The 103-ha Maluti-A-Phofung Special Economic Zone (MAP-SEZ) in Harrismith, in the Free State, forms an important part of government’s SEZ Programme, which is aimed at ensuring excluded areas of the country are developed and able to contribute to the country’s economic growth.
At the launch of the SEZ on Tuesday, President Jacob Zuma said the SEZ was aimed at creating growth opportunities outside of traditional manufacturing and industrial areas.
He stated that government was fully committed to pursuing and implementing a programme of “radical economic transformation”, noting that one of the critical components of achieving transformation was the notion of a balanced regional economy, together with industrial development.
“South Africa’s economy continues to rely on the regional investor hubs in Gauteng, eThekwini, the Cape Peninsula and Pietermaritzburg. These regions collectively account for 70% of the nation’s gross value-added tax (VAT),” Zuma pointed out, stating that many other regions were completely neglected, resulting in their development potential being severely constrained.
He added that many of the excluded areas lacked the critical factors for long-term economic and industrial success and that the SEZ Programme was an important catalyst that would allow excluded areas to contribute to the country’s economy.
He further noted that the SEZ, others like it and the Department of Trade and Industry’s (DTI’s) broader industrial parks initiatives were critical to efforts to radically transform the economy. He also noted that, to date, the SEZ Programme has attracted over R9-billion of investment into the country.
There are currently eight SEZs in South Africa and the DTI has been working with the National Treasury to improve the incentive package put on offer to attract more investors.
“This includes a 15% corporate tax for ten years, instead of the usual 28% corporate tax companies have to pay. There are also VAT and customs duties exemptions for those who invest in an SEZ,” Minister Davies noted.
The MAP-SEZ will focus on investments in the automotive, agroprocessing logistics, information and communication technology, pharmaceuticals and general processing sectors.
