On the day that Finance Minister Pravin Gordhan presented South Africa’s mid-term budget in Parliament, and announced that SARS revenue collected is R5 billion less, and is unlikely to grow next year, Minister Alan Winde closed the Wesgro AGM with refreshing honesty, and said that the Finance Minister’s speech meant that provinces would receive the same allocation as the current financial year, meaning a lower buying power next year due to cost increases.  He also said that currently South Africa is lacking leadership, and is not projecting the right image to the outside world, given the strike of the SA Transport and Allied Worker’s Union, the Marikana massacre, and the capsizing of the Miroshga off Hout Bay.

Minister Winde’s sombre closure of the AGM reflecting the tough trading conditions which the Western Cape businesses can expect for the next two years, and which have already affected Wesgro’s performance in not meeting its top targets of Investment.  The Trade, Investment and (new) Tourism promotion body celebrated its 30th anniversary this year, and probably presented negative figures for the first time in many years.  It has an interesting method of setting targets, at a high and a low band.  In most measurements presented, Wesgro exceeded the ‘low road’, but did not meet the ‘high road’ budgets in its Investment and Trade Promotion divisions.  Wesgro Chairman Benjamin Kodisang started off the proceedings by also adding his negative view of the world, expressing that he is ‘a concerned man, who has never found the world in the situation it is in now, economically, socially, and politically’.  He challenged business persons in the Cape to ‘stand up, and be counted’, and to show leadership, as contained in Wesgro’s Vision of leading ‘the creation and promotion of a compelling global destination for investment, trade and destination marketing for the benefit of all people in the Western Cape’. Good news is that the Western Cape economic growth has outshone that of the national economy for the eleventh year running, with a growth rate of 3,1 % currently, driven largely by a 7% growth in exports, mainly of fruit.  Over a third of exports go to Asia, and one-quarter to Europe (of which one-fifth is wine).  R1,24 billion in Investment was attracted to the province in the past year, it was reported.  More than 1000 jobs were created in the same period.  The dominant export markets for the Western Cape remain the UK, France and Germany, but the West Africa Trade Corridor is gaining importance, in particular Nigeria, Angola, Cameroon, and Côte d’Ivoire.  Angola has taken over from Mozambique as the province’s largest trade partner in Africa, said Nils Flaatten, Wesgro CEO.  Brazil, India and China, all BRICS countries, are important for partnerships to promote the economy of the Western Cape.  The United Nations Procurement Programme, incorporating our province as one of only three developing areas, is a bonus for the Western Cape.

In April Wesgro incorporated Cape Town Routes Unlimited, which no longer operates by that name, but which still has a Board in place until the Western Cape Tourism Act of 2004 has been repealed, likely to be in April 2013. The Wesgro Act is being amended too, to allow the organisation to adopt the role of tourism promotion too.  Deon Cloete, Chairman of the Cape Town Routes Unlimited Board, also painted a picture of a tough economy and the effect of the incorporation of the organisation into Wesgro, the contribution of conferences to the Western Cape economy having been R254 million instead of the projected R360 million, even though the number of conferences grew.  The 1,4 million tourist arrivals means an 8% decline, while spend by foreign tourists had declined by 16% to R18 billion, he said.  The province sold 26% of the national bednights, and the average spend per day on a trip was R1420.   Cloete warned of a ‘tough year’ ahead, despite the country’s most popular tourism destination, the V&A Waterfront, being in the Cape and having achieved 22 million visitors.  Minister Winde highlighted that 600 conferences and events had been held in the Western Cape in the past year.

Flaatten said that the vision going forward is to cross-sell the Western Cape in a three-prong Trade, Investment and Destination Marketing approach.

Embarrassing is the glowing write up in the Wesgro 2011-2012 Annual Report of Cape Town Tourism CEO and Wesgro Board member Mariette du Toit-Helmbold: ‘Under her  leadership Cape Town Tourism has won critical acclaim as a Visitor Services and Destination Marketing Organisation doing sterling work at the coal face of one of the country’s fastest growing industries’. The City of Cape Town clearly does not agree, having taken the responsibility of Destination Marketing away from Cape Town Tourism, announced at the Cape Town Tourism AGM just a week ago!

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com Twitter: WhaleCottage