In its integrated development plan, the Mangaung Local Municipality identified the need for an inclusive and broad-based economy, with a development vision of a sustainable and investor-friendly environment.

The strategic thrust behind its economic development strategy involves employment creation, economic diversification, an environment conducive to growth and the development of Mangaung into a regional economic centre.

Key sectors flagged for investment include retail and trade, transport, tourism and hospitality, information and communications technology (ICT), distribution and warehousing, manufacturing and agro-processing, as well as property development.

Projects such as the N8 Corridor development were intended to act as catalysts in the Mangaung Economic Development Strategy, highlighting rich markets and opportunities for the private sector, but investment has been slow.

Absa’s manager for the public sector, Vincent Mothunyane, explained that although many projects are at advanced stages, red tape needs to be loosened to accelerate development.

“Some projects have stalled because of the regulations surrounding the approval of land rezoning, for example. There is a lot of lobbying for investment by various institutions, but I feel red tape should take a back seat to delivery.

“Integrated community housing projects like Mandela Park and Eden View have been slowed by rezoning troubles and this has deterred some investors. By actively bringing plans to show investors and providing more incentives, the much-needed capital injection can get development on track,” he said.

Mothunyane said Absa, Mangaung Local Municipality’s bankers, helps with finance for projects as well as skills. However, a lack of buy-in from stakeholders has seen many facilities lie fallow.

“Northern Bloemfontein cannot really be developed further, so the east is the place to go. The major growth opportunities lie in property development, tourism and commerce, because there is lots of space available. The local municipality has input from major players and there are plans under way, but they need to be taken more seriously and offer business a greater role. More business sense should be allied to the natural resources and central location of Mangaung,” said Mothunyane.

He added that capital alone could not create development.

“The municipality must create the infrastructure that is to be developed, but the new council has yet to gain a proper foothold, and it will require a more integrated approach. In terms of banking for the municipality, our role will not change but we are keen to offer a broader range of expertise to get development on track. We have a development division waiting in the wings to offer guidance and support — a comprehensive basket of business skills.”

For example, Absa is involved in training SMMEs in conjunction with the Central University of Technology in Bloemfontein. A broad business curriculum provides skills not just for Mangaung, but for the whole Free State, he added.

Mangaung’s SMME Service Centre became a local branch of the Small Enterprise Development Agency (Seda), and its business adviser, Godfrey Khumalo, agrees that there are major challenges in rolling out economic development programmes in the region.

“We have a mandate to empower SMMEs in our region, 80% of which are informal. We develop, source, package and deliver needs-based products and solutions to enhance the competitiveness of these enterprises. Our role involves assisting them with product development, quality improvement and training, as well as offering them trading points that are accessible for locals.

“We need to raise awareness and create interest in entrepreneurial activities. In partnership with the University of the Free State and the Mangaung Local Municipality, we have compiled a database of BEE compliance-seeking partners for our SMMEs and the agri-sector. By teaching industrial innovation and staging promotional events, we play an advocacy role through acting as a sounding board for local business,” said Khumalo.

Although developments have mushroomed around the airport and along the N8 Corridor, Khumalo feels SMME awareness of such projects is still poor. “We are trying to be relevant to the local situation, but our new strategy is to make local entrepreneurs more aware of opportunities. We need more marketing to quicken the process.”

Various nodes along the N8 Corridor have been selected for development, including Botshabelo and Thaba Nchu, but many facilities owned by the Free State Development Corporation remain underused. According to Khumalo, Chinese investment and factory development has dominated in Botshabelo and Thaba Nchu, but new black enterprises are emerging in retailing and manufacturing.

“Seda is also involved in developing emerging farmers in the region. Unfortunately, before the merging of the three municipalities into Mangaung, development was tremendously skewed. Thaba Nchu had been part of Bophuthatswana and tribal legacies created obstacles to development. I feel that the municipality’s new strategy will address these discrepancies, provided that the influx of residents from the rural areas to Bloemfontein can be stemmed.”

Mangaung’s executive mayor, Gertrude Mothupi, said rural and agricultural development was being fostered by training farms.

“The Lengau Agri-Centre has been established through partnerships with the University of the Free State and the National African Farmers’ Union. The aim is to encourage practical learning and mentoring, giving commercial farmers the opportunity to help emerging farmers in commercialising their operations.”

Khumalo said there was tremendously diverse potential to be tapped in the region.

“Realising the development objectives, from the inner city all the way to Lesotho along the N8, can be achieved and maintained after 2010 if all stakeholders act together in an integrated approach. The environment must be conducive politically, socially and economically to lure the investment Mangaung needs to succeed.”