what are the factors that promote production in Port Elizabeth Uitenhage Industrial Area?
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1 INTRODUCTION
This paper addresses the concept of a relatively new approach to economic development in
South African cities and towns. In particular, the focus is on local economic development and
its association with industrial strategy. The case study of the Port Elizabeth metropole1
is
used to illustrate the question of industrial development as an effective local economic
development strategy.
Since the early 1980s, there have been changes in the local economic development (LED)
literature. The traditional neoclassical approach to LED appears to have given way to a new
concept of economic development in which "economic values and motivations are only part
of the story". The traditional "development from above" paradigm has been shelved in favour
of "development from below" and a new emphasis on the role of institutions, evolutionary
dynamics, and territorial specificity in the approach to both industrialisation and regional
development. The responsibility for economic development has shifted to the local or city
level in response to the inability of regions to respond to the global crisis prompted by global
restructuring. Although the international trend has been towards a reduced industrial sector
and a growth in services, it appears that "manufacturing still matters" in terms of the health
and wealth of a country's economy.
A number of LED models have emerged which provide guidance to cities that are interested
in taking the initiative in responding to the rise of the new flexible production order. In
responding to the objectives set in a localised industrial development strategy, it is useful to
consider three main options:- the attraction of new industries into the area, the strengthening
of the existing industrial base, and the promotion of new small business and/or the
agglomeration of interlinked small firms that serve specialised markets and react flexibly to
emerging market niches.
The main argument in this paper is that an effective2
local industrial development strategy
that complements other economic activity in other sectors - and that is not solely based on
large-scale industry - needs to be designed for the Port Elizabeth metropole, and that the
new theories of LED provide some useful guidelines.
Section 2 presents a case study of the city of Port Elizabeth. The history of the economy and
manufacturing sector are described, and the opportunities for development are considered. In
Section 3 the role of the manufacturing sector in the economy and the objectives of industrial
strategy are discussed, followed by a review of the role of industrial development at a local
level. The new developments in the LED literature are presented, and existing industrial and
LED policy and its relation to the local level in South Africa is determined. Section 4 then
offers some suggestions as to how an effective local industrial strategy could be designed for
the city of Port Elizabeth. In the concluding part of this paper, Section 5, some important
questions are posed with regard to what needs to be further investigated.
Port Elizabeth or Nelson Mandela Bay (Xhosa: iBhayi, alternatively Gqebera; Afrikaans: Die Baai [di ˈbɑːi]) often known by its initials PE, and colloquially as “The Friendly City”or "The Windy City", is a major seaport city and most populous city in the Eastern Cape province of South Africa. Port Elizabeth is the seat of the Nelson Mandela Bay Metropolitan Municipality, South Africa's second largest metropolitan district by area.[circular reference] It is the most-populous city of the Eastern Cape and the sixth most-populous city in South Africa. the most-populous city of Eastern Cape; and the cultural, economic and financial center of the Eastern Cape.The city is among the top five cities in the world for pleasant weather, according to a 2014 scientific climate study of 600 global cities. Port Elizabeth is known for many blue-flag beaches along the city's urban coastline; its popularity as an international and local holiday destination; and its rich and diverse cultural heritage. It is a tourism gateway city for the Eastern Cape and the only city with the closest proximity to malaria-free big five game reserves.