GESTAMP RENEWABLE INDUSTRIES
How a multinational investor settled on Cape Town
Gestamp Renewable Industries (GRI), the world’s largest wind tower producer, first announced plans to open a factory in South Africa in 2012, but needed a location.
After scoping sites across the country, the company settled on Atlantis, 40km north of Cape Town’s central business district. The area had the correctly zoned and environmentally authorised land and was well-positioned with both the Cape Town and the Saldanha Ports in close proximity, says GRI South Africa plant manager, Christiaan Botha.
Once the location was finalised, Botha expected a long and arduous journey that would entail having to cut through mounds of municipal red tape. But his experience was quite the opposite. “Once land was identified through GreenCape, we were immediately put in touch with City officials. We had a single contact point. They pulled together all the necessary role-players, which made the entire process easier and faster. The efficiency and speed at which this investment was executed is unheard of in South Africa.”
Botha says working with the City’s coordination team shaved 18 months off the project initiation process. “That’s the duration of an environmental impact assessment alone,” says Botha. “We went from conception to being fully operational within 12 months. That’s unheard of in Africa. The efficiency of the City’s investment facilitation team, together with the enthusiasm of the service departments involved, was worth much more than the R1 million we received in incentives.”
Another plus, says Botha, was the aptitude of officials. “They were knowledgeable and helpful, but most importantly understood our needs. From the moment we submitted our plans, to it being approved took only two weeks. The construction company that built the factory said they had never experienced anything like it. If it was anywhere else in South Africa, it would have taken months.”
The City of Cape Town in 2013 introduced a series of incentives to help attract job-creating investment into Atlantis. This was later followed by the adoption of a city-wide Investment Incentives Policy.
The policy responds to the opportunity city principle as articulated in the City of Cape Town’s Integrated Development Plan (IDP), providing incentives which help foster increased opportunities for economic participation through creating an enabling business environment.
The City focused on Atlantis as this community was in urgent need of assistance. Since implementation, the Atlantis area has seen a marked increase in new industrial investment. The City’s incentive scheme consists of financial measures including an electricity tariff subsidy and exemption from land-use application fees, as well as nonfinancial measures such the city helping companies obtain faster authorisation from the provincial department of environmental affairs and development planning.
The R350 million investment from GRI was the first to be attracted through the incentive scheme and facilitated by the City’s Enterprise and Investment Department, which resides in the office of Cape Town mayor Patricia de Lille. The department’s core function is to ensure an enabling environment for foreign investment and trade, and to ease the tension of doing business with Cape Town.
GRI’s six factories around the world (in Spain, Turkey, India, Brazil, USA and South Africa) produce about 1 300 wind towers a year. Of those, about 150 are manufactured in Cape Town. Tower sections of 90 tons, 38 meters in length and five meters in diameter can be accommodated at the Cape Town facility.
GRI South Africa brought more than 200 job opportunities to Atlantis. “Within a year, we’ve upped the number to 342 employees, of which about 300 live in Atlantis,” says Botha.
“We believe that we’ve made a significant difference in this community. About 300 households that would otherwise have been without an income, can now be sustained.”
Botha says the company would invest in Cape Town again. He dispelled the myth that Cape Town, including council processes, shuts down over the December holidays. “What impressed us most was the eagerness of officials to assist, even at that time of the year,” says Botha. “We started negotiating the purchase of the land with the City in December. Over the Christmas period we made the offer to purchase. In January, council approved and by March we had access to the land. The City of Cape Town, including the executive, understood the need to effectively and efficiently facilitate investment.”
GRI specialises in the production of tower masts and components for large wind turbines and is a division of Europe’s leading steel sector multinational CorporaciónGestamp.