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Investing in North West

By John Young

North West Province has rich mineral and agricultural resources. Known as the Platinum Province for the large concentration of platinum mines in the greater Rustenburg area, other productive mining sectors include gold, diamonds, dimension stone, granite and cement.

Educational excellence is promoted by outstanding research done by North-West University, which has three campuses.

North West Province is bordered on the west by Botswana and the province of Gauteng to the east. The Vaal River runs along the province’s south-eastern border with the Free State, and the province also shares borders with the Northern Cape to the south and Limpopo in the north.

• Read more: North West Province, South Africa

Mining and manufacturing

The contribution of the mining sector to the gross regional domestic product (GRDP) of the province amounts to 30.4%, government services contributes 10.8%, and finance and business services 12%. Trade accounts for 10% and manufacturing 5.8%.

Manufacturing capacity is concentrated in the larger towns in the north-east and eastern regions of the province. The economy of the town of Rustenburg is closely linked to the fortunes of platinum mining, with the sector contributing 77% of the city’s gross geographic product.

The major manufactured products of the province are fabricated metals, food and beverages and non-metallic metals. Mining-related engineering works are prevalent near mining operations, while companies in the automotive and automotive-supply industry are active in Brits.

The Rustenburg Local Municipality announced in 2010 that the city was the fastest- growing city in Africa.

• Rustenburg Local Municipality: www.rustenburg.gov.za

Agriculture

The North West is a major producer of maize and sunflower seeds and many other agricultural products. About one-third of South Africa’s maize comes from the province, as does 15% of its wheat.

The dry western part of the province is home to beef cattle, game ranching and hunting, with Vryburg being a major centre for cattle auctions. The well-watered eastern and north-eastern regions can carry many kinds of crops, many of which find themselves on the tables of the citizens of the nearby urban centres of Johannesburg and Pretoria.

The agricultural sector generates large-scale storage and logistics operations, particularly in Klerksdorp, Vryburg and Brits.

Infrastructure

The Rustenburg Rapid Transport (RRT) project will cost R3-billion and transform the city’s economy. About 200 000 passengers are expected to use the system.

• Rustenburg Rapid Transport: www.rustenburgrapidtransport.co.za

The Platinum Spatial Development Initiative aims to develop all areas on the N4 highway that links South Africa’s most densely populated areas with the town of Lobatse in Botswana. By developing nodes along the logistical corridor, the aim is to stimulate economic development. Rustenburg stands to benefit from increased traffic along this route, which is ultimately intended to link Namibia and Mozambique.

Investing in manufacturing

Strong efforts are being made to attract investment into the manufacturing sector of the North West by a variety of groups, with provincial investment agency Invest North West in the forefront. The priority is to add value to the province’s raw materials. The mining industry lends itself to various forms of spinoffs and beneficiation projects, like catalytic converters for motor vehicles, but there is also tremendous scope for the development of agri-processing, as the province is so rich in agricultural produce. Leather for car seats is an obvious example.

Tourism

North West’s tourism offering is varied and comprehensive. The emphasis is on the bushveld experience, with major assets being the Pilanesberg National Park (a provincial facility) and the Madikwe Game Reserve, which contains many luxury private lodges. The North West Parks and Tourism Board runs a further 12 smaller parks and reserves.

Two Unesco World Heritage Sites are located at Vredefort Dome (where a meteorite hit the earth about two million years ago) and Taung, where the discovery by an archaeologist of a skull in 1924 is regarded as one of the most significant of all time.

• Read more: The world's biggest meteor crater and World heritage in South Africa

The complex of hotels at Sun City in the Pilanesberg offers a range of accommodation, from the last word in luxury to family accommodation. There are two very good golf courses at Sun City.

The annual Nedbank Golf Challenge, hosted at the Gary Player Country Club, helps to put North West Province in the international spotlight There are campuses of North- West University in Potchefstroom, Mahikeng and the Vaal Triangle.

• Tourism North West Province: www.tourismnorthwest.co.za
• Sun City International: www.suninternational.com
• Nedbank Golf Challenge: www.nedbankgolfchallenge.com

Geography

The province falls in a summer rainfall area and the vegetation mostly comprises bushveld. The Magaliesberg is the only significant mountain range in the province. It runs for about 130km between Rustenburg and Pretoria in the northeast part of the province.

Three of South Africa’s major water catchment areas run through the North West Province: Limpopo, Orange and Vaal. The rivers and irrigation schemes (particularly centred on the Crocodile, Harts and Vaal rivers) support extensive commercial agricultural enterprises, small-scale farming and game ranching.

North West Province’s landmass of 116 320km˛ comprises just less than 8.7% of South Africa’s, while a population of 3.5-million makes up 6.8% of the national population.

Towns

The main towns being Mahikeng (the provincial capital), Potchefstroom, Rustenburg, Brits and Klerksdorp. Klerksdorp, which has gold mining and manufacturing capacity, is the largest city in terms of population, with about 423 000 people living there.

Traditions

A number of traditional communities in North West Province are active participants in the modern economy. The best known among these is the Royal Bafokeng Nation, with diverse holdings in 18 companies ranging from telecommunications to short-term insurance, and assets worth more than R30-billion, but there are several other Setswana-speaking communities that have shares in mining companies active in North West Province.

Many of the complex share-ownership and black empowerment deals have led to tension and court disputes between companies and communities – and indeed between groups within communities – but the great mineral wealth of the area presents a great opportunity for the upliftment of poor rural people.

The Bafokeng number around 300 000, of whom about half live to the north-west of Rustenburg, with the capital city of Phokeng being the administrative centre. The source of the community’s wealth is the mineral-rich land they own.

Remarkably in the South African context, this black tribe has held title to this land since the time of British rule. The great, great, great, great grandfather of the current kgosi (king) of the Bafokeng, Kgosi Mokgatle, encouraged young men to work for cash on the mines of Kimberley so that title deeds for the group’s traditional lands could be bought and registered. Now Kgosi Leruo Tshekedi Molotlegi presides over a community that is a significant player in the platinum sector and has a large and diverse investment portfolio.

• Royal Bafokeng Nation: www.bafokeng.com

This is an edited version of an article published by Frontier Market Network. Republished here with kind permission.

Copyright © Frontier Market Intelligence Ltd. All rights reserved

Reviewed: September 2013