8 October 2014
The Dube TradePort in the South African port city of Durban is now officially an Industrial Development Zone (IDZ), joining three other similar economic zones spread out across the country.
President Jacob Zuma on Tuesday, 7 October, handed over an IDZ operator licence to the Dube TradePort Corporation for the precinct, which has already attracted investments worth nearly R1-billion since it was opened in 2012.
The Dube TradePort IDZ is the latest in the nationwide rollout of special economic zones aimed at growing the country’s economy to meet the target of 5% growth by 2019.
The first IDZ for Durban, the Dube TradePort IDZ joins similar projects in Port Elizabeth, East London and Richards Bay that have attracted a combined investment of over R5- billion. According to Department of Trade and Industry director general Lionel October more special economic zones will be rolled out across the country as government intensifies its approach to industrialise South Africa’s economy as demanded by the National Development Plan (NDP).
Special economic zones
October says government has identified IDZs as the most effective way to grow the South African economy and create jobs; “We are suffering with slow growth and we are going to reindustrialise this country. We need to fast-track economic development and the special economic zones are the way of fast-tracking development but also to decentralise development.
“Naturally investors want to relocate towards the big centres of the economy like Johannesburg because it’s closer to the market. Through these IDZs we want to attract investors to the new areas like the Dube TradePort, Coega, Richards Bay and the East London IDZ,’ said October.
Trade and industry minister, Rob Davies, concurred, and said special economic zones have been shown to be useful tools to promote industrial development and diversification of the economy.
“These are the industries that are largely supporting our export markets and are located in ports and around airports. In the life of the last administration we looked critically in what we can achieve from the special economic zones programme. I can say today that the three active IDZs (Coega, East London and Richards Bay) have now attracted investment worth R5-billion in total so the strategy is working.’
He said government was setting up a Special Economic Zones Board to advise the minister on implementing special economic zones.
Investor tax incentives
Davies said what makes the IDZs unique is that they offer a variety of incentives for investors, including a 15% corporate tax rate.
Situated at the heart of King Shaka International Airport, the Dube TradePort IDZ is set to transform Kwazulu-Natal into a central business gateway and a noteworthy player in the global supply chain. Two investment areas – Dube TradeZone, and Dube AgriZone – will be crucial in the IDZ’s success.
Industries that will be represented in the IDZ include electronics manufacturing and assembly; aerospace and aviation-linked manufacturing; agriculture and agro processing; medical and pharmaceutical production; and clothing and textiles. Zuma said the Dube TradePort is expected to create more than 150 000 jobs by 2060, by when the development is also expected to have contributed R5.6-billion to the country’s GDP.
“We are determined to create an environment that is investor-friendly. We will continue to improve support measures both through the special economic zones and other development tools,’ Zuma said.