Gold: Brent Crude Oil: 5yrs later, no company stationed in SEZs
MBABANE - Since the establishment of the Eswatini Royal Science and Technology Park (RSTP) in 2018, no companies have completed applications to be stationed in the Special Economic Zones (SEZ).
This is according to the Eswatini Single Window Service Readiness Analysis report provided by the International Integrated Systems, Inc (IISI), a consultant from Taiwan, assisting the Government of Eswatini in the amendments of the SEZ Act of 2018.
To assist in attracting investment to the RSTP-SEZ and enhance its Single Window services, the report examines the readiness of the Eswatini RSTP Single Window services across four main dimensions: Legal Framework, Industrial Environment, Infrastructure and SEZ Services.
It further analyses relevant influencing factors within each dimension to comprehensively assess potential challenges and issues that the Eswatini RSTP Single Window service development may face.
The existing legal basis for the RSTP or SEZ is the Special Economic Zone Act (SEZ Act). Upon examining the elements covered by the legal framework and further reviewing the content of the SEZ Act and relevant regulations from other departments and ministries, it became evident that the overall legal framework was incomplete.
The authority and responsibilities of the governing body under the SEZ Act lack a clear delineation of tasks and management mechanisms. Additionally, various incentive measures lack corresponding detailed implementation rules or supporting measures.
REGULATIONS
It had been found that the existing regulations do not establish clear standardised procedures (current regulations exhibit a strong element of discretionary decision-making) and terminology definitions are unclear, leading to potential misunderstandings.
The regulatory content concerning domestic sales restrictions contradicts the market competition principles of the Organisation for Economic Co-operation and Development (OECD) and conflicts with the interests of the Southern African Customs Union (SACU).
Furthermore, although the Special Economic Zone Act outlines relevant investment incentives, the lack of associated measures for practical implementation leads to a deficiency in the legal basis for various agencies.
Consequently, the effective implementation of investment incentive measures is hindered, introducing uncertainty for businesses.
This also causes related incentive measures to become nominal rather than substantial, severely impeding business investment intentions.
In summary, the legal framework requires adjustment and enhancement.
It is suggested that the country should re-evaluate the provisions of the SEZ Act, convene relevant business agencies to collaboratively formulate practical implementation procedures and simultaneously adjust the content of relevant regulations while proposing corresponding supporting measures.
COOPERATION
This would facilitate practical co-operation by various business agencies in accordance with the provisions of the SEZ Act. Beyond the process of amending the SEZ Act, a simultaneous review of other related legal norms in various fields is necessary.
This examination should assess whether any conflicts arise between regulations and whether there is a lack of corresponding supporting measures, hindering practical implementation. The formulation of relevant supporting measures encompasses tax policies, administrative procedures, eligibility criteria and more.
This aims to provide a more comprehensive regulatory framework for SEZ operations, enabling SEZ management to proceed in accordance with the law and better fulfil operational requirements. This facilitates smoother investment attraction within the SEZ.
Furthermore, although the Special Economic Zone Act outlines relevant investment incentives, the lack of associated measures for practical implementation leads to a deficiency in the legal basis for various agencies.”