sustainability
Economic impact
GPI’s portfolio of assets has contributed substantially to the local economies within which it operates, the biggest contributor being the Western Cape-based SunWest investment.
Economic impact of SunWest
SunWest has made a significant economic contribution to the province and the country, making a cumulative contribution to Gross Domestic Product (“GDP”) between 1997 and 2008 of over R15,8 billion. In 2008 SunWest contributed over R2,8 billion to GDP. This comprised the following:
- R338,7 million from ongoing capital expenditure at GrandWest due to the expansion of the facilities;
- R1,46 billion from the running of GrandWest;
- R148,3 million from the concessionaires operating at GrandWest;
- R13,6 million from ongoing capital expenditure at the Table Bay Hotel;
- R253,6 million from the running of the hotel;
- R5.7 million from the concessionaires operating at the hotel; and
- R645,5 million from the Cape Town International Convention Centre (Pty) Limited (”CTICC“). This last part of the contribution has a variety of sources and includes construction and maintenance expenditure, operational expenditure, spending by exhibitors, spending by delegates and induced tourism spending.
In addition, by 2008, SunWest had contributed over R600 million to Gross Geographic Product (“GGP”). This is made up of the following:
- R61,6 million in ongoing capital expenditure at GrandWest;
- R252,2 million from the running of GrandWest;
- R27,7 million from the concessionaries operating at GrandWest;
- R2,5 million from ongoing capital expenditure at The Table Bay Hotel;
- R44,9 million from the running of the hotel;
- R1,0 million from the concessionaires operating at the hotel; and
- R210,9 million from the CTICC.
To summarise, between 1997 and 2008, SunWest made a cumulative contribution to GGP of nearly R3,2 billion. Furthermore, in 2008 SunWest paid R429,1 million in casino levies and VAT, R287,2 million in other forms of direct taxes (such as income and corporate tax) and R24,4 million in licence fees. This resulted in a total of R740,7 million being paid into the fiscus in various forms of direct taxes, while an additional R286,1 million in indirect taxes was also generated during that year.
Job creation
SunWest has, since its inception, spawned many new business opportunities and created employment for thousands of people from its surrounding communities and beyond. Sustainable jobs created include employment provided by the CTICC, which SunWest played a pivotal role in launching by providing considerable intellectual and financial support. The spin-off benefit of this world-class international convention centre to Cape Town and South Africa has been substantial and is continuing to grow over time.
In 2001, at the peak of the construction of GrandWest, SunWest created or sustained 7 102 direct jobs and 7 455 indirect jobs, resulting in a total of 14 558 jobs created or sustained. By 2008 SunWest activities was sustaining 5 781 direct jobs and 5 235 indirect jobs. This is a total of 11 017 sustainable jobs due to the activities of SunWest.
In addition, GrandWest has 27 concessionaires ranging from fast food outlets and restaurants to entertainment and retail. These provide jobs for over 1 000 people. At the same time, there are eleven outsourced service providers, with the largest being the providers of catering, security and cleaning services. In total these service providers employ more than 1 600 people, most of whom never had jobs before.
The Table Bay Hotel has two concessionaires who employ a total of 37 people and five service providers who employ in excess of 400 people. The CTICC currently has five concessionaires and 22 service providers.
In the 2008 financial year, GrandWest spent over R130 million in purchasing goods and services in the local economy, and because 60% of tracked procurement was placed with the BEE sector, GrandWest has substantially advanced the provincial government’s agenda in respect of transformation in the Western Cape leisure industry.
Economic impact of Worcester Casino
In 2009 Worcester Casino made the following contributions to GDP:
- R8 million from ongoing capital expenditure;
- R104 million from running the casino and lodge in 2009; and
- Total capital investment for the lodge and casino was R225 million.
Worcester Casino currently employs 135 direct staff and has appointed three major service providers in the categories of catering, cleaning and security, creating employment for 214 people.
Economic impact of LPM Investments
Over the past year, Thuo Gaming WC and Thuo Gaming KZN have made a substantial economic impact. All venues through which the LPM machines are operating are subject to strict regulations and accordingly fall within the tax net. Many of the venues received substantial upgrades and the activities associated with these upgrades provided an important economic benefit.
The nature of route operations is that they are geographically dispersed throughout the provinces within which they operate and accordingly the benefit of the network is shared as opposed to being concentrated for the exclusive benefit of the big urbanised cities.
An updated economic assessment of the economic benefits of these operations is under way and through this we will be able to confirm and provide a report on how the actual benefit stacks up against the projected benefits at the inception of these businesses.
It is incumbent of casino operators, as a condition to being granted a licence, to provide for social upliftment and the promotion of responsible gambling within any given affected community.