Sectors

Agricultural Sector

Agriculture is recognized as an important sector contributing significantly to the district economy. The agricultural activity in the Ugu is mainly crop farming (i.e. flowers, chilies, cucumber and tomatoes), commercial farming have established markets for sugar, timber, banana, tea and macadamia nuts. The subsistence farming areas exhibit low levels of livestock and poultry due to a very few small dams that are in the district. Small scales of farmers are also found in areas like Hlokozi, KwaJali, Ezingolweni and Umzumbe. There is a substantial harvesting of crayfish and oysters particularly in the Port Edward and Mfazazana areas. Commercial plantations are situated in the high rainfall areas in Harding, in the north areas of Vulamehlo and in the central areas of Umzumbe and Ezinqoleni.

Manufacturing Sector

There are two major industries that are limestone - mining in the district. Alpha Carbonates is located in Hibiscus local municipality and it supplies the fertilizer, animal fodder, paint, paper and plastic industries. Simuma cements is located in the Ezinqoleni local municipality. Food and beverages industry is mainly in Hibiscus coast municipality, present 14% of manufacturing sector. Clothing and textile are recognized as major employment sector and they are dominant in Port Shepstone, Umkomaas and Scottsburg. The metal industries are located in Margate, Umzinto and Port Shepstone. The small wood and wood products are concentrated around Harding, Port Shepstone and Margate.

Trade and Tourism Sector

Trade is the second highest contributing sector in the district economy. Indicators show that the sector contributed R664.8 million to the local economy and 16.7% to the total economy of the district. The trade sector is well established and extends into the rural areas through the sale of goods and services, particularly basics households supplies and educational requirements. In the rural areas they rely on spaza shops and trading stores to generate income.
Tourism sector is one of the major generators of employment in the district. The tourism related firms are based along the coastal strip where there are beaches, coves and golf courses. The main tourists' attraction includes beaches, scenery sites, inland activity fishing and adventure tourism. Popular attractions and important nature conservation areas are located in the southern section of Hibiscus coast municipality, within Ezinqoleni and inland of Scottsburg

Ugu District Municipality

It is the most preferred and popular tourism destination by both local and foreign tourists. It includes the well established coastal towns such as Port Shepstone, Margate, Pennington and Hibberdene. The district incorporates some of the best sub-tropical bush land and forest in KwaZulu-Natal. The main economic activities in the district are in the areas of tourism, agriculture and some manufacturing. Port Shepstone is the main commercial centre and the major source of employment. The local municipalities within the district are Hibiscus, Ezinqoleni, Umdoni, uMuziwabantu, Umzumbe and Vulamehlo.

Development Corridors

Spatial Development Corridor

Nodes and Development Corridors for this region for the next five years:

• SC6 - Port Shepstone/St Faiths/Ixopo Corridor, focusing primarily on Developing a direct link between the Southern Drakensberg and the Coastal areas to expand the basket of tourist destinations and spending options.

Ugu District Municipality

It is the most preferred and popular tourism destination by both local and foreign tourists. It includes the well established coastal towns such as Port Shepstone, Margate, Pennington and Hibberdene. The district incorporates some of the best sub-tropical bush land and forest in KwaZulu-Natal. The main economic activities in the district are in the areas of tourism, agriculture and some manufacturing. Port Shepstone is the main commercial centre and the major source of employment. The local municipalities within the district are Hibiscus, Ezinqoleni, Umdoni, uMuziwabantu, Umzumbe and Vulamehlo.

Ugu District: Socio-Economic Profile

• Demographics
• The KwaZulu-Natal Province has both, a growing and maturing population, presenting opportunities and challenges to the province. According to Statistics South Africa mid-year estimates (2008), KwaZulu-Natal population was estimated at an average size of 10,1 million people. The largest number of these people lived in eThekwini Metro (32.6 percent of the provincial population), followed by uThungulu district (10.2%) and uMgungundlovu (10.0%). Ugu district had an estimated average population of 669,256, accounting for 6.9 percent of the provincial population between 2002 and 2008 (Figure 1.1).


• Figure 1.2 shows the distribution of the population across DMs by age group. The largest proportion of the population in Ugu was the age group 15-64 years (58.8%) followed by age group 0-14 years (39,1%). The elderly population made the smallest portion of the total population.
  A population distribution skewed towards a working-age population tends to translate into higher unemployment levels, particularly if individuals are not appropriately skilled.


• Hence, the higher number of both young individuals and people in the labour force will require more spending in education (primary and secondary) and skills development.
  The majority of the population across all DMs was female during this period (Figure 1.3). Ugu district followed a similar pattern, with 53.0 percent of its population falling in this gender group.
• Economic Outlook

Gross domestic product per municipality (GDP-M)

• Between 2002 and 2007, the GDPR for KwaZulu-Natal was estimated at an annual average of R184,8bn. There was significant growth of 29.9 percent from R162bn in 2002 to R210,4bn in 2007. Ugu was the fourth largest contributor to the provincial GDPR at an annual average of 3.69 percent, after eThekwini (64.9%), uThungulu (9.3%), and uMgungundlovu (8.4%). The least contributor was Umzinyathi at 0.8 percent (Figure 1.4).


• Figure 1.5 shows Ugu’s GDP-M by economic sector between 2002 and 2007. During this period the economy of the district grew by an annual average of 4.1 percent. Manufacturing, Community Services, and Trade sectors are the main economic drivers in this district. These three sectors contributed respective annual averages of 20.1 percent, 19.1 percent and 15.7 percent to the district’s GDPM between 2002 and 2007. However, Transport was the fastest growing sector at an annual average of 7.1 percent. Mining is the only sector which did not experience any growth.

• International Trade
• Figure 1.6 shows the percentage of exports, imports and trade balance (as a proportion of GDP-M) across all DMs. The figure reveals that international trade has minimal impact on the economy of Ugu. The district’s imports made up 3.08 percent of the economy’s GDP and its exports were a mere 1.30 percent on average between 2002 and 2008. This resulted in a negative trade balance of 1.8 percent of the GDP-R.

• The Labour Market

The labour force and the economically active population

• Between 2002 and 2007, the provincial labour force1 approximated at 6,0 million people per annum (approximately 60.0% of total provincial population). Of this total, the economically active population (EAP)2 was approximately 3,1 million. More than 1,4 million of these people were in eThekwini, followed by UMgungundlovu (360,000) and uThungulu (221,000). Ugu held the fourth position with about 182,000 people falling in this category (Figure 1.7).

• 1 Labour force is population aged 15-64 years.
  2 The category EAP is made up of people who are either employed or unemployed. The employed consists of employers and employees, while unemployment are those not having a job but are actively seeking one (official definition), or they do not have a job, are actively seeking one or have given up searching yet still available for work at anytime (expanded definition).
  As a proportion of the district labour force3, Ugu’s EAP was about 45.0 percent. At this rate, the district was the fifth highly economically active after the Metro (67.0%), uMgungundlovu (61.0%), Amajuba (55.0%) and iLembe (49.0%).


• Unemployment
• During the review period (2002-2007), there were about 94,000 unemployed people in the district. This was the fifth highest level of unemployment after the Metro (562,000), uMgungundlovu (172,000), uThungulu (112,000) and Zululand (102,000) (Figure 1.8).

• During the same period, the district’s unemployment rate45 was moderately high at about 51.0 percent. This means that slightly more than half the number of people falling within the EAP could not find employment (Figure 1.9).
  3 EAP/LF = Labour participation rate or ratio.
  4 Unemployment rate is the ratio of the unemployed to the EAP 5 Global Insight makes use of the expanded definition of unemployment, this includes those unemployed but not actively seeking a job
  
• 
• As with the other districts, Ugu’s unemployment rate was skewed towards the Blacks (54.8%). The respective rates for Coloureds, Indians and Whites were 29.3, 18.6 and 11.5 percent, and these were slightly higher than the pattern observed in the previously discussed districts.
• Employment

Total employment

• During the period under review, KwaZulu-Natal employment totaled an annual average of 2,1 million workers. Ugu’s employment was the fourth highest after that of the Metro, uMgungundlovu and uThungulu (Figure 1.10).


Formal employment

• The district’s formal employment was among the relatively lower levels at 68.7 of total employment (Figure 1.11). Agriculture, Community Sevices, Household Services, Manufacturing and Trade sectors played a significant role in the district’s formal employment, together accounting for about 84.0 percent of the formal employment (Figure 1.12).
  
  As with the other districts, employment in Agriculture, the co-major employer with Community Services, has seen declines since 2000. A larger part of this sector’s employment was recorded in Agriculture and Hunting industry (or sub-sector) than in Forestry and Logging (Figure 1.13). An average of only 14 people worked in the Fishing industry.


Informal employment

• KwaZulu-Natal’s informal sector employment, recorded mainly in Trade, Construction, Community Services, Manufacturing, Transport and Finance6 sectors, was generally skewed towards the Trade sector. This was true in all but four districts, each having at least half the employment in this sector involved in trade of some kind; Ugu had a similar experience. The district also had a uniquely high employment in Constriction as slightly more than 20.0 percent (Figure 1.14).
  
  Figure 1.15 shows the distribution of formal employment in the Trade sector, the major contributor to informal employment. Similar to uThungulu, uMgungundlovu and iLembe, Ugu’s formal employment in trade was almost uniformly distributed among the four main industries, with ‘Retail Trade and Repairs of Goods’ leading at 33.4 percent. The informal employment sector could also have followed a similar structure.
  
  6 These are the sectors recorded by Global Insight; they are easier to monitor and collect data thereon than the remaining others.


Crime

• Between 2002 and 2006, there was a consistent decline in reported incidences of crime in the province (2.4 percent annual average). UMkhanyakude, and uThungulu to a less extent, were the only district resistant to declining crime rates. However, 2003 forward saw a comprehensive decline, though with differing magnitudes; the provincial collapse rate in crime was 5.1 percent, while Amajuba, Sisonke, uThukela and Zululand enjoyed the highest decline of at least 8.0 percent each.
  From 2002, Ugu boasted a decline in the number of reported crimes of 24.4 percent on average.

• During the same period 2002 to 2007, the most common crimes in this district were theft, assault and burglary.

1.5 Land Cover and Use

• In 2006, Ugu’s share of the KwaZulu-Natal soil was a miniature 5.4 percent, larger only than iLembe (3.5%) and eThekwini (2.4%). However, the districts maximized the use of the land as an impressive 14.2 percent was used for permanent cultivation, and an additional 8.2 percent was cultivated temporarily. This could still be expanded as an enormous 13.0 percent is covered by unimproved grasslands (Figure 1.17).


Social Development

• Figure 1.18 shows poverty rate, Human Development Index (HDI) and Gini coefficient for the district of interest. It is clear from this graph that the proportion of people living in poverty in Ugu has been decreasing, contributing to improved HDI in the district. However, similar to other areas, the Gini coefficient, which measures the income gap between households, has been on the rise.

Contact Details

• MM: Mr Luvuyo Mahlaka
  P O Box 33 Port Shepstone
  28 Connor Street Port Shepstone 4240
  Tel: 039 688 5700
  Fax: 039 682 4820 /1720
  E-mail: luvuyo.mahlaka@ugu.gov.za Website: www.ugu.gov.za

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