Province moves away from auto sector reliance

The Coega special economic zone’s stainless steel smelter, valued at R174bn – and notably the highest-value project in the provincial investment pipeline – will rewrite the province’s industrial history and eliminate over-reliance on the automotive sector.

This is according to Coega Development Corporation executive manager for business development, Christopher Mashigo, who spoke at the Eastern Cape Investment Conference in East London on Tuesday.

Mashigo outlined several projects in the pipeline at Coega, amounting to R287bn in total, focusing on aquaculture, agro-processing, renewable energy and metals manufacturing.

He said 85% of the stainless steel smelter project, spearheaded by Lamergyre Alloys Limited, would be funded by offshore original equipment manufacturers (OEMs).

The project is also expected to employ 30,000 people during the construction stage and 4,500 when operations begin.

“With regards to metals . . . as a province we always have to have a major transformational project that will have the same impact that the vehicle manufacturing sector has had since basing itself here.

“But to reduce our dependence on that sector we are looking elsewhere to rewrite our economic futures,” he said.

Other investment prospects that Mashigo highlighted are:

● Grain milling initiatives valued at R600m to address the challenges of food security. This project is expected to offer 160 permanent jobs and 100 jobs during construction;

● Two perlemoen farms valued at R200m and R500m;

● Development of a roofmounted solar power generation system on Coega buildings, valued at R950m;

● A renewable energy facility with an estimated value of R310m; and

● A stainless steel precision strip mill within the automotive sector valued at R620m.

“This is just a basket of bankable projects that we are looking at over the next five to 10 years, with some of them being implementable within a one-year horizon,” he said.

The ICT project presented by the East London industrial development zone has been described as a “catalytic” initiative that would transform the company’s business operations.

The East London IDZ’s renewable energy manager, Chris Ettmayr, said the project would be a massive boost for the province and would set Buffalo City municipality aside as leaders in the African continent.

“What we are presenting is an international sea cable which will bring internet at 13.5 terabytes per second – so really great internet – through the ocean.

“Essentially, it is an internet cable that will run from Mauritius, connect in a little place called Rodrigues Island, touch Madagascar and land in the [East London IDZ] and then extend all the way backwards into India,” he said.

The aim of the investment conference was to package together various investment projects which would serve as a blueprint to grow the province.