2024 regional overview of the Eastern Cape Province

In a year which celebrated a century of automotive investment in the province, new sectors such as renewable and alternative energy are growing, and large infrastructure projects are underway. The province’s ports and Special Economic Zones are receiving upgrades and investments.

Struandale Engine Plant. Credit: Ford Motor Company

By John Young

Ford Motor Company started making cars in what was Port Elizabeth (now Gqeberha) in 1924. That company remains a pillar of the automotive sector in a province that exports more than half the cars that South Africa makes.

The other long-time original equipment manufacturers (OEMs) are Volkswagen South Africa, Mercedes-Benz South Africa and Isuzu, which started life as General Motors in 1926, becoming the city’s second auto manufacturer. VWSA began as SAMAD in Kariega (Uitenhage) in 1949 and the first East London assembly undertaken by Mercedes-Benz South Africa started in 1954.

These marques have recently been joined by Chinese OEM FAW and the Stellantis Group, which will start assembling the Peugeot Landtrek at the Coega SEZ in 2026.

The shift to renewable energy which is happening across the world can be seen very clearly on the hills of the Eastern Cape, which has rapidly earned itself the tile of the “Wind Province”. Other forms of green power and battery storage are being actively explored, and this is the subject of a Special Feature elsewhere in this journal.

The many new wind-power plants that the province now hosts bring power, but they also bring employment and opportunities for local communities where the wind farms are sited.

Turbines on hills of Roggeveld Wind Farm. Credit: Roggeveld Wind

The province’s most recent wind-power investment will see three 110MW facilities constructed in the Kouga Local Municipality. The Impofu wind farms will supply energy to Sasol and Air Liquide in Mpumalanga. Enel Green Power and Red Cap are building the R9-billion project after a lengthy environmental and public engagement process with about 60 landowners, including the Reebok Rant Workers Trust, a dairy operation near Oyster Bay.

Andreas Brand, CEO of Mercedes-Benz South Africa, inspects the company’s rooftop solar installation. Credit: Mercedes-Benz South Africa

The automotive industry is also increasingly playing a role in the energy transition, both in terms of powering plants’ operations but also in producing electric vehicles. East London-based Mercedes-Benz South Africa (MBSA) is working to reduce its carbon footprint at its manufacturing plant. The second phase of the company’s solar PV plan will see 22 847 panels bringing the combined total up to 26 539, an array capable of providing 14.6MW. Over the course of a year, this installation should contribute about 20% of the plant’s consumption.

Volkswagen has installed 3 136 solar photovoltaic panels at its Kariega plant which will produce an estimated 2 500MWh at full capacity. In addition, Volkswagen is building a wastewater recycling facility, replacing alien plants at its premises and planting a carbon bank of nearly 5 000 spekboom cuttings. Ford’s Struandale Engine Plant has been a winner of the SJM Flex Environmental Award for excellence in environmental management with its improved production methods leading to reductions in water and electrical consumption. Other factors were rainwater harvesting and recycling of 97% of waste produced at the factory.

A R22-million investment in a solar energy plant is paying off for Montego Pet Nutrition in Graaff-Reinet. The company reported a 300-ton reduction in CO2 emissions in a single year, the equivalent of planting about 9 000 trees to offset emissions. The nine-month solar project happened soon after a R70-million expansion project which increased the factory’s overall production by 30%.

Credit: CCBSA

Another of the Eastern Cape’s biggest brands is putting a great deal of time and effort into water conservation. When the dam levels feeding the Nelson Mandela Bay Metropolitan area reached critical levels, Coca-Cola Beverages South Africa (CCBSA) mobilised a comprehensive response.

Working together with other entities, CCBSA delivered water, JoJo Tanks and water wheelers to communities suffering shortages but also offered a longer-term solution in the form of a groundwater harvesting and treatment system known as Coke Villes.

Infrastructure

The province’s two Special Economic Zones (SEZs) have been the focus of investment to prepare them to host an array of enterprises. Dedicated sections of the SEZs provide for a cluster approach, something which automotive suppliers and logistics firms have taken advantage of.

In the SOPA, Premier Mabuyane reported that the East London Industrial Development Zone (ELIDZ) exported over R3-billion worth of products in a 12-month period. In the five years to 2024, the ELIDZ signed up 24 investors with an investment value of R5.7-billion, primarily in the automotive, agro-processing and general manufacturing sectors, but he noted that renewable energy sector investment is rising fast.

Within the Coega SEZ, just north of the city of Gqeberha, the Port of Ngqura was primarily designed as a container terminal but additional capabilities are being added. The Coega Development Corporation (CDC) has been tasked with finding a developer for a new Liquid Bulk Terminal and for a new manganese terminal. Transnet has agreed that the tank farm and manganese storage facility at the Port of Gqeberha is to be moved to the Port of Ngqura.

The provincial government has identified six “mega” infrastructure projects on which to focus: N2 Wild Coast Highway, Mzimvubu Water Project, Eastern Cape Transnet initiatives, N2 Nodal Development, undersea cables and the Wild Coast SEZ.

In addition, Premier Mabuyane revealed in the 2024 SOPA what he expects will be the priorities of the next provincial administration, the seventh since democracy was ushered in in 1994. The Eastern Cape is one of the provinces in South Africa where the African National Congress (ANC) is most confident of returning as the governing party.

The Premier listed the priorities as follows: biofuels, cannabis, oceans economy, Bhisho precinct, Bulembu airport for cargo and liquified natural gas.

With three ports and two large airports, the Eastern Cape is well suited to logistics activity.

Port of East London. Credit: TNPA

The massive Msikaba Bridge under construction in the OR Tambo District is on track for completion in 2025. This will transform travel in what used to be the Transkei and open up the Wild Coast for tourism. Work on the Mtentu Bridge in the Alfred Nzo District resumed in December 2023 and is scheduled for completion in 2027. Seven of the roads that lead to these bridges will be upgraded from gravel to tar as part of the broader project.

Both Vodacom and MTN are continuing to invest in telecommunications infrastructure. A project to connect 23 rural villages was completed by Vodacom at a cost of R34-million; a further R71-million will be spent on connecting another 86 villages. MTN allocated R600-million to protect its network and has rolled out an extensive programme of battery and generator support.

A Samsung Innovation Campus has been initiated at Walter Sisulu University. To be run by the Centre for Entrepreneurship Rapid Incubators (CFERI), the campus programme aims to transfer IT skills and help graduates start their own businesses. There will be courses on coding, programming, artificial intelligence and the Internet of Things.

Tourism

Tourism is one of the sectors that was hit hardest by Covid-19. Although times were tough for the “Adventure Province”, there was some good news out of a sector that still retains enormous potential for growth and has been identified by the Eastern Cape Development Corporation (ECDC) as a priority sector.

The ECDC invested R2-million in attracting the TV series Survivor South Africa: Immunity Island and that investment has been shown to pay off both in monetary terms and in showcasing the spectacular Wild Coast to TV audiences. The immediate economic impact of the filming was estimated at R10-million.

The north-eastern segment of the province is the site of a possible future national park, which would bring to five the number of national parks in the province, joining the Addo Elephant, the Camdeboo, Garden Route and Mountain Zebra National Parks. These parks not only look after animals but also protect quite distinct types of vegetation.

Credit: Sibuya Rhino Foundation

If the proposed Grassveld National Park is established high in the mountains above the village of Rhodes and near to the border with Lesotho, it would be South Africa’s 20th. The conservation goal behind the park is to preserve grasslands through agreements with landowners and farmers who would continue to farm the land responsibly. The land of the Batlokoa community is near the famous Naude’s Neck Pass.

As a source of clean water, the area is a hugely important resource and worth preserving for that reason too. The water that falls away from the highest point of this proposed park is described by Andrew Weiss of the WWF as “heading towards the Mzimvubu River and the Indian Ocean” while another small stream at the top of the mountain is destined to join the Orange River in the west.

Weiss also described rock paintings of eland and reedbuck “with the unusual addition of dogs and a fat-tailed sheep”. The Grassveld National Park project of the South African National Botanical Institute (SANBI) has recorded 1 131 species of plant life on the iNaturalist app.

In addition to national parks, the Eastern Cape has 15 provincial nature reserves and a multitude of luxury private game reserves.

The events sector was just about to restart before the Omicron variant put a stop to all travel. This is something the Eastern Cape does well, with the National Arts Festival and a variety of sporting events such as Iron Man being hosted by the province.

Two big new golf events have put the spotlight on the province’s tourism offering, the SDC Championship at St Francis Links (jointly hosted by South Africa’s Sunshine Tour with the DP World Tour) and the Nelson Mandela Bay Championship, an official DP World Challenge Tour event.