Will Rob Davies' new SPECIAL ECONOMIC ZONES fly?
May last year.
The development will put flesh on the bones of a policy review that began in 2007. The review supposedly also addresses weaknesses in government’s IDZ programme, launched in 1999.
But it has been a protracted process, which has fuelled charges that the minister has too much discretion over zone legislation and designation. Critics also say that SEZs are badly suited for uplifting poor regions because of a lack of infrastructure in many such areas, limited access to skills and distance to markets.
As recently as 2013, the department of trade & industry (DTI) acknowledged in parliament that IDZs had not “performed as expected”.
So the new programme needs to be part of a wider “gateway project” that integrates with global value chains, spurring rapid regional industrialisation as well as domestic manufacturing. Analysts also say multinational companies have to be part of the policy-making process if social, environmental and economic development are to be sustainable.
The new SEZ regulations will also need to address complaints that taxpayer money has been used to subsidise large multinationals such as General Motors SA (GMSA) in the Coega IDZ near Port Elizabeth. When it opened a R250m parts and accessories warehouse in the zone in 2010, Coega Development Corp CEO Pepi Silinga said Coega had leased the facility to the US car