R40bn investment in Musina-Makhado Special Economic Zone
Pretoria - More than R40 billion will be injected into the proposed Musina-Makhado Special Economic Zone (SEZ).
In a statement on Thursday, the Department of Trade and Industry (dti) said the investment will go towards the establishment of an energy and metallurgical industrial park.
Last week, Cabinet approved Minister Rob Davies’ decision to designate the SEZ. This means that Minister Davies has been given the green light to designate the zone and issue a SEZ operator permit to the Department of Economic Development, Environment and Tourism in Limpopo.
The industrial park will include 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.
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 SEZ, 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 becomes a reality.
The SEZ programme is one of the tools identified by 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,” said Minister Davies.
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 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,” said Minister Davies.