Queenstown PACA ® : Promotion of the Local Economy in Queenstown / Lukhanji

1. Queenstown PACA®:Promotion of the Local Economy in Queenstown / Lukhanji

2. Participatory Appraisal of Competitive Advantage Involve local stakeholders Motivate local stakeholders to take an active role in an LED initiative Transfer know-how to local stakeholders and businesses Do a quick scan of the local economy Assess and refocus ongoing local economic development activities Identify strengths, skills, talents and opportunities Identify business and LED opportunities What is Participatory Appraisal of Competitive Advantage (PACA®)?

3. What have we been doing? • Interviews with businesspeople and stakeholders in Queenstown / Lukhanji • Miniworkshops with • Tourism sector • SMME support agencies • Training and education institutions • Local business men

4. Structure of this presentation • What is Local Economic Development (LED)? • What is the first diagnostic of Queenstown? • What are the first proposals to promote the local economy in Queenstown?

5. 1. What is Local Economic Development (LED)?

6. What isn’t Local Economic Development Attraction of new investment = investment promotion Community development Skills development SMME support + development Employment creation ... in a segmented and fragmented way!

7. What is Local Economic Development Community development Attraction of new investment Employment creation SMME development Skills development

8. Local economic development Community development Infrastructure Employment creation Transport SMME development Health Energy Poverty alleviation Technology Investment promotion Schools Housing HIV / AIDS Water / sewage Skills development Education How does local economic development relate to other activities? Local development SMME promotion

9. Principles of economic development: Rivalry / competition Invisible hand of the market Survival of the fittest Principles of community development: Solidarity Collaboration Support for the weak and disadvantaged Why there is a tension between economic and community development Consequences: • It is important to separate economic development and community development in terms of organization and implementation • It is possible, and indeed essential, to seek areas of overlap, to create synergies, and to learn from each other

10. 2.What is the first diagnostic of Queenstown / Lukhanji?

11. Sectors considered in the first Queenstown / Lukhanji PACA® • Tourism Sector • Queenstown / Lukhanji as Distribution Hub • Queenstown / Lukhanji as Service Hub • General Observations

12. General observations:Strong points and opportunities • Underutilised industrial area • Availability of vacant factory premises • Existence of a number of large manufactureres • Dynamic businesspeople sincerely interested in the development of Queenstown / Lukhanji • Proactive approaching by interest groups to PACA Team • Comparatively low crime rate • Schools of outstanding quality in national terms

13. General observations:Weaknesses • No active marketing of Queenstown / Lukhanji • Culture of Non-Cooperation • Fragmentation in business community • Not enough communication and information sharing taking place • Access and integration of new-coming businessmen is difficult • Sale and dismantling of vacant factory halls • Hawkers fill up sidewalks • Not enough coordination between some local government activities

14. Tourism Sector:Strong points and opportunities • Potential source of continuous revenue • Location at N6-Road • Continuous support from Regional Tourism Office • Game reserve and its supportive industries • Bongolo dam • Opportunities for a range of outdoor activities • Considerable number of B&B accommodations available • Strong demand for: • Caravan site - 4 X 4 Trails • Hotel accommodation - Birding • Hunting & game sale - Fishing • Flying

15. Tourism Sector:Weaknesses • Lack of tourism awareness • Lack of knowledge on the needs /expectations of tourists • Insufficient Signage • Remote location of entrance gate to game reserve • Only few tourist activities available • Missing entertainment facilities (e.g. movie theater) • No hotel accommodation in Queenstown / Lukhanji • Difficult currency exchange • Lack of Transport Shuttle Services • No proper stopover of Tourist Bus-Routes • Location of Local Tourist Office

16. Queenstown / Lukhanji as a Distribution Hub:Strong points and opportunities • Central location within a large rural catchment area • Good road and rail infrastructure • Well established suppliers (hardware, furniture, motorspares, wide range of food etc.) • Should benefit from common supply chains (e.g. wood, steel) • Low rentals • Scope for a goods consolidator

17. Queenstown / Lukhanji as a Distribution Hub:Weaknesses • No active marketing as distribution hub • Limited competition: a large number of competing distributors are facing high buying power = service not always customer-friendly • Decreasing buying power due to unemployment and increase in basic prices • High cost of transport • Long distance to main centers (Jo-burg, Cape Town, PE, Durban) • Inefficient and unreliable rail transport service • Unavailability of certain products

18. Queenstown / Lukhanji as a Service Hub:Strong points and opportunities • Large catchment area for banking and other service providers (150 km) • Tradition as a service and trade locality due to its location between Transkei and Ciskei • Most service requirements are offered in Queenstown / Lukhanji • Demand for better and more sophisticated services

19. Queenstown / Lukhanji as a Service Hub:Weaknesses • People moving here perceived bureaucratic procedures required by the local administration as complicated • Not well-used courier services • SMME support agencies are often not focused on the needs of SMMEs – focused on funders • Customer service is not a priority – businesses are often very complacent • Banks do not meet the demands of business / customers • Signage and information are not inviting people off the main route • Unwelcoming attitude perceived by some people

20. 3.What are the first proposals to promote the local economy in Queenstown / Lukhanji?

21. General ObservationsProposal #1: • Purpose: Restore of municipal park and provision of skills training • Proposal • Restore municipal park to create a more tourist-friendly appearance and to increase the leisure value • Use unemployed and unskilled workers to restore and subsequently maintain the park • As a secondary result those workers obtain skills of gardening and thus future job opportunities (garden workers, Garden services)

22. Tourism SectorProposal #1: • Purpose: Strengthening of Local and Regional Tourism Organisations • Proposal • Closer co-operation between private and public sector – make sure the LTO works • Local government to support the LTO and the marketing of Queenstown • Local government need to recognise tourism as an important growth sector • Leverage GTZ and DBSA technical assistance to structure and facilitate tourism activities • Only LTO registered members to benefit from joint marketing activities

23. Tourism SectorProposal #2: • Purpose: Marketing and information of Queenstown (Lukhanji) • Proposal • Create a brochure on Queenstown (Lukhanji) • Accommodation • Activities in the region • Review the current website initiative and contribute where possible • Engage with tour groups and passing busses • Collect information on how similar cities market themselves (benchmarking)

24. Tourism SectorProposal #3: • Purpose: Sharing and distribution of tourism related information • Proposal • Use the media to spread news and information regarding Queenstown tourism activities • Spread tourism statistics, tourist demands and suggestions to tourism establishments • LTO to become the hub of tourism information • LTO to be tasked with active marketing and spreading of information

25. Tourism SectorProposal #4: • Purpose: Signage to important tourism destinations to be improved further • Proposal • Signs and route signs to be erected that leads to important tourism destinations (e.g Game reserve, rock paintings etc)

26. Queenstown / Lukhanji as a Distribution Hub • Challenges: • Have to attract more business that will use Queenstown as a distribution base • Service of rail transport need to improve • Need to attract cargo consolidators

27. Queenstown / Lukhanji as a Distribution Hub Proposal #1: • Purpose: Market Queenstown as a distribution hub • Proposal • Embark on a marketing campaign that will promote Queenstown as a distribution hub • Maybe consider an incentive to attract businesses • Involve existing distributors to address common issues • Identify empty factories that can be used as warehouses and market them

28. Queenstown / Lukhanji as a Distribution Hub Proposal #2: • Purpose: Improve the inefficient and unreliable rail service • Proposal • Enter into negotiations with Spoornet & Department of Transport regarding service • Keep all businesses that can benefit from this service informed of progress • Make sure the service is not downscaled • Look at how other cities on similar routes assisted or used incentives for rail transport • Promote opportunities in rail consolidation and cargo handling

29. Queenstown / Lukhanji as a Distribution Hub Proposal #3: • Purpose: Arrange for Department of Labour to present Skills Development Fund workshops • Proposal • Workshop must target business that can benefit from upgrading the skills of their workforce • Educate businesses about the procedures of SDF

30. Queenstown / Lukhanji as a Distribution Hub Proposal #4: • Purpose: Motivate distributors to develop common/improved supply chains • Proposal • Educate distributors about the benefits of common & improved supply chains • Identify common suppliers and raw materials • Facilitate discussions between local business and suppliers of raw materials • If transport services or cargo handling is insufficient then identify the gaps

31. Queenstown / Lukhanji as a Distribution HubProposal #5: • Purpose: “Buy Local” campaign • Proposal • Promote local suppliers of the region to business and community (chickens, vegetables, etc) • Identify gaps and opportunities in the service offerings and stimulate the closure (GTZ to assist) • Discuss “supply problems” with large retailers • Consider a monthly “market in the park” for art, craft and local producers

32. Queenstown / Lukhanji as a Service HubProposal #1: • Purpose: Enter into discussions with banks to improve their service • Proposal • Arrange a meeting with banks and express concerns of business and community • Request services like Foreign exchange service, faster queues • Reward positive response with support from local government and media coverage

33. Queenstown / Lukhanji as a Service HubProposal #2: • Purpose: Reward good service & “Customer friendly campaign” • Proposal • Increase the scope of current service award to include categories like “best tourism establishment”, “best attraction” etc • Increase the involvement of media, associations and community in the process (do it BIG) • Use this process to educate people about customer service and customer focus • Create awareness of good service • Arrange for “Customer Service Training” in area • access Skills Development Fund (SDF)

34. Queenstown / Lukhanji as aService HubProposal #3: • Purpose: Promote Queenstown / Lukhanji as a service hub to the region • Proposal • Town already known as a service hub to agriculture, expand this to other sectors • Market Queenstown as a service hub • Create a directory of services • GTZ to assist with the stimulation of demand between service providers and small business needs in the next few months

35. Thank your for your attention!

36. The PACA® team in Queenstown • Christian Schoen (PACA® consultant) • Shawn Cunningham (GTZ Project Manager) • Shakes Mandaba (LED-Councilor Lukhanji) • Ian van Dyk (LED-Officer Lukhanji) • With support from P.J. Cloete (Councilor Lukhanji), Donovan van Wyk (Admin Director of Lukhanji), Charles Lubbe (Admin Staff of Lukhanji)

37. Contacts • Christian Schoen (cs@mesopartner.com) • Shawn Cunningham (cunningham@gtzpsdp.co.za) • Ian van Dyk (qtsec@lukhanji.co.za) PACA® is a registered trademark of mesopartner: www.mesopartner.com