An investment of more than R40 billion is expected to be injected into the proposed Musina-Makhado Special Economic Zone (SEZ) for the establishment of an energy and metallurgical industrial park. The industrial park will include the power, coking, ferrochrome, ferromanganese, ferrosilicon, pig iron metallurgy, lime, steel and stainless steel plants. These projects will be implemented over a period of five years and are expected to create almost 21 000 jobs in the region.
Last week Cabinet approved the decision of the Minister of Trade and Industry, Dr Rob Davies to designate the Musina-Makhado SEZ. This means that Minister Davies has been given the green light to designate the zone and issue an SEZ operator permit to the Department of Economic Development, Environment and Tourism in Limpopo.
A consortium of Chinese investors led by Hong Kong Mining Exchange (Hoi Mor) will be investing more than R40 billion into the park which they will also develop and manage. The park will be operating within the Special Economic Zone which will focus on the beneficiation of minerals and agricultural endowments. Some preliminary work such as the identification of the land and environmental impact assessment has already started in order to ensure that the proposed SEZ become a reality.
Minerals such as chrome, manganese, coking coal and lime will be extracted and beneficiated in the park in line with the country’s national industrialisation objectives and mineral beneficiation strategy.
The SEZ programme is one of the tools identified by the South Africa government through the Industrial Policy Action Plan (IPAP) to boost the country’s industrialisation and manufacturing capacity.
“The Special Economic Zones Programme is aimed at accelerating economic growth and development in designated regions of the country. The key measures of performance for the programme include increasing foreign and domestic direct investments, increasing value-added exports, creating jobs, building industrial clusters and regional industrial hubs,” says Minister Davies.
He adds that the SEZ Act of 2014 has brought about a new approach to the planning and development of special economic zones and introduced a new incentives package for special economic zones. The new incentives package includes a corporate tax rate of 15% for qualifying investments in SEZs.
“SEZs will be designated to promote targeted economic activities, supported through special arrangements and support systems including incentives, business support services, streamlined approval processes and infrastructure,” adds Minister Davies.
The purpose of establishing SEZs includes facilitating the creation of an industrial complex, having strategic national economic advantage for targeted investments and industries in the manufacturing sector and tradable services, developing infrastructure required to support the development of targeted industrial activities; and attracting foreign and domestic direct investment.
Source: Department of Trade and Industry