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SALGA_Polokwane_10_Nov_2010

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					NATIONAL INFORMAL TRADE ECONOMY
             SUMMIT

Pierre Voges: Mandela Bay Development
         Agency: Port Elizabeth

        10 NOVEMBER 2010
           POLOKWANE
Moving Out of the Financial Crisis;
“No Income, No Job, Asset Less”
Background

•   City initiated an focussed urban regeneration project
•   The industrial Port of Ngqura built 40 km north of the
    city
•   Includes a major Industrial Development Zone (IDZ)
•   Old port on the city‟s doorstep offers possibility of
    non-port developments (retail/residential/office and
    tourism/leisure/entertainment)
•   Inner city urban regeneration may use redundant port
    areas for non-port development
•   Informal trading part and parcel of urban renewal in
    the CBD
    Two Visions for the Harbour




•   Expanded auto & container freight on          •   Waterfront development over southern
    vacated tank farm & manganese land                portion of the harbour
•   No allocation of land beyond Southern Ports   •   Continued vehicle freight and fishing
    Agreement                                         related activities in northern portion of the
•   Environmental, safety and access                  harbour
    constraints on Southern Port land means       •   Waterfront and city integration
    that development options are very limited
Background

•   Port Elizabeth has seen the worst urban decay of all South
    African cities
•   An interventionist approach followed
•   City and region very dependent on motor manufacturing and
    related industry (VW and General Motors)
•   City initiated an focussed urban regeneration project
•   Agency an innovative cluster development vehicle
•   An intersection between economic development and urban
    planning
•   Far reaching effect on the discourse of urban management
    and planning
•   Urban planning in SA a very western approach; informal
    trading never really part of urban planning
•   Informal trading a key element in urban renewal in Port
    Elizabeth
A Third Way to urban planning…

•    A shift from the rational, linear structure of urban
    planning to an interactive governance of planning
    and development
•   A Third Way refers to guided development through a
    well-defined briefing process
•   A collaborative approach between the state and the
    private sector
•   Developments not always responding to the social
    fabric of a particular city– often islands of
    sophistication
•   A Third Way of thinking reinforced by the economic
    recession – planning needs to be done differently
•   Informal trading now a key sector of the economy,
    not merely an irritation
A Third Way applied in Port Elizabeth…

•   The city traditionally dominates by an competitive motor
    manufacturing industry
•   The secondary industry is strong, but vulnerable to external
    shocks
•   The tertiary industry (tourism and real estate) shows strong
    potential for growth; a perfect place for informal trading
•   A place for the middle class to live, work and play
•   The traditional middle class, industrial/blue-collar liability
    becomes an asset, as the development speaks to that market
•   The main objective is to use urban regeneration of a
    bounded, formally redundant place (port and city) may serve
    as a tool for the creation of an urban node
•   Economic and social growth based structures integrated in
    the urban regeneration process, incl informal trading
Sectoral contribution to Gross
Domestic Product (GDP) in Nelson Mandela Metro
Figure 1: Sectoral contribution to Nelson Mandela Metro‟s GDPR 1995-2007 (constant 2000
prices)




The Metro‟s economy is dominated by the tertiary sector, (tourism - incl informal trading and real estate)
contributing 64% to the GDP, the secondary sector mainly automotive) 35% and the
primary sector (mining) only 1 %.
Stability of Sectors
 Figure 2: Year on year % change in growth rate (constant 2000 prices) of sectors in Nelson Mandela
 Metro




 The tertiary sector (which includes informal trading) is the most stable, and has shown the most
 consistent positive growth, where the secondary sector is highly volatile
A Third at work in Port Elizabeth…

•   Influencing social and economic forces in urban
    planning
•   Often referring to as “slum clearing”, “reorganising”,
    “giving new birth”, “breaking new ground”,
    “refashioning”
•   Using “enabling” urban planning
•   Practising Dynamic Place Initiative (DPI) – creating
    sustainable urban places where informal trading is a
    key element
Practicing the new Model

•   The model a result of practice in workspace, place
    and reflection
•   The process of how architecture and design can be
    used as a tool to encourage a range of factors to
    interact in creating economic growth
•   Economics and innovation theory used to
    understand urban development against the backdrop
    of placed focus urban development
•   Using urban planning innovation to meet customer
    needs – Dynamic Place Initiative
Practicing the new Model

•   Port Elizabeth (as other port cities) the result of
    changes in industrial technology resulting in redundant
    city and port properties
•   The construction of the industrial Port Of Ngqura 40 km
    north of the city offers a unique development
    opportunity
•   City can recreate and finance a new urban system with
    the customer playing the centre of urban planning;
    informal trading a key customer
•   Planning and construction are programmatic activities
    – economic and social regeneration is more complex
    though
•   A special purpose vehicle is an avenue to bridge the
    gap
Practicing the new Model

•   Due to the ongoing transformation of South Africa away from
    apartheid type planning, the situation even more complex
•   Global competition forces a city such as port Elizabeth to
    reduce the traditional national foothold, using global
    standards rather than traditional local belongings
•   A new urban planning/economic context is often referred to
    as “post-fordism”, the “new economy” or the post modern
    society” – the recession reinforces this trend
•   The driving forces in the economy changing from a national
    orientated , raw material based perspective (the industrial
    society) to a global, regional and knowledge orientated and
    growth based production structure
•   Planning therefore needs to be economic growth orientated
Practicing the new Model

•   Port Elizabeth follows an interventionist approach in
    planning urban renewal
•   Urban regeneration infrastructure projects must be well-
    researched and speaking to customer need; private sector
    investment will follow public sector investment
•   Due to the ongoing transformation of South Africa away from
    apartheid type planning, the situation even more complex
•   Urban planning not only a method for regulations and
    control, but a channel for an enabling economic environment
    at a local level
•   Society needs to be more involved in urban planning
•   The approach must reduce private sector risk; economic and
    planning conditions must be reasonably predictable
Practicing the new Model

•   In short, other than making political and social sense,
    urban planning must make economic and financial
    sense – it therefore cannot ignore informal trading
•   A development agency, as a conduit between the
    state and the private sector become a key tool in
    ensuring urban planning makes political, social and
    economic sense
•   Urban planning must include informal trading, not
    because it has to, but because it adds to the urban
    fabric – dynamic place initiative
A New Way

•   Private actors will only enter urban redevelopment
    through property actions rather than through the
    urban planning system
•   A development agency is a perfect route to ensure
    that architecture, urban design only makes sense if it
    speak to customer needs, i.e. it must make economic
    and financial sense
•   The recession showed us that property development
    will change – the need for sophisticated islands,
    particularly in emerging economies will be less in
    demand and customer, middle-class driven
    developmental will be more important in urban
    planning
A City Turning Around

• Political will
• A well-researched Master Plan; “home-brewed”
• SUSTAINABILITY; LED failing in SA due to lack of
  sustainability – What does the market want?
• Building a strong local economy, driven by local people
  first; then outside people
• CREATE SPACE FOR INFORMAL TRADING
• Making the CBD a safe, clean and friendly
• To restore business and public confidence
• Stem capital flight; rescue dwindling municipal revenues
• Implement catalytic capital infrastructure projects
• Making NMBM unused properties “sweat”
What does the City want?
What can it absorb?

   Contextual       Sector analysis
    analysis

                        Office Market         Market size
  Comparative
   analysis of                                Market
  market size          Retail Market – INCL   performance
                      INFORMAL TRADING
                                              Market profile
                     Residential Market       Market gaps
   Economic
  base analysis                               Investment
                      Tourism market          opportunities
                    Leisure/Sport market
                     Culture & Heritage
Consumer market            market
    profile
The Political Enviroment
Overarching principles…

• Informal trading a key element of dynamic place initiative
• Well-regulated (formalising informal trading...?)
• Permit fee paid for informal trading kiosks and allocated
  trading spots
• Must have SA passport or valid work visa
• Self-regulation through trading associations – traders
  decide who gets a permit
• Traders part of urban design – it becomes their product
Govan Mbeki Avenue Market Research:
Where do people come from?


  65%                             22%




 13%
Govan Mbeki Avenue: Market
Research: How do people travel?



        Minibus Taxi   55%
        Bus             7%
        Car            17%
        Walk           19%
        Train           2%
The Plan…
              A SIMPLE DEFINITION…

• Working definition of informal trading is the economic
  activity undertaken by entrepreneurs who sell legal
  goods and services within a space deemed to be
  public property, within the informal sector.
• The implication is that informal trading management
  requires a public space management focus.
• This specifically excludes any activity that is defined as
  illegal by any national and/or provincial law.
• VISION
   “A well managed informal trading sector that is fully
   integrated into the economic, spatial and social
   development objectives of the city”
• MISSION
  “Through a developmental approach, the city seeks
   to facilitate the access to job and entrepreneurial
   opportunities within the informal trading sector and
   the nurturing of a positive relationship with the
   formal business sector providing a stable regulatory
   and flexible management environment that is
   predictable, empowering and sustainable”
  MBDA „S NFORMAL TRADING APPROACH IN
            THE MANDATE AREA


• The MBDA understands that it has a role and
  responsibility to play in respect of informal trading
• It affirms the importance of the informal trading sector
  and defines the MBDA’s willingness to ensure that
  informal traders are part of the integrated economic
  growth of the region
SCOPE OF INFORMAL TRADING POLICY

Types of informal trading that are addressed:


• Street/kerbside trading
• Trading in the pedestrian malls
• Markets (flea & craft markets as well as special markets,
  e.g. sector based)
• Trading in public open spaces
• Special events (night markets etc)
Key Findings from Business Survey

• 78% of respondents said that the upgrades in
  Parliament Street had improved their property value
• 30% of respondents said that there had been a
  significant drop in the amount of crime that occurs in
  Parliament Street
• 20% of respondents indicated that there had been no
  improvement in congestion in Parliament Street as a
  result of the upgrades
ILLEGAL TRADERS
WHY WE HAD TO REMOVE THIS
       STRUCTURE?
Key Findings from Business Survey

• 78% of businesses surveyed had made improvements
  to their premises in the last 5 years
• 70% indicated that these improvements were the result
  of the MBDA upgrades
• The majority of these improvements (50%) were to
  upgrade the interior of the businesses
• Only 20% of businesses said these improvements were
  to expand their business
Key Findings from Business Survey

• 52% of respondents indicated that they were planning
  on making improvements to their business in the next
  1 to 2 years
• 26% indicated that they were unsure
• Of the respondents that indicated that they were
  planning on making improvements, 43% indicated that
  these improvements were the result of the MBDA‟s
  upgrade
• Surveyed businesses, on average, employed 10
  people, of which 87% were permanent staff
Change in turnover over the last 5 years


          7.4%   3.7% 3.7%

                                     Significant drop in turnover

                                     Slight drop in turnover

33.3%                                No change in turnover

                                     Slight increase in turnover

                             51.9%   Significant increase in
                                     turnover
Key Findings from Business Survey

• 78% of respondents said that the upgrades in
  Parliament Street had improved their property value
• 30% of respondents said that there had been a
  significant drop in the amount of crime that occurs in
  Parliament Street
• 20% of respondents indicated that there had been no
  improvement in congestion in Parliament Street as a
  result of the upgrades
Rating the Impact of Permanent
Security and cleaners in Parliament Street
80%
                                               70.4%
70%

60%

50%
                                       40.7%
40%

30%                                                      25.9% 25.9%

20%               18.5%
      14.8%

10%
                          3.7%
0%
       Negative     Neutral              Positive      Extremely positive

                       Security   Cleaners
Rating of the aesthetic and functional
improvements of Parliament Street
60%

                                                        51.9%
50%
                                      44.4%
                                              40.7%
40%


30%
          25.9%

20%                      18.5%
                                                                14.8%

10%
                  3.7%

0%
      Negative     Neutral              Positive      Extremely positive

                    Aesthetic    Functional
Masterplan
SITE WORKS THE FLAG – POSITION,
SCALE AND PROPORTION
The Puzzle

                            Jetty and Strand
             Govan                Street
             Mbeki Ave




               Parliament       Donkin
                 Street         Reserve
Thinking differently about nodes…


                                   North
                                   End              New
                                                  Brighton



                             CBD



                                           PORT


                Motherwell
              WHERE WE ARE
• We started at Govan Mbeki Avenue (GMA) between the
  City Hall and Russell Road (72 traders)
• Strand Street (38 traders)
• Govan Mbeki Avenue between Russell Road and Albany
  Road (130 traders)
• Uitenhage CBD: (Market Street area (136); BATA Taxi
  Rank (46) & Uncedo Taxi Rank (56)
QUESTIONS?

				
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