Current Edition >> Archives Section >> Leading Stories >> 1 October 2006

Newly revised Free State Growth and Development Strategy on the table

• Johann Dannhauser

The Free State Growth and Development Strategy (FSGDS), which has gone the past 12 years through successive stages of transformation – often with little practical effect – has been revised and a draft was tabled at a Stakeholders' Consultative Meeting on 21 September 2006 at Bloemfontein. This draft Strategy tabled for discussion by stakeholders from both the public and private sectors, would appear to be the best of its kind the province has had as yet.
The FSGDS is supposed to be a blueprint for the overall economic development of the province, i.e. a type of business plan for optimised development of the Free State. In the past, various consultants and consulting firms have been contracted to assist the Provincial Government in drawing up the FSGDS, but this time round the Centre for Development Support at the University of the Free State has been commissioned to shake up the FSGDS. This was done in conjunction with the Policy Unit of the Dept. of the Premier.
All provinces are required to develop Provincial Growth and Development Strategies (PGDS), which in turn must line up with the National Spatial Development Perspective (NSDP) and its guidelines as being coordinated by the Dept. of the Presidency. At municipal level, the Integrated Development Plans (IDP) of municipalities have to align with the PGDS. Overall, PGDS's are seen as critical tools to direct and coordinate the allocation of national, provincial and local resources, as well as private sector investments, to achieve sustainable development outcomes.
The current draft of the FSGDS tabled at the meeting of 21 September 2006 held at the President Hotel at Bloemfontein, consist of eight chapters, with Chapter 1 a rationale and overview, Chapters 2 and 3 two different analyses, Chapter 4 an assessment, Chapter 5 determining priorities and implications, Chapter 6 setting strategic direction, Chapter 7 an implementation framework and Chapter 8 implementation arrangements.
Some telling features contained in the current FSGDS are:

• The contribution of the five regions in the Free State to the provincial GDP are as follows: Motheo District with 26,9% of the Free State's population contributes 32,7% to the GDP; Fezile Dabi District with 17% of the population contributes 32,2% to the GDP; the Lejweleputswa District with 24,3% of the population contributes 20,6% to the GDP; Thabo Mofutsanyana District with 26,8% of the population contributes 11,7% to the GDP; and Xhariep District with 5% of the population contributes 2,8% to the GDP.

• These figures indicate that Bloemfontein and Sasolburg together contribute approximately 51% to the Free State economy and if Welkom is added, this rises to above 60%.

• In 1990 the Free State contributed 6% to the national GDP - in 2002 it amounted to only 5% of the national GDP.

• The population of the Free State decreased by 0,7% from 1991 to 2002, largely as a result of outflow of people, of whom 50% left for Gauteng.

• Although different premises were used, recent research indicated that HIV and AIDS will probably halve the population growth of the Free State by 2020.

• The Free State economy is declining – the average economic growth for the province for 1996 – 2000 was 1,2% and for 2001 – 2003 it was 0,1%. For the period 1996 – 2004 the average economic growth rate for the province was a mere 0,7% compared with 2,8% for South Africa as a whole. Although the objective is still to increase the average long term growth rate in SA to approximately 5% to 6%, it is highly unlikely that the Free State will achieve this, given the current structure and output of the Free State economy linked to other constraints such as skill levels, limited human capital, service backlogs, etc.

• Unemployment is the most serious issue the provincial economy faces – disproportionately high at 30,6% and exceeded only by KZN and Limpopo provinces.

• The Free State has 1,7 million people (55,9% of whom are living in poverty).

• The sectoral share of provincial GDP in 2004 is given as follows: Agriculture 8,2%, mining 9,7%, manufacturing 19,7%, electricity 3,9%, construction 1,4%, trade 12,1%, transport 7,4%, finance 10,6% and community services 27,0%.

• In terms of the NSDP it is clear that, from a district economical perspective, the focus regarding potential for growth should be on Fezile Dabi and Motheo as key districts to propel the Free State economy in the next 10 years.

• The top five specific magisterial districts contributing most to the economy of the Free State during 2004, were Bloemfontein (R17,7 billion), Sasolburg (R15,2 billion), Welkom (R6,5 billion), Kroonstad (R2,3 billion) and Bethlehem (R2,2 billion).

• It is commonly accepted that also in the Free State more than 50% of SMME's do not survive for more than three years.

• As to the future, four strategic components are identified to propel the Free State economy optimally, viz. expanding the manufacturing sector in key sub-sectors; focussing on diversification in agricultural development; developing tourism; and develop and expand the transport and distribution industry.

Seen on the whole, the bulk of the document contains an excellent analysis of the present state of the Free State economy, especially with comparisons to past achievements and the state of affairs in other provinces, as well as international benchmarking. As such the draft FSGDS clearly bears out critical developmental indicators, trends and future guidelines. The most salient feature of the document is its logical and analytical exposition, amounting as a matter of fact to a brilliant documented strategy.
On the negative side, however, the document perhaps does not contain sufficient guidance on practical implementation and how certain growth targets are to be achieved. While of course there are considerable aspects which simply cannot be quantified, whilst the human factor always has its unpredictability, the unmistakable impression is that as to practical outcomes more work would have to be put into the document.
Be as it may, the current FSGDS is a document of importance to every Free Stater concerned with business and economic development in the province. As such it needs to be dealt with in a way that would make it a “living” document.
Henceforward the draft FSGDS is to be further amended according to inputs made at the consultative meeting, after which it would be processed to finalisation through the provincial structures and clusters up to final approval by the Provincial Executive Council envisaged for November 2006.
The final document would then be launched for implementation in all Free State spheres.