It's all about jobs

These are difficult times. Unemployment seems to remain at the very least constant. Dependency on grants is at an all-time high. Relations between commerce and the state seem strained. And the threat of a possible double-dip recession looms large. But it is when times are darkest that you realise that you need a little faith to get you through. And not some false comfort: what is needed is the kind of faith that sustains us at even the best of times.

On Saturday I will be leaving for Taiwan where we hope to be named as the World Design Capital for 2014. After that, I will be meeting with the Mayor of New York, Michael Bloomberg, in his great city and at his invitation to discuss the approach of cities to fostering entrepreneurship.

With mayors from major cities around the world and a range of experts, including several from Columbia University, we will be comparing notes and exploring best practice through several days of engagements. And I will tell Mayor Bloomberg that what cities need is a little faith: faith in business. It is only the market, often supported by cities such as Cape Town with infrastructure-led growth, that can truly lift people out of poverty and give them the dignity that they deserve.

We just have to learn how to trust in it and let it do what it does better than any other state or civil actor- create the kind of growth that generates employment. This administration's creed is to get out of the way of business for it is only business that can create the sustainable jobs that this city and our country so desperately need.

For too long, state actors at all levels have tried to dictate what the market should do and intervene in an area where they have, at best, limited skills. We must realise that different components of society do different things.

The state, in its various guises, must perform a range of functions, including providing support to the poor and vulnerable. But when it comes to the interface with business, it must provide infrastructure, support and a level of regulation to ensure that fair practices are adhered to.

Ultimately though, it must facilitate business. It must not try and replicate it. We are faced with an odd situation in South Africa. For many years, state officials have tried various growth schemes. These are now so many acronyms on the pile of history, nothing more. And yet still the common wisdom seems to be for state direction and direct involvement and management.

It has not worked in the past and there is no evidence that it will work in future. Instead, its multiplying effects have exacerbated existing structural deficiencies. Unemployment has increased over the course of the last few years. And various sectors have either been artificially supported when they have been failing or not provided with enough support when they have been succeeding.

All of it stems from the state trying to be business. If officials and politicians want to work in business, then they should become business people. There is a great reservoir of untapped energy in the market today that, when given the chance, tries to express itself.

It is an energy common to large producers, even though in South Africa they are made so uncertain of the regulatory terrain that they do not invest as much as they could. And it is common to smaller producers that start their own micro industries to support themselves and their families. It is an energy that has proved itself throughout history. In our peers in the developing world, especially in the BRICS countries, it is an energy that has seen large and small producers thrive. This is especially true for Brazil which has seen levels of 8% annual growth, growth which has lifted millions of people into the middle class.

What they have had in common are governments that facilitate them but ultimately allow them to flourish. They are governments that have faith in their creative market potential.

This administration would see that same energy untapped in Cape Town. We have made it our mission to create the economic environment in which investment can grow and jobs can be created. And we will step out of the way in order to do so.

This will involve a strategy on multiple fronts. At the higher end of the market, we want to attract big corporations to establish their headquarters in Cape Town. We want to encourage those sectors where we have a competitive advantage, like the financial sector and the oil and gas industry, to expand their foothold in Cape Town.

We want to capitalise on our attraction as a creative and educational centre and the industries that comprise them. We want to maximise our geographical position as an entry point for industry to the West African market. And we want to encourage smaller enterprises that are the most direct drivers of economic activity in communities to become established and to grow.

To do these things, government indeed has a role to play. We aim to establish catalyst projects to be the major drivers of growth. These include expanding our public transportation links and installing a competitive broadband infrastructure network. It entails rolling-out sound infrastructure to support commerce. And making strategic investments such as the R500 million the City has put into the Convenco Expansion programme which holds the promise of creating numerous additional jobs.

But it also means simplifying and streamlining the planning regime. We want to make the city development friendly; we want to literally walk large-scale developers, whose investments will create jobs, through the planning process. We want to help those just getting started by exposing them to expertise in the market and advising them on how to navigate a complex regulatory environment.

And we also mean to talk to all levels of the market at every step of the way by engaging with their formal representative bodies and the forum provided by the Economic Development Partnership (EDP). That is the essence of a partnership: having faith in your partner and their abilities. And those partners must have faith in ours too. We will do what we should as government, from the provision of services, to providing direct poverty alleviation through community works programmes, to fostering social inclusion through our programme of redress.

But we must be aware of our roles. There is a distorted logic prevalent in some circles that sees the state as the ultimate moral force that must accrue to itself all powers, including those of the market. That is not our morality. Our morality is to roll back the frontiers of poverty.

To do that, we will put our faith in the only viable driver of growth, employment and opportunities: business. In New York, I shall tell them that in Cape Town, our faith is strong.

This article by Patricia de Lille first appeared in Cape Town This Week, the weekly online newsletter of the Mayor of Cape Town.

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