Connecting Cape Town to the world

At a recent Accelerate Cape Town stakeholder meeting, the issue of Cape Town being a globally connected city was discussed. Any city with aspirations of being a global business centre must be connected to the rest of the world, both through technology and international flights.

The two speakers, Deon Cloete, general manager of Cape Town International Airport, and Brian Pinnock of Dimension Data, talked about what is being done to ensure that Cape Town becomes as connected as any other globally recognised business city.

Cloete provided detailed statistics showing the effect of the global economic crisis on air traffic in general and on the Cape Town airport in particular. While all predictions were that nearly 10-million passengers annually would be passing through the new airport by now, current data indicates that just under 8-million passengers used the airport in 2009.

While these lower-than-predicted passenger volumes are being experienced at all South African airports, they are coupled, in the case of Cape Town, with very seasonal demand for flights. As a holiday destination, Cape Town airport experiences a dramatic increase in passenger numbers during summer. At the same time, there are a number of events that add to this trend: the Argus Cycle Tour and the Two Oceans Marathon are just two examples of summer events that add to the seasonal traffic at the airport.

As a result, there are fewer airlines prepared to provide direct international flights to Cape Town and a number of them only fly directly to Cape Town during the summer months.

Cloete pointed out that good flight connections, and preferably direct flights, are crucial to any city with aspirations to a global business presence. Reliance on seasonal demand will certainly not entice airlines to establish direct links to Cape Town. There is thus a need for a concerted business drive to create demand for business flights into the Cape throughout the year – and particularly in winter. Conventions and conferences in the off-season are an obvious solution, as would be any initiative to promote “winter tourism”.

Pinnock pointed out that broadband availability is now as crucial to the connectivity of any city as any provision of transport and other infrastructure. Globally, the provision of broadband is recognised as the key enabler for business, education and government, and has been found to add as much as 1% to gross domestic product (GDP) in some locations.

In the South African context, the availability of broadband provides numerous commercial opportunities. These include:
• Providing services to foreign companies
• The possibility of business expansion into Africa
• Increased opportunities for people to work remotely

Unlimited broadband also comes with some potential commercial threats to South African business, however, as lower-cost geographies outside South Africa could prove more attractive than local cities, and global concerns, such as Google, could well capitalise on the ability to sell services into South Africa and Cape Town – thus displacing local business opportunities.

There are many challenges to providing unlimited broadband, however. These challenges are not limited to the expansion of the fibre optic cable network, although this is essential (and has received extensive media coverage). Crucially, more than half the cost of broadband connectivity is incurred after the fibre optic network is in place, through local copper and wireless networks. This remains an issue.

Guy Lundy, CEO of Accelerate Cape Town, stressed that it is vital that Cape Town continues to drive for increased connectivity. “If we are to be competitive, not just in a global sense, but also in comparison with Johannesburg and Durban, we must continue to push for direct flight connections and for broadband to be as widely available in our city as possible. Cape Town has the potential to lead South Africa, and Africa, in terms of having connections to the world and with ourselves, and we must not lose this opportunity to capitalise on our reputation as a city of innovation.”

Guy Lundy is the CEO of Accelerate Cape Town.  He is also the co-author of South Africa: Reasons to Believe and the co-editor of South Africa 2014: The Story of our Future.  He spent several years living and working on four continents before returning home to Cape Town.

Accelerate Cape Town is a business-led initiative aimed at bringing together stakeholders in the Cape Town region to develop and implement a long-term vision for sustainable, inclusive economic growth. It was started by a group of business leaders brought together by a common concern over the lack of pace and direction of change in the Cape. They agreed that a common long-term vision and future strategy were needed for the region, and that “big business” should play a leading role in developing and implementing them.

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