Musina Makhado SEZ hosts packed investment conference to transform Limpopo’s economy
The strategic location of the Musina-makhado SEZ in the far north of Limpopo – with links to Zimbabwe, Botswana and Mozambique, and three South African provinces – makes it the fulcrum of a market of about 300-million people. It is Limpopo’s flagship eco
The Musina-makhado Special Economic Zone (MMSEZ) on November 28 2019 hosted an investment conference in Sandton aimed at attracting additional investment to the R165-billion committed by a consortium of Chinese investors to enhance mineral beneficiation operations. The conference was an outstanding success. The approximately 250 attendees far outstripped the expected 150, and several co-operation agreements were signed with entities such as SAFCOL, Transnet and Roads Agency Limpopo, aimed at facilitating the implementation of the MMSEZ.
According to Limpopo premier Stanley Mathabatha, local investments attracted in the conference will take the current total of R165-billion to a new record high of R250-billion and this will significantly contribute to the development of a new city through the merging of the Musina and Makhado municipalities. About 21 000 jobs are expected to be generated during the development phases.
The location of the MMSEZ neighboring Zimbabwe, Botswana and Mozambique, with Limpopo also neighboring the three provinces of North West, Gauteng and Mpumalanga, enables the flow of goods through the established trade corridors. All developed regions of the world have a high proportion of intra-trade; in the case of SADC, the intra-trade is significantly lower than competing economies. Consequently, it is initiatives such as MMSEZ and the bringing of border posts such as Beit Bridge up to fourth industrial revolution (4IR) standards of automation for rapid transit that will transform the economic landscape of the SADC.
Much of the groundwork is now completed; the MMSEZ board under the chairmanship of Rob Tooley and chief executive Lehlogonolo Masoga has been appointed to steer the project in the right direction, said MEC for Limpopo Economic Development, Environment and Tourism (LEDET), Thabo Mokone. Neighbouring countries and provinces are being approached to ensure an all-inclusive regionally integrated export hub to produce goods and services for domestic and international markets.
A one-stop shop is being established to manage all the governmental red tape on behalf of foreign investors who may be unfamiliar with South African laws.
This one-stop-shop will be launched in March 2020 in provincial capital Polokwane, sponsored by the dti, said Lekota, emphasising that the provincial government gives its full backing to this project; that ease of doing business will be central to all investment initiatives; and any challenges experienced by investors in this area will be swiftly dealt with by the one-stop-shop.
Central to this concept and the entire MMSEZ is the Beit Bridge border post with Zimbabwe — the busiest border post in Africa — and discussions are ongoing to improve the efficiencies of the border post in facilitating trade.
Limpopo is one of the least industrialised provinces in South Africa, but it has the lowest unemployment rate. Much of its employment opportunities come from mining, agriculture and tourism. Mathabatha signalled that “almost limitless” opportunities exist in manufacturing and mining, food processing, the automotive sector, pharmaceuticals and logistics. “This project is at the very apex of economic priorities for the provincial govern
ment; it also enjoys the highest priority of the national government and is being monitored from the presidential office.
“The mineral deposits in the area and the mining value chain present opportunities for investment and consequent industrialisation due to a longer lifespan of various ore resources. Investing in the MMSEZ comes with tantalising tax incentives and a completely different ease of
doing business.”
Busiest port in Africa
Tooley said: “It is about our comparative advantage, which is that we are based in the busiest dry-land port in Africa. We see our SEZ as a SADC opportunity and not just a Limpopo opportunity.
“The concept is that all the minerals mined throughout SADC and shipped abroad from Richards Bay or Durban to be processed elsewhere could rather be beneficiated here in our new metallurgical park. The reduced costs of shipping and manufacturing could thereafter make our processed exports competitively viable,” said Tooley.
“For instance, lithium is going to become a massive global industry, with talk of Elon Musk establishing a lithium battery factory in Africa — why not in our SEZ, which is tailored for such industries? The potential is massive.”
It is for this reason that MMSEZ also has an automotive focus.
“The basic appeal of MMSEZ is the under-development of Africa, and as a 4IR logistical hub we are a conduit to development in SADC. The challenge will be to ensure that investments also create jobs — it can’t be one without the other. The quid pro quo of an SEZ is that although you lose on corporate tax, with jobs being created you gain on PAYE and VAT as the economy grows,” said Tooley.