A high-level delegation of BRICS business leaders toured the Tshwane Automotive Special Economic Zone (TASEZ) hub on Wednesday, 23 August 2023 to see firsthand what opportunities special economic zones can offer to investors.
The delegates, part of the BRICS inward buying and investment mission, visited a number of factories producing components for the Ford Next Gen Ranger to view the world-class facilities available in the TASEZ hub.
The visit, hosted in partnership with the BRICS Business Council, was a side event to the 15th annual BRICS summit being held in South Africa this week and came hot on the heels of the signing of a memorandum of understanding (MoU) between China and South Africa during an official state visit by President Xi Jinping focusing on developing special economic zones and industrial parks. The MoU was one of many bilateral agreements signed between the two countries on Tuesday, 22 August 2023.
BRICS, made up of Brazil, Russia, India, China and South Africa, incorporates more than 40% of the global population and accounts for over 25% of the world’s economy.
Welcomed at Automould, Aeroklas Duys, Ford Frame and Sodecia, the international visitors were shown the components manufactured at each plant that all form part of the just-in-time and just-in-sequence processes that go into building each car. They were told that some 700 vehicles come off the assembly line each day.
Impressed by what they saw, the delegates eagerly asked questions of the plant managers, networked with TASEZ representatives along with officials from the hub’s stakeholders in the Department of Trade, Industry and Competition and the Gauteng Department of Economic Development.
At the end of the day, the deputy chair of the BRICS Manufacturing Working Group, Lesetja Mogaba described what the team had experienced was something that showed just how to link industrial development to local community needs – “This is a class act,” he said.
TASEZ is situated between the townships of Eersterust, Mamelodi and Nellmapius and one of its key mandates is to broaden economic participation by promoting small, micro, and medium sized enterprises and co-operatives, while promoting skills and technology transfer.
The BRICS delegation was hosted by a TASEZ team lead by board chair Lionel October, board member Susan Mangole, TASEZ CEO, Dr Bheka Zulu, and the chief director in the Office of the Gauteng Premier Victor Radebe, who explained to the visitors the importance of special economic zones (SEZs) in the South African context.
The importance of SEZs
SEZs economic zones are seen as vehicles to broaden South Africa’s economic activities and foster industrial growth, encouraging direct foreign investment, providing skills development, creating jobs and transforming the country both socially and economically.
Radebe, in his formal opening address to the delegates after the hub tour, noted that the automotive sector could be seen as the heartbeat of the economy.
TASEZ is a sector specific SEZ that focuses on growing the automotive sector, offering a prime location and a range of incentives to potential investors wanting to be part of an innovative economic development.
October noted that one of the biggest challenges South Africa faced was to overcome inequality and poverty. “It has been shown that the only way to move out of poverty is through industrial development, and SEZs are central to the industrialisation process.”
He described how TASEZ had, in just two short years, developed a world-class zone in an undeveloped area of scrub and trees. “We are building Africa’s first industrial city here.”
South Africa wanted to become a player in the advanced and medium technology industries, October said, adding TASEZ was looking forward to attracting international investors in the original equipment manufacturing and components space.
Based in Silverton in Tshwane, TASEZ is particularly well placed to build on its position as Africa’s first automotive city. With Phase 1 of its development complete and fully occupied by anchor tenant Ford and nine manufacturers producing components required for the Ford Ranger, TASEZ is now looking to implementing the Phase 2 and Phase 3 development plans.
One of the key issues discussed was the development of electric vehicles and that South Africa had to be prepared for this transition.
Dr Zulu, who shared TASEZ’s journey, with the delegations spoke of the numerous investment opportunities available in the hub, adding that TASEZ was planning to create an automotive incubation programme and focus on skills development in support of Tier 1 and Tier 2 suppliers along with expanding the hub and creating 3 000 new jobs.