
3.6
13.9
11.5
7.7
0.21
14.5
25.9
7.2
14.3
-
The trends in Table 8 show that Transport and Communication, have the highest growth
rate of 14.3%, followed by Trade and Catering (14.5%), Community Services (14.3)%) and
the Mining sector (13.9%), etc.
All Rights Reserved
Page 17
Marketing and Investment Strategy
The apparent low growth rate in water and electricity and construction industry suggest that
the Waterberg District Municipality has not had significant infrastructure development and
may account for some part of unemployment or lack of job creation. In this regard,
infrastructure development is one of the areas needing substantial investment.
6. INVESTMENT OPPORTUNITIES IN WATERBERG DISTRICT
MUNICIPALITY
Waterberg is a region that covers extensive tracks of savannah bushes and mountains. It
is a region that has attracted attention of many archaeological and palaeolontogical
scholars since its establishment, due to its remains of early human origins. Until recently,
the region has been estimated to be 3 million years old. It’s unique complex rocks,
however, are acclaimed to be more than 600 millions years.
Waterberg District Municipality is one of the most mineralised regions in South Africa as it
forms a unique complex of rocks dating back to more than 600 millions years. Minerals
found in this region include chrome, platinum, nickel iron, tin, tungsten and many other
metals that saw it flourishing in mining industry.
Waterberg District Municipality’s fertile soil has placed it to a high level of competitiveness
in terms of agricultural and farming products. While it is a region still plagued with high
levels of poverty and unemployment, Waterberg has substantial potential to attract
investors in the areas of Agriculture, Mining and Tourism.
6.1 INVESTMENT OPPORTUNITIES IN TOURISM
The region is so richly endowed with natural assets and is malaria-free – only two hours
drive from Gauteng Province in South Africa, the principal source of domestic tourism and
main dispersal point for foreign tourists. It is this competitive advantage that the Waterberg
District Municipality intends to exploit. It has been placed on the world tourism map and a
414 000 hectares were declared by the United Nations a Biosphere Reserve. Moreover,
Waterberg is also home to Nylsvley, an international recognised wetland, which has been
accorded a RAMSAR status.
In view of the above, it is apparent that investment opportunities in tourism sectors in
Waterberg abound. The atmosphere of tranquillity makes Waterberg an ideal NumberOne-Stop for tourist re-energizing. It is no doubt that tourism would contribute towards
employment generation, foreign exchange revenue, thus very optimistic in terms of poverty
reduction.
Page 18
All Rights Reserved
Waterberg District Municipality
Already in place, attractions include game farms and Nature Reserves. Similarly, hotels,
guesthouses and caravan parks are niche areas to be considered as investment potentials.
Archaeologists would also find the place interesting since the region has been declared a
national heritage because of its status of being the cradle of mankind.
The Waterberg District Municipality is playing a significant role in developing tourism by
upgrading roads leading to Marakele National Park and other game farms, and by
contributing funds to local tourism associations, enabling them to more effectively market
the region.
Therefore, taking into account the region’s capacity to attract more tourists, a monetary
injection in the sector would see the region flourish and will positively impact on the quality
of life of the Waterberg communities. The Investment opportunities offered by the tourism
market are unlimited in the Waterberg area. The Waterberg region offers what can be
defined as “tranquil haven” for tourists.
6.2 INVESTMENT OPPORTUNITIES IN AGRICULTURE
Agriculture is an economic sector on which many people rely to earn a living. It is one of
the sector that extensively contributes to the District’s gross domestic product (GDP).
Major crops include cotton, sunflower, tobacco, soya beans, etc. Other potential areas for
investment include Marula processing, aquaculture, livestock improvement schemes, game
farming and production of paprika, peach, grape and herbs for Traditional African Medicine.
Waterberg is renown for its fertile land, which produces citrus and sub-tropical fruit.
Waterberg is the major contributor towards the Limpopo’s 70% of South Africa’s avocados
and of tomatoes, 75% of mangoes and macadamia nuts, 65% of papayas; and 25% of
citrus.
Well known for its production and processing of cotton and sunflowers, the region is
experiencing growth in its tobacco industry, with farmers expanding operations to take up
demand in the wake of the near collapse of the Zimbabwean crop. The agricultural sector is
set to expand with plans to establish export-driven, R500 million soya food processing plant
in the area. The available technology will remove the intrusive “beany” taste from soya, a
protein-and fibre-rich food increasingly being consumed as an alternative to meat.
Such a bulky production has led to a range of processed products such as fruit juice,
concentrates, soya bean products, and so on. In addition, the District envisages the
development of several types of farming such as sugar, oils, catfish and goats, among
many.
The Waterberg District Municipality is supporting agricultural growth by developing a policy
for the sub-division of agricultural land, setting up a task team to assist the Land Claims
All Rights Reserved
Page 19
Marketing and Investment Strategy
Commission, and entering into negotiations to acquire State land for sustainable
development.
Pre-feasibility studies in the Limpopo Province indicate Waterberg is one of the areas
where almond, cassava and bamboo production can flourish. Soil and climatic conditions
in large parts of the province are well suited to these commodities and ready markets for
almost any level of production can be found in the District, Province, in the country and in
sub-Saharan Africa.
Cassava and bamboo are suitable for the production of staple foods and animal fodder.
The first commercial cassava starch plantation was established in the province in January
1999. Production yields are significantly higher than in other areas such as the Far East
and South America.
Bamboo can also be used for building materials, which are appropriate for sub-tropical and
tropical climates. Several large irrigation facilities are also under-utilised and could form the
basis for mutually rewarding public-private partnerships. Pre-feasibility studies that have
been conducted on these projects indicate sound viability for sub-tropical fruit and citrus
production.
Waterberg is rich in traditional African medicines. Herbs that have treated diverse diseases
in Africa continue to survive in Waterberg. Potential investors would be those interested in
developing sustainable projects that will bring traditional African medicine to the main
stream of economy.
There are also a number of ongoing and potential projects such as Ostrich Farming; Cotton
Production; Cut Flower Production; Herb Production; Table Grape Production and Tobacco
Production. Among other projects, it is an ambitious initiative to produce one million goats a
year to supply meat to the Middle East market. The initiative will also produce goat’s milk,
cheese, offal, and hides for processing into leather for manufacturing of crafted products
such as wallets, folders, key holders, shoes, handbags, etc.
6.3 INVESTMENT OPPORTUNITIES IN MINING
Mining can be regarded as the most important economic sector of Waterberg District
Municipality. The Waterberg District mining sector has been operational for many years.
Aside from the Thabazimbi iron and ore mines, the region produces vast qualities of
platinum at Mokopane and Northam areas. Its coalfield at Lephalale, formerly Ellisras, fuels
a giant Eskom power station, but its remaining reserves of the black gold are largely
untapped.
Its mining resources include the following:
Page 20
All Rights Reserved
Waterberg District Municipality

Precious metals: Gold, Diamonds (Kimberlite), and Platinum; and

Ferrous and base metals: Copper, Tin, Manganese, Colbat, Iron, Nickel, Titanium,
Molybdenum, Vanadium, Chrome, Lead, Berylium, etc.
Recent investment opportunities are found in the following:

The Coal Mining cluster in the Lephalale area. The prospects could contribute
towards job creation and turn the area into the province’s new coal source.
Waterberg’s coal reserves have over 6.5 billion tons of coal, making it South Africa’s
third largest coal reserve after Witbank and Highveld fields. In addition, various
important minerals, such as chromium, tin, etc. are currently mined in the area.

Apart from the popular precious and ferrous metals, Waterberg offers opportunities to
expand the exploitation of minerals such as Attapulgite clay, Fluorspar, Phosphate
Topaz, etc. Of special interest to potential investors, is a Government commissioned
study report, which points to positive prospects for development including fuel-fromcoal liquification. The mines have direct impact on employment creation as well as
on disposable income.

Furthermore, Waterberg is one area of the Limpopo province that has depository of
antimony in the world. This strategic chemical element is used in alloys and in
medicine. Also in the surroundings is a hub of smaller operations extracting a large
range of minerals including gold, black granite, potassium and silica.

Until recently, Iscor, Eskom and Sasol hold mining licences in the area, which
operate the giant oil-coal plant in Mpumalanga Province. Elsewhere, large deposits of
iron ore and vanadium remain unexploited.
It is evident from the above that Waterberg offers potential investors an opportunity to
contribute towards the development of the region and be part of one of the most revered
places in the universe.
7. THE POLICY AND LEGISLATIVE MANDATE
South Africa has a rapidly transforming national economy striving to expand and increase
its competitive edge in the world and other regional markets. The South African
Government has developed a range of policies and legislation, and implemented a range of
incentive programmes aimed at facilitating investments in different economic sectors.
The model of promoting local sustainable developmental programmes has been recurring
at international, national, provincial, and local levels. Central themes include improved
quality of life for marginalized social groups, skills development, job-creation, economic
All Rights Reserved
Page 21
Marketing and Investment Strategy
development, and poverty reduction. The government role in realising these targets
features in almost all policy documents, especially because of the disparity between
economic growth with extreme unemployment and poverty.
Targets that have been set by organisations like the United Nations, NEPAD, African
Union, and so on, are frequently employed at most policy levels. The targets are
increasingly being classified along spatial dimensions for impact and sustainability
purposes. Achievement of these targets at a municipal level is a requirement for their
achievement at provincial and national levels. Consequently, as much as the Waterberg
Marketing and Investment Strategy should have a local focus, it should also be viewed in
the context of broader provincial, national, regional and international strategic goals. It
strikes a balance between the social needs of local communities and the promotion of
investments and economic growth interventions.
As already indicated, this strategy is informed by policy frameworks and legislation at
international, national, provincial and local contexts.
In the case of a local government in South Africa, the following relevant legislation need to
be considered:

Section 152 of the Constitution assigns the Local Government to promote social and
economic development, so as to involve the local communities and organizations in
local governance issues;

The 1998 White Paper on Local Government outlines a series of strategies with
which to engage local communities and stakeholders in forging relevant strategies;

The Municipal Structures Act of 1995 defines the delineates the structures governing
the municipalities, which are bestowed with the authority to initiate developmental
activities; and

The Municipal Systems Act of 2000 entrusts local government with developing its
communities including the formulation of Integrated Development Plans (IDPs).
7.1 LINKAGES WITH NATIONAL INITIATIVES
Within South Africa, the need for the country’s marketing has long been in both the national
as well as the provincial strategic planning process. Among others are the following:

The National Spatial Development Perspective (NSDP), which calls for infrastructure
investment and development. It encourages provinces to use similar strategies.

The South African Growth Summit (SAGS), which focused on growth and
development with emphasis on job creation, investment and people-centred
Page 22
All Rights Reserved
Waterberg District Municipality
development. Resolutions taken in the summit have a common goal of halving
unemployment by the year 2015. Further the resolutions articulated the following
commitments:
a.
Public investment initiatives, particularly in infrastructure;
b.
Expanded Public Works Programmes, including erosion control, fencing and
maintenance of public facilities;
c.
Sector partnerships and strategies, incorporating sector summits;
d.
Local procurement;
e.
Small enterprise promotion;
f.
Support for co-operatives; and
g.
Job impact assessment and monitoring.

The Broad-Based Black Economic Empowerment (BEE) Strategy, which regards
broad-based black empowerment as an economic process that must ensure that
black people manage, own and control most of the country’s economy;

The National Micro-Economic Reform Strategy, which emphases on the reduction of
poverty and job-creation. It focuses on agriculture, cultural industries, exports,
information and communication technology and tourism; and

The Intergovernmental Relations (IGR) Bill provides principles, objectives and
platforms to promote good relations among the three spheres of government. The
IGR ‘s main objectives include:
a.
b.
c.
d.
e.
f.
Integrated delivery of public goods and services;
Increased access to services;
Mutual consultation on policy and legislation;
Co-ordinated strategic planning linked with financial allocations;
Accountability for performance and expenditure; and
Sustainable development.
The IGR promotes the objectives of intergovernmental relations through institutional
capacity building, information exchange among all government spheres and the
establishment of appropriate intergovernmental forums.
All Rights Reserved
Page 23
Marketing and Investment Strategy
7.2 LINKAGES WITH PROVINCIAL INITIATIVES
In turn, the Limpopo Provincial Growth and Development Strategy (PGDS) outlines a
framework with which to turn its vision and mission into realizable goals and objectives.
Critical in the PGDS is the quest for economic growth, employment origination, poverty
eradication, creation of wealth and capital, and more. The PGDS sets out a comprehensive
strategy for:

Spatial Rationale;

Integrated Sustainable Rural Development Strategy;

Spatial Development Initiative;

Agricultural Development Strategy;

Mining Development Strategy;

Manufacturing Development Strategy;

Transportation Strategy;

Tourism Growth Plan;

Small, Medium and Micro Enterprise (SMME) Strategy; and

Poverty Eradication Strategy.
It is the PGDS that provides the Waterberg District Municipality with a lead. Thus
Waterberg District Municipality’s developmental planning is informed by the overall strategic
goals of the province.
7.3 FOCAL AREA STRATEGIES FOR MARKETING AND INVESTMENT AT
WATERBERG DISTRICT MUNICIPALITY
There are many niche areas in which the Marketing and Investment Strategy may be
applied. The Provincial Growth and Development Strategy have already recommended
some of the following strategic areas.
7.3.1 RURAL DEVELOPMENT STRATEGY
The Waterberg District Municipality is committed to the empowerment and development of
rural communities. This specific spatial focus is meant to improve the living conditions of
people who are deprived of basic needs.
The Waterberg’s rural development strategy derives its intervention principles from the
provincial Integrated Sustainable Rural Development Strategy, which is spatially specific, in
order to improve the living conditions of people who are deprived of basic needs.
Page 24
All Rights Reserved
Waterberg District Municipality
7.3.2 AGRICULTURAL STRATEGY
Provincial priorities that are particularly relevant to Waterberg include the high-value and
export-orientated commodities, agro-processing, promoting competitive supply chains and
providing support programmes for emerging previously disadvantaged farmers. The
contribution from the sector to the District’s economy varies considerably from year-to-year
according to weather patterns.
Therefore, the Agricultural Mission of Waterberg is to accelerate economic growth and
reduce poverty by inviting potential investors and empowering people to manage natural
resources in a sustainable manner.
The strategic priorities for marketing and investment in the Waterberg District Municipality
agricultural programme are:

Transformation of municipal controlled assets;

Redesigning of land use;

Poverty reduction;

Animal health and production;

Human resource development, and

Agri-Business development within the AgriBEE Framework document.
The Waterberg’s Marketing and Investment Strategy sets up these priorities by detailing
strategies, output service delivery for each priority.
7.3.3 TRANSPORTATION STRATEGY
Waterberg’s economic prominence requires that it be endowed with robust transportation
infrastructure and services. In this regard, there is a need for a comprehensive transport
strategy, which will set out key intervention areas for marketing and investment. Such
areas would include:

Planning, co-ordination and consultation;

Transport management;

Freight transport;

Passenger transport;

Transport infrastructure, and

Road traffic and safety.
All Rights Reserved
Page 25
Marketing and Investment Strategy
This approach is in line with the provincial Limpopo in Motion Strategy and it fits the
Waterberg District Municipality to develop business plans to guide the implementation
process.
7.3.4 POVERTY REDUCTION STRATEGY
An extensive investigation was conducted during 2001 to identify and recommend
strategies that would improve the impact of poverty reduction projects in Limpopo. As subobjective of the study was to provide a description of poverty, as it manifests within the
Province.
The World Bank insists that in order to know what helps to alleviate poverty, what works
and what does not, as well as what changes over time, poverty has to be ‘defined,
measured and studied, and even lived’. As poverty has many dimensions, it has to be
looked at through a variety of indicators – levels of income and consumption, social
indicators and now increasingly, indicators or vulnerability to risks and of socio/political
access.
The simplest way to measure poverty is to express the number of poor as a proportion of
the population. This requires an income definition of poverty. The World Bank has arbitrarily
set this level at one US dollar per person per day in the year 2000. In terms of this
definition, poverty has almost been eradicated in East Asia and in the Pacific region, but the
number of people living in poverty in Sub-Saharan Africa is increasing. International poverty
alleviation strategies have programmes for income generation, education, health and the
environment.
The Report on Poverty and Inequality in South Africa of May 1998 points out that
government will have to adjust its fiscal, monetary policies, as well as its programmes for
spatial and institutional reform. Policy measures that were recommended to achieve this,
fall into three general categories dealing with improved endowments, preventative
measures to avert deprivation; and protective measures that provide relief from deprivation.
Support for small-scale agricultural activities, emerging entrepreneurs, the CommunityBased Public Works Programme and housing subsidies, are seen as important ways to
improve livelihoods and to create household assets. Restructuring of state assets can make
a positive impact in this regard.
7.3.5 COOPERATIVE DEVELOPMENT STRATEGY
Aside from great agricultural development strategies, Waterberg envisages to invite
investment into producer co-operatives as means to promote manufacturing, job-creation
and economic empowerment within rural areas.
Page 26
All Rights Reserved
Waterberg District Municipality
Members of co-operatives require training across a wide range of issues, from skills,
operational and management aspects. The lack of founding and operating capital and
problems directly linked to market are obstacles to co-operative development of the
previously disadvantaged communities.
Therefore, the Waterberg District Municipality would need to formulate a Marketing and
Investment Strategy that will attract potential investors to revive co-operatives. The plan
would need to state in broad terms some basic intervention areas and where possible or
necessary timelines and budgetary implications.
7.3.6 SPORT, ART AND CULTURE
A very crucial area needing investment is Sports, Arts and Culture. Aside from providing
cohesion among different cultural groups within the Waterberg District Municipality, sport,
art and culture can help minimise idleness and vagrancy. The White Paper on Sports and
Recreation (1998) urges that sports and recreation activities be used for:

Increasing the levels of participation in sports and recreations;

Raising the profile of sports in the face of conflicting priorities;

Maximising the probability of success in major events, and

Placing sports in the forefront of crime reduction and prevention strategies.
While provincial authorities are responsible for policy regarding federations at that level,
local authorities are responsible for policy at their level, the funding of clubs and the
building and maintenance of facilities for provincial and local events.
In addition, the White Paper on Arts, Culture and Heritage (1996) supports the principle that
arts, culture and heritage be used for social and economic development, nature creativity
and innovation, and promote the diverse heritage of the nation. Therefore, the Waterberg
District Municipality encourages investments initiatives that support:

Arts, culture and heritage projects, which seek to pursue economic activity;

The linguistic diversity of the District as a resource to empower all its communities to
participate full in their District’s social, and economic life; and

The equitable development and preservation of experiences, heritage and symbols or
various cultural groups in the District.
In this regard, intervention priorities entail:
All Rights Reserved
Page 27
Marketing and Investment Strategy

Formulation of general principles and a management system to control the District’s
heritage resources;

Establishing a Committee that facilitates Marketing and Investment Strategy
implementation process with regard to sports, arts and recreation; and

Formulation of niche area action plans to guide potential investors with regard to
specific output deliveries and time frames.
7.3.7 ECONOMIC INFRASTRUCTURE STRATEGY
The importance of infrastructure in any economy is its role in terms of providing resources
and technology that enable efficient delivery of goods and services as well as enhancement
of performance in carrying out plans and activities assigned in relevant strategies. The
attention in this sector is on the policy environment for infrastructure that promotes
economic development and improves the quality of life of Waterberg citizens.
The Limpopo Integrated Infrastructure Plan has already provided a framework in this
regard. Therefore, Waterberg District Municipality’s intervention areas entail the following:

Undertake a comprehensive environmental and spatial analysis for infrastructure
development and investment needs;

Promote investment initiatives that will use technologies such as the Geographical
Information Systems (GIS) as an informative resource to prospective potential
investors in infrastructure; and

Provide investment opportunities to improve the existing social infrastructure, with
specific outputs delivery goal ends and time frames;
7.3.8 SMALL, MEDIUM AND MICRO ENTERPRISE (SMME) STRATEGY
Small, Medium and Micro Enterprise (SMME) Strategy is the Waterberg District
Municipality’s key to originate employment opportunities, to empower previously
disadvantaged communities and to reduce poverty. For this purpose it will establish a
SMME Support Unit to develop a strategy to attract investment aimed at supporting SMME
initiatives. The purpose of this strategy is to create an enabling environment for SMMEs to
succeed.
Specific intervention steps include the following:

Coordination and integration of support services to SMMEs, especial among
government departments and to create an investor’s network for the Waterberg
District Municipality’s SMME Support Unit;
Page 28
All Rights Reserved
Waterberg District Municipality

To improve on SMME access to finance in collaboration with Waterberg District
Municipality and other Retail Finance Intermediaries (RFIs);

To improve SMME engagement in the procurement processes of national, provincial
and local government, as well as parastatals and the private sector;

To create viable SMMEs in the construction, manufacturing, mining, tourism and
agricultural sector;

To create an entrepreneurial culture, particularly among the youth and the
unemployed persons of the Waterberg District Municipality;

To design a marketing strategy that would attract additional investment to SMMEs;
and

To develop a monitoring system for SMME interventions.
8. MARKET GROWTH ANALYSIS
8.1 WATERBERG MARKET TRENDS
Waterberg’s market growth ought to be understood within the Limpopo Provincial context.
Such an approach is necessary given that the Waterberg District Municipality is the major
contributor to the Limpopo Provincial economy.
It is crucial to note that available indicators do no not show market trends areas directly
linked to specific products; however, they do outline special sectors from which market
growth can be understood. For example the Provincial Growth and Development Strategy
(PGDS)6 indicates that in 2002 the economic structure of the Limpopo Province had
Government Social Service as the most dominant sector (See Chart 9).
All Rights Reserved
Page 29
Marketing and Investment Strategy
Chart 9: Limpopo Province Economic Structure in 1995
(Source: Limpopo Growth and Development Strategy. 2004)
While there is reason for concern regarding the apparent stagnation of agricultural, mining
and tourism sectors during the past 6 years, aggressive interventions are set to attenuate
the situation during this decade through a strong strategic diversification of the economy.
Chart 10: Limpopo Province Economic Structure in 2002
(Source: Limpopo Growth and Development Strategy, 2004)
Comparing the two charts (Chart 9 & Chart 10), Construction, Water and Electricity sectors
have been relatively dormant during six years. This state of affairs may be attributed to the
fact that in those years, shortly after the 1994 elections, municipal borders were still being
redefined and there were uncertainties in terms of powers and functions. In market terms,
this could have impacted negatively on the Province in general and Waterberg in particular.
Supporting this interpretation are the District indicators, which show the sectoral Gross
Geographic Product (GGP) growth rate from 1995 to 2000 and the contribution of
respective sectors to employment (See Table 9).
Page 30
All Rights Reserved
Waterberg District Municipality
Table 9: Sectoral Employment of Waterberg District Municipality
SECTOR
Agriculture and Forestry
Mining
Manufacturing
Electricity, gas & Water
Construction
Trade & Catering
Transport & Communication
Finance and Business
Community Services
Total
(Source: Statistics South Africa, 2001).
GGP CONTRIBUTION
AVERAGE GROWTH RATE
(1995-2000)
4.3%
40.8%
2.2%
16.5%
0.2%
10.5%
4.7%
7.0%
13.8%
100.00%
3.6%
13.9%
11.5%
7.7%
0.21%n
14.5%
25.9%
7.2%n
14.3%
100.0%
EMPLOYMENT
CONTRIBUTION
21%
21%
3%
3%
3%
18%
4%
4%
23%
100%
In market terms, the analysis of these indicators needs to be clearly understood. For
example, while Mining contributes with 40% of GGP and 21% of employment, it is not easy
to affirm that the employment part is solely about Waterberg residents only, since this
sector does also have a labour immigration component.
Comparing the same figures with those of Provincial Economic Structure in 2002, the
construction sector shows a dwindling at District level as well with 0.21% of growth rate
while only contributing with 0.2% of GGP.
In market terms, the decrease in construction industry could be attributed to different
factors:

The first may be speculated that during this period Waterberg was less attractive as
an ideal place to buy property and build homes; and

The second could be attributed to limited infrastructure development in terms of
roads, rails and recreation.
Despite these trivial shortcomings, in terms of market growth Waterberg continues to be the
major contributor both in terms of economic and market growth compared to other District
Municipalities in the Province (See Table 10).
All Rights Reserved
Page 31
Marketing and Investment Strategy
Table 10: Gross Geographic Product per District Municipality
MOPANI
SEKHUKHUNE
VHEMBE
WATERBERG
Agric & Forerstry
Mining
Manufacturing
Elect. & Wat.er
Construction
Trade & Catering
Trans & Communications
Finance/ Business
Comm.\unity Services
Total Average
BOHLABELA
SECTOR
CAPRICORN
(Source: Limpopo Province Development Information Database, 2001)
DISTRICT MUNICIPALITY AREAS
14.96%
3.45%
45.36%
15.27%
40.75%
32.93%
40.65%
36.60%
25.21%
24.17%
4.38%
0%
4.26%
3.99%
4.03%
6.62%
6.80%
3.09%
10.99%
5.86%
28.24%
21.07%
19.10%
18.73%
30.47%
17.23%
21.39%
19.30%
19.53%
20.00%
0.85%
7.51%
3.98%
3.00%
1.22%
6.7%
4.59
0.31%
12.94%
7.25%
22.77%
10.49%
13.34%
10.19
21.46%
20.94%
0.93
18.77%
18.74
15.93
28.80%
57.48%
13.95%
48.82%
2.07%
15.41%
25.25%
21.93%
12.59%
26.79%
Total
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
It is important to note that Tourism had been previously excluded from important economic
sectors and that it only received recognition as a major player in economic development in
very recent years.
Notwithstanding the analysis above, the PGDS has projected good prospects for job
creation in 2005 whereby Waterberg will generate over 6000 jobs. These prospects can be
linked directly with good market growths.
In addition to the preceding analysis is the need for economic diversification. Diversification
will ensure that the Waterberg District Municipality has a competitive advantage and extend
its value chains of activities from the competitive sectors, which are agriculture, mining and
tourism.
8.2 MARKET GROWTH PROJECTIONS AND INDICATORS
From the actual status quo to projections, the PGDS has provided generic indicators across
all District Municipalities in the Province. The main aspects, which are linked to market
growth, are Capital Formation, Economic Growth, Job Creation, and Economic
Diversification.
8.2.1 CAPITAL FORMATION
The PGDS has regarded Capital Investment as primary objective since it is a driver and
indicator of economic growth (See Chart 11). The indicators in Chart 11 reveal good level of
capital investment over R 5 billion per year, with major contribution of the mining sector.
This surpasses the PGDS target, given the fact that Limpopo Province has the fastest
growing economy in the country.
Page 32
All Rights Reserved
Waterberg District Municipality
Chart 11: Levels of Capital Investments from 1998-2010
(Source: Limpopo Growth and Development Strategy, 2004)
The decline projected by the status quo from 2003 onwards does provide a rationale of the
apparent slow market growth, which by implication impacts on Waterberg, the major
economic contributor in the Province. An optimistic trend, however, enters in 2010 –
assuming that the present capital projection has been met.
8.2.2 ECONOMIC GROWTH
Relating economic growth to market, it has a very critical role in that it is directly linked to
job creation. Limpopo Province had the highest economic growth compared to all
provinces in the country, scoring a 6.3% growth rate in 2001. With the prospects of
platinum mining projects success, the economic growth rate needs to exceed the current
6% per year so that the 2020 vision, identified in the PGDS, can be achieved. The rate
should at least be 7% to 8% annually.
Chart 12: Economic Growth Rate
(Source: Limpopo Growth and Development Strategy, 2004)
10
Actual
5
SQ Projection
0
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
Economic
Growth Rate
Economic Growth: 1998-2010
Years from 1998 -2010
On the basis of the Provincial projections, the Market Growth trends in Waterberg appear
very optimistic in the next decade and beyond.
All Rights Reserved
Page 33
Marketing and Investment Strategy
8.2.3 JOB CREATION
Creation of jobs is among the top priorities of the PGDS and the Waterberg District
Municipality. This is critical in that job proliferation directly impacts on the quality of life and
the living standards of the communities in the District so as to reduce poverty and
promotion of economic self-reliance.
The current state of affairs of unemployment is compounded by population growth and
urbanisation. The actual projected unemployment rates from 1998 to 2010 are alarming
(See Chart 13).
Chart 13: Actual Projected Unemployment Rates 1998-2010
(Source: Limpopo Growth and Development Strategy, 2004)
The projected figures in terms of unemployment do pose a challenge to Waterberg District
Municipality with regard to market growth prospects. While the optimism projected at
provincial level favours Waterberg because of its economic contribution, it is, nonetheless,
an indicative that can never be neglected.
Despite the apparent challenges confronting the Waterberg region, there is optimism that
market trends will change within this decade. However, there is a need to balance the
provincial projections at broad level and the actual pressing day-to-day reality. This implies
that the Waterberg District Municipality should devise proactive mechanisms to guard
against disruptive elements in the market trends.
9. MARKETING AND INVESTMENT PRODUCT PORTFOLIO
Challenges confronting Waterberg in terms of Market Growth and Investment needs can be
improved through a systematic profiling of existing products in the three strategic
investment sectors: Agriculture, Mining and Tourism. Basic understanding of potential
derivates from the raw materials will increase the chances of strategizing for investment
attraction and luring potential markets from within the country and abroad.
Page 34
All Rights Reserved
Waterberg District Municipality
In this strategy formulation, portfolio of a product consists of the following:

The identification or name of the product;

The location where the product is found within Waterberg area;

Possible and potential markets and clientele where the product is in demand or
needed;

A description of Waterberg’s competitiveness in terms of both capacity and expertise
to proliferate such a product;

The resources needed to multiply the product for market purposes in terms of
infrastructure and monetary injection; and

The extent to which potential project contribute to the overall strategic goals of
Waterberg District Municipality such as BEE, SMME, PPP and IRD, etc.
In this regard, a product will receive development priority provided that it will contribute
towards poverty reduction, job creation, Black Economic Empowerment, Integrated Rural
Development, etc. The success of product portfolio is to reach balance between financial
measures and social benefits as well as the ability to optimise the mix of product for
common good.
9.1 PRODUCT PORTFOLIO IN AGRICULTURAL SECTOR
PRODUCT 1: Soya Processing
Location: Currently located in Thabazimbi Municipality. It has a potential to expand into
other municipalities.
Potential Market: Potential markets are mainly found in Africa, where the prices of protein
products are very high. In South Africa, for example, Protein Industries such as Thabazimbi
(Pty) Ltd considers the following as potential clients in the soyamilk, soyamilk powder and
okara edible markets: Grobler dairies, Nutri Bev, Nestle, Borden, Freddy Hirsh Foods, CJ
Petro etc. There is also huge international trade links with European countries.
Competitiveness: Waterberg’s competitiveness is reflected in the Thabazimbi experience
and expertise and the capability of raw material mass-production. Derivate end-products
include among others Soya Milk, Soya Milk Powder and Okara (wet and dry).
Resources Needed: Capital investment, machinery, human resources, in strategic areas,
etc.
Strategic Goals: The main strategic aims is to contribute towards job creation, poverty
reduction, food security, rural development. In addition, the Black Economic Empowerment
and SMME establishments, ought to benefit from relevant initiatives.
All Rights Reserved
Page 35
Marketing and Investment Strategy
PRODUCT 2: Integrated Animal Feed (Boskos)
Location: This is a potential pursuit that may be initiated in all Local Municipalities.
Potential Markets: The market includes the following segments: Game farming operation;
Zoo operation; Horse owners; International game markets and Cattle farmers. The market is
spread throughout the District, Province and South Africa in general with good prospects for
exports.
Competitiveness: Waterberg has long been involved in feed production plant, processing
invader bush through a patented process, to animal feed suitable for game, horses and
cattle. It is endowed with internationally renown expertise and knowledge.
Resources Needed: Capital investment, machinery, additional human resources, etc.
Strategic Goals: Job creation, investment attraction, poverty reduction, Black Economic
Empowerment and Small, Micro-Medium Enterprises development.
PRODUCT 3: Organic Farming
Location: All Local Municipalities
Potential Markets: A number of European countries have indicated the need for organic
products. Some major food wholesalers in South Africa have announced their intentions to
sell only Organic Food within two years from now. The African Continent in particular is the
immediate market, which is currently consuming organic foods – against the western
genetically engineered products.
Competitiveness: Waterberg area has a large amount of virgin land for organic farming,
good climate and geo-political conditions which cannot be found anywhere in the world. The
Waterberg virgin organic land, gives both local and international investors an opportunity to
become world leaders in organic farming and world markets. Local expertise, coupled with
extensive indigenous African farming methods, makes Waterberg organic products unique at
value and taste.
Resources Needed: Machinery, human resources, capital investment, infrastructure as well
as human resources in strategic organic farming sectors, etc.
Strategic Goals: Job creation, poverty reduction, food security, integrated rural development,
Page 36
All Rights Reserved
Waterberg District Municipality
PRODUCT 4: Traditional African Medicine (TAM)
Location: All Local Municipalities
Potential Markets: Research shows that 95% of all medicines come from plant roots, bark
and leaves. Over 85% of the African population use plant medicines. Therefore, potential
market comprises majority of African in the Continent as well as in Diaspora. With the recent
rise of fatal diseases in the world, western and far-eastern scientists have been interested in
laboratory experiments of African plants.
Competitiveness: It is no doubt that Waterberg is still endowed with virgin forests and
savannahs, which have preserved many of the most values medicinal plants in the world.
Researchers investigating South Africa’s wealth of medicinal and perfume plants have found
that adequate financial backing, research and development, exposure, and marketing could
open opportunities for both local and international investors.
Resources Needed: Human resources in strategic fields, capital investment; appropriate
extraction, refining, packaging technology, etc.
Strategic Goals: Promotion of traditional African medicines to enter the mainstream market,
job creation, SMME development, promotion of cooperatives and incentives schemes,
minimisation of medical expenses among the African poor in rural areas, etc.
In addition, there are a number of agricultural products, which could not be exhausted in the
outline above. They are summarised in Table 11 below.
Table 11: Summary Of Waterberg Agricultural Products Per Local Municipality
MUNICIPALITY
Bela – Bela
Modimolle
Mookgophong
Lephalale























CROPS
Cotton
Maize
Millet
Tobacco
Paprika
Sorghum
Lucerne
Cowpeas
Groundnuts
Wheat
Jug beans
Chinabeans
Sunflower
Ground nut
Cotton
Millet
Tobacco
Paprika
Sorghum
Lucerne
Cowpeas
Groundnuts
Wheat
All Rights Reserved





FRUITS
Citrus
(oranges)
Peaches
Table
Grapes




Citrus
Peaches
-Table
Grapes












VEGETABLES
Potatoes
Tomatoes
Cabbage
Carrots
Onions
Curcubits (the
pumpkin type)
Potatoes
Tomatoes
Cabbage
Carrots
Onions
Curcubits (the
pumpkin type)
LIVESTOCK POULTRY PIGGERY
 Cattle: zebu type Afrikaner
 Brahman, Nguni, senglen, Tuli,
Bonsmara, Drakensberg and
Summwntaller.
 Sheep: Dorper, Damara and Van
Rooyen.
 Goats: Boer goats,
 Poultry: New Hemisphere white
leghorns Austrolopers,
 Potchefstroom Kokoes, Black
leghorns.
 Piggery: Large white, Minnesota
and Landras
 Cattle: Zebu type Afrikaner,
Brahman, Nguni, Senglen, Tuli,
Bosmara and Drakensberger.
 Sheep: Dorper, Damara and Van
Rooyen.
 Piggery: Large white, Minnesota
and Landras
 Poultry: New Hemisphere white
leghorns Austrolopers,
 Potchefstroom Kokoes, Black
Page 37
Marketing and Investment Strategy
Mogalakwena
Thabazimbi






















Jug beans
Chinabeans
Sunflower
Peanuts
Maize,
Sorghum and
Babala.
Sunflower,
Wheat,
Sorghum
Cotton.
Tobacco
Maize
Manna
Tobacco
Paprika, Cow
Peas
Sorghum
Lucerne
Groundnuts
Wheat
Jug beans
Sunflower
leghorns.
 Citrus (oranges
 Baltimoore:
Potatoes, Orions,
Tomatoes, Melons,
Pumpkinbeet,
Carrots
 Onions potatoes
 Citrus
 Peaches
 TableGrapes






Potatoes
Tomatoes
Cabbage
Carrots
Onions
Curcubits and
Spinach
 The whole area has the capacity
for cattle and game farming, with
beef/cattle dominance in the
Mapela/ Bakenberg area and
Robone/ Baltimoore having the
potential for goat farming. The
most dominant breed is the
Bonsmara.
 Cattle: Afrikaner, Brahman, Nguni,
Simmentaller, Senglen, Tuli,
Bonsmara and, Van Rooyen.
 Goats: Boer goats. Poultry: New
Hemisphere, White leghorns,
Australops, Potchefstroom Kokoes,
Black Leg Horns. Piggery Large
white, Minnesota and Landras.
9.2 PRODUCT PORTFOLIO IN MINING SECTOR
PRODUCT 1: Coal Liquification
Location: Lephalale Local Municipality
Potential Markets: Markets do exist nationally and internationally. As raw material coal may
be supplied to gas producers, direct as fuel, or cooking. The Waterberg coal can be used for
the following purposes: gas generation; direct liquification as fuel, blend coking in ferro-alloy
industries and PF combustion for electricity generation.
Competitiveness: Since the major coal producing areas in South Africa have reached
maturity and large scale expansion limited, it is necessary that energy strategy be developed
for sustainable development of the coal and gas resources of the Waterberg. The Waterberg
coalfield offers the potential to sustain energy development in the long term when coal
production enters a declining phase in the traditional high producing areas.
Resources Needed: Infrastructure, machinery, human resources, capital investment, etc.
Strategic Goals: Job creation, Black Economic Empowerment, poverty reduction, integrated
rural development, etc.
PRODUCT 2: Platinum
Location: It is found in Mogalakwena, Mookgophong and Thabazimbi. Its availability
extends 60km North-West of Polokwane within the East-West Spatial Development Initiative.
Potential Markets: Markets for platinum are found nationally and internationally. It is in
demand for manufacturing of corrosion-resistant products. Prognoses show that the metal
Page 38
All Rights Reserved
Waterberg District Municipality
will be in demand for the next ten years.
Competitiveness: It is to mine Platinum Group Metals on seven farms in northern limb of
the Bushveld Complex (Platreef). Mineralisation is most intense in 20m thick pyroxenite and
disseminated base metal sulphides are common.
Resources Needed: Infrastructure, human resources, capital investment, etc.
Strategic Goals: Black economic empowerment, job creation, poverty reduction, etc.
PRODUCT 3: Vanadium
Location: Mollendraai. The main magnetic layer in this area is about 8m thick and occurs
about 230m above the first appearance of the magnetite in the sequence and some 110m
above the lowest layer. The farms Gezond 235 KR, Commandodrift 238 KR, Mollendraai
807 LR and Mozambique 807 LR were investigated by Mining Corporation during 1986 and
found the layer to be containing an average of 1,69% vanadium (V205).
Potential Markets: The market for vanadium is mostly at international level and prospects
are that demand will exceed supply for the next ten years. Silvery white toxic metallic
element is used in steel alloys; it occurs in several complex minerals including carnotite and
vanadinite. Heavy metallurg industries are also likely to be target markets.
Competitiveness: Mogalakwena is known to have sufficient repositaries of Vanadium and
could become the major source of this metal in the next 15 to 20 years.
Resources Needed: Infrastructure, human resources, capital investment, etc.
Strategic Goals: Black economic empowerment, job creation, poverty reduction, etc.
PRODUCT 4: Gold
Location: Bela-Bela Plat River and Thabazimbi (Madikwe)
Potential Markets: Gold is amongst the most popular metals. Its markets are both national
and international.
Competitiveness: Relatively at small scale, Thabazimbi is known to have good prospects in
gold mining.
Resources Needed: Infrastructure, human resources, capital investment, etc.
Strategic Goals: Black economic empowerment, job creation, poverty reduction, etc.
PRODUCT 5: Diamonds (Kimberlite)
Location: Bela-Bela (Mckenzie) and Lephalale (Swatwater)
Potential Markets: These very hard indigenous African crystalline carbon stones valued as
gems are in demand all over the world.
All Rights Reserved
Page 39
Marketing and Investment Strategy
Competitiveness: Relatively at large sufficient scale for exploitation, Lephalale has had
extensive mining experience and has the drive to pursue diamond products development.
Resources Needed: Infrastructure, human resources, capital investment, etc.
Strategic Goals: Black economic empowerment, job creation, poverty reduction, etc.
Waterberg has many mining opportunities, which were not outlined above, but are
summarised in Table 4 and Table 5. These include precious and ferrous metals
respectively.
Table 12: Precious Metals And Diamonds Per Local Municipality
MUNICIPALITY
Bela-Bela
MINERAL NAME
(Source: Council For Geoscience)
LOCATION
DEPOSIT STATUS
Gold
Plat river
Small scale
Diamonds
Kimberlite)
Mackenizie
Sufficient
Mogalakwena
Platinum
Gold
Mookgophong
Lephalale
Platinum
Diamond
(Kimberlite)
Platinum
Gold
Platinum reef
Rebone
Ga-Mathapo
Swaershoek Mountains
Swartwater
Sufficient
Small scale
Small scale
Medium scale
Large and small
scale
Sufficient
Sufficient Medium
scale
Modimolle
Thabazimbi
Northam complex Kaya put
(Madikwe) Dwaalboom
CORRIDOR STATUS
Our the 50 km radius of the
East-West corridor, within
the 20 km radius of the
Trans-Limpopo corridor
20 km radius of the Trans
Limpopo corridor
Within the 20 km radius of
the East-West corridor
50 km corridor area
50 km outside 50 km
radius
Outside the 50 km radius
Outside the 50 km radius
Outside the 50 km radius
Table 13: Ferrous And Base Metals Per Local Municipality
MUNICIPALITY
Bela – Bela *1
Modimolle *1
Mogalakwana *1
Mookgophong *1
MINERAL NAME
Managanese
Copper
Tin
Cobalt
Silica
Manganese
Iron
Tin
Zirconium
Nickel
Vanadium
Tin
Titanium
Molybdenum
Chrome
Lead
Tin
(Source: Council For Geoscience)
LOCATION
DEPOSIT STATUS
CORRIDOR STATUS
Plat river
Small scale Small scale
Small scale
Small scale
Outside 50 km radius
Modimolle
Modille-Vaalwater
Alma
Alma
Witkop
Droomdlea
Along the N11
Tin mines
Waterberg mountains
Tin mines
Chrome mines
Vlakfontein/Uitgedaght
Swaerhoek Mountains
Sufficient
Small scale
Small scale
Small scale
Small scale
Sufficient
Sufficient
Sufficient
Small scale
Small scale
Sufficient
Small scale
Sufficient
Outside the 50 km radius
Within a 20 km radius
Core of the SDI
Within the 20 km radius
Within the 20 km radius
Within the 20 km radius
Within the 20 km radius
Within the 20 km radius
Within the 20 km radius
Page 40
All Rights Reserved
Waterberg District Municipality
Lephalale *2
Iron
Copper
Thabazimbi
Nickel
Iron
Nickel
Beryllium
Kauletsi
Tom burke
Kauletsi/
Glennover/ Rosedale
Doornfontein
Thabazimbi
Northam
Rooibokkraal
Small scale
Small scale
Small scale
Small scale
Small scale
Sufficient (CPR)
Sufficient
Small scale
Within the 20 km radius
Outside the 50 km radius
Within the 50 km radius
Outside the 50 km radius
Outside the 50 km radius
Outside the 50 km radius
Outside the 50 km radius
9.3 PRODUCT PORTFOLIO IN TOURISM SECTOR
PRODUCT 1: Waterberg Biosphere
Location: The Waterberg Biosphere Reserve, which has been acknowledged by the United
Nations. It is mostly popularised by the Nylsvlei Nature Reserve, which for decades has been
declared a nature reserve and acquired an RAMSAR in 1998.
Potential Markets: Middle-income tourists and scholarly research institutions interested in
biodiversity.
Competitiveness: It posses some of the natural beauties of sandstone formations and
natural caves that are aged with the early San-Bushman habitation. In it dwells various
species of wildlife and a diversity of bird species.
Resources Needed: Infrastructure, well-equipped laboratories, human resources, capital
investment, etc. There is a need to develop compatible infrastructure for preservation and
research.
Strategic Goals: Conservation function: To contribute to the conservation of the full
hierarchy of biodiversity, including landscapes, econ-systems, species and genes.
Developmental function: To foster economic and human development, which is socioculturally and ecologically sensitive. Logical function: To foster support for research,
monitoring, education and information exchange related to local, nation and global issues of
conservation and development.
PRODUCT 2: Makapan Lodge and Conference Facility
Location: Makapan Lodge and Conference Facility is located in the Makapan Valley
adjacent to the Potgietersrus Game Breeding Centre, which is stocked with both exotic and
indigenous animals.
Potential Markets: The growing trend to host meetings, training workshops and other
occasions in rural locations, provides Makapan Lodge and Conference Centre with the
opportunity to successfully target the Meetings, Incentives, Conferences and Exhibitions.
Competitiveness: The site is of great natural, historical, archaeological and palaeontological
significance and includes a number of caves and other historical sites, and is in the process
of applying for world heritage site status.
All Rights Reserved
Page 41
Marketing and Investment Strategy
Resources Needed: Need to improve and expand the existing infrastructure.
Strategic Goals: Small Micro-Medium Enterprises and BEE ownership as
well as Integrated Rural Development.
PRODUCT 3: Moepel Farms Eco-Training Centre
Location: The project is located between Mokopane and Marken in East-West Spatial
Development Initiative of the Limpopo Province.
Potential Markets: Currently Eco-Tourists want to learn more about the environment,
wildlife, ecosystems, etc. There is a need for a product that serves both the supply and
demand sides of the eco-tourism sector. There is a potential for eco-tourism population, the
hunting market and leisure tourism.
Competitiveness: Moepel Farm is a suitable location for a centre that can address this
demand as it lies in the heart of one of South Africa’s foremost developing ecotourism areas
and offers easy access from its feeder markets.
Resources Needed: Need to improve and expand the existing infrastructure.
Strategic Goals: Job creation, SMME, BEE and IRD.
PRODUCT 4: Makapan Valley Adventure Camp
Location: Makapan Valley Adventure Camp is located outside Mokopane, in TransLimpopo Spatial Development Initiative of the Limpopo Province.
Potential Markets: Leisure tourism (national and international, collective events, youths
camping, church groups, sports groups, etc.)
Competitiveness: The physical, natural and historic attributes of this facility make it an
ideal location for the development of a camp catering for school and youth groups. Features
of the site that provide it with a competitive advantage include its proximity to the primary
source markets of Limpopo and Gauteng, the archaeological sites of Makapan and the
Potgietersrus Game Breeding Centre.
Resources Needed: Need to improve and expand the existing infrastructure
Strategic Goals: Job creation, SMME, BEE and IRD.
PRODUCT 5: Doorndraai Dam Leisure Village
Location: Doorndraai Dam Nature Reserve is located approximately 100km south of
Polokwane. It is located at the crossroads of N1 between Pretoria in the south and
Polokwane in the north, and the N11, which leads towards Groblersbrug on the Botswana
border.
Potential Markets: Leisure market: free independent tourists, tour groups, special interest
Page 42
All Rights Reserved
Waterberg District Municipality
tours and day visitors and the MICE markets.
Competitiveness: The inclusion of Entabeni Nature Reserve and the surrounding private
game farms enhances the product offering of the destination and create a unique experience
to attract the relevant markets.
Resources Needed: Need to improve and expand the existing infrastructure
Strategic Goals: Job creation, SMME, BEE and IRD.
PRODUCT 6: Mokolo Dam Nature Reserve
Location: Lephalale Local Municipality
Potential Markets: Leisure tourists, holidaymakers, hiking clubs, school excursions, etc.
Competitiveness: The area is know for its natural beauty and has a commercial water
lodges.
Resources Needed: Infrastructure, human resources, capital investment, etc.
Strategic Goals: Black economic empowerment, job creation, promotion of cooperatives,
poverty reduction, etc.
PRODUCT 7: D’Nyala Nature Reserve
Location: Lephalale Local Municipality
Potential Markets: Leisure tourists, sports clubs, hiking clubs, school excursions, birding
lovers, etc.
Competitiveness: The area has been a good tourist and holiday destination.
Resources Needed:
facilities, etc.
Needs upgrading of infrastructure, human resources, and other
Strategic Goals: Black economic empowerment, job creation, promotion of cooperatives,
poverty reduction, etc.
PRODUCT 8: Witvinger Nature Reserve
Location: Mokopane
Potential Markets: Leisure tourism, school excursions, sports clubs, birding, etc.
Competitiveness: The area is well known for its natural beauties, which preserve some of
the most ancient admired vestiges. Sediments, fossils, bones and artifacts preserve unique
history of hominid habitation and evolution acclaimed to be more that 3.3 million years.
Resources Needed:
facilities, etc.
All Rights Reserved
Needs upgrading of infrastructure, human resources, and other
Page 43
Marketing and Investment Strategy
Strategic Goals: Black economic empowerment, job creation, promotion of cooperatives,
poverty reduction, etc.
Other tourism products, which are found throughout Waterberg districts are summarised in
Table 14. They are listed according to Local Municipalities.
Nature
/Game
Reserves
Guest
Farms
Guest
Houses
Hotels
Camping
Fishing
Art &
Crafts
Conf.
Centres
Total no.
of Beds
Bela-Bela
Modimolle
Mookgophong
Mogalakwena
Lephalale
Thabazimbi
Totals
Holiday
Flats
Municipality
Holiday
Resorts
Table 14: Summary of Waterberg Tourism Products (facilities) in Local Municipalities
4
5
10
10
10
19
9
12
12
23
75
19
3
7
29
8
8
5
11
28
4
1
1
3
9
9
4
1
4
5
23
1
7
8
4
4
1
1
2
5546
1593
1775
516
508
623
10561
6
25
10. PUBLIC-PRIVATE PARTNERSHIPS: THE VALUE CHAIN AND
CLUSTER CHAINS OF STRATEGIC SECTORS
The value chain describes the full range of activities that are required to bring a product
from its conception to its end use and beyond. This includes activities such as design,
production, marketing, distribution and support to the final consumer.
Therefore, there is a quest for Waterberg to adopt a new approach in this regard. To
continuously grow profitably the Waterberg District Municipality has to follow a concise
three-step approach to marketing and investment attraction:

First, relates to the development of a complete understanding of the way it creates
value for its clientele and investors, and how they can best create value in the future.
To be successful, the District needs not only define clientele and investor’s
requirements, it needs to take its understanding one step further by quantifying the
value it provides to its clientele and investors.

Second, relates to the development of a deep understanding of how value gets
delivered through the value chains in which it competes. The District needs to
understand the true drivers of demand, the current profit pools at each value chain
step, and, most importantly, the steps where investment rewards will pool tomorrow.
It needs to create operational processes from the “Outside-In”, keeping the clientele
and the investors at the centre of the transformation; ensuring that it is aligned to
deliver optimal value to the most valuable clientele and investors.
Page 44
All Rights Reserved
Waterberg District Municipality

Third, having optimised the creation and delivery of value, the District needs to take a
disciplined approach to capture for its clientele and investors as much of the value as
possible. Both through optimising the quality of service delivery and maximising the
share of its clientele and investors money.
Above all, the challenge is to optimise the District share of the overall market to increase
clientele and investors satisfaction.
10.1 THE CLASSICAL APPROACH
Hence the approach depicted in Figure 1 is based on the tradition popularly known as
Supply Chain (Figure 1). The figure depicts a typical supply chain associated with a
hypothetical process manufacturer. It shows the flow of product from raw material through
end-product distribution.
Figure 1: Typical Supply Chain
Raw
Material
Processing
Conversion
Final
Product
Supply Chain
Distribution
Waterberg
Tourism Value
Chain Cluster
Supply Chain
Figure 1 above does capture all the steps needed to produce and deliver a product to an
end-user customer or consumer. It exposes the inventory positions, cycle times, and
different throughput requirements at every step.
However, while the supply chain does a great deal in tracking the flow of supply, it fails to
capture the flow of demand from the end customer up the chain. Hence a challenge to
Waterberg District Municipality is to shift the approach from a “Supply Chain” orientation to
a “Value Chain” orientation depicted in Figure 2.
Figure 2: Typical Value Chain
Design
Procure
Produce
Educate
Deliver
Service
Demand Value Chain:
Tracks the flow of demand
Values flows from the source of demand back through the chain
Identifies which players control the flow of demand back through the chain
Taking tourism as an example of how tourism in Waterberg and other parts of Limpopo and
All Rights Reserved
Page 45
Marketing and Investment Strategy
It is evident that South Africa in general has not succeeded attracting African investors in
huge numbers; it is because they have focussed on linear models, which remained “InsideOut” in approach (Figure 3).
Figure 3: Inside-Out Methods
Waterberg District
Municipality
Tourism products and
services:
Hotels
Game Reserves
Conference Centres
Hiking Facilities, etc.
Clientele:
Tourists and Investors
This model of practice is purely based on the Supply Chain tradition. The consequence of
this is the omission of potential clientele that could otherwise be interested in tourism
product should these be modified or enhanced with specific values that meet the needs of
potential clientele of investors.
A salient example of the Waterberg tourism industry in particular and South Africa in
general is the lack of success in attracting African tourists. Methods to discover the
reasons behind this shortcoming may only be found through a Value Chain process (Figure
3). In other words, Waterberg needs to discover or develop value orientation that will
attract attention of Africans to invest in tourism products.
Similarly, the problem is found in other key sectors such as game farming and mining,
which are extensively owned by foreigners. This suggests that many products are westernvalue encoded, therefore, more appealing to western clientele and investors.
Page 46
All Rights Reserved
Waterberg District Municipality
Afrocentric-value
Encoding
Process
International-value
Encoding
Process
Appeal to African
Clientele &
Investors
Marketing and
Advertising
Product Development
Waterberg District Municipality
Figure 5: Designing Progressive Value Encoding Model
For Local and International Clientele / Investors
Appeal to
International
Clientele &
Investors
The central theme in Figure 5 is “Value-Encoding”, which the investor or any type of
clientele will decode through appropriate marketing strategy. The challenge is on
Waterberg to understand what is, that which constitutes value, for example in Agriculture,
Tourism and Mining, for the African population. Encoding such values will make the
products more appealing, therefore, making potential African investors buy into the actual
process.
10.2 CREATING VALUE
It is extremely important to fully understand the key elements of value in the eyes of the
investor or clientele. As Waterberg goes through this process, it realizes that clientele and
investors perceive value in many areas that are readily visible.
For example, the decline in Waterberg’s construction sector since 1995 to 2000 changed
with the demands pattern of clientele during 2001. Registered improvements are mainly
attributed to security companies, which needed big complexes from where they could
operate. The sense of security need in holiday resorts and game reserves rocketed the
building of more secured infrastructure for tourists and holidaymakers. Therefore, security
in holiday resort is a value that must constantly be maintained.
In addition, part of the problem of scarce African tourists is related to accessibility.
Traditionally, South African game reserves, for example, were designed for access through
private transport, often-expensive four-wheel drive vehicles. This simply meant that only the
affluent could afford access to those facilities.
Therefore, in addressing the value issue, it is a challenge for the Waterberg District
Municipality to know and quantify the value that its clientele and investors expect in its
All Rights Reserved
Page 47
Marketing and Investment Strategy
product and services under four broad categories: Product or Utility, Access, Experience,
and Cost, as summarised in Figure 6 and Figure 7.
Figure 6: Four broad categories to convince clientele
UTILITY
 Performance
 Features/Functions
 Technical Innovation
+
ACCESS +
 Availability
 Reliability of supply
 Distribution Channels

EXPERIENCE
 Service
 Solutions
 Impact on
clientele/investor
 Brand

-
COST





Price
Total cost of ownership
Process cost
Payment terms
THE MUNICIPALITIES DELIVER VALUE TO CLIENTELE AND INVESTORS
ACROSS EACH OF THE DIMENSIONS OF THE RELATIONSHIP
This means, for instance, a tourist who wishes to assess the quality and value of products
offered in Waterberg facilities, he or she would focus his or her assessment on the
following:

Utility: This includes level of performance, features and functions and technical
innovation. Hence the whole concept of user-friendly technology.

Access: It includes availability, reliability of supply and distribution channels. This
could include information, facilitating travel agencies, transport, and so forth.
Information is critical in this regard. So is the reduction of bureaucracy.

Experience: This would include service quality, solution, and impact. For example, in
a game reserve facility, a client (or tourist) would expect good quality service in terms
of accommodation facilities, tour guides, diet variety, etc. In circumstances where, for
example, there are some exclusion or selection criteria of clients, there could be a
detrimental consequence to Waterberg reputation. In general, it can negatively
impact on the District’s branding. The ultimate evaluator is clientele/investor’s
satisfaction.

Cost: Whether the price is commensurate to satisfaction and service quality. The
Utility, Access and Experience must justify the price and once that happens, the
reputation and branding gain a special status. The question is whether the price is
justifiable (See Figure 8).
Analysing the demand value chains in which the Waterberg District Municipality participates
reveals the true sources of demand and enables it to track the flow and pooling of value at
different steps.
Page 48
All Rights Reserved
Waterberg District Municipality
In short, it allows the District to define where each of its opportunities to create value
resides and to determine how close these opportunities are to the Waterberg District
Municipality’s core competencies. This view also highlights the market players who control
the flow of demand and shape the economics for all participants. In this regard, the District
can only shape the position of the profit pools by developing a deep understanding of the
value chains.
Figure 7: Quantifying customer value – Disciplined process
Utility
User-friendly
Access
Information
Market
Validation
CLIENTELE/
Investor
Cost
Justification
Value Driver
Discovery
Experience
Satisfactions
Value
Quantification
Value quantification requires the municipality to follow a disciplined process
By understanding how each of the attributes of product, access, experience, and cost
contribute to the overall value received by the clientele and investors it allows the District to
effectively differentiate from its peer-competitors based on total value system.
In summary, a clientele/investor-value based approach to management can help
municipalities instil a fact based decision-making process. This promotes faster growth
through differentiated investment. It ensures that the highest return initiatives are prioritised.
Municipalities using this disciplined three step approach, focus on understanding value
potential, creating value and delivering value, and managing their market position to
maximize the value they capture. Municipalities that are attuned to the Value Creation
Cycle build deep moats around their customers that rival industries and peer municipalities
- competitors find difficult to cross. Mastering the Value Cycle enables these municipalities
to win in both the clientele/investor and the financial markets. In short it leads them to longterm economic growth.
10.3. VALUE CHAIN CLUSTERS IN WATERBERG STRATEGIC SECTORS
From the anterior subsection, it is now critical to ponder on key investment strategic sectors
of Waterberg and tentatively apply the fundamentals of value chain. The current section
provides a generic framework, which could be applied to understand the value chain
process of all products in agriculture, mining and tourism sectors. Each diagram shows a
All Rights Reserved
Page 49
Marketing and Investment Strategy
specific magnitude of complexity in terms of interconnectedness of players in the value
chain on each sector. This, by essence is called “Cluster Chain” in that it relates all
beneficiaries, influencers and stakeholders in the system. For example, in the Agricultural
sector, there are many interest groups, which have a stake (See Figure 8). They range
from Investors, Raw Material Suppliers and Labour to institutions, colleges, financial
institutions, government regulators, agricultural unions, etc.
The diagram in Figure 8 shows a complex system in agricultural value chain. While it only
focuses on institutional relationships, it shows how the CONSUMER (or END-USER) bears
the costs of the entire process. Besides the overburdening of the consumer is the whole
configuration of the cluster such as the composition and how it is representative of the
Waterberg District’s demographics. This concern has found exhaustive expression in the
BEE Act of 20037 and the Code of Good Practice of the National Treasury. 8
The diagram in Figure 9 demonstrates the systemic process in the mining sector: the input
processes in terms of investment and raw material, the human resources, product
development, marketing, retailing and ultimately to the END-USER. The END-USER is an
important player here in that the production costs of the entire process are factored within
the retail price.
Page 50
All Rights Reserved
Waterberg District Municipality
Figure 8: Value Chain Cluster in Agricultural Products
INVESTORS
RAW MATERIAL SUPPLY
AGRICULTURAL
MEDIA
OTHER
INSTITUTIONS
LABOUR SUPPLY
PRODUCERS
PROCESSORS
AGRICULTURAL
COLLEGES
AGRICULTURAL
CONSULTANTS
AGRICULTURAL
ORGANISATIONS
EQUIPPERS
BUILDERS
DISTRIBUTORS
GOVERNMENT
REGULATORS
SPHERES OF
GOVERNMENT
SUPPLIERS AND
TRANSPORTERS
RETAILERS
FINANCIAL
INSTITUTIONS
CONSUMERS
All Rights Reserved
Page 51
Marketing and Investment Strategy
Figure 9: Value Chain in Mining Industry
INBOUND
LOGISTICS
OUTBOUND
LOGISTICS
OPERATIONS
INVESTMENTS
INPUTS
END-USER
RETAILERS
PRODUCT DEVELOPMENT:
IMPROVED QUALITY
INCREASED FLEXIBILITY
JUST IN TIME
MARKETING
INFRASTRUCTURE
MONETARY
HUMAN
RESOURCES
RAW MATERIAL
ETC.
RAW MATERIALS
Shafts
EXTRACTION
PROCESSING
The diagram in Figure 10 depicts another example, which demonstrates how different
stakeholders benefit in a value chain. There are three rows of hierarchies in four categories
of processes:

The first shows that in strategy and planning there are skills and capital input, which
ends up in human resources development;

The second sequence shows that the product development creates jobs, which by
implication contribute to poverty reduction;

The third sequence shows that marketing leads to Waterberg publicity and branding,
which leads to attraction of investors; and

The last sequences show the consumption and recycling of product, which by
implication bring in state revenue that ultimately contribute to local infrastructure
development.
Page 52
All Rights Reserved
Waterberg District Municipality
Figure 10: Value Chain Cluster in tourism Sector
FEEDBACK MECHANISMS:
Product Design:
Strategy and
Planning
Input:
Skills &
Capital
HR
Development
Product
Development:
Holiday resorts
Nature reserve
Game reserves
Guest houses
Hotels
Hiking clubs, etc.
Marketing:
Advertising
Pamphlets
Magazines
Electronic Media
Billboards, etc.
Job
Creation
Waterberg
Publicity
and
Branding
Poverty
Reduction
Investor
Attraction
Consumption &
Recycling:
State
Revenue
Infrastructure &
LED
CONTINUUM
In turn, there are feedback mechanisms, which are intended to inform the strategists and
planners about the success or shortcomings in the system. It is crucial to note that the
challenges associated with the value chain concept are in the initial creation of chains,
especially for the key sectors of Waterberg in present status quo.
As per the discussion of this concept, there is no doubt that benefits may not be realized in
the pricing structure. Benefits are more likely realized from non-price issues such as greater
investor/clientele responsiveness, long-term contracts, guaranteed supply, and reduced
bureaucracy levels.
However, the complexity of the Tourism Sector is well demonstrated in Figure 11 below.
The diagram shows the extent to which many players directly or indirectly have stakes in
the whole sector. In terms of socio-economic analysis, holidaymakers, ownership of the
All Rights Reserved
Page 53
Marketing and Investment Strategy
attractions and supply of services are predominantly white, which is a serious cause of
concern for the emerging business of the black community in Waterberg. It is this
complexity that has propelled the quest for BEE in the country as a whole.
Figure 11: Complexity of Value Chain Cluster in Waterberg Tourism Sector
Visitors/Tourists
International ,
Dometic/Local,
Individuals, families,
Excursions, sports clubs,
Conferences, etc.
Onshore Distribution System
Tour Operators, Travel
Agencies, etc
OFFSHORE DISTRIBUTION
SYSTEM





Economic Foundations
National
Government
Hard
Infrastructure
Suppliers
Transport companies
Travel agencies
Hotels & Guesthouses
Care hire companies
Medical & insurance
agencies
 Construction industries
Attractions
Holiday resorts,
Nature reserves,
Cultural villages,
Game parks,
Flea markets, etc.





Waterberg District
Municipality
Limpopo Government
Communities Bela-Bela
Soft
Infrastructure





Lephalale
Training centers,
Schools, etc
Roads
Modimolle
Police & Security
Companies
Rail
Mogalakwena
Industry
Associations
Telecommunications
Mookgophong
Thabazimbi
Banks and
Financial Service
Utilities
Page 54
All Rights Reserved
Waterberg District Municipality
11. ADOPTING APPROPRIATE CORPORATE STRATEGIES FOR
BLACK ECONOMIC EMPOWERMENT
11.1 LEGAL BASIS FOR PUBLIC-PRIVATE PARTNERSHIP, BLACK ECONOMIC
EMPOWERMENT AND SMALL MICRO-MEDIUM ENTERPRISES POLICY
This PPP, BEE and SMME policy were developed with reference to the following
legislation:

The Constitution of the Republic of South Africa, Act 108 of 1996, enables organs of
state to implement “procurement policy for (a) categories of preference in the
allocation of contracts and (b) the protection or advancement of persons, or
categories of persons, disadvantaged by unfair discrimination”.9

Treasury Regulation 16, issued in terms of the Public Finance Management Act
(PFMA) for the purposes of regulating national and provincial PPPs, states that the
procurement procedure for a PPP “must include a preference for the protection or
advancement of persons, or categories of persons, disadvantaged by unfair
discrimination”.10

The BBBEE Bill, whose objective is “to facilitate broad-based black economic
empowerment” and which provides for the issuing of codes of good practice which
must be applied by organs of state and public entities, inter alia, “in developing
criteria for entering into partnerships with the private sector.”
11.2 THE BEE AND THE ENTERPRISE OWNERSHIP
The need for a BEE Commission (BEECom) arose out of a resolution taken at the Black
Management Forum (BMF) National Conference in Stellenbosch, from 14 to 15 November
1997. 11 The prominent view was that black people should direct and take responsibility for
their own destiny so as to devise the means to ensure that they empower themselves in the
historical context of socio-political and economic conditions of South Africa. Main reasons
for the establishment of BEECom were, among others:

The lack of a national vision for BEE;

The failure by Government and black business to provide leadership and a vision for
BEE;

Empowerment versus enrichment;

The empowerment process being driven by white institutions;

The lack of a coherent definition for BEE;
All Rights Reserved
Page 55
Marketing and Investment Strategy
Consequently, the issues of ownership in the three Waterberg’s strategic sectors need
special attention with regard to existing policies. There are principles that can be derived
from such policies regarding BEE viz. ownership, management and control of various
economic sectors. Two basic policy guidelines provide a prelude to this strategy at hand:
The BEE Commission Report and the Code of Good Practice for Black Economic
Empowerment in the Public Private Partnerships.
The BEE Commission Report identifies five distinct categories of ownership:

The first is a 100% foreign-owned companies;

The second category is wholly owned subsidiaries of public listed companies, either
on the JSE or an offshore exchange;

The third comprises companies independently listed on the JSE;

The fourth accounts for companies privately owned by mainly South African interests;
and

The fifth is made of those companies wholly or partly owned by the government or
state-owned enterprises.
In each of these categories there are distinct issues to be taken into account when
measuring black ownership and constraints on increasing that ownership.
In the case of 100% foreign-owned companies, there is little incentive for the foreign
owners to give up any of their equity, barring government intervention – which would carry
a high risk of desinvestment, or at least reduced investment. Therefore, there are relatively
few empowerment companies able to meet these conditions.
Tentative definitions of BEE ownership categories include:

A "black company" is one that is 50,1% owned and managed by black people.

A "black empowered company" is one that is at least 25,1% owned and managed by
black people.

A "black influenced company" is one that is 5-25% owned and managed by black
people.

An "engendered company" is one with at least 30% representation of black women
within the black equity and management portion.
Page 56
All Rights Reserved
Waterberg District Municipality
By these measures very few Waterberg companies involved in agriculture, mining and
tourism sectors can be regarded as black or black empowered. In fact, ownership turns out
to be far more complex and difficult to measure than these definitions would suggest. 12
11.3 THE PPP CODE OF GOOD PRACTICE
The Code of Good Practice for Black Economic Empowerment in the Public-Private
Partnerships, which is a Module of the National Treasury’s PPP Manual has Standardised
PPP Provisions to ensure that BEE becomes contractually binding in PPP contracts. The
following prescriptions are critical:

The BEE component of a Transaction Advisor bid will constitute no less than 20% of
the evaluation, with the price and technical elements constituting the remaining 80%.

The BEE component of a Transaction Advisor bid will constitute no less than 20% of
the evaluation, with the price and technical elements constituting the remaining 80%.

In addition, there is a 12% threshold on the BEE component of a Transaction Advisor
bid. If the Transaction Advisor bid passes the technical threshold but fails to pass the
BEE threshold, it will not be further considered for selection.
Therefore, understanding the competitive environment through the value chain provides the
Waterberg District Municipality with a clear systematic way of diagnosing its relative
strengths and weaknesses compared to its rivals. However, within a public sector such as
the Waterberg District Municipality a successful value chain process can be made more
effective if blended with an integrative corporate strategy to product and service delivery.
11.4 PRINCIPLES FOR SUCCESSFUL PPP AND BEE VENTURES
It is no doubt that in order for the PPP and BEE ventures to be successful, proactive
measures from relevant institutions need to be in place. There is a number of tools that
have been designed by the relevant authorities such as the Tourism Business Council of
South Africa (TBCSA)13, South Africa’s Economic Transformation: A Strategy for Broad
Based Black Economic Empowerment,14 South African Mining Charter, Code of Good
Practice,15 … Tools and guidelines include, among many, the following:

Conducting feasibility studies of BEE ventures;

Scorecard system to measure enterprises’ progress with regard to black ownership,
management, control and employment.

Longevity of projects and initiatives and the way they translate into beneficiation to
non-government organisations, civil society, clinics, child-care, etc.16 and

Government proactive commitment to support BEE in PPPs.
All Rights Reserved
Page 57
Marketing and Investment Strategy
11.4.1 THE PPP FEASIBILITY STUDY
The key components of the Feasibility Study with regard to BEE are summarised in the
Table 15 below.
Table 15: PPP & BEE Initiatives Feasibility Study Guide
Relevant Component
Output Specifications
Brief Description
To clearly identify what the Institution
wants to deliver
Solution Options
Analysis
To identify the pros and cons of each
option that can meet the Institution’s
needs and output specifications; to
examine the risks, benefits and
impacts to govt of each; and to select
a preferred option.
To undertake a due diligence assessing all budgetary, institutional,
legal, regulatory, site, and socioeconomic factors that constrain
and/or enable the project.
Due diligence
BEE Feasibility Phase
Draw up a list of BEE outputs that the
Institution wishes to achieve the
project, using the PPP BEE Balanced
Scorecard as reference
Set out a preliminary view of the
impact of each option on the
intended BEE outputs, and identify
the possible BEE outcomes of the
preferred option
Identify project-specific BEE
sectoral conditions, black enterprise
strength, impact of
sectoral BEE Charters, and any
constraining factors to the
achievement of the intended BEE
outputs.
If the preferred option can be procured through a PPP, the Institution must then establish affordability, value-for-money
and risk transfer. This entails constructing a Public Sector Comparator model, and a PPP Reference model, both riskadjusted.
Draft a proposed BEE Balanced
Scorecard for the project, based on
the PPP BEE Balanced Scorecard,
taking account of factors identified in
due diligence.
Risk identification
To identify all possible risks in the
Identify all possible BEE risks in the
construction and operation of the
project, using the proposed BEE
project, probability of each arising,
Balanced Scorecard for the project
the value of each risk, and strategies as reference, probabilities of each
and costs of mitigation
such risk arising, values for each,
and the strategies and costs of
mitigation.
Public Sector Comparator (PSC)
Life-cycle cost model of the output
Cost the achievement of the project’s
specifications where the public sector identified BEE objectives if it were
takes construction and operating
procured conventionally i.e. Calculate
risks.
preferential procurement as
stipulated by the PPPFA’s 90:10
formula, and include this in the
model.
PPP Reference
Life-cycle cost model of the same
Cost the achievement of the project’s
output specifications where the
identified BEE objectives by
private sector takes substantial
calculating how the private sector
construction and operating risk.
would cost each of the BEE elements
of the proposed PPP BEE Balanced
Scorecard for the project in the PPP
Reference model.
Sensitivity analyses
To test the resilience of the models to Test varying BEE targets for the
changes in assumptions and risk
project, their costs, and their
Page 58
All Rights Reserved
Waterberg District Municipality
over the project term.
assumptions to assess the impact on
affordability and value-for-money
Value Comparison
To reach a justified conclusion
Write up a separate analysis of the
Report
analysing the outcomes of the
BEE outcomes (quantitative and
modelling as to which procurement
qualitative) of each procurement
route will achieve optimal value for
option, and which is going to best
the Institution
achieve the project’s BEE objectives.
Thereafter, produce the optimal proposed BEE Balanced Scorecard for the project, with
appropriate targets for the project.
Economic analysis
To establish the economic rationale
Identify economic benefits for
for the project, where required
BEE, and opportunity cost to BEE of
‘no-project’ scenario.
11.4.2 THE SCORECARD MEASURES
The scorecard measures three core elements of BEE:

Direct empowerment through ownership and control of enterprises and assets;

Human resource development and employment equity; and

Indirect empowerment
development.
thorough
preferential
procurement
and
enterprise
The BBBEE Strategy notes that BEE criteria, reflecting the balanced scorecard, will be
applied whenever government, inter alia, “grants a concession to a private enterprise to
operate an asset or enterprise on behalf of the state” or “enters into a public private
partnership.”17
The scorecard will be issued as a Code of Good Practice, which allows for a measure of
flexibility in order that it can be adapted to the particular circumstances of specific sectors
or enterprises, while at the same time bringing a measure of standardisation to the
definition and measurement of BEE. In particular, government will apply BEE criteria, as
set out in scorecard (or charter) whenever it:

Grants a licence to engage in a specific regulated economic activity, for example,
gambling or mining;

Grants a concession to a private enterprise to operate an asset or enterprise on
behalf of the state;

Sells an asset or a state-owned enterprise;

Enters into a public-private partnership; and

Engages in any economic activity.
All Rights Reserved
Page 59
Marketing and Investment Strategy
11.4.3 APPLYING THE BEE PRINCIPLES IN PPP MINING SECTOR
The South African Mining Charter has laid basic principles catering for BEE policy. One of
the main focus of the Mining Charter is a socio-economic strategy, which calls for redress
of the imbalances of the past, so as to improve the lot of the Historically Disadvantaged
South Africans (HDSA).18 Its approach includes:

Redressing the results of past or present discrimination based on race, gender or
other disability of historically disadvantaged persons in the minerals and petroleum
industry, related industries and in the value chain of such industries; and

Transforming such industries so as to assist in, provide for, initiate, facilitate or
benefit from them;

Ownership participation in existing or future mining, prospecting, exploration and
beneficiation operations;

Participation in or control of management of such operations;

Development of management, scientific, engineering or other skills of HDSA's;

Involvement of or participation in the procurement chains of operations;

Integrated Socio-economic development for host communities, major labour sending
areas and areas that due to unintended consequences of mining are becoming ghost
towns by mobilising all stakeholder resources.
The Charter goes on to list its focal areas noting the need to address the following:

HDSA Companies are those companies that are owned or controlled by historically
disadvantaged South Africans.

Major labour sending areas refer to areas from where a significant number of
mineworkers are or have been recruited.

Ghost towns refer to areas whose economies were dependent on mining and
therefore could not survive beyond the closure or significant downsizing of mining
activities.
In terms of ownership, the Charter outlines the following possibilities for BEE initiatives:

A majority shareholding position, i.e. 50% + 1 share,

Joint ventures or partnerships (25% equity plus one share).

Broad based ownership (such as HDSA dedicated mining unit trusts, or employee
share ownership schemes).
Page 60
All Rights Reserved
Waterberg District Municipality
11.4.4 APPLYING THE BEE PRINCIPLES IN PPP TOURISM SECTOR
Deriving its principles from the Broad Based Black Economic Empowerment Act, the
Tourism BEE Charter and Scoreboard defines Black Economic Empowerment as
…an integrated and coherent socio-economic process that directly contributes to the
economic transformation of South Africa and brings about significant increases in the
number of black people that manage, own and control the country's economy, as well
as significant decreases in income inequalities.19
Using a scoreboard as per expectation of the Code of Good Practice, the Tourism BEE
Charter and Scoreboard derives its approach from the Tourism BEE Scoreboard launched
by Minister of Environmental Affairs and Tourism in July 2004.
The Steering Committee was requested to accomplish the following, inter alia:

The development of a BEE Scorecard for the Tourism sector in order to advance the
objectives of the Broad-Based Black Economic Empowerment Act no. 53 of 2003;

Develop and promote the BEE process in the Tourism industry;

Be committed to the development of the BEE Scorecard;

Drive the scorecard development process, particularly in terms of promotion,
deliverables and the solicitation of input;

Communicate the process and broader principles of the BEE Scorecard; facilitate
access to research, input and information in the Tourism industry; facilitate
partnerships between organs of state and the private sector that will advance the
objectives of the Scorecard.
Other responsibilities of the Steering Committee included:

Providing recommendations with respect to the amendment of the Tourism Charter to
ensure its alignment with the negotiated Tourism BEE scorecard;

Providing recommendations for the consideration of a BEE Tourism Council and the
submission of a recommendation to the Minister for his approval.
The process after the launch of the Scorecard process and the appointment of the Steering
Committee in July 2004 include:

Establishment of Sub-sector working groups involving Steering Committee members
and representatives of major stakeholders in key tourism sub-sectors;

Consultation with the major stakeholders in key tourism sub-sectors and the collation
and moderation of input into the preliminary scorecard in September 2004;
All Rights Reserved
Page 61
Marketing and Investment Strategy

Provincial road-shows and other communication mechanisms to solicit further input
from all major stakeholders, as well as any other existing and potential stakeholders,
on the preliminary scorecard in October 2004;

Collation and finalisation of the final draft Scorecard by the Steering Committee
during November and December 2004; and

Submission of the draft Scorecard to the Minister of Environmental Affairs and
Tourism on 8 December 2004.
All these items were strictly aligned with the principles of BEE Act of 2003. The Charter
applies to all tourism related fields of the Tourism Value Chain Cluster, inclusive:
Accommodation

Hotels;

Resort properties and timeshare;

Bed and Breakfasts;

Guesthouses;

Game Lodges; and

Backpackers and hostels;
Hospitality and Related Services

Restaurants (not attached to hotels);

Conference venues (not attached to hotels);

Professional catering;

Attractions; and

Consulting and professional services companies;
Travel Distribution Systems

Tour wholesalers;

Tour operators;

Travel agents;

Tourist guides;

Car rental companies; and

Coach operators
Page 62
All Rights Reserved
Waterberg District Municipality
11.4.5 APPLYING THE BEE PRINCIPLES IN PPP AGRICULTURAL SECTOR
The implementation of the BEE principles in Agricultural Sector should be integrated within
the agenda of Integrated Rural Development Strategy. The BEE Commission Report
pointed to the need for drastic interventions to improve the livelihoods of the rural poor,
including:

Establishing a framework for increased State intervention in rural areas aimed at
breaking the cycle of underdevelopment and stimulating rural economies. This will
require targeted initiatives that meet the needs of rural communities.

Substantially improving the economic and social position of women in rural areas
through specific programmes aimed at women and targets in all other development
initiatives.

Increasing levels of food security in rural areas. While there is adequate food at
national level, some 30 – 50% of the population has insufficient food or is exposed to
an imbalanced diet due to low incomes.

Empowering rural people to unleash their full potential by providing increased access
to schooling and adult basic education and training (Abet). Skills development and
entrepreneurial capacity should be promoted within existing schools, tertiary
institutions and SME support agencies.

Giving rural communities real ownership of productive assets by increasing access to
financial services and through land reform programmes.

Enabling rural communities to utilise land productively through appropriate extension
services, including technical support, marketing and product development.

Providing access to the information and communication technology (ICT)
infrastructure to improve the delivery of Government services, enhance the use of
productive assets and to improve access to affordable financial services and markets.

Increasing levels of state welfare to rural households through a Comprehensive
Social Security System.
This strategic approach needs to be enhanced by clear and systematic process of land
reform, promotion of community ownership, access to finance and investment in rural
infrastructure.
The first piece of legislation passed by the democratic Government was the Restitution of
Land Rights Act of 1994. Since then the Government enacted relevant laws such as the
Provision of Land and Assistance Act of 1998, The Land Reform (Labour Tenants) Act of
1996, the Interim Protection of Informal Land Rights Act of 1996, the White Paper on South
African Land Policy and the Extension of Security of Tenure Act of 1997.20
All Rights Reserved
Page 63
Marketing and Investment Strategy
11.5 VERTICAL AND HORIZONTAL STRATEGIES
An integrative strategy is commonly known as a combination of backward and forward
vertical strategies, as well as horizontal strategies. This strategy would enable the
exploitation of technical talent and strength in the primary business and economic affairs
when opportunities are available and compatible with the District’s mission and vision.
11.5.1 BACKWARD VERTICAL INTEGRATION
Backward vertical integration is the strategy followed by an enterprise seeking increased
control of its supply sources. The enterprise can create its own source of supply or can
purchase an existing supplier. This strategy is very attractive if there is uncertainty
regarding availability, cost or reliability of the deliveries of supplies. It does, however,
require a large capital investment.
For example, if a Waterberg BEE company manufactures citrus derivate drinks such as
orange juice, orange flavoured biscuits and beverages, it needs to ensure that suppliers
make the raw material are supplied uninterruptedly. But when the supplier does not match
the BEE company’s production tempo, the later can simply decide to buy the supplier’s
business so that it supplies itself without unnecessary obstacles. The approach is quite
common in today’s emerging black South African entrepreneurs.
11.5.2 FORWARD VERTICAL INTEGRATION
When the strategy involves the acquisition of a business nearer to the ultimate, it is called
forward vertical integration. An example would be a paper producer purchasing a
bookstore. Forward vertical integrated is an attractive alternative if an enterprise is
receiving unsatisfactory service from the distributor of its products. Another example would
relate to the emerging BEE Farming Company struggling with market monopoly. The
Company may decide to buy retail venture such as Fruit and Vegetable Company so that it
supplies and retails its own products directly.
In a tourism context, for example, an African entrepreneur who has started a holiday resort
in Waterberg and is not receiving satisfactory service and publicity from an influential
travelling agency can decide to take over the agency so that its resort is advertised
properly, so as to lure tourists and holiday makers.
11.5.3 HORIZONTAL INTEGRATION
Horizontal integration is a long-term growth strategy by which one or more similar
enterprises are taken over for reasons such as scale of operational benefits or a larger
market share. Such acquisitions, on the one hand, provide access to new markets and, on
the other hand eliminate rivalry and competition. In South Africa a similar merger was seen
recently among Shoprite, Checkers and OK Stores.
Page 64
All Rights Reserved
Waterberg District Municipality
For instance, the combination of two Waterberg emerging African shirt manufacturing
companies, this merger would be classified as horizontal integration. The diagram in
Figure 12 depicts such a model of vertical and horizontal integration between companies.
Beyond the process of horizontal integration is the necessity of a strategy that blends
together the vertical and horizontal processes. Such a blending advances a scenario
where the backward and forward vertical strategies are combined with horizontal integration
to provide emerging BEE and SMME initiative with a robust competitive foothold in the
market.
11.5.4 VERTICAL AND HORIZONTAL STRATEGIC INTEGRATION
The discussion and analogies provided a benchmark to another level of understanding the
need for an integrative approach. The strength into the proposition is the existing policy on
BEE and SMME. The importance of such integration is to bring to realisation the goals set
out in the BEE and SMME policy framework.
During the early 1990s, black business organisations adopted the BEE targets to be
achieved by the year 2000. However, the goals are still very far to be attained. Despite the
relative implementation of Affirmative Action in many companies, black ownership, control
and management is still very small.
It is thus important to include other measures of empowerment while recognising that, in
the long run, increased ownership of enterprises by blacks in Waterberg will remain a
challenge and a necessary element of empowerment.
Small business development and affirmative procurement have the potential to account for
a large proportion of BEE activity in the Agriculture, Mining and Tourism sectors of
Waterberg, and are especially significant for those companies whose current shareholding
structures place constraints on their ability to increase black ownership.
The diagram in Figure 12 proposes how vertical and horizontal processes should be
integrated, whereby at all vertical levels 25% of shareholding is black, including the
horizontal layers in the hierarchy of products.
There are three broad challenges for the Waterberg District Municipality when adopting the
approach in Figure 12:

Firstly, locating businesses that are able to provide goods and services of an
acceptable quality;

Secondly, providing medium-term support and capacity-building to those small
businesses that require it; and
All Rights Reserved
Page 65
Marketing and Investment Strategy

Thirdly, communicating with small businesses, which have neither e-mail nor internet
connectivity nor a reliable contact telephone number. Black SMMEs, especially
community-based small businesses, may lose business opportunities due to lack of
access to information about tourism related tenders, events, products or initiatives.
BBBEE Act
Mining Charter
Tourism Charter
SA Agricultural Charter
National Treasury PPP Unit
Tourism





Mining
POLICY ENVIRONMENT:
Agriculture
Figure 12: Illustration of Vertical and Horizontal Integration Model for BEE and SMME
SOURCES RAW MATERIAL
PROCESSORS
PRODUCERS
DISTRIBUTORS
RETAILERS
Acquisition or merger of suppliers or customer business are vertical integration
Acquisition or merger of suppliers of competing businesses are horizontal integration
Page 66
All Rights Reserved
Waterberg District Municipality
12. OVERALL STRATEGY TO MARKET THE WATERBERG
DISTRICT MUNICIPALITY
The quest for investment strategy in Waterberg is prompted by globalisation and the recent
trends of urbanisation as many people from rural areas are moving to towns and cities.
Leading municipalities in the country and other parts of the world have established
investment recruiting agencies to promote their regions and the available opportunities. It
is within this global and regional context that the Waterberg District Municipality has
embarked on a process to position its region as an investment destination within the
Limpopo Province.
Therefore, the Waterberg District Municipality Marketing and Investment Strategy is
propelled by three fundamental factors:

First, this strategy is a consequence of the market and socio-economic imperatives of
Waterberg District Municipality itself;

Second, global and regional trends have made it a compelling task for states, cities,
and towns, especially those in the developing world to market themselves in order to
improve their plight and their quality of life of their citizens; and

The South African legislative mandate, which compels the local government to pursue
developmental programmes that improve the socio-economic conditions of their
citizens and communities.
These three factors do not necessarily depend on which products Waterberg can provide
rather they constitute a compelling environment within which the Waterberg must market
itself.
Further, this marketing strategy needs to outplay four aspects that have a critical bearing on
the process of marketing: (See Figure 15):

Favourable circumstances: These are immanent conditions within Waterberg area,
which include the current natural attraction that makes it unique, in terms of
friendliness, culture and its people, reliable infrastructure, and so on.

Hostile environment. Those circumstances that pose a challenge on Waterberg’s
desire to become the most preferable place for investors in the Limpopo Province.
The “hostile environment” may include aspects such as rivalry and stiff competition
from other districts within or outside the province, crime, etc.

Local and national socio-political context. Socio-political stability of the country –
nationally, provincially and locally – are paramount to marketing strategy and investor
All Rights Reserved
Page 67
Marketing and Investment Strategy
attraction. Socio-political stability of the District is key to formulating good marketing
strategy that attracts potential investment.

Regional and international socio-political context. While this aspect does not
necessarily have a direct bearing on Waterberg District, it has a potential of impacting
on Waterberg. For example, a negative political instability in neighbouring states, or
proliferation of drugs in the region, can be perceived as influencing the good
administration of South Africa, then Limpopo and therefore Waterberg.
The Waterberg District Municipality has factored in all optimistic ingredients, which have
been successful to outplay all potential pessimistic elements as it has become a distinctive
and unique identity, with which every potential investor would like to be associated.
Figure 15: Interplay between Marketing Strategy and Socio-political Dynamics
Favourable
Circumstances
Local SocioPolitical
Context:
Reputation
about people
and government
Waterberg Context:
AS PRODUCT AND
PREFERED
DESTINATION
Regional
Socio-political
context:
Positive or
negative
perceptions
Hostile
Environment
Granted the circumstances surrounding the market strategy, the Waterberg District
Municipality has devised proactive measures to address all possible aspects of the strategy
as it relates to that of specific products. These measures may include: Branding and
Positioning Strategy, Image Reputation Strategy and Reputation Management. These
ingredients provide a solid strategy with which the Waterberg District Municipality will
promote its region to potential investors and other types of clientele.
Page 68
All Rights Reserved
Waterberg District Municipality
12.1 STRATEGIC FOCAL AREAS
The Waterberg District Municipality has determined strategic focal areas, which can be
used as a starting point of an investment process. Such strategic focal areas include those
programmes that aim to improve the business enabling environment and those that support
the development of BEE and SMME initiatives. The selection should depend on the results
of the economic status.
12.1.1 STRATEGIC FOCUS 1: ENCOURAGING LOCAL BUSINESS GROWTH AND RETENTION
Most local industrial and economic growth are generated by small and medium-sized businesses that are already
established in the District. These strategies are classified as business retention and expansion strategies.
Waterberg offers a range of opportunities to support local businesses including:
Business retention visits and surveys
Visits and surveys of the District firms can be used to help identify problems and determine how the business is
performing, from where it sources its inputs, whether it is expanding, etc. These visits can be used to elicit potential
investment information and to encourage local businesses to source more inputs locally, identify and finance training
and skills needs. An important role these visits can have is to devise proactive measure to prevent brain-drain and
exodus of skilful human resources from leaving the District.
Technical assistance to business
This includes broad-based management and marketing programmes, quality and environmental standards training and
advice through to more specialized export training or research and development support.
Financial advice and assistance
One of the hardest issues for BEE businesses is to access capital. Waterberg District Municipality will facilitate a
financial support programme, which will provide advice and training on financial planning, access to capital, credit, etc.
In some cases it may be possible to establish small grant or loan programs to encourage, for example, investment in
modern technology, mining, tourism, manufacturing, and agriculture. Great care is taken with these to ensure fairness,
so as to ensure that these schemes are always transparent.
All Rights Reserved
Page 69
Marketing and Investment Strategy
12.1.2 STRATEGIC FOCUS 2: IMPROVING THE LOCAL BUSINESS INVESTMENT CLIMATE
A business environment assessment for the Waterberg District Municipality will assess the performance of the Local
Municipalities in terms of those aspects of the investment climate that it has control over. These include, but are not
limited to:
Land and Property

Land title

Property registration
Planning and Development Control

Real estate improvements

Building plans passed
Infrastructure Provision and Maintenance

Roads

Electricity

Water and sewage

Garbage collection
Business Registration and Licensing

Business registration

Business licenses
State Revenue Methods

Tax rates

Fiscal system
Health and Safety (including environmental)

Support for HIV/AIDS programs

Environmental standards

Occupational health standards
Internal Operations and Procedures

Passing of by-laws

User friendliness of LGA

Who is the right person
Once the diagnosis is completed then a Local Investment Strategy can be developed. In addition the above list,
Waterberg District Municipality will develop strategies aimed at reducing bureaucratic bottlenecks, which discourage
potential investors.
The amount of permits and approvals that businesses need to obtain, and the time it takes to obtain them, are not only
expensive and time consuming, they can also be a disincentive to register into the formal economy or expand. A good
place to start is to review existing regulations and laws, consult with stakeholders and develop a feasible plan. This will
probably include streamlining local government processes and may also include a lobbying program to reduce
bureaucracy in the provincial and national government spheres.
Page 70
All Rights Reserved
Waterberg District Municipality
12.1.3 STRATEGIC FOCUS 3: PROMOTING INWARD INVESTMENT
Waterberg District Municipality will promote foreign direct/inward investment means to attract businesses to an area
from elsewhere in the country and from other countries. Careful consideration is given to the costs and benefits of
attracting inward investors. Therefore, Waterberg will embarked on a strategic process to ensure the following::

A stable macro-economic climate

A stable political and regulatory environment

Market access and open competition

A welcoming environment

Available sites and/or premises

Appropriate, available and reliable utilities and transportation

Available skilled workforce

Available local suppliers and resources

Appropriate education, training and research facilities

A good quality of life, especially when bringing ex-patriots

Manageable regulation and taxation systems

Incentive schemes, etc.
These processes are meant to ensure great achievements. Besides direct employment, an increase in the tax base
and indirect employment, there are potential wins for the Local Municipalities through the skill transfer to the workforce,
increases in wages, and opportunities for local SMMEs that supply and buy from these investors.
In order to ensure that Inward investment strategies are successful, the Waterberg District Municipality will devise
mechanisms, which will ensure that:

They are a component of a broader strategy of the local economy

The community has the appropriate hard and soft infrastructure in place or available to support the likely
investments

Targeted investments fit the competitive advantage of the receiving community (normally a sector/cluster
approach is likely to be most successful)

Marketing strategies are carefully prepared, budgets are appropriate and follow up procedures are in place

Incentive programs are considered, varied and not excessive;

Staff involved in attracting strategic investors have an understanding of investment needs and what the local
context has to offer;

Opportunities for local businesses are optimised through careful aftercare programs.
This means that when a new investor is attracted to Waterberg, every opportunity is taken to encourage the investor to
source his/her supplies locally, enabling supply and value chain advantages to be exploited locally. Waterberg District
Municipality will provide guidance with regard to the development of Investor Aftercare Programme. Such programs are
aimed at ensuring investors are happy and that they are given every opportunity to source their inputs locally.
All Rights Reserved
Page 71
Marketing and Investment Strategy
12.1.4 STRATEGIC FOCUS 4: INVESTMENT IN HARD STRATEGIC INFRASTRUCTURE
The Waterberg District Municipality intends to open investment opportunities in hard infrastructure. This entails
investing in order to improve the physical environment for businesses thereby making it more attractive for business
retention, expansion and recruitment.
Prospective projects in this strategic focus include, but not limited to:

Building or improving key access roads;

Improving the railway for passenger and goods services;

Developing, improving and/or expanding the local airport;

Developing, improving and/or expanding industrial sites and buildings. This could include anything from
planting trees, to comprehensive landscaping, to building entire new science parks;

Developing, improving and/or expanding commercial sites and buildings (for shops and offices);

Increasing the availability of industrial and potable water;

Improving and/or expanding the sewerage disposal system;

Improving and expanding the telecommunications systems;

Improving and expanding the energy systems;

Environmental enhancements; and,

Crime prevention technology installation.
All these projects involve considerable expense, outside agencies and often national government departments and the
private sector. Competing demands for hard infrastructure investment are always hard to prioritise, especially when
there are massive poverty issues for communities to face in both urban and rural areas.
However, investment strategy can help Waterberg prioritise infrastructure investments according to need, potential for
cost-recovery, opportunities for leveraging additional resources, etc. It can also provide an opportunity to identify
possible public-private partnerships in the provision of infrastructure and related maintenance.
Page 72
All Rights Reserved
Waterberg District Municipality
12.1.5 STRATEGIC FOCUS 5: INTEGRATING LOW INCOME OR HARD-TO-EMPLOY WORKERS
Targeting Disadvantaged Groups
Recognising the socio-economic imbalances, the Waterberg District Municipality will embark on special projects that
deliberately target specific social groups. Targeting disadvantaged groups means that measures are targeted at
groups of individuals such as poor children, the urban poor, redundant workers, the long-term unemployed and youths.
Possible projects include:
Language training
This is a key issue where there are groups of illiterate people seeking employment in urban centres. Seeking command
of bureaucratic and professional language is critical.
Skills retraining and job placement programmes
Skills retraining can be done using a demand-led approach i.e. businesses need to be involved in articulating the skills
needs. There is little point in retraining individuals in skill areas for which there is no local demand. Job placement
programs assist individuals in acquiring the skills they need to access jobs and assist in identifying opportunities.
Raising educational achievement
This is usually an issue for an entire region, but specific Local Municipalities may need of extra support.
Enterprise training
Many disadvantaged groups have both high unemployment and a large proportion of workers in the informal sector.
Basic training in terms of business management, finance and marketing can have a significant impact on these
communities.
Helping women to access employment and self-employment programmes
Projects could include skills development, confidence building programs, and provision of crèches and after-school
clubs.
Micro-enterprise lending programmes
This area of activity is also well suited to assisting disadvantaged groups to access self employment.
Work experience and teacher/pupil placement schemes
These schemes involve teachers and students working for short periods of time in businesses to gain work experience
and work ethic skills. Teachers do this, which gives them a better understanding of workplace requirements.
Developing mentor programmes
The idea is to ensure that more experienced business people mentor new starters and give them support,
encouragement and ideas. Mentor programs can be very informal, and are a way of helping individuals to start their
own business.
Health awareness programmes
Often the most disadvantaged suffer from the worst health. Besides the direct effects on individuals, poor health
becomes a serious limiting factor when trying to access work. Health awareness programs can be closely targeted at,
for example, specific schools, communities and so on.
All Rights Reserved
Page 73
Marketing and Investment Strategy
12.2 INTERVENTION STRATEGIES AND MARKETING ACTION PLAN:
In order to realize the Marketing and Investment Strategy, the Waterberg District
Municipality will embark on a series of activities that lead to attraction of national and
foreign investment in the region. The main purpose of the Action Plan is to take the
strategy to achieve its objectives.
The first step towards affecting a marketing strategy is to determine the kind of clientele
and investors Waterberg purports to attract. It entails a systematic process of identifying
potential markets within and outside Waterberg. These include among others the following:
12.2.1 DEVELOPING BUSINESS RETENTION AND EXPANSION PROGRAMMES
This aspect entails assisting the existing businesses in Waterberg to create jobs by growing existing business so as to
empower the local people. In addition, this programme will undertake the following:





Analysis of the results for critical issues and common concerns;
Identify the needs and concerns to local business through a structured survey;
Develop and win local support for an action plan to address them;
Locate the necessary resources from national, provincial and local government; and
Implement a plan to assist the industries to remain in the area and to look at opportunities for growth through local
task teams.
This programme could be more effective when driven in partnerships with Local Municipalities, the business community
of Waterberg and other stakeholders. Where necessary, expertise from other spheres of government may be
borrowed.
12.2.2 CORPORATE LIAISON AND MEETING WITH INVESTORS
In the light of this new strategic climate, the Waterberg District Municipality will need to engage in a process of
systematic information sharing with potential investors locally and outside the region. The objective can be aligning
with the provincial as well as the national policy environment on investment, which would underpin the approach of the
Waterberg District Municipality. In this regard, it is necessary to undertake a feasibility study, of which results will guide
the entire protocol interacting with potential investors.
12.2.3 STRATEGIC ALLIANCES
Strategic Alliances could take a form of establishing partnerships with other entities nationally and abroad. This
strategy is useful in terms of consolidating good relationships with BEE and SMME companies so as to win support
and to attract potential investors to the Waterberg region.
In order to realize this, it is crucial to undertake outreach missions to the SADC region selected regions in the
developing countries European Unions and Asia.
12.2.4 INVESTMENT FACILITATION
Aside from facilitating interaction and meetings with and amongst potential investors, the Waterberg District
Municipality will focus on developing investment methodologies and strategies for Local Municipalities. This will entail
developing an Investor’s Guide Protocol to capacitate all Local Municipalities on the nitty-gritty of investment
mechanics at local, provincial, national and international levels.
Page 74
All Rights Reserved
Waterberg District Municipality
12.2.5 FREE TRADE AGREEMENT PLATFORM
In order to maximize the opportunities of luring potential investors, there will be a need to establish free trade
agreement between Waterberg and other regions within SADC and Europe. Agreements of such magnitude require
well trained personnel to engage in excellent negotiations. Expert capabilities on qualitative and quantitative economic
and trade analysis is paramount. It needs to be noted that linkages with provincial and national spheres of government
must be maintained in order to avoid unnecessary replications
12.2.6 ESTABLISHMENT OF BACKWARD AND FORWARD VERTICAL BUSINESS UNIT
Taking a lead from the notion of the Value-Chain and Integrated Vertical and Horizontal Strategy, it is absolutely critical
that investors commit to the cause of BEE and SMME in Waterberg.
The Waterberg could use the backward strategies concept to implement the BEE Act. This can be done by a holistic
approach to black economic empowerment, looking at a wide range of enterprises and individuals and where they fit
into the economic value chain. The BEE Act looks at the suppliers to large companies, the downstream beneficiation of
goods produced by companies, the development of human resources, the levels of BEE in the ownership in
companies, and very importantly, the levels of BEE in management.
12.2.7 EXPOSING THE WATERBERG BEE AND SMMES TO INVESTMENT TRADE AND EXPORT
OPPORTUNITIES
In order for the Waterberg District Municipality’s strategy on Marketing and Investment to be embraced by the formerly
disadvantaged groups, there is a need to establish a programme that can impart knowledge on Investment, Trade and
Exports to BEE and SMME emerging enterprises. Exposure to trade exhibitions at local, provincial and national levels
can play a major role in increasing investment and trade between Waterberg and other companies in South Africa or
abroad. Even more valuable is the opportunity to interact with countries that had never done business with Waterberg
directly. Exhibitions are also another form of inward or outward missions. The make export, import, trade and
investment opportunities translate into transactions, and consolidate vital milestones for trade and investment
relationships.
12.2.8 INDUSTRIAL RECRUITMENT
Existing investment opportunities in Waterberg need a systematic strategic approach to recruit potential local talents
and industries to spark a momentum of job creation and poverty reduction. From the market growth and value chain
analysis, it is wholly critical to encourage potential industries, communities and individuals to develop sectoral cluster
projects or cooperatives initiatives.
At core of this strategy is the whole concept of “clustering” either in a form of cooperative, associations, or community
initiated projects so as to ensure that there is a local-driven beneficiation of existing opportunities. Further the strategy
starts with a three-pronged approach in clustering:
 Inclusion of leading industries;
 Establishment of network for business support; and
 Strengthening of economic infrastructure.
The interdependence and relationship of this arrangement entails:
 First, leading industries such as tourism, agriculture, and mining will be engaged in activities that attract direct
industrial investment;21
 Secondly, there is a category of middle range networks, emerging businesses, cooperative-based and cluster
projects, which will derive support from the leading industrial sectors; and
 As consequence, communities in the District benefit through the improvement of infrastructure and living conditions.
In turn, the government at local provincial and national levels has a direct stake through the existing revenue and
fiscal systems (See Figure 13)
All Rights Reserved
Page 75
Marketing and Investment Strategy
In total, intervention strategies are summarised by the diagram in Figure 18.
Develop Business
Retention
Programmes
Develop Expansion
Programmes
Corporate Liaison
& Meeting
Investors
Strategic
Alliances
Investment
Facilitation &
Free Trade
Agreements
Feedback
Mechanisms
Establish
Backward &
Forward
Vertical Unit
SMMEs Exposure
to Import& Export
Trade
Figure 18: Steps in Intervention Strategies for Investment Attraction
12.3 BRANDING AND POSITIONING
Image building and positioning constitutes a critical factor in the investment promotion
pipeline. The Waterberg District Municipality has developed a measurable marketing and
positioning strategy. It will re-brand itself and launch its new brand within a determined
period within the first year of its implementation strategy. The Waterberg District
Municipality Marketing and Investment Strategy can consist of the following ingredients:
12.3.1 ADVERTISING IN MASS MEDIA
The merits of advertising in mass media such as local newspapers, radio, television,
magazines, etc. will be exploited to the advantage of branding Waterberg.
12.3.2 PARTICIPATING IN INVESTMENT EXHIBITIONS
This method of branding yields to higher success, especially because of human interaction
and relationships that are forged between encounters of people in the events.
12.3.3 ADVERTISING IN SECTOR AND INDUSTRY MEDIA
Advertising is a good tool to build a brand. This will consist of Waterberg proliferating
information in a form of magazines, newsletters in companies and other sectors.
12.3.4 CONDUCTING INVESTMENT SEMINARS
This method is crucial and it presupposes that Waterberg District Municipality facilitate
investment opportunities to the region.
Page 76
All Rights Reserved
Waterberg District Municipality
12.3.5 UTILISING WATERBERG DISTRICT MUNICIPALITY WEBSITE
The Website will be very informative and will embody all interests and values of Waterberg
as a region. The website on its own will not suffice to market Waterberg region; therefore, it
must be supplemented by other relevant material that will be developed in due process.
12.3.6 IMAGE REPUTATION
Marketing concentrates progressively on developing strong brand reputations to build
equity and ownership. The region of Waterberg has a reputation onto which the brand is
attached. In the past there has not been the opportunity of developing a brand-product from
scratch, and therefore the Waterberg District Municipality has had to adopt the existing
product package, which is mostly at variance with, and often lacking the integrative
approach. While the Waterberg District Municipality cannot define itself outside the
Limpopo Province and South Africa in general, its strategy will include distinctive features
that emphasize the best aspects of the region so that good brand image is preserved
12.3.7 UNIQUENESS REPUTATION MANAGEMENT
While naturally having a unique and self-contained context-brand, Waterberg
acknowledges several factors at the national context and translate them where possible
into a marketing strategy at local context. The are five basic principles of managing
uniqueness and reputation:

Distinctiveness. The distinctive leadership style of Waterberg makes it a desirable
region first, to visit and admire its scenic landscapes, and secondly as an attractive
investment destination.

Focus. This entails identifying specific main focal points that exalt individual product
at its control;

Consistency. As a product, Waterberg must complement the pride of its people
through the promotion the amicable culture and warm hospitality to tourists and
visitors;

Identity. Considering the involvement of various stakeholders in forging good
management practice, Waterberg, as a product identity reveres all parties involved,
so that the products are associated with everyone’s effort.

Transparency. In all its operational ramifications, Waterberg encourages strong
transparent practice in order to win clientele confidence.
12.3.8 MANAGEMENT INFORMAL MODES OF COMMUNICATION
Verbal communication and information propagated through conversation and informal
modes of personal recommendation can have a drastic impact on how Waterberg is
perceived by prospective clientele and potential investors. This approach entails motivating
the Waterberg District residents of the importance of the area’s image and reputation. For
All Rights Reserved
Page 77
Marketing and Investment Strategy
example, attracting tourists, or delegates who come to the area for official purposes such
as conferences, research, etc. should be instilled with positive feelings and are able to give
strong recommendations on return to their home countries. However, if they return with
negative experiences or perceptions, their word-of-mouth comments will severely affect the
Waterberg District Municipality’s reputation.
12.3.9 DISPELLING PESSIMISTIC PERCEPTIONS
Another approach of maintaining the region’s reputable status is to underplay negative
assumptions about the area. It is assumed, and this cannot be proved due to absence of
research, that Waterberg District is negatively perceived internationally due to the extent of
negative South African publicity in the media. While this is true, it can be argued that
Waterberg District has no separate or unique reputation internationally. Without scientific
media analysis this will remain a pure speculation. However, communication campaigns
directed at the international market to overcome negative perceptions will be encouraged to
potential investors.
12.3.10 CREATION OF INVESTOR FRIENDLY CLIMATE
The ability to lure trade and investment into the region is a challenge to Waterberg District
Municipality to conduct a market research into the nature of the market it is drawing into.
From an investment perspective, this means that it is critical to turn raw data into
intelligence for strategic decision-making and identification of key industries and
opportunities. A critical success factor to prospective investor is the provision of reliable
information and research. The easier to access reliable information the quicker to make
decision to invest on the part of potential investors.
12.3.11 FOLLOW-UP PROCESSES
This entails devising follow-up mechanisms to revive all investment pledges and economic
development treaties agreed upon. The main questions to be addressed could include:

Progress reports on signed agreements and memoranda;

Identify potential hindrances impeding implementation of agreements and treaties;
and

Explore possible methods of effecting all signed agreements and treaties.
All the ingredients outlined under 12.3 subsection are necessary for a composite strategy to
make Waterberg a unique reputable brand.
12.4 OUTWARD AND INWARD MISSIONS
12.4.1 INWARD MISSIONS
Inward mission initiatives require the establishment of linkages and networks with potential
investors in order to promote and market the region’s investment opportunities. This could
Page 78
All Rights Reserved
Waterberg District Municipality
include the following activities:

Establish networks with national municipalities across all provinces for mutual
economic development and investment interests;

Develop capacity building programmes that enhance the knowledge and skills of
Local Municipality officials, BEE and SMME managers with regard to investment and
trade issues.

To borrow relevant experiences from other similar context in order to strategise for
more efficient marketing and investment strategies;

To promote and convene potential stakeholders and investors within the District in
order to identify potential projects for investment in an ongoing basis; and

Establish relationship with Diplomatic Missions and Consulates of countries from
which potential investors may be persuaded to come to Waterberg.
During the missions, Waterberg representatives have as essential focus guaranteeing the
investor of the conducive and amicable atmosphere for investment and trade. A friendly
environment is vital to convince diplomatic representatives to persuade their home country
citizens to invest in Waterberg.
12.4.2 OUTWARD MISSIONS
Outward missions would be strategic intervention, which require the Waterberg District
Municipality to carry special tasks of marketing its products and the region outside its
borders, nationally and internationally. Among others, the following form part of this outward
strategic intervention:

Devising mechanisms and carry out promotional trips to market Waterberg District
Municipality nationally and abroad; and

Establish an information exchange programme that promotes Waterberg with the aim
of attracting investment.
Outward missions require a systematic and periodic programmes targeting specific regions,
countries and/or other peer municipalities. In sum, Outward Investment Missions are other
methods of raising the profile of the Waterberg region. However, it must be noted those
entrusted with representing Waterberg act as ambassadors of the region, the Limpopo
Province and the country as a whole. Table 20 simulates an example of Inward/Outward
Mission for Marketing and Investment Strategies.
Secto
r
Table 20: Example of Inward/Outward Mission Planning
Target
All Rights Reserved
Missions and Purpose
Projections
Page 79
AGRICULTUE
Marketing and Investment Strategy
Country or
Region
Inward
Missions
People’s Republic of
China
Invitation to visit the virgin
forests of Waterber and
assess potential herbal
medicine plants
Hosting of experts to provide
advice and share experience
Host conferences
PPP, BEE, SMEs,
Corporate,
6 months
Fact finding trip to US
to acquire experience
Fact-finding in UAE, for
further
12 months
Free Trade
Agreements and
Memoranda of
Understanding
Exchange
programmes
Trade
Agreements and
MoUs
Mining Sites visits for
analysis
Staff Exchange
Programmes
2 years
MoUs
6 months
Information
Exchange
Host Toursim Conference for
strategic economic projects
Go to that region to
learn about other
tourism strategies
Attend Tourism product
exhibition in the region
12 months
A hosted
conference by
the District
United States
United Arab Emirates
MINING
United States
Tourism
KZN tourism
SADC
Outward Missions
Timelines
Milestones
12.5 USING THE PRINCIPAL MEDIA TO MARKET WATERBERG
Using a variety of media will enhance the dissemination of information that will position
Waterberg District Municipality in good prospects, thus shaping its image and attract
potential investors and clientele. The fundamental principle in this regard is publicity and
advertising Waterberg as a unique region on its own right.
A public relations effort should have a specific objective. A mix of media is ideal; and one
important aspect in this regard is the choice between controlled and uncontrolled media.
For example, a billboard is an example of a controlled medium. There can be complete
control over its content and its appearance and place where it must be erected. On the
other hand, television is an uncontrolled medium, since even when the content of a
message is controlled; it is not possible to have control over its context – what spot is
shown immediately before or after it and what content the surrounding programme will
have. Thus, there is an element of uncontrollability in every aspect of communication.
There is no guarantee that the audience to whom a message is sent will pay attention or
respond to it.
Therefore, three questions must be considered in selecting the proper medium for the
message:

The first is “What audience is the District trying to reach, and what is its credibility
rating for its medium?”

When does the District need to reach this audience, and what does it need to receive
the message in order to respond to it?
Page 80
All Rights Reserved
Waterberg District Municipality

How much does the District needs to spend, and how much can the District afford to
spend?
After answering these questions, there are more four additional questions:

Which medium reaches the broadest segment of its target audience at the lowest
cost?

Which one has the highest credibility, and what is its cost?

Which medium to count on to deliver the message within the necessary time
constraints for the message to be effective?

Should a single medium be used? If a media mix is preferred, which media types
should be used to complement one another?
In the context of Waterberg, for example, newspapers, as compared to radio, maybe costeffective in terms of printing costs but ineffective in terms of reaching the audience in rural
areas. Besides, newspapers need a literate audience. On the other hand radio would be
far effective, yet expensive in terms of time costs to the Waterberg District Municipality.
Table 21: Example of variety of choice in mass media to Market Waterberg
Domain
Medium Type
Print














Electronic
Local
Waterberg Newspaper
Sowetan
Daily Sun
Sunday Times
City Press
The Citizen
Bona Magazine
Drum Magazine, etc.
Radio Thobela
SAFM
SABC TV channels
SABC AFRICA
5FM
Ukhozi FM, etc.











International
Mail and Guardian
Time Magazine
Financial Mail
Tourist Booklets
BBC TV Channel
BBC Radio
CNN International
SKY Television
SAFM
Radio Netherlands, etc.
All types of media need special attention since they operate within friendly or hostile
political environment. For instance, Table 22 presents a comparative analysis of
advantages and disadvantages of each medium.
Table 22: Principal Media: Advantages and Disadvantages
Comparative Analysis
Medium Type
Television
Advantages
 Combined sight, sound and motion attributes
 Allows physical demonstration of product
 Belivabilty due to immediacy of message
All Rights Reserved
Disadvantages
 Message limited by restricted time segments
 No possibility for consumer referral to message
 Availability sometime difficult to arrange
Page 81
Marketing and Investment Strategy
Radio
Magazines
Newspapers
Direct Mail
Point-of-purchase
displays
Outdoor posters
Billboards
Transit posters on
moving vehicles
Advertising
specialists
Pamphlets and
booklets
Computers and
information
technologies



















High impact of message
Huge audience
Good product identifiction
Popular medium
Selectivity of geographical markets
Good saturation of local markets
Ease of changing advertising copy
Relatively low cost
Selectivity of audience/readership
Reaches more affluent clientele
Offers prestige to an advertiser
Pass-long readership
Good colour reproduction
Selectivity of geographical markets
Ease of changing advertising copy
Reaches all income groups
Ease of scheduling advertisements
Relatively low costs
Good medium for manufacturer advertising



































Extremely selective
Message can be personalized
Little competition with other advertisers
Ease message effect of advertisement
Provide easy means for clientele action
Presents message at point of sale
Great flexibility for creativity
Ability to demonstrate product in use
Good colour reproduction
Repetitive value
Selectivity of geographical markets
High repetitive value
Large physical size
Relatively low cost
Good colour reproduction
Selectivity of geographical markets
High repetitive value
Large physical size
Relatively low cost
Good colour reproduction
Selectivity of geographical markets
Captive audience
Very low cost; High repetitive value
Good colour reproduction
Unique representation
High repetitive value
Has a “gift” quality
Relatively long life
Offer detailed message at point of sale
Supplement a personal sales presentation
Offer to potential buyers a good referral means
Good colour reproduction
Highly personalized
Creativity and flexibility
Home, office and remote use





Hi time costs
Waste coverage
Hi production costs
Poor colour transmission
Message limited by restricted segments
No possibility for consumer referral to message
No visual appeal
Waste coverage
Often duplicates circulation
Usually cannot dominate in local market
Long closing dates
No immediacy of message
Sometimes high production costs
High cost for national coverage
Shortness of message life
Waste circulation
Differences of sizes and formats
Rate differentials between local and national
advertisements
Sometimes poor colour reproduction
Often has poor image
Can be very expensive
Many restrictive postal regulations
Problem in maintaining mailing list













Dealer apathy in installation
Long production period
High unit cost
Transportation problems
Space problems
Often has poor image
Message must be short
Waste circulation
National coverage is expensive
Few creative specialist
Message must be short
National coverage is expensive
Few creative specialist















Cannot be used in all contexts
Waste circulation
Surroundings may be disreputable
Few creative specialists
Subject to fads and exaggeration
Message must be short
High unit cost
Effectiveness difficult to measure
Dealers often fail to use
May have relatively high unit cost
Few creative specialists
Effectiveness difficult to measure
Restrictive group users
Accessible to relatively affluent clientele
High unit cost


















In turn, to attract international audience, television and digital technology are ideal. For
example, Waterberg may choose to advertise its products on international television
channels such as SABC Africa, BBC, SKY TV, CNN, etc. Distribution of digital materials
and glossy magazines to travel agencies will reach travellers and tourists.
Table 22 provides a possible list of print and electronic media that may be used to market
Waterberg. To make effective use of the media selected, the strategist must know enough
Page 82
All Rights Reserved
Waterberg District Municipality
about the mechanics and technology of each medium to prepare the content and message
properly. For example, some commercial airliners may be willing to have Waterberg
magazines distributed on board for both domestic and international flights.
12.6 ESTABLISHING AN INFORMATION SYSTEM
An information system for the strategy is critical. The Waterberg District Municipality will
employ three systematic steps of information management system: Input, Processing and
Output.

The Input is effectuated at higher level of Management and Decision-Making of the
Waterberg District Municipality;

The Processing is handled at information transformation, which is to be turned into
product for public consumption; and

The Output concerns the finished or transformed inputs into usable knowledge for the
intended recipients.
This process is well captured in Figure 19 and it demonstrates how this process functions in
Local Government investment strategic setting.
An information system has three basic interactive components:

Input, which involves assembling of data, ideas, facts and opinions from
stakeholders, interest groups, experts, and the public in general regarding potential
investment projects in Waterberg;

Processing entails transforming the input into knowledge or usable information. In
terms of the present strategy, this could mean that data gathered could be
transformed into knowledge to make proper decision on feasible investment areas
and viable programmes; and

Output involves packaging, transferring and distributing such knowledge and
information to ultimate destinations such as Municipal Managers, strategists, interest
groups, potential investors, the Waterberg public in general, etc. The information can
be made available to all intended recipients through new media such as the
Waterberg District Municipality website as well as classical printed, electronic (radio,
television), magazines, newspapers, brochures, travel guides, town hall and other
formats for those sections of the recipient that prefer and desire to use a particular
medium. The Output is critical in building the confidence level of the District, as it is at
this level that stakeholders and communities read about the development and
improvement of their lot on regular basis.
All Rights Reserved
Page 83
Marketing and Investment Strategy
To keep a system in equilibrium there is a need for feedback, which can be seen as a
fourth basic component, particularly in relation to the Marketing and Investment Strategy.
Figure 19: Mechanics of Information System for Investment Strategising
MANAGEMENT
INFORMATION
SYSTEM
HIGH LEVEL OF DECISIONMAKING PROCESS
INTERMEDIATE DECISIONMAKING PROCESS
DELIVERY AND PRODUCTION &
DISTRIBUTION PROCESS
INPUT
PROCESSING
OUTPUT
NATURE OF ACTIVITIES:
Transforming
Gate-keeping
Communicating
Knowledge Making
NATURE OF ACTIVITIES:
 Finished Information
for Consumption
 Information Delivery
 Distributing
 Multiplying




NATURE OF ACTIVITIES:
Planning
Organising
Leading
Controlling




INFORMATION DELIVERY STRUCTURE
Like other functional aspects, an information system is a component of the strategy. The
fundamental purpose of the information system is to convert data into information that is
useful for the investment and marketing of Waterberg. In this regard, there are three
categories of information:

Strategic Information aimed at supporting the strategic planning in marketing and
investment strategy. It is generally handled at mayoral level or other municipal
department charged with District marketing and investment; At the top level of
strategic planning of the Municipality, the management requires information that
assists in making long-term planning decisions of the District as a whole. Since
strategic plans are of a long-term nature, they require approximate indications of
future conditions rather than exact statements about the past or present.
Page 84
All Rights Reserved
FEEDBACK MECHANISMS
FEEDBACK MECHANISMS
OVERALL INFORMATION PRINCIPLE FOR
INVESTMENT STRATEGY
Waterberg District Municipality

Tactical Information is deliberately furnished to assist managers to monitor and
control operations and to allocate their resources effectively to achieve the marketing
and investment goals. Tactical information is used to monitor and gauge performance
of investment projects of the Waterberg District Municipality. Tactical information has
an intelligence component in approach, as it also as a barometer to measure the
market forces that environ the context in which competition occurs. Middle-level
managers need tactical information to monitor and control operations as well as to
gauge opportunistic circumstances that may be of benefit or detriment to the goals
and objectives of the strategy.

Operational Information, which is furnished at implementation level to enable
operational managers to effect the necessary tasks of programmes, projects and
strategies. At the operational level, the information needs to be highly accurate and
detailed in order to enable implementers of the strategy to perform efficiently. A
production supervisor in the manufacturing industry for example, has to know exactly
what the output is on a weekly or monthly basis.
Table 23 and Figure 20 provide a good depiction of information system, as it will be
employed for the Marketing and Investment Strategy of the Waterberg District Municipality.
Table 23: Summary of Categories of Information Usefulness
Characteristic
Management level
Frequency
Dependability of results
Time period covered
Level of detail
Source of data
Nature of data
Accuracy
Typical user
Level of the decision
All Rights Reserved
Operational
Daily implementation
supervision
Regular, repetitive
Expected
The past
Very detailed
Internal
Highly structured
High
First-line supervisors
Task-orientated
Information Categories
Tactical
Middle managers and
market intelligence
Mostly regular
Sometimes Surprising
Comparative
Summaries of data
Internal and external
Sometimes unstructured
Sometimes subjective
Middle managers
Control and resource
allocation-orientated
Strategic
Mayoral level and senior
officials
Often ad hoc
Often Surprising
Predictive of the future
Summaries of data
Mostly external
Highly unstructured
Highly subjective
Top management
Long term goal-orientated
Page 85
Marketing and Investment Strategy
Figure 20: Summary of Information Requirement by Management Levels
Decision
Structure
Information
Traits
Unstructured
Strategic
Management
Structured
Unscheduled,
Summarised Infrequent
Goal-Oriented, Wide
Scope
Tactical
Management
Structured
Operational
Management
Scheduled, Detailed
Frequent
Task-Oriented, Narrow
Focus
(Compare with O’Brien, 1990:328)22
Consequently, an information system is paramount for the Marketing and Investment
Strategy. In fact, information flow that is well organised is the blood life of the strategy
itself. Reliable and scientifically accurate information lead to fruitful results, yet unorganised
and inaccurate information can be detrimental to the entire project.
12.7 IMPLEMENTING THE STRATEGY
In a spirit of delivery-oriented strategies, the Waterberg Municipality will implement the
strategy taking into consideration the interests and views of different stakeholders in the
entire process. The Implementation Plan lays out budgetary, human resource, institutional
and procedural implications of implementing the Marketing and Investment Strategy. It is
thus the point of integration of all projects and programs within a Marketing and Investment
Strategy. The Action Plan lays out a hierarchy of tasks, responsible parties, realistic time
tables, human resource and financial needs, sources of funding, expected impacts and
results, performance measures and systems for evaluating progress for each project.
Pertinent questions in an implementation plan comprise:

Who takes responsibility for each program or project?
Page 86
All Rights Reserved
Waterberg District Municipality

What are the targets in terms of outputs, timing and funding?

What steps need to be taken to achieve the targets?

What will be the reporting structures and communication strategy (including to
stakeholders)?

What are the performance monitoring and evaluation systems and processes?

What has to happen to ensure they are in place and used?

What are the budgetary and human resource requirements for the sustained delivery
of the project or program?
The institutional implications of the Marketing and Investment Programmes and projects,
including:

Any new internal of the procedures and processes of the local Council;

The new departments/units/people or inter-departmental coordination that are
required for the fulfilment of the project;

The effect of this on the capacity of an Investment Function, which until now did not
manage implementation; and

The new skills required for the implementation of programs and projects.
Granted the complexity of industrial investment and other related projects, the Waterberg
District Municipality will adopt an integrated approach whereby the team of implementers is
composed of both internal staff of the District and external stakeholders. However, there
are inherent benefits and shortcomings as summarized in Table 24.
Table 24: Key Consideration In Managerial Task of Strategy Implementation
Composition of the Team
Advantages
USING EXISTING EXECUTIVES TO
IMPLEMENT THE STRATEGY
 Already know key people practices
and conditions
 Personal qualities better known and
understood by associates
 Hove established relationships with
peers, subordinates, suppliers,
buyers, etc.
 Symbolise organisational commitment
to individual careers
 Outsiders may already belive in and
have lived the new strategy
 Outsider is unencumbered by internal
commitment and enthusiasm
 Bringing in outsiders can send
powerful signals throughout the
organisation that change is expected
BRINING IN OUTSIDERS TO IMPLEMENT
THE NEW STRATEGY
Disadvantages
 Less adaptable major strategic
changes because of knowledge,
attitudes and values
 Past commitments may hamper hard
decision required in executing a new
strategy
 Less ability to become inspired and
credibly convey the need for change
 Often costly, both in terms of
compensation and learning-to worktogether time
 Scarcity of suitable candidates to
effect change
 There is always uncertainty to select
the right person for the job
 The morale goes low with insiders who
wanted the job
(See Smit, P.J. and Gronje, GJ de, 1992)23
All Rights Reserved
Page 87
Marketing and Investment Strategy
12.8 THE ACTION PLAN
The following are important deliberation that the Waterberg District Municipality will
consider for the Action Plan of each project:

A hierarchy of tasks;

Responsible parties;

Realistic timetables;

Human resource and financial needs;

Sources of funding;

Expected impacts and results; and,

Performance measures and systems for evaluating progress for each project.
Strategy implementation is never as clear-cut as the strategy development itself. It often
takes longer than expected and involves a consistently changing environment. Within each
project and programme that is being implemented, strategic thought will occur at every step
of the way. This will often focus on how to best advance the project in an often rapidly
changing environment.
Implementation Plan acts in the final instance, as a mediator between various projects and
their action plans to ensure that these do not inappropriately compete for resources. It also
provides information for Monitoring and Evaluation to all parties involved, in particular the
Municipal Manager or any who must report to the highest level of the municipal government
and to the Waterberg citizens.
12.6 MONITORING AND EVALUATION PLAN
A Monitoring and Evaluation workshop should be conducted following the agreed upon
local assessment of investment needs and opportunities. This workshop will set up a plan
to monitor progress according to agreed indicators of success and milestones at project
level, as well as define a system for learning by doing during the Marketing and Investment
Programme.
The Monitoring and Evaluation Plan will, therefore, include a process timetable of meetings,
audits, etc. throughout the period pre-planned and budgeted in advance. This also
establishes clear timeframes for reporting. Distinctive features of monitoring and evaluation
are sketched in Table 25.
Page 88
All Rights Reserved
Waterberg District Municipality
Table 25: Comparison Between Monitoring and Evaluation
WHAT
PURPOSE
MONITORING
EVALUATION
Monitoring is the process of routinely
gathering information on all aspects of a
project or program. It is used to inform
decision making on project implementation.
Evaluation involves a ‘stepping back’ to gain a deeper
perspective on what effects and impacts have been
achieved. It informs every decision-making.

Analyse the current situation

Identify problems and find solutions

Discover trends and patterns

Keep program activities on schedule

WHEN
HOW
WHY
INFORMATION
TYPE
INFORMATION
CATEGORY

Determine how effective a project or program has
been

Determine the extent to which goals have been
achieved

Measure
progress
towards

intermediate goals and revise action in
order to achieve these goals

Formulate key questions

Make decisions about human, financial

and material resources
Monitoring is continuous (daily, monthly,
annual).
Monitoring activities should be scheduled
as part of the project’s workplan and be a
routine part of project implementation.
Monitoring can be carried out by staff and
participants through field visits, review of
service delivery and through a
Management Information System.
Monitoring provides managers with
information needed to analyse the current
project situation, identify and find solutions,
discover trends and patterns, keep in
schedule and measure progress towards
expected outcomes. It allows an
opportunity make decisions regarding
human, financial and material resources
and minimize needless program costs.
More emphasis on quantitative data but
some qualitative data is gathered to
contextualise the quantitative analysis.
Descriptive, analytical and documentary
data should all be used to observe the
‘what’ and understand the ‘why’ of the
project activities.
Learn how efficiently things are being done
Develop ‘lessons learned’ so future programmes
and projects of a similar nature can be improved
Evaluation is conducted periodically:
At or near the mid-point of implementation
At the end of a project
At a point well after a project has been completed (3-8
years)
Internal evaluations can be carried out by the project
manager and/or project staff and participants.
External Evaluations are generally conducted by
external consultants, external agencies or donors.
Evaluation is the formal process of documenting the
following project achievements:
 Progress in the workplan
 Establishment of systems
 Implementation of planned activities
 Achievement of goals
 Effectiveness of the project
 Impact of the project
 Efficiency or cost-effectiveness
More emphasis on qualitative data but quantitative
data is gathered in indicators. Qualitative analysis
often supports the quantitative assessment.
Descriptive, analytical and documentary data should
all be used to observe and record the ‘what’ and
understand the ‘why’ of the project achievements.
12.13 FUNDING THE MARKETING AND INVESTMENT STRATEGY
Funding the Marketing and Investment Strategy may become often very intricate. When it
comes to budget time, trade and investment are competing for scarce resources with
All Rights Reserved
Page 89
Marketing and Investment Strategy
departments at provincial and national level. Sometimes, it is difficult for elected municipal
officials to justify spending scarce resources on Marketing and Investment mission because
short time horizon responses are often perceived as more important than initiatives that
often have longer time horizons, and whose benefits may not be immediately apparent. For
this reason, it is important to have political support and commitment to contribute resources
by the business community. It is also important that the municipal authorities view the
Marketing and Investment Strategy as a mechanism for supporting future sources of
revenue growth.
The Marketing and Investment Strategy must have a budget. It may be small at first but
with opportunities for follow-up funding it may grow and support may come from various
interest groups. In selecting particular programmes and projects, care needs to be taken to
ensure that funds are available for the entire length of each activity as projects are likely to
span several financial years.
Sources of funding for Marketing and Investment initiatives could include:

Waterberg District Municipality revenue raised from the usual sources including
property taxes, fiscal systems, etc.

Sale or leasing out local Municipality-owned industrial or commercial buildings and
land;

National and state government intergovernmental transfers;

International donor grants and loans;

Private sector funding such as corporate contributions/investments;

Foundations, especially for environmental improvements, human resource, etc.

Social responsibility grant from local businesses involved in Mining, Agriculture,
Tourism, Construction, Finance, etc.

International Investors;

International Development Agencies such as European Union, USAID, UNDP, World
Bank, etc.

National Development Agencies such as Development Bank of Southern Africa, etc.
Page 90
All Rights Reserved
Waterberg District Municipality
Figure 17: Diagrammatic Summary of the Overall Strategy




POLICY
ENVIRONMENT:
Inter-Governmental Relations Act
Integrated Rural Development
Programme
BBBEE Act
Poverty Reduction Programme
STRATEGY SETTING:
Vision
Mission




MONETARY
SUPPORT:
National Government;
Provincial Government;
Private Sector;
Local government Revenue, etc.
GOALS:
Aims
Objective
APPROACH:
Implementation
Plan







INTERVENTION
STRATEGIES
Investor Identification
Corporate Liaison
Strategic Alliances
Free Trade Agreements
Branding & Positioning
Investor Facilitation
Follow-up Processes







OUTWARD/INWARD
MISSIONS
Trade trips
Product Exhibitions
Conferences Abroad
Conferences Locally
Information Exchange
Treaties & Memoranda
of Understanding
Staff exchange
programmes
BRANDING
Advertising
Investment Exhibitions
Investment Seminars
District Website
Digital Distribution
Reputation
Management
 Informal Modes of
Communication, etc













USE OF PRINCIPAL
MEDIA
Local Print Media
Local Electronic Media
International Print Media
International Electronic
Media
Billboards, Pamphlets,
Travel Agency
Magazines
Airliners on board
magazines, etc.
MONOTORING AND EVALUATION
All Rights Reserved
Page 91
Marketing and Investment Strategy
13. SUMMARY AND OVERALL RECOMMENDATION FOR
IMPLEMENTATION
This strategy has provided an overview of the Waterberg District Municipality’s status quo
potential in terms of investment opportunities and, its potential market growth, as well as its
promising prospects in terms of corporate strategies for industrial recruitment that can
benefit the BEE and SMMEs emerging enterprises and potential cluster-chain projects.
The notion of the Value Chain and the Vertical-Horizontal Integration Strategies should be
regarded as an alternative analytical and strategic tool to advance the economic
empowerment of the disadvantaged communities and the emerging black entrepreneurs.
Important to note, it is the proposed Marketing and Investment Strategy and its Action Plan
that will brand and publicize Waterberg products and investment opportunities nationally
and internationally.
Motivating the whole process of this strategy is the quest for economic and market growth
in Waterberg. The potential for this is found in the regions product portfolio with specific
reference to Agriculture, Mining and tourism sectors.
The challenge, however, is to ensure that the present strategy is effectively implemented,
through appropriate monitoring and evaluation mechanisms. In this regard, it is proposed
that the “District Investment Council” should be established in order to boost and attract
investment in the region. The Council should be consisted of champions of different
strategic sectors in Waterberg District Municipality who would advise on issues of strategic
investment potentials to the municipality.
For strategic reasons, it would be appropriate that the District’s Executive Mayor’s office
takes a lead in the establishment of the proposed council, in order to offer strategic
direction on investment opportunities and related issues.
In addition, the there would be a need to appoint an “Operations Manager” of the Council,
who will be responsible for driving and implementing decisions.
The Council should incorporate all strategic partners of the Waterberg District Municipality.
Starting with its six local municipalities, the Council should ensure an effective partnership
between public and private sector to help steer the Waterberg District Municipality’s
strategies, policies and programmes regarding Marketing and Investment. In this regard,
the council will represent the public and private sectors that will collaborate to establish
priorities for investment. Private-sector involvement will generate a quicker turnaround time
on investment issues.
Page 92
All Rights Reserved
Waterberg District Municipality
Moreover, the Council should seek ways of attracting and expanding investment to the
Waterberg region. It should also ensure that appropriate resources are mobilised to
establish priorities for investment. Its efficiency level should match international standards,
in order not to compete for domestic investment, but also for international capital.
The “District Investment Council” needs to be creative if it is to compete with best in the
world and attract investment so that Waterberg becomes the preferred investment
destination of choice. Investors require an efficient and well-formulated response prior to
making an investment decision otherwise they go elsewhere. For instance, investors are
choosing other countries over South Africa because of the tax breaks they get.
The “District Investment Council” should develop aggressive strategies to attract investment
to the region. This can be done by increasing the role of small business in the economy,
retaining already existing local businesses and establishment of Broad Based Black
Economic Empowerment Co-operatives.
The District is a hive of economic activity and obviously, it cannot implement this strategy
alone. There would a need to co-ordinate through the “District Investment Council” other
line government departments and development agencies that can add value to the effective
marketing of the District investment potentials.
All Rights Reserved
Page 93
Marketing and Investment Strategy
REFERENCES
Local Government White Paper, 1998 pp25, 30.
See Section 152 of The Constitution of the Republic of South Africa.
3The White Paper on Local Government. 1998, p17.
4 The Municipal Structures Act No 117 of 1998
5 The Municipal Systems Act of 2000
6 Limpopo Provincial Government (2004). Growth and Development Strategy. Polokwane.
7 BEE COM (2000). Economic Empowerment: A National Growth Imperative.
8 PPP Unit (2003) Code of Good Practice for Black Economic Empowerment in Public-Private Partnership. Pretoria:
National treasury.
9 The Constitution of the Republic of South Africa, Act 108 of 1996, section 217(2))
10 Treasury Regulation 16.5.3 (b)), issued in terms of Public Finance Management Act.
11 BEE Commission (2001). Black Economic Empowerment Commission Report. Johannesburg: Skotaville Press, p.1.
12 See Letsema Consulting (2002). “South African Tourism Industry Empowerment and Transformation”. Annual
Review. Pp 11-15. Funded by the Tourism Business Council of South Africa.
13 Tourism Business Council of South Africa (2004). Tourism Charter and Scorecard: Steering Committee
Recommendations.
14 South Africa’s Economic Transformation: A Strategy for Broad Based Black Economic Empowerment.
15 National Treasury (2003). Code of Good Practice for Black Economic Empowerment in Public Private Partnerships.
PPP Unit: Pretoria.
16 Ibid, p.12.
17 Ibid, p.2. See also South Africa’s Economic Transformation: A Strategy for Broad Based Black Economic
Empowerment, p.14.
18 See South African Mining Charter.
19 Tourism Business Council of South Africa (2004). Tourism Charter and Scorecard: Steering Committee
Recommendations, p.3.
20 See RDP Audit; White Paper on South African Land Policy.
21 Waterberg District Municipality (2004). Local Economic Development Plan (LED) and Socio-Economic Statuts Quo
Report. Waterberg: Thabametse Development Cosortium.
22 O’Brien, J.A. 1990. Management Information Systems: A Managerial End User Perspective. Homewood, Illinois:
Irwin.
23 Smit, PJ & GJ de J Cronje (1992). Management Principles: A Contemporary South African Edition. Cape Town: Juta
& Co, Ltd.
1
2
Page 94
All Rights Reserved