Africa's own silicon valley

Silicon Valley is a region in California noted for its computing and information technology (IT) industries. The Western Cape, and Cape Town in particular, are generally regarded as an attractive destination for IT companies and start-ups. This has been largely attributed to the provincial government's support for entrepreneurial activity.

The provincial government and the City of Cape Town have invested heavily in broadband infrastructure in recent years, and analysts believe that this could further encourage start-ups and stimulate economic growth.

"The investment in broadband by the city and the provincial government will help to establish the Western Cape as a centre of business excellence and the Silicon Valley of Africa," Cape Chamber of Commerce president Fred Jacobs said.

He said that in order to establish the province as Africa's Silicon Valley, the government and the private sector had to work closely together.

The investment in broadband infrastructure by the city and the province would also encourage entrepreneurial activity, Jacobs said.

He was speaking after finance MEC Alan Winde's provincial budget speech last week. Winde said the province's broadband project would receive about R500m over the 2013 medium-term expenditure framework. This would be to deliver high-speed Internet to government buildings, schools and public libraries. In the year ahead, the province would also roll out its pilot Wireless Mesh project in Khayelitsha, Mitchells Plain and Saldanha Bay.

Broadband infrastructure

By 2020, the plan is to have rolled out broadband to every citizen of the province - a project which will require large public investment, Winde said.

The City of Cape Town has invested R150m in broadband infrastructure and over the next seven to 10 years it is expected that the province-backed project will cost R1.3bn.

The authorities say that, in addition to improving the municipality's high-speed data communications and making Internet services widely accessible, the broadband infrastructure will be the key to driving economic growth and development. The city says affordable bandwidth is frequently cited as one of the main factors supporting investment and economic growth in developing countries. According to a study by the World Bank, 1.4% growth is recorded for every 10% increase in broadband penetration.

Technology expert and World Wide Worx's managing director Arthur Goldstuck said there was "no question" that the Western Cape, Cape Town and Stellenbosch in particular, were attractive destinations for young developers and entrepreneurs.

He said the investment made by the City of Cape Town and the province in broadband infrastructure would bring more skills and entrepreneurs to the Western Cape, which would have positive economic spin-offs.

Source: Business Day via I-Net Bridge