The Head of Regional and Spatial Economic Development at the Department of Trade and Industry (the dti), Mr Alfred Tau is convinced that the Northern Cape is ready for the establishment of special economic zones in the province. Tau was speaking at a public hearings session on the draft Special Economic Zones Bill and Policy hosted by the dti at the Kalahari Lodge in Kimberley yesterday.
The purpose of the public hearings is to give members of the public, organised labour and business an opportunity to express their views on the draft bill and policy before they become law.
“The kind of enthusiasm and level of engagement and commitment that characterised today’s session has left us with no doubt that the Northern Cape is ready for business when it comes to the establishment and development of special economic zones. There is no doubt that your valuable inputs will go a long way in enriching the new legislation.
The vision displayed by the participants from both the public and private sectors in their comments proves that the establishment of the two special economic zones that are planned for the Northern Cape will not be a difficult goal to achieve. Our department has already began engaging with the provincial government in regard to establishing the zones, and the fact that businesspeople here already have such progressive and visionary ideas and suggestions will ensure the process runs well,” added Tau.
In his presentation to outline government’s vision and motivation behind the establishment of special economic zones in all of the country’s provinces as proposed in the draft bill, Tau said special economic zones would go a long in assisting South Africa address some of the country’s socio-economic challenges such as unemployment, poverty, and social and economic inequalities that are still rife in the country.
“South Africa still experiences a high unemployment rate, particularly amongst the country’s youth, regionally concentrated economy as well as high levels of poverty and inequalities. The special economic zones, as proposed in the draft bill and policy, will be used as one of the tools that government will apply in order to address some of these challenges. The government moves from the premise that industrial development is key to growing the country’s economy and creating employment opportunities, as well as generally bettering the lives of our people,” said Tau.
He added that no successful economy in the world had achieved that feat without industrialisation. “The fastest growing economies in the world, such as India, China and Brazil have used special economic zones as instruments to accelerate their industrial development,” he said.
He added that significant changes had occurred since the introduction of the Industrial Development Zones programme by the dti in the year 2000. These include changes in the country’s industrial and economic policies, with the introduction of new policies and strategies namely the national industrial policy framework and the Industrial Policy Action Plan (IPAP), New Growth Path and the National Development Plan.
“In addition, there has been a gradual shift in the concentration of the economic power from the West to the East, coupled with new sources of Foreign Direct Investments. New economic blocks, BRICS (Brazil, Russia, India, China and South Africa) have also emerged,” said Tau.
The Chief Director of infrastructure Development Support at the dti, Kaya Ngqaka said the direction proposed by the Bill and Policy for the special economic zones have the full support of national government. This was illustrated by Minister of Finance, Mr Pravin Gordhan in his Budget Speech on Wednesday, 22 February 2012, when he announced that tax relief was under consideration for businesses that invest in the special economic zones, including a reduction in the corporate income tax rate and support for employment and training expenses. Minister Gordhan also pronounced that R2.3 billion would be allocated to the dti for industrial development and special economic zones.
He added that the new legislation would also promote the development of world-class infrastructure in each region in line with the needs of the targeted industries; support beneficiation and value addition of the country’s minerals and attract desired foreign and domestic direct investments. To this end, negotiations with the Northern Cape Provincial Government on identifying possible development zones in the province have already begun.
The purpose of the Bill, which was gazetted by the Minister of Trade and Industry, Dr Rob Davies last month, is to provide for an effective mechanism for the development, operation and management of special economic zones in order to promote accelerated industrial development and industrial decentralisation.
Tau said opinions expressed and submission made by those attending the session in Kimberley, and others throughout the country, will be considered when the bill and policy are finalised.
Enquiries:
Sidwell Medupe (Departmental Spokesperson)
Cell: 079 492 1774
Tel: 012 394 1650
E-mail: MSMedupe@thedti.gov.za
