Drakensberg Cable Car

Drakensberg Cable Car

In our last budget policy speech we reported that we had commissioned a feasibility study for the development of a cable car in the
Drakensberg mountain range. We are delighted to inform this house about the progress that has been scored thus far.

Since the proposed venue of the project is located adjacent to one of the country’s UNESCO declared heritage sites, the Drakensberg
Ukhahlamba mountain range and local traditional communities, we had to canvass inputs from various affected parties, including those
responsible for advocating biodiversity protection. While an expert organization Graham Muller Associates undertook the project
feasibility assessment, we held briefing and consultative meetings with neighbouring communities under traditional councils of eMangwaneni,
Mazizini and KwaShabalala and we are happy to report that such sessions were well received.

The initiation estimates as per the interim business plan point to around R500 million that would be required to get this investment on
track. As part of the initiation of the project, market testing to ensure long term project sustainability and the ability to trigger other
business operations that could unleash business and employment opportunities was essential. We are pleased to report that the initiative
promises significant business opportunities for both small scale local entrepreneurs and established businesses.

Besides the immediate affected parties like communities, statutory bodies and environmental activists and as well as the proximity to
the Free State and Lesotho made a compelling case that we integrate our government counterparts in these two neighbouring areas,
hence we are in constant liaison with relevant Ministers in Lesotho and the Free State to ensure a collective interest in the project,
which we believe has cross-border socio-economic benefits.

In September this year, I will host a meeting with my counterparts from the two neighbouring areas and as well as our own National
Minister of Environment Affairs to update them on the progress made and canvass their unwavering support and commitment for
this project. In terms of protocols, the Department of Environmental Affairs would be an ideal offi cial link with UNESCO which is the
formal guardian of the Drakensberg as a heritage site. At the same time, the Ingonyama Trust has also expressed a keen interest in the
initiative as it could have an impact on land under its jurisdiction and therefore it became imperative that they become of one of our
contact stakeholders.

However, as stated above, the project is situated adjacent to a world heritage site which necessitates that the environmental impact assessment
exercise would have to be conducted with considerable sensitivity of our natural capital. Relevant interested parties such as
UNESCO and our own National Department of Environmental Affairs had to be informed to solicit their wise counsel to ensure that
even the compilation of the Terms of Reference for the Environmental Impact Assessment are reflective of the stature of the environment
within which the project is located.

However, we want to state that this is not the first time that a project of this magnitude has been attempted in a world heritage site
and to this end, we are confident that this cable car investment will receive positive response from all quarters including the United
Nations.Concerns about the current state of the R74 motorway have been raised with the Premier of the Free State and SANRAL to
ensure that there is synergy in the upgrading of this crucial travel facility.

Meanwhile, to advance this project, there was a need to identify the project champion that would act as a business applicant for the utili-
sation of the site for the development of the cable car.We believe that Ithala Development Finance Corporation, based on its historical
experience in conceptualising and implementing business models such as industrial parks and shopping malls, has therequisiteknow-how
to handle a project of this magnitude.

Ithala has therefore been assigned the responsibilityof initiating the process of undertaking the scanning of an appropriate business
model and developing the terms of reference that would correctly influence the content of the EIA to be presented to appropriate au-
thorities, probably including UNESCO if need be.This implies that a formal spatial development plan covering all developmental projects
aligned to the cable car would be developed and other developmental agencies like IDC, DBSA and NEF would have their attention
brought to this undertaking to ensure their immediate contribution to the funding of the project and its allied business operations.
We will therefore be convening a special meeting with these entities to brief them on this investment opportunity as we believe their
experience in the project promotion would be invaluable to the success of developing an impeccable financial model for this cable car
business.

Ithala’s task will be supported by a technical team of senior government officials and co-opted private sector representatives led by the
Head of Department for the implementation of this initiative.This team will also be charged with the responsibility of identifying and
appointing the potential project operator with substantial experience in similar initiatives at global level.

This should be an operator who also understands seasonal variations across the world with the capacity to assist with the marketing
of the cable car to visitors that would be fascinated by the experience of favourable climatic conditions that KwaZulu-Natal is blessed
with.This implies that the prospective operator would have to bring a combination of experience that includes technical and market-
ing capacity to ensure long term business growth and sustainability.To ensure the viability of the project and successful bidding for its
implementation, the above-mentioned team will alsoundertake an overseas tour of similar projects, especially those located within
world heritage sites to be able to learn about how they managed to solicit the approval of UNESCO for their project implementations
and what it is that we should consider when developing our own business case.

The KwaZulu-Natal EzemveloWildlife as our immediate expert custodians of our nature conservation would be playing an active role
in this project. IthalaDevelopment Finance Corporation will therefore be the developer of the project as stated above.It will therefore
compare the content of the feasibility study and the overall project business plan to ensure synergic profile that is essential to avoid
delays in the activation of this initiative, which we are confident would have significant economic spin-offs for the province and the
region as a whole.

We will therefore be announcing very soon the dates in which such fact-finding travels will be undertaken and a special workshop con-
sisting of various role players will be held in November this year to assess the progress that had been made with respect to working
towards the full swing implementation of this multi-million rand investment.We intend working closely with all affected stakeholders
and interested parties to ensure that we have minimal delays and also present a uniform investment proposition.

Madlala did not reveal the cost of the trip.