Financial Mail


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

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