Downtown Cape Town growth may mirror continent

While large sections of Johannesburg shuts down when the sun sets, Cape Town's center overflows with local shops, cafes and restaurants, a product of local public-private partnerships.
Written by Dave Mayers, Correspondent, Johannesburg

JOHANNESBURG--Cape Town's downtown bucks the trend of the centers of most South African cities: it's alive at night. While large sections of central Johannesburg and Pretoria shut down when the sun sets, Cape Town's bustling center overflows with local shops, cafés and restaurants spilling out onto downtown streets.

The Mother City's success is emblematic of something that's becoming more and more common in sub-Saharan Africa. Driven not by the top-down, heavy-handed central planning of the past, this new growth takes advantage of partnerships between the local public and private sectors.

In November 2000, Cape Town's local business leaders set up the Central City Improvement District (CCID) to try to stave off downtown decay that had engulfed much of Johannesburg's central business district. Using a Canadian model, Cape Town's CCID has worked in partnership with local businesses and government to address their needs and plans for the future.

Over the last twelve years, the CCID has been an amazing success story. Part private police force and part government liaison, the CCID has changed the culture in central Cape Town. Andrew McNulty writes in the Financial Mail:

It is an arena where success breeds success, and the sharing of knowledge can contribute to urban renaissance in other places. In the past two years alone, crime rates in Cape Town's central city have halved.

The revival of Cape Town's center also capitalizes on some much larger demographic shifts in Africa. A population explosion coupled with a rising consumer market with disposable income have made projects like Cape Town's CCID possible.

In the recent study "The rise of the African Consumer" (pdf) McKinsey predicts that consumer facing industries will grow by more than $400 billion by 2020, making up more than half of continent-wide business growth.

In one of the first market studies of its kind, the global consulting firm surveyed 13,000 individuals across sub-Saharan Africa, and found a continent on the verge of a dramatic increase in urban growth and consumer spending.

The fast growing population will flock mostly to cities. And while Johannesburg is the regional powerhouse, its cities like Cape Town-which McKinsey calls "middleweight"-that will see the most dramatic changes.

"Growth in these middleweight cities is often faster, with less competition, than in the megacities; as a result, they may offer better profit margins," the study finds.

Africa's 156 middleweight cities contain only seven percent of the population but could conceivably contribute 20 percent to the continent's GDP growth through 2025.

This is not the post-colonial independence Africa. This growth is not built on the continent's natural resources, but rather on a growing  consumer market.

It's organizations like Cape Town's CCID that are best situated to take advantage of this demographic tide. While residents with means left Johannesburg's center in droves, between 2004 and 2007 the CCID oversaw the conversion of 40 buildings to residential use, eventually being filled with 6,500 new downtown residents.

Photos: Flickr/Derek Keats and 126 Club

This post was originally published on Smartplanet.com

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