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City’s economy continues to weather the storms

City Economy - [http://cdni.wired.co.uk/1920x1280/a_c/city-reserves.jpg] City Economy - [http://cdni.wired.co.uk/1920x1280/a_c/city-reserves.jpg]

The positive upward trend of the Cape Town economy amid the uncertainty and volatility that prevails in the national economy is reason to be optimistic.

According to the Economic Performance Indicators for Cape Town (EPIC) report for the fourth quarter of 2015, there are a number of reasons to be upbeat about the local economy.

The following are some of the highlights for the city:

  • The latest Quarterly Labour Force Survey for the fourth quarter of 2015 reported on in this edition of the EPIC report highlights the progress made in reducing unemployment in the city, which now stands at 20,5% – four percentage points lower than the national rate
  • The largest contributor to economic growth in the Western Cape for the fourth quarter in 2015 was the wholesale and retail trade sector, which recorded a growth rate of 3%. This was 0,2 percentage points higher than the sector’s growth rate nationally in the fourth quarter.  
  • The easing of visa regulations in the fourth quarter, coupled with a number of major events being held in the city, led to a bumper tourism season. Over the festive period in particular, the city attracted a record number of tourists
  • Total passenger arrivals to Cape Town International Airport increased by 11,2% year on year and international arrivals increased by 9,2% during the period under review
  • The city’s top five tourist attractions experienced an increase in numbers by 10,12% year on year, with hotel occupancy rates also on an upward trend having improved on the previous year’s occupancy figures by 3,8 percentage points.

The sector focus in this edition of the EPIC report is on the electronic and electrical components sector. 

‘The EPIC report takes a more in-depth look at the importance of the electronic sector to the city’s economy and identifies some of the opportunities that exist to grow it.  The ever-shifting technologies, together with rapidly evolving consumer tastes, have resulted in an industry which rewards companies that are flexible, responsive and innovative,’ said the City’s Mayoral Committee Member for Tourism, Events and Economic Development, Councillor Garreth Bloor.

Some indicators of headline performance in the electronic and electrical components sector, as outlined in the latest edition of EPIC include: 

  • The electronics industry was the fastest growing manufacturing sector in Cape Town over the period 2004 – 2014, growing at an average rate of 4,4%
  • The strong growth of 15,2% in employment in the consumer electronics sub-sector over the last two years can be attributed to the large investments that were recently made into the sector in Cape Town
  • A total of 16 foreign direct investment projects totalling R1,6 bn were made in the electronics industry between 2003 and 2015. This investment translated into 1 246 jobs in the electronics industry (source: Financial Times, 2016)
  • The consumer electronics sub-sector recorded its highest employment level over the last 10 years in 2014

‘The city has a comparative advantage in the manufacture of electronic products compared with other regions in South Africa.

‘Cape Town has recorded South Africa’s largest foreign direct investment in the consumer electronics sub-sector, with Hisense opening a factory in Atlantis and regional head offices in Century City,’ added Councillor Bloor.

Cape Town has strong company representation in the following sub-sectors:

  • Satellite technology
  • Circuit board and contract manufacturing
  • Audio-visual product manufacturing, including televisions
  • Telecommunications (not cellphones)
  • Medical technology

The complete EPIC Report for the fourth quarter of 2015 can be downloaded here:https://www.capetown.gov.za/en/visitcapetown/Documents/EPIC_Quarter_4_October_December_2015.pdf

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