Business

The Eastern Cape is poised for great things

2019-10-07 15:00

The chief executive of the SA Oil and Gas Alliance believes the Nelson Mandela Bay area in the Eastern Cape has an opportunity to create either an “absolute disaster” or a really fantastic future, based on the oil and gas industry.

Niall Kramer said Nelson Mandela Bay’s environment had lots of wind, fantastic sun and was well-positioned for potential shale gas in the Karoo.

“So, in terms of becoming an energy hub that integrates renewables and gas, this potentially is a very exciting area,” Kramer said.

He was the keynote speaker on Friday at the two-day Manufacturing Indaba at the Boardwalk Conference Centre in Port Elizabeth.

He said a certain, physically attractive and stable policy environment was needed to ensure that all these opportunities were not lost.

Kramer said in October 2016 the energy department announced that liquefied natural gas (LNG) would be imported into Richards Bay and Nelson Mandela Bay.

“LNG imports were announced in the last budget speech of Gwede Mantashe [minister of mineral resources and energy] as coming to Nelson Mandela Bay,” said Kramer.

His message to Eastern Cape industry players was that the oil-gas industry was going to be a highly contested space and those who want it must make themselves attractive and not rely on political reprieve, as things change rapidly.

He said if he were in charge of the Eastern Cape he would focus on establishing reliable, consistent energy because without it there could be no development especially in industrialisation.

Kramer said the alliance, a special-purpose vehicle, was set up to make the oil and gas space investible, attractive to international investors but, more importantly, so that local businesses in the South African value chain could draw opportunities.

Kramer said the alliance had more than 230 member companies across the value chain. He said they had seen the huge future of oil-gas in South Africa in the past 10 years and the country was potentially on the verge of something great.

There are a lot of people here who cannot get money from normal banks. I think to grow the South African economy it is important to understand what alternative sources of funding are there

He said Mozambique, for example, was likely to become one of the world’s top three LNG players soon.

“To date they [Mozambique] have attracted $50 billion of foreign direct investment. In five to 10 years’ time that is going to be something like $120 billion,” he said.

The rise of the fourth industrial revolution

Professor Chris Adendorff from the Nelson Mandela University’s Business School – referring to the fourth industrial revolution – said people should not be worried about robots dominating humanity as this was not likely to happen anytime soon.

He said the fourth industrial revolution was being driven by systematic transformation of technology information on a global scale and was not only affecting South Africa.

“The biggest problem we have as South Africans is that we think we are the world. This is actually happening on a global scale,” he said.

He said the fourth industrial revolution was more than technology. It was also meant to have a positive effect on core industries, such as education, health and smart business.

The biggest problem we have as South Africans is that we think we are the world. This is actually happening on a global scale

Nelson Mandela Bay mayor Mongameli Bobani said the Eastern Cape – including the metro – was undoubtedly a leading player in the manufacturing sector.

“We are determined to position ourselves at the forefront of manufacturing innovation and thereby provide rewarding and quality employment to our communities,” said Bobani.

Anton Roelofse, the regional general manager from Business Partners, a specialist company that finances smaller and medium-size enterprises, said on Thursday that his company financed companies from R500 000 to R50 million.

“Our business is very important in the context of this indaba in terms of access to funding. There are a lot of people here who cannot get money from normal banks. I think to grow the South African economy it is important to understand what alternative sources of funding are there,” said Roelofse.

He said small, medium and micro-size enterprises (SMMEs) were critical in creating jobs.

“I can’t see how big business is going to grow jobs into the future. I think SMMEs are going to become increasingly important for South Africa.

“We have seen that in the rest of Africa the SMME sector is the one driving employment and wealth creation,” he said.


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October 13 2019