Should plans materialise for the newly licenced Saldanha Bay Industrial Zone to attract foreign and local business investments from the oil and gas sectors over 25 years, the region will benefit from direct and indirect investment estimated at R12b.
The economic prospects of large scale social upliftment through poverty alleviation in traditional fishing towns, will include increased facilities in the housing, basic education, and skills development sectors. Although industry specialists advise caution against over development and potential financial losses, following the demise of many property owners since the economic slump, those with a conservative approach may benefit.
The Cape West Coast population of 289 000, represents about 6% of the total Western Cape population, of which Saldanha Bay’s 78 000 residents represents 27%. Increased job opportunities for residents in and around the West Coast triangle of Saldanha Bay, Langebaan, and Vredenburg will see Saldanha Bay Municipality’s provision for about 3 200 houses from 2014 and further 1 000 units per year, up to 2020.
Increased marine traffic along the Cape West Coast, specifically for the maintenance of oil rigs, will attract more skilled technical and artisan workers from areas such as Vredenburg, which represent the commercial hub of this region. The local accommodation and catering facilities in and around Saldanha Bay Port is currently benefiting from the first refurbishing of an oil rig in the town.
Agents say increased market activity has been noted across the West Coast corridor prior to government’s granting of the licence for industrial development in and around the Port of Saldanha last week. Growth in property sales of 54% from Oct 2012 to Oct 2013 was reported by Pierre Germishuys of Seeff Properties West Coast. He says one of the reasons for the upturn since the extended property slump, is that owners and developers have benefited from the earliest anticipation for future investment since IDZ approvals became imminent a year ago.
The coastal town of Langebaan and the commercial hub of Vredendal are experiencing stock shortages to meet increased demand for rental properties, to cater for incoming business people and employees of national and foreign companies. While sufficient land is available for new development, the biggest demand for rentals is currently for housing from R5000 and R8000 per month, and purchases ranging from R800 000 to R1.2 million for medium size homes.
This coastal region, which is located about two hours from Cape Town en route to Namibia, has traditionally been a relatively unexplored tourism destination, is seeing increasing numbers of visitors to the area. Dave Osborne of Saldanha Bay Tourism says: “Spin off is filtering through to the tourism industry, where not all participants in the accommodation and tourist activities markets have escaped the prolonged economic slump.” He says increased leisure as well as business tourism, predominantly from national destinations, is now starting to impact the property industry.
Although economic growth is welcomed, residents of the Langebaan Residents’ and Ratepayers’ Association have expressed concern over costs to taxpayers as the result of the impact of the IDZ development on the area.
Professor Johan Ackron of the Langebaan Ratepayers Association says the IDZ is a conditional viability on a narrow front, specifically for marine related activity. "There will speculators in property as before, on the back of unrealistic expectations." He says given the historic, over development of sites in Langebaan, this will be unwise and premature.
The association, which has conducted its own feasibility study with regard the impact of the IDZ on Langebaan, states that proper due diligence needs to be carried out on this model to determine its implications, not least in terms of benefits and costs for the taxpayer.