Veteran World Cup observer Duncan Hall is reporting exclusively from South Africa for The Royal Gazette, but as well as watching the football, he has taken time out to explore. Here he reports from Cape Town.

Bermuda and cosmopolitan Cape Town have more in common than refreshing ocean breezes and first-rate golf courses. Some 160 years ago, with Australia having grown tired of being the dumping ground for British convicts, the United Kingdom government attempted to turn Cape Town into its newest penal colony.

The British convict ship Neptune left Bermuda in 1848, bound for Cape Town with a cargo of 282 prisoners, including several leading Irish dissidents. The episode is recounted in Sean McConville's book, 'Irish Political Prisoners 1848-1922 Theatres of War'.

When Cape Town residents discovered the ship was en route, they protested loudly against becoming the latest destination for British felons and enemies of the state.

Some 5,000 protesters gathered on the Grand Parade a large open area that on February 11, 1990, saw thousands gather to hear Nelson Mandela make his first speech after being released from prison to hear leading liberals denounce the British government's plans.

The protest is shown in Johan Marthinus Carstens Schonegevel's painting, 'The Great Meeting of the People at the Commercial Exchange', which now hangs in Cape Town's Rust-en-Vreugd Museum, a house built in 1778 for leading government official Willem Cornelis Boers.

An editorial in the city's newspaper, the South African Commercial Advertiser, opposed the ship's landing, too. The attempt to convert Cape Town into a penal settlement, it said, was "injurious, despotic, and tyrannical … and beyond the Constitutional prerogatives and recognised powers of the Crown of Great Britain".

When the Neptune docked in Cape Town in September 1849, Governor Sir Harry Smith gave an order forbidding the ship from discharging its cargo. For five months, the ship lay at anchor in Simon's Bay. Meanwhile, back in the UK, Conservative politician Charles Bowyer Adderley addressed Parliament, supporting the Cape colonists' opposition to becoming a penal colony.

Five months after it first arrived in Cape Town, the Neptune left for Tasmania, arriving on April 6, 1850. In consideration of the hardships they had suffered, ordinary convicts on board were given immediate conditional pardons. In Cape Town, meanwhile, grateful citizens re-named the city's main thoroughfare, Adderley Street.

For us, the transition from Johannesburg, a city with attitude as well as altitude, to the comparatively laid back vibe of coastal Cape Town has been most welcome. While many of Jozi's residents hide away at night behind eight foot walls topped by electrified razor wire, those precautions are rarer in Cape Town.

Founded some 350 years ago, the Mother City is South Africa's oldest settlement. For much of that history, the city's white establishment preferred to think of the city as European in nature in the mid-17th century, they even considered digging a canal across the Cape Peninsula to set it apart from the rest of the country.

Table Mountain, southwest of the city, and the pounding surf of the southern Atlantic Ocean, conspire to create a stunning physical landscape. The city is a thriving commercial centre Bermuda's Orbis group of companies has its roots in Cape Town. It's also an active centre for film, Quinton Lavery, whose short film 'Freedom Days' screened at BIFF in 2007, works at a casting agency that is currently seeking South African actors for Halle Berry's next film. The guest house where we are staying in the Sea Point district of the city was taken over during filming by the cast of Invictus a framed t-shirt proudly displayed in the reception area is signed by Morgan Freeman, Matt Damon and Clint Eastwood.

South of the city, the Constantia winelands and the fishing and bohemian arts villages along the coast are havens for day-trippers, but signs of this country's economic inequalities are ever present.

The largest residential quarter in this city of three million people is the Cape Flats, a district east of the city that encompasses squatter shantytowns, African townships and coloured (mixed-race) districts. More than half a million people live in the Cape Flats, many in tin shacks with corrugated roofs. It is common for a multi-generational family to live in one room.

Many of the corrugated tin shacks have been replaced by small cottages during the 16 years since the historic elections of 1994, but thousands still live under difficult conditions, lacking basic services like housing, water, and proper sanitation. Protests against inadequate service delivery have taken place in townships across the country, including in the Makhaza district of Khayelitsha in the Cape Flats, where the local government erected public toilets on empty lots, but did not build walls around them.

Official unemployment in South Africa sits at 26 per cent. Life expectancy is 50 for men, and 53 for women, in part due to one in seven of the country's 50 million population being infected with HIV/AIDS.

The challenge that the South African government faces in Cape Town, and in other cities throughout the country, is to provide a level of comfort and opportunity for segments of their communities that were ignored for much of the country's history while, at the same time, keeping one eye on an economy that must remain globally competitive.

It's a long-term project, one likely to take a few generations to complete, and only then will all South Africans participate equally in one of the world's youngest democracies.