Ma­luti-a-Pho­fung eco­nomic zone to trans­form econ­omy

Vuk'uzenzele - - General - Neo Se­mono

South Africa’S eighth Spe­cial Eco­nomic Zone, the Ma­luti-a-Pho­fung SEZ, al­ready has over R1-bil­lion of in­vest­ments and is set to cre­ate thou­sands of jobs in the Free State.

Pres­i­dent Ja­cob Zuma re­cently launched Ma­luti-a-Pho­fung Spe­cial Eco­nomic Zone (MAP-SEZ) in the Free State, high­light­ing the gov­ern­ment’s drive to­wards in­clu­sive eco­nomic growth.

“This launch and the de­vel­op­ment of the Ma­luti-a-Pho­fung SEZ demon­strates our pro­mo­tion of in­dus­trial de­vel­op­ment which is key to the na­tion’s long-term eco­nomic suc­cess and pros­per­ity,” said Pres­i­dent Zuma.

He said South Africa needs to change the way its econ­omy is struc­tured.

“Our cur­rent reliance on ex­port­ing min­er­als and other raw ma­te­ri­als to other coun­tries is a sure recipe for an econ­omy that en­riches the few at the ex­pense of the ma­jor­ity. This, of course, will just deepen the al­ready high lev­els of in­equal­ity in our so­ci­ety,” the Pres­i­dent said.

The launch brings South Africa’s to­tal num­ber of SEZs to eight. SEZs are geo­graphic ar­eas of a coun­try set aside for spe­cific eco­nomic ac­tiv­i­ties. They of­fer in­cen­tives to busi­nesses

to set up shop there.

Cre­at­ing thou­sands of jobs

At the launch, Trade and In­dus­try Min­is­ter Rob Davies said South Africa’s Spe­cial Eco­nomic Zones have to­gether at­tracted over R9.5 bil­lion in in­vest­ments so far. They have also cre­ated over 10 000 di­rect jobs and 65 000 in­di­rect jobs.

The MAP-SEZ has an in­vest­ment pipe­line of R2.6 bil­lion, Min­is­ter Davies said. “I be­lieve it’s around R1 bil­lion of in­vest­ment that’s here al­ready.”

The Free State SEZ was once an apartheid-era in­dus­trial park set up to pro­vide ac­cess to cheap black labour.

Pres­i­dent Zuma pointed out that these in­dus­trial parks were in­tro­duced not for their eco­nomic po­ten­tial, but sim­ply to sus­tain the apartheid gov­ern­ment’s “home­lands” sys­tem.

SEZs crit­i­cal to trans­form econ­omy

The Spe­cial Eco­nomic Zones and In­dus­trial Parks pro­gramme, run by the Depart­ment of Trade and In­dus­try, is crit­i­cal to the rad­i­cal trans­for­ma­tion of South Africa’s econ­omy.

The new SEZ is part of the gov­ern­ment’s ef­forts to boost eco­nomic growth and job op­por­tu­ni­ties closer to where peo­ple live.

“This we do through pro­mot­ing in­dus­tri­al­i­sa­tion and also the de­vel­op­ment of town­ship and ru­ral economies,” the Pres­i­dent said.

SEZs also play an im­por­tant role by bring­ing do­mes­tic and for­eign di­rect in­vest­ment into the econ­omy.

“Spe­cial Eco­nomic Zones have to­gether cre­ated

over 10 000 di­rect jobs and 65 000 in­di­rect

jobs so far.”

In­cen­tives for busi­ness

The gov­ern­ment of­fers tax in­cen­tives to at­tract busi­nesses to SEZs. The MAP-SEZ will of­fer a pref­er­en­tial 15 per cent – in­stead of 28 per cent – cor­po­rate in­come tax in­stead for a pe­riod of 10 years. Im­port duty tax will also be re­duced on man­u­fac­tur­ing ma­te­ri­als and equip­ment.

MAP-SEZ in­cen­tives also in­clude a re­search and de­vel­op­ment al­lowance of 50 per cent for any new tech­nol­ogy that en­hances pro­duc­tiv­ity, and en­ergy-sav­ings in­cen­tives for the use of green build­ing tech­niques.

In declar­ing the MAP-SEZ open, Pres­i­dent Zuma urged com­pa­nies set­ting up there to do busi­ness with lo­cal small en­ter­prises.

“I am quite cer­tain that this makes good busi­ness sense,” he said.

(Photo: GCIS)

Pres­i­dent Ja­cob Zuma chats with entrepreneurs who have set up shop at the new Ma­luti-A-Pho­fung Spe­cial Eco­nomic Zone out­side Har­ri­smith in the Free State

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