Cape Town - The City of Cape Town got all defensive over the results of the Global Cities Index (GCI), a measure that seeks to quantify the extent to which a city can attract, retain and generate global flows of capital, people and ideas.
It was flabbergasted at dropping two places to 84th position, while Johannesburg retained its 58th overall position.
Mayco member for economic growth James Vos was almost dismissive of the report.
“It is important to note that there are many global city indexes published annually and it is sometimes unclear what data sets they utilise in the compilation of this data.”
The report said Cape Town dropped two places because of a decline in three of the GCI dimensions, namely human capital, business activity and cultural experience.
It said this was in large part due to heightened global competition for talent and shifting business dynamics and disruptive economic forces on the continent and beyond.
On the human capital side, Vos said Cape Town was able to draw and retain talent, but bemoaned the country’s visa regime in making it attractive for talent to flow into the city.
“The City’s experience, however, is that Cape Town continues to attract global talent, especially in some of the key high-growth sectors. There are, however, certain constraints with our visa regime where we have found certain companies struggling to obtain work visas for some of their highly and specialised skilled staff from abroad that are needed. This has been the case in one of our fastest growing sectors, namely the Business Process Outsourcing (BPO) sector.”
He said more could be done to make it easier for workers from abroad to come and work in the city and mentioned the boat building and tech sector as outstanding industries where the city is making its mark.
“Our high-growth sectors, like our tech sector, BPO, boat building, etc, would certainly benefit from an easier visa regime in order to make up our high skills gaps that we currently have.”
However, Lester September, chairperson of the Forum for Cape Flats Civics, said that through the City’s public participation processes they have made several suggestions on how the city can retain talent and attract talent from overseas.
“Low levels of work opportunity for the majority of Capetonians is seeing semigration to other provinces and emigration overseas. Cape Town also lags (behind) world cities in the availability of affordable housing close to where people work, compared to London, New York and Berlin.
“They all have affordable social housing programmes such as London requiring all new housing to have a 50% affordable housing component, while the City of Berlin requires 55% affordable housing with 10% owned by the city as social housing.
“Attracting and retaining newly qualified skilled individuals also requires providing affordable housing in close proximity to where they work, but also providing social development infrastructure as found in London, in the form of urban parks, and state of the libraries, with study halls and study cubicles in outlying areas such as the Cape Flats,” September said.
The report by Kearney, a leading global management consulting firm, said the average GCI scores across all cities remained steady in 2023 following several years of decline.
It said the human capital dimension witnessed a significant rise due to the return of the international movement of people to pre-pandemic levels, counter-balancing the continued decline of the business activity dimension as a result of persistent economic challenges.
“European cities maintained a strong presence in the top 30 rankings, while Asia’s global hubs, including Seoul, Osaka and Chennai, made significant strides. In the US, second-tier metropolitan areas performed particularly well, having successfully attracted talent and capital over the turbulent past few years.”
The reports notes the opportunities that Artificial Intelligence (AI) and related technologies offer cities like Cape Town where remote work does not necessarily mean that people have to physically work in big cities.
Vos boasts that Cape Town has been recognised as the start-up capital of Africa.
“Cape Town is home to one of the most promising and competitive innovation ecosystems on the continent – bigger than Nairobi and Lagos combined.
“The city boasts one of the highest-ranked start-up ecosystems in Africa, and is placed within the top 150 leading start-up ecosystems globally.
“With impressive internet penetration, structures to assist and encourage entrepreneurship, as well as access to one of the largest fibre networks in Africa, Cape Town sees almost 60% of South Africa’s start-ups flourish within its borders.
“What’s more, the city attracts global interest and tech-savvy entrepreneurs who are leading the advancement of Africa’s digital economy.
“To date, distinguished businesses such as Amazon, Microsoft and IBM have all planted roots in the Mother City.”
September said the levels of connectivity in Cape Town’s peripheral areas were poor, with a strangling of mobile signal “another of the curses of apartheid spatial design”.
Cape Town had its best scores in the ranking in 2018 and 2020 when it scored 73 and 77 respectively.
The report also mentioned that the city had fallen on the cultural experience. Vos mentioned several projects that they have to support and uplift the arts and artists.
“In Cape Town, the power of art is harnessed to address key challenges and uplift communities.
“Through these projects the City of Cape Town facilitates nurturing of artistic talent, fostering community engagement and empowering emerging artists, all while enhancing public spaces and celebrating the city’s rich cultural heritage.”
The report does mention that Cape Town has improved four places in the information exchange dimension, including through an improved online presence.