intermediate cities report Key findings (Work in progress)

1. intermediate cities reportKey findings (Work in progress) CENTRE FOR DEVELOPMENT SUPPORT UNIVERSITY OF THE FREE STATE

2. OUTLINE OF THE PRESENTATION • Definitions and case study framework • Lessons from literature review • The narrative of each city • Key themes and conceptual ideas in understanding intermediate cities • Lessons in respect of differentiation and categorisation • Concluding comments

3. definitions • Intermediate cities • Historical definitions and pre-selection on size • More recently: Size, function and location • The term secondary – refers to 2nd tier cities • The term intermediate reflects on the functional role within the a settlement hierarchy (can include the flow of power, people, innovation etc). • Key questions: the international, national and regional importance • The importance of location (in relation to resources, agriculture and metros)

4. Towards a definition • Baloy and Rabinovich summarise the role of intermediate cities in the following way: • “To conclude, we may say that the cities we studied, and by extension a number of urban agglomerations, have a double affiliation: • their intermediate function on the one hand, their position of medium-sized town within the urban hierarchy on the other. • ... intermediate cities are a privileged environment for regional planning linking urban growth and regional equilibrium in a positive dynamic between the urban and the rural. • They supply goods and public and private services, and often function as administrative centres, representing the provincial and national authorities”.

5. Lessons for south Africa from literature review • The importance of the functional role (expressed in terms of international, national or regional importance) and understanding the risks associated with it.... • Understand functionality within settlement hierarchy • The importance of intermediate cities in respect of the management of urbanisation • Articulate the importance of small and intermediate urban areas in rural development • Has an appropriate environment been created for the development of place-based strategies (Can places really change their pathways...???) • ID of intermediate cities (self-selection vs predetermined)

6. Lessons for south Africa from literature review • Should be able to understand the impact of national policies • Mining – boom-bust cycles • Spatial targeting of intermediate cities requires a long-term approach and will be subject to significant policy tensions.

7. Overview of the framework given for the individual reports • History • Current status and planning • Economic trends • Demographic trends • Local level planning • Social issues • Spatial planning • Municipal governance and finance • The environment • Infrastructure and engineering services • Links with rural hinterland • Innovation, Human Capital and knowledge of the area • Government - LG relations • Synthesis (Risks and policy implications0

8. Themes within case studies • Single sector / narrow economic base • International connectiveness • National importance • The importance of regional service towns (incl. An increasing trend towards private services in these areas and management of urbanisation) • The technology angle (these are place of old but not unimportant technology) - except for tourism also very little evidence of new economies emerging.... • Historical pathways and path dependency • The environment • The role of freight and logistic infrastructure • Strategic planning at local but also other spheres of government – a largely short term orientation... • The role of national planning and policy guidelines • Varied quality of local government institutions (at institutional level but also at the level of infrastructure provision and management) • General poor business – local government relations • Demarcation and functionality

9. You need to help with the following: • Reasons for differentiation • Lessons / implications for differentiation • Lessons / implications for categorisation • I shall make some initial points but your inputs will be appreciated....

10. City of Matlosana: History • Social storyline: “Considerable mining decline but it is not that bad” • Main urban areas: Klerksdorp, Orkney, Stilfontein and Hartebeespoort • Klerksdorp est. late 1888s • Mining towns after 2nd WW • Considerable growth in mining • Downscaling since 1990s (Employment in mining drops from 80 000 in 1996 – 24 000 in 2011) (Mining GVA = 50% of total in 1996 – less than 10% in 2011) • Total population: 398 000

11. City of matlosana: keynotes • Historic role of gold (as exporter) – new emphasis on uranium • Population growth (1%p.a.) • Some indication of aging (economic active population migrate) • Downscaling being buffered by two factors (1) original rural service function which have expanded (2) proximity to Rustenburg – people keep residing in the area • Little evidence of collaborative planning (SLPs and IDPs) • Municipal management – (e.g. Municipal billing systems) • Municipal finance (revenue bigger than some of the smaller Metros; • Old Infrastructure – downscaling leads to less pressure in water but 40% of electricity is unaccounted for • Maintenance – significantly below 5% • Local planning and land use regulations to deal with decline • Some signs of improved business – LG relations • The environment • Lower house prices

12. City of matlosana: risks AND POLICY IMPLICATIONS • Risks • Impact of mine downscaling only felt a decade after initial downscaling • What happens in the platinum belt has an impact? • Agricultural services • Policy issues • Strategy for mine downscaling (amongst others how do we plan new mining settlements) • Ensuring integration between planning instruments (IDP and SLP)

13. Emalahleni (history) • Social story line: “long history of coal mining, but an increased need for energy and changing labour regimes have placed huge pressure on urban infrastructure and increased the long term environmental concerns” • Witbank Est. 1903 (heart of the SA coal industry) • 1950s – development of steel industry (mainly due to availability of energy) • Population: 395 000 (3.58% p.a. Growth during last 10 years resulting in informal settlements...)

14. Emalahleni – key notes • The mineral-energy complex: Established because of coal; coal – leads to energy production – energy to steel industry (these three sectors contribute 75% of the economy of the city) • National energy provider • Linkage with Maputo • Long history of water shortage • Major land use regulatory problems as a result of housing demand and poor municipal management • Some notes on mine / municipal dependence – example of water by Anglo • Municipality under administration (administrator describing this as a case of “....robbed a rich municipality to bankruptcy’ • Proximity to Gauteng an important long term consideration • But competition with Middelburg • Strategic planning - geared at ensuring municipal stability • Environment: (spontaneous combustion of coal, acid mine water, air pollution)

15. Emalahleni: key risks • Environment (air pollution / acid mine water and the ecology of the Olifants River) • What happens if there is no more coal? • New technologies in the steel industry? • Competition with Steve Tswete (Middelburg)

16. Emfuleni - history • Social story line: “Emfuleni’s history is closely knitted with that of developing the steel industry, through ISCOR as state corporation, linked to Afrikaner nationalism. ISCOR was eventually privatised and internationalised with significant implications for the local economy” • Est. of Vereeniging (coal-energy-first steel plant in SA) • Est. of ISCOR in Pretoria (1928) • Est. of Vanderbijlpark (1943 - 1959) • Growth of ISCOR (1960 – 1989) • Privatisation (1989 – 2000) • Internationalisation (2000 + • Historic development of Vaal Triangle? • Population: 730 000

17. Emfuleni: Key issues • Privatisation of ISCOR leads to major job losses • Internationalisation helps to stabilise • but the balance can easily be disturbed.... • Downscaling buffered by proximity to Jhb, decentralisation of private / financial services, weekend tourism industry and university growth • RDP housing • Infrastructure and density problems • Social perception of the place: the dirty place with conservative Afrikaners but it is slowly changing with significant levels of desegregation • Strategic planning – weak • Municipality – history of institutional problems – last three years it has stabilised – BUT... Below the surface... • Municipal – business relations (Cape Gate)

18. EMFULENI: Key risks • Closure but more likely a melting down of the steel industry • Environment (air pollution) • Government intervention in the steel industry • Municipal finance dependence on electricity charges (5 enterprises pay 80% of the electricity bill) • The role of new technologies as risk factor • Risks in SA steel supply • Increase in imports

19. George - History • Social story line: “long history of Khoi and colonial settlers, created a closed community which provided holiday space for the inland areas, with new comers being labelled “incommers”) • Established settlement in 1711 (Houtpos) – Linked to wood exploitation (originally export orientated) • 1811 formally est. as George by the British • Long history of tourism and second home development • Obtaining and airport in 1977 (by mere luck, but which helped to expand the tourism potential of the region) • 1982: Regional industrial development programme of the Apartheid state • 1987: Mossgas developments – significant increase in migrants from the Eastern Cape. • Fancourt Golf Club (1996) • Since 1994 the retirement industry • Population: 193 000

20. George key issues • Increased tourism and second home developments (link with the construction sector) • Considerable population growth (2% p.a. Between 2001 and 2011) • International tourism and the swallows • Expansion and the biodiversity • Available water • Sense of “white” and “coloured town” • Fairly good business / municipal relationships • Strategic planning and economic planning – in general good but no ref to retirement industry and tourism and LED are not linked – over emphasis on short term goals • High level of money borrowed from banks....to finance infrastructure • The concept of a dispersed city...

21. George: key risks • Economic decline – tourism / swallows (29 000 empty residential stands for middle- and high income groups) • Second home industry also small and focused on a specific segment of the population • Narrow base of the retirement industry

22. Polokwane - history • Story line: “the city evolved from bastion for Afrikaner conservatism / nationalism in the north, to developing a small but significant industrial base, to the administrative capital of Limpopo with bling and an important urban centre in the north” • Est. as rural service centre – Pietersburg – 1886 • Apartheid planning (township areas within former homeland areas) • University town from the 1960s (declining numbers) • Role of a town clerk in creating an improved access route between Polokwane and Gauteng and creating an industrial base of the town in the late 1980s • Provincial capital – administration in the 1990s • Population: 629 000 (Polokwane city 166 000 – rural 350 000)

23. Polokwane: key issues • Smart city and bling • 2.4% annual growth in population between 2001 and 2011 (Limpopo 0.82% p.a.) • Soccer world Cup • Airport • Easter weekend tourism • Provincial capital (tender park) • Rural areas (embargo on development....) • Water • Overall positive and good municipal finance situation despite some problems 5/6 years ago (last 2 financial years – unqualified audit) • Negative impact of politicians from provincial level • Positioning as place of trade for African countries to the north (you need not go to Gauteng, you can get it in Polokwane) • Fairly good business – municipal relationships (100 business are all linked to specific managers)

24. Polokwane: key risks • State driven development – lacks creativity • Economic recovery in Zimbabwe • Change in the structure and functions of provinces • Water • The fact that the municipality cannot control land-use on communal land

25. Umhlathuze - history • Storyline: “Original importance ito agriculture but the establishment of the port lead to the Richard Bay harbour becoming the gateway to international coal trade and a place of heavy industry, but the full potential ignored since 1994...” • Mostly wetland areas • Empangeni • Cane and mills up to 1960s (town also formerly established in 1969) • Establishment of Port in 1970s (linked to R293 town and homeland development) • Related industry (smelters but also forestry and sugar cane related) • Creation of a new town (If we had to apply environmental legislation applicable today, the town would never have been developed) • Port development orientated towards coal exports • Rail link with what is today known as Mpumalanga Highveld • Population: 334000 (160 000 urban)

26. Umhlathuze – key issues • Aluminium • Cranes at the Port / Competition with Coega? And Durban (The role of SOEs??) • The expansion of the rail capacity • IDZ no successes in the last 10 years • Very little development since the mid 1990s • Considerable urbanisation from the immediate rural hinterland create informal settlement developments – no history of planning on former communal land vs well-established history of urbanising farm land • A rural orientated municipal governance structure – with little understanding of the concept of internationalisation • Municipal finance • Strategic planning and the risks associated with international connectiveness • Significant political instability and some under spending • Importance; closest port to east and EU; and Jhb;

27. Umhlathuze: Key risks • National plans • Environment • Inability to create local responses – high dependence on SOE (and those who influence SOEs) • To some degree the inability of LG to respond? • Risk associated with a smaller international coal market • Financial risks associated with a small number of enterprises paying the bill • Maputo harbour

28. WHY ARE THESE CITIES DIFFERENT • Their specific intermediate role (regionally, nationally and internationally) • Their social and political role • Their sustainability • Their institutions and capacity • Actors and leverage points • Opportunities and risks

29. Reflecting on the Key themes from the case studies • Single sector / narrow economic base • International connectiveness • National importance • The importance of regional service towns (incl. An increasing trend towards private services in these areas and management of urbanisation) • The technology angle (these are place of old but not unimportant technology) - except for tourism also very little evidence of new economies emerging.... • Historical pathways and path dependency • The environment • The role of freight and logistic infrastructure • Strategic planning at local but also other spheres of government – a largely short term orientation... • The role of national planning and policy guidelines • Varied quality of local government institutions (at institutional level but also at the level of infrastructure provision and management) • General poor business – local government relations • Demarcation and functionality • DID YOU PERHAPS SEE OTHER THEMES?

31. Theme 1: Single sector / narrow economic base • Risk of international market change and international competitiveness • Risk of changing technology • Risk of resource depletion (or extraction not being viable) • Risk of poor strategic planning at local level • Risk of poor municipal management • Risk of changing government policies (economic sector policies such as steel) • What does it mean for differentiation?

32. Theme 2: international connectiveness • All cities a degree of international competitiveness (Polokwane, George, Matlosana, Emalahleni, Emfuleni, Umhlathuze) • Mainly in narrow sectors... • But, how do localities respond to this? • How is SA’s logistics network orientated towards addressing this? • What does it mean for differentiation?

33. Theme 3: National importance of these places • Regional service cities important in managing urbanisation, spreading government / private services / and rural development • Steel / Aluminium production • The environment (Vaal / Olifants River ecologies) • International logistics (Umhlathuze) and exports (Mining, steel and tourism) • National competencies (iro steel, aluminium) • Social and political roles of for example Polokwane • Managing national urbanisation. • What does it mean for Differentiation?

34. Theme 4: the importance of regional service centres • Polokwane, George, and Klerksdorp • Play a specific role in the urban hierarchy – usually originally linked to agriculture • Functions have grown • Functional distance of service area has expanded • The important role wrt private services (Health / education) • Polokwane City / Richards Bay very specific role wrt the rural hinterland • What does it mean for differentiation?

35. Theme 5: technology and economic type • In the main old technology (steel as oppose to plastic; steel production as oppose to fabrication; aluminium smelting as oppose to fabrication; extraction as oppose to beneficiation) • Or old economies (trade as oppose to tourism) • Which lead to either mobile human capital (mining areas) or not always that creative human capital (Mining, steel and government services) • Historic linkages between education institutions and industry have also become weaker over the past 20 years (reasons). • So what is different? • What does it mean for differentiation?

36. THEME 6: Historical pathways, path dependency and the ability (inability) to overcome risks • The case of Klerksdorp • All of these towns are locked into a path dependency with very little signs of breaking out of it.... In many cases they just expand their existing pathway... • City of Matlosana • Polokwane • Emfuleni • Umhlathuze • What does it mean for categorisation / differentiation?

37. THEME 7: THE ENVIRONMENT • Water access in Polokwane / George • The sensitive bio-environment in George / Umhlathuze (wetlands) • Acid drain water from mines in Emalahleni, Emfuleni and City of Matlosana (living with the long term implications of mining) • Emfuleni and acid mine water.... (would this have happened with a metro?) • Air pollution in Emfuleni, Emalahleni and Umhlathuze • Important for river ecologies (Vaal and Olifants) • Questions of cost benefit wrt the environment (Umhlathuze rail story). • At what scale are we tackling environmental problems? • Managing the environment and international connectiveness (the case of Emfuleni) • Intermediate cities – more direct link with environment • Implications for differentiation?

38. THEME 8: Freight and logistics • A crane for the port in Umhlathuze • The upgrade of the old Ermelo – RB rail? • Exports from Emfuleni • Implications for differentiation?

39. THEME 9: Strategic planning • Limited evidence of appropriate strategic planning @ local government sphere • Planning is a five year cycle theme – something we align with performance management contracts etc (also visible in George where there has been regime changes) • Cranes at Umhlathuze / Richards Bay • Emfuleni – the notion of not understanding the long term risks associated in the steel industry (the notion of international competitiveness does not feature in the local planning documents). • Umhlathuze – the importance of the port not conceptualised in IDP • Implications for differentiation?

40. THEME 10: National planning and policy • The story of Umhlathuze (harbour at Coega, upgrade of Durban – Jhb rail as oppose to accessing port in Umhlathuze) • Cranes • Emfuleni (possible creation of another steel mill / dispute between gov and AMSA) • Water in Polokwane (miss calculation of demand by national department of Water) • Expanding Emalahleni (does this not require some form of national response) • Implications for differentiation / categorisation?

41. THEME 11: VARIED QUALITY WRT local government institutions • Overall management: • George and Umhlathuze – maybe the exceptions with some significant improvements at Polokwane • The other had histories of poor municipal management, low expenditure on maintenance and political infighting • One under administration • The risk of poor municipal management if a city is a single sector city? • Financial management (Overall, PPPs) • Management of urbanisation (Examples) • Infrastructure • Spatial planning (Desegregation)

42. Theme 12: Poor business / government relations • Polokwane and George fairly good relationships • The others can at the best be described as ad hoc • Cases where businesses maintain infrastructure / provide water? • Municipal finance systems do not promote better relationships • Implications for differentiation?

43. Theme 13: demarcation and functionality • Administrative systems and functionality • The case of Emfuleni and Metsimaholo • Emalahleni (Witbank) / Steve Tswete (Middelburg) • Umhlathuze (as administrative unit) vs Richards Bay as a dense urban settlement mediating access to international markets – largely loose from the rural hinterland. • Is the one not keeping the other back? Can an overwhelming rural municipality and its local government structure (probably dominated by rural wards) plan international competitiveness? • It seems as if the new boundary demarcations in Umhlathuze increase the above pressure. • Rates on communal land? • The ability to formalise land on communal land near Richard Bay is crucial to the development of the “city” • Polokwane city vs rural hinterland • Implications of differentiation?

44. Differentiation: some initial notes • Differentiation approach in municipal management – Getting the basics right but also conceptualising these places within international connectiveness? • Can not think about differentiation only ito finance systems– other themes which should be considered are strategy, management performance (including financial management) and partnerships • International connectiveness, national and regional importance are key considerations and require differentiated approaches in policy, planning, municipal supprt and finance • Mining - relationship with the settlement environment in both boom and bust cycles

45. Differentiation (2) • Environmental considerations and long term environmental impacts should also be considered wrt differentiation

46. categorisation • Lesson 1: The importance of path dependency in the evolvement and future of cities suggest that sterile categorisation frameworks have serious shortcomings • Lesson 2: The dynamic nature of our case study cities cities suggest that movement within a categorisation framework should be possible • Lesson 3: A multi-layer of categorisation should be possible (an initial step could be Harrison’s work in order to provide a wide framework)

47. Thank you!