TASEZ shares investment ideas, experience with African SEZs

11 December 2024

By Mandla Mpangase

The leaders of Africa’s special economic zones (SEZs) – including Africa’s first automotive city – are putting their minds to the role they can play in attracting impactful investments and redefining competitiveness.

This theme set the tone for the annual meeting of the African SEZs which was held in Nairobi, Kenya, at the end of November 2024. The meeting was attended by some 300 participants representing governments, international experts, decision-makers, financial institutions and representatives from the various SEZs.

The Tshwane Automotive Special Economic (TASEZ) team participated in the meeting in order to “see how we are positioned in terms of the SEZs across the continent”, according to TASEZ CEO Dr Bheka Zulu, adding that it was surprising to find that TASEZ was ahead of the curve.

“We have a lot to contribute, and we have much to learn too,” Dr Zulu adds.

There are more than 200 operational SEZs in 47 countries on the continent, according to the African Economic Zones Outlook 2021. This breaks down into 150 000 hectares dedicated to manufacturing, ago-processing and services. It is estimated that more than $2.6-billion has been invested in these zones.

South Africa currently has 11 SEZs based in different provinces: in the Eastern Cape are Coega and the East London SEZs; Maluti-A-Phofung is in the Free State; OR Tambo and the Tshwane Automotive Special Economic Zone (TASEZ) are situated in Gauteng; Dube Tradeport and Richards Bay are based in KwaZulu-Natal; the Musina/Makhado SEZ is in Limpopo; Nkomazi is based in Mpumalanga; and the Atlantis and Saldanha Bay SEZs are in the Western Cape.

The African SEZs annual meeting is the flagship event of the African Union Commission (AUC) and the Africa Economic Zones Organisation (AEZO), providing insights on critical issues related to the development of SEZs in Africa.

Said Business Development Executive Msokoli Ntombana: “SEZs are viewed as one of the key instruments to accelerate industrialisation, attract important foreign direct investments, and stimulate the country’s economy. It is crucial that these elements are firmly in place to answer the call of the National Development Plan to create jobs, fight poverty and promote socio-economic equality.

“Not only are these priorities for South Africa, but are crucial for Africa’s success, as driven by the Africa Agenda 2063. SEZs have a critical role to play in shaping Africa’s economic landscape long-term,” Ntombana says.

Topics covered at the Nairobi meeting included:

- Building intelligent infrastructure, focusing on necessary infrastructure upgrades, such as 5G networks and data centres to support industrial activity securely;

- Workforce development, looking at strategies for upskilling the workforce to integrate large-scale technologies;

- Regulatory frameworks for new technologies, examining how policies can be adapted to foster technology innovation while protecting data privacy and ensuring ethical use;

- Sustainability, discussing the integration of circular economy principles, eco-industrial parks, and sustainable urban planning in SEZ development;

- Financing sustainable SEZs, looking at innovative financing mechanisms such as green bonds and climate funds to support the sustainable development of SEZs; and

- Policy and governance, examining how African governments can create conducive environments for the growth of socially inclusive and sustainable SEZs.

“As we head into the age of the new energy vehicles (NEVs), it is important to recognise that most of the commodities required for NEV development comes from the African continent,” the CEO says.

“So for us to tap into the relationships with our brothers and sisters is actually forward- looking, because we have the insight to be able to create trade lines between ourselves,” Dr Zulu notes.

“It is important to capacitate the rail infrastructure between the original equipment manufacturers based in the City of Tshwane and our ports, which are crucial to the export of vehicles to our global markets,” TASEZ CEO Dr Bheka Zulu noted.