By Nigel Gwynne-Evans, Western Cape Government, South Africa, presented at the 16th TCI Global Conference, Kolding 2013.

1. Differing priorities in clustering and innovation –
a view from South Africa
Nigel Gwynne-Evans
Cluster Development in Times of Change
5 September 2013

2. Differing priorities in clustering and
innovation – a view from South
Africa
TCI Conference
September 2013

3. New section heading
Broad generalisations between developing and
developed economies
• Differing industrial structure (More primary sector/
industrially focused).
• Within sectors – differing challenges.
• Cluster initiatives at different phases – generally
less mature.
CONCERN WITH THE USE OF “INNOVATION” AS A
CONCEPT FOR DELIVERY IN A DEVELOPING COUNTRY
CONTEXT

4. New section heading
Cape region cluster programme key facts
• 15 clusters – Euro 60m
since 2006
• 140 staff in clusters (40
Public/ 100 Cluster )
• Funding - 60% from
government/ 40%
outside
• 6000 member
companies
represented
• All 4 universities
• Average 6 staff per SPV, but range
from 2 up to 35 employees.
• Not-for profit companies
• Public/ Private funded
• Open membership to all firms and
actors within the cluster
• Representative boards (majority
industry + reps from academic &
research institutions / government).
• Directors appointed on an annual
basis through open-AGM process
• Directors positions are non-
remunerative
• CEOs – industry specialists
Background Nature of Clusters

5. New section heading
Focus sectors for economic development: High
multipliers
Focus
sectors
• Oil, Gas and Marine
Complex
• Green Economy
• Tourism and Film
• BPO, Financial Services and
ICT
• Agri- Aqua and food
processing
• Creative and Design-
Industries
• Clothing, Textiles & Fashion
• Metals and Engineering
1st leg: Key Propulsive Sectors
2nd Leg: Employment
Supporting Sectors
Focused on reducing unemployment, through facilitating 400,000 new
direct jobs: Further multiplier effects of 2.5

6. New section heading
WC Clusters - 2013

7. New section heading
10 functions of Cluster Initiatives
Goals of cluster
initiatives
Marketing and
promotion
Skills and training
Debottlenecking
Innovation support Transformation
Productivity
programmes
Networking
Understand the industry
Business development Support institutions
1
2
“SPVs provide the framework to deliver targeted programmes to firms
within an industry sector”
3
4
5
6
7
8
9
10

8. New section heading
Primary product/ Industrially focused needs
• Structure of the SA cluster programme –
dominated by manufacturing – primary
producers
• Programmes dominated by benchmarking,
upgrading programmes, investment
attraction, export-development, skills.
• Service sectors focused on skills, promotion,
mentorship, venture capital attraction).

9. New section heading
Examples of dominant functions of each sector:
• Oil and gas services: Infra-structure, skills,
investment attraction
• Clothing and textiles: Lean manufacturing
and benchmarking
• Agri-processing: New investment, export
development and production efficiencies
• Engineering: Skills and lean manufacturing.
• Clean-tech: Investment attraction, skills
• Craft and design Sectors: Entrepreneurship,
market development, product development

10. New section heading
Dominant Functions in service sectors:
• Call-centres: Investment attraction and skills
• ICT sector: Entrepreneurship support; skills
development, funding attraction.
• Bio-tech: Commercialisation

11. New section heading
Our experience with “Innovation” as a tool
• Innovation a very broad concept
• Difficult to determine the tools that should be applied
• Not well understood in primary/ manufacturing sectors
• Difficult to convince CEO’s/MD’s that they need to adopt
innovation as a priority (need to focus on more concrete
actions)
• Triple Helix / R&D considerations less critical? (Applied
research & graduate development more important)

12. New section heading
For Africa/ Developing countries
• Be wary of driving developed economy
agenda’s on early-stage cluster development
• Focus on addressing competitiveness issues
and the underlying market failures confronting
each sector
• Firm-level upgrading & market
development
• Skills development
• Infra-structure and investment
• Regulatory constraints

13. Thank you