Durban Aerotropolis: Good Governance key To Ensuring Its Success

30 September 2019

“I admire the vision of the Durban Aerotropolis. You have got it down right.” These were the words of airport city expert Professor Douglas Baker of the Queensland University of Technology, Australia, during his presentation at the KwaZulu-Natal International Investment Conference at the Durban ICC,

Discussing airport cities and their role in attracting future investment, Baker said he had spent an interesting two days in Durban looking at the political support being given to the development of the Durban Aerotropolis. “It’s amazing to see this and critical that this support be there for its (aerotropolis) success.”

Finding common interests that bring people together with a mutual vision was key to relationships and governance. Fifteen years ago when he, along with Professor John Kasarda, looked at airports as hubs for investment and they did not realise how important the governance interface was at that point.

"Governance hinges on critical networks and relationships with government at all levels, corporations, and stakeholders including investors and communities. Governance domains were being contested; deregulation was taking place and a wider array of stakeholders world-wide were involved in the airport and the airport business," he said.

The present challenge for governance was in digital technology and platforms where there was currently a lack of co-ordination between firms, government and research institutions. Greater collaboration in this area was critical for the future of logistics and supply chains.

"Investment was most crucial for the success of an aerotropolis," International aerotropolis investment expert Dr Mirjam Wiedemann, Managing Director  of Wiedemann Consultants told delegates.

In a global context some aerotropoli and airport cities were flying with all investment opportunities,  while others were struggling, and this hinged on the approach to attracting investment.

Very clear short, medium and long-term strategies were needed. Social inclusion and regional benefits were critical for Durban. “If you put so much money into such a big project, it is important that everyone is included,” she said.

"Timing and phasing of different developments may be affected by current challenges; infrastructure and connectivity, the future development of the airport and ongoing stakeholder relationships are ongoing and traditional investment incentives were no-longer enough but a good add-on," she said.

Underscoring Wiedemann’s views on attracting investors Hamish Erskine Chief Executive, Dube TradePort Corporation said “Investors don’t just come. We need to look at the different value propositions that make sense  for investors to put their money in and participate or provide facilities for tenants.”

Adjusting and keeping the vision of the aerotropolis alive into the future was a continual strategy which will be key for Dube TradePort Corporation as the implementing agent and is something that will need a coordinated effort to achieve.

Keeping the vision alive was; “about governance – something we do very well in KwaZulu-Natal, about collaboration, provincial government working with local government, private sector, coalitions and working together is the deliver on a vision like this,” he said.

“In my view to get the aerotropolis to work, we need to unleash all of the creative and financial skills of the society to deliver on it. It cannot be delivered by one entity. That’s the exciting challenge. Let’s not go out there and find other investors to come and solve our problems, let’s find ways of driving solutions to those problems and get those investors wanting to participate,” he said.

Jarendra Reddy HATCH Regional Director Urban Solutions said the Durban aerotropolis was never designed to compete. It was designed to complement and was fundamentally about raising the game for South Africa. “Many cities get caught up in this notion of competition but when you are really harmonising that is when you realise the best opportunities.”

Touching on the proposition for the aerotropolis, Reddy asked how many cities around the world have vast areas of land and a choice of how best to use that land; where there was room to increase investment overtime because of the amount of land and where investors had a unique opportunity to get in early and partner with government to co-create an aerotropolis.