Economic stability is no longer the deciding factor for corporates choosing off-shore destinations to set up their offices, and Cape Town is reaping the rewards of this change.
Considerations such as the weather, location, quality of schools, hospitals, and travel opportunities now rank higher than ever before, making the Mother City a standout choice.
Paul Keursten, chief executive and co-founder of fully-serviced co-working business Workshop17, says the Western Cape provincial government has made its ambitions to establish Cape Town as the forerunner of the tech space “very clear”, with the city already ranked in the top emerging start-up ecosystems in the world.
One of the main contributing factors towards this is the infrastructure to sustain a hybrid working model.
“The competition is so fierce to attract and retain the right employees that both local and international corporations are now offering packages that include consideration for your mental and physical health, and lifestyle options for you and your family. With Cape Town and its mix of cultures, oceans, mountains, vineyards and weather that is conducive to an active lifestyle, employees are choosing the Mother City as their new work placement home.”
South Africa attracts many professionals and big multinationals, and is currently home to more than 75% of all top global companies in Africa. The country also recorded the second-highest number of start-ups, after Nigeria. He says Workshop17 has noticed a “sharp increase” of both international and domestic businesses, partly due to the number of foreign direct investment (FDI) projects, especially in the software and IT services sector.
“Approximately 58% of their members are freelancers and sole traders, with the majority of these operating in the technology industry such as programming and design. Larger tech companies that have made the flexible model their base with them include CV Labs, Flutterwave, and Nedscaper.”
Keursten adds that there has been an increase in international satellite company hybrid set-ups in the city.
“Companies are looking at the best ways to retain their teams, regarding lifestyle requirements as a top priority, and then a place where they can plug in with flexibility, regardless of a break in municipal services such as load shedding. And the CBD isn’t alone; we’ve recently signed TASC who prefer the more residential Newlands location.”
After Cape Town, Workshop17 ranks Johannesburg and then Ballito as the leading cities with international satellite offices in the country.
The Cape Town Central City Improvement District’s (CCID) recently-released State of Cape Town Central City Report 2022, says the city is a hub of opportunity, and is shifting to a service-driven economy with an established business culture and a cluster of trusted financial institutions.
There is confidence in the soundness of banks in the region, rated third in the world by the World Economic Forum, and the City of Cape Town received a clean audit award for the 2021/2022 financial year.
“Cape Town is a sub-Saharan African business hub with a sophisticated economy, and is an ideal destination for industry and innovation. The city has everything in place for sustainable economic growth – from its world-class Central City to its established infrastructure across several sectors.
“Cape Town’s service-driven economy has grown at a higher rate than the national average thanks to its competitive advantage in key industries and sectors, including several manufacturing sub-sectors such as electronic and electrical products, metal, steel, and beverages. Compared with other international cities, it offers excellent value for investors.”
The report states that the city also has:
- a steadily growing fintech sector
- rapidly expanding B2B and B2C e-commerce sectors
- increased exports
- an improved trade balance.
“With its expansive agricultural surroundings, Cape Town acts as a processing, trade and retail hub for a wide range of export-quality produce. Cape Town hosts a globally recognised film and media production industry.”
IOL Business