Cape Town is the economic hub of the Western Cape Province, South Africa’s second main economic centre and Africa’s third main economic hub city. It serves as the regional manufacturing centre in the Western Cape. In 2011 the city’s GDP was US$56.8 billion with a GDP per capita of US$15,721. In the five years preceding 2014 Cape Town GDP grew at an average of 3.7% a year.
As a proportion of GDP the agriculture and manufacturing sectors have declined whilst finance, business services, transport and logistics have grown reflecting the growth in specialised services sectors of the local economy. Fishing, clothing and textiles, wood product manufacturing, electronics, furniture, hospitality, finance and business services are industries in with Cape Town’s economy has the largest comparative advantage in.
Between 2001 to 2010 the city’s Gini coefficient, a measure of inequality, improved by dropping from 0.59 in 2007 to 0.57 in 2010 only to increase to 0.67 by 2011/12. Despite this increase, Cape Town’s Gini coefficient remained the lowest of any large city in South Africa.
Cape Town has recently enjoyed a booming real estate and construction market, because of the 2010 World Cup as well as many people buying summer homes in the city or relocating there permanently. Cape Town hosted nine World Cup matches: Six first-round matches, one second-round match, one quarter final and one semi-final.
The central business district is under an extensive urban renewal programme, with numerous new buildings and renovations taking place under the guidance of the Cape Town Partnership.
The Cape Town Partnership is a collaboration between the public and private sectors working together to develop, promote and manage Cape Town Central City as a place for all citizens. The Partnership was formed ten years ago when the City of Cape Town, the South African Property Owners Association (SAPOA), the Cape Town Regional Chamber of Commerce and Industry and other stakeholders came together to address issues of urban degeneration, disinvestment and the social problems in the Central City.
Cape Town has four major commercial nodes, with Cape Town Central Business District containing the majority of job opportunities and office space. Century City, the Bellville/Tyger Valley strip and Claremont commercial nodes are well established and contain many offices and corporate headquarters as well.
Most companies headquartered in the city are insurance companies, retail groups, publishers, design houses, fashion designers, shipping companies, petrochemical companies, architects and advertising agencies. The most notable companies headquartered in the city are food and fashion retailer Woolworths, supermarket chain Pick n Pay Stores and Shoprite, New Clicks Holdings Limited, fashion retailer Foschini Group, internet service provider MWEB, Mediclinic International, etv , multi-national mass media giant Naspers, and financial services giant Sanlam.
Other notable companies include Belron (vehicle glass repair and replacement group operating worldwide), CapeRay (develops, manufactures and supplies medical imaging equipment for the diagnosis of breast cancer),Ceres Fruit Juices (produces fruit juice and other fruit based products), Coronation Fund Managers (third-party fund management company), ICS (was one of the largest meat processing and distribution companies in the world), Vida e Caffè (chain of coffee retailers), Capitec Bank (commercial bank in the Republic of South Africa).
The city is a manufacturing base for several multi-national companies including, Johnson & Johnson, GlaxoSmithKline, Levi Strauss & Co., Adidas, Bokomo Foods, and Nampak.
Much of the produce is handled through the Port of Cape Town or Cape Town International Airport. Most major shipbuilding companies have offices and manufacturing locations in Cape Town.
The Province is also a centre of energy development for the country, with the existing Koeberg nuclear power station providing energy for the Western Cape’s needs.
The Western Cape is an important tourist region in South Africa; the tourism industry accounts for 9.8% of the GDP of the province and employs 9.6% of the province’s workforce. In 2010, over 1.5 million international tourists visited the area.
With the highest number of successful Information Technology companies in Africa, Cape Town is an important centre for the industry on the continent. Growing at an annual rate of 8.5% and an estimated worth of R77 billion in 2010 nationwide the IT industry in Cape Town is becoming increasingly important to the city’s economy.
The city was recently named as the most entrepreneurial city in South Africa, with the percentage of Capetonians pursuing business opportunities almost three times higher than the national average. Those aged between 18 to 64 were 190% more likely to pursue new business, whilst in Johannesburg, the same demographic group was only 60% more likely than the national average to pursue a new business.