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Eastern Cape Business 2018 edition

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  • Mandela
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A unique guide to business and investment in the Eastern Cape. The 2018 edition of Eastern Cape Business is the 11th issue of this highly successful publication that, since its launch in 2006, has established itself as the premier business and investment guide for the Eastern Cape. The Eastern Cape’s investment and business opportunities are highlighted in this publication. In addition to the regular articles providing insight into each of the key economic sectors of the province, there are special features on the role of the renewable energy sector on the region’s future and on the growth of tourism (spurred by the hosting of international events such as the 2018 IRONMAN 70.3 World Championship, the first-ever cricket Test match to be played at night at St George’s Park and Vodacom Origins of Golf events at St Francis Links). All of the major business chambers in the province have made contributions to the journal. To complement the extensive local, national and international distribution of the print edition, the full content can also be viewed online at www.easterncapebusiness.co.za. Updated information on the Eastern Cape is also available through our monthly e-newsletter, which you can subscribe to online at www.gan.co.za, in addition to our complementary business-to-business titles that cover all nine provinces as well as our flagship South African Business title.

OVERVIEW Forestry

OVERVIEW Forestry Thousands of hectares have been identified for new planting. Forestry is an important part of government plans to expand agri-processing. More than 3 400ha of new land has been planted and timber harvests are expected within three years. Six community projects in the district municipalities of OR Tambo and Alfred Nzo are employing more than 1 000 people. Rural Enterprise Development (RED) hubs have been established in Mqanduli and Ncorha, with funding from the Jobs Fund, the Eastern Cape Development Corporation and the Eastern Cape Rural Development Agency (ECRDA). The Mqanduli Mill is supplying the Nicks Spar in King William’s Town. According to the ECRDA, government plantations have more than 15 000ha of unplanted areas which would be easy to develop: they do not require high initiation costs because no licence is required. The Eastern Cape’s forestry sector comprises 130 000ha of plantations, 46 sawmills, two chipboard operations, 10 pole treatment plants, a veneer plant and six charcoal plants, which collectively process about 770 500 cubic metres of timber annually. The region is well-served by wood-processing facilities such as the R1.3-billion board plant outside Ugie that is owned by PG Bison. Another of the province’s major forestry stakeholders is Amathola Forestry, along with their sister company Rance Timber’s Kubusi and Sandile Sawmill near Stutterheim, producing 45 000 cubic metres of sawn board annually. About 75% of the province’s plantations are controlled by the private sector. Forestry South Africa has set up a Business Development Unit to empower small-scale timber growers. ONLINE RESOURCES Eastern Cape Department of Rural Development and Agrarian Reform: www.drdar.gov.za Eastern Cape Rural Development Agency: www.ecrda.co.za Forestry SA: www.forestry.co.za Institute for Commercial Forestry Research: www.icfr.ukzn.ac.za National Department of Agriculture, Forestry and Fisheries: www.daff.gov.za South African Institute for Forestry: www.saif.org.za SECTOR INSIGHT Mqanduli Mill is supplying a large retailer in King William’s Town. The ECRDA aims to transform unproductive communal land assets through commercial forestry development. The ECRDA’s Sinawo project in Mbizana has started selling timber to Sappi and intends commercialising all its operations. In 2015/16 the project earned about R7-million from the sale of timber and the total employee count rose to 208. Sappi and PG Bison are supporting these community initiatives. Paper and packaging group Sappi is working with the ECRDA and with several communities to establish forestation programmes. At Mkambathi a total of 668ha has been planted and Sappi has agreed to buy 65% of the timber produced and to give technical support where it can. Downstream opportunities created by new plantations include a planned treated-pole plant in Butterworth and a paper and pulp mill in Mthatha, which has also been selected as a future furniture-sector incubator. EASTERN CAPE BUSINESS 2018 46

OVERVIEW Aquaculture Fish from the Karoo will soon be a popular dish. ONLINE RESOURCES Aquaculture Association of South Africa: www.aasa-aqua.co.za Aquaculture Development and Enhancement Programme: www.thedti.gov.za Coega IDZ: www.coega.co.za East London Industrial Development Zone: www.elidz.co.za Operation Phakisa: www.operationphakisa.gov.za South African International Maritime Institute: www.saimi.co.za South African Institute of Aquatic Biodiversity: www.saiab.ac.za SECTOR INSIGHT The provincial government is investing in fish-farming technology. Investment in local infrastructure at the East London Industrial Development Zone (ELIDZ) is focussed on localising fin fish farming technology. In 2017/18, an amount of R15-million was set aside by the Eastern Cape Provincial Government for this purpose. The Science and Technology Park at the ELIDZ could also become the site of a marine sector incubation programme to foster interest in the Oceans Economy among young people and entrepreneurs. INMED South Africa, a non-profit organisation devoted to better health and nutrition for children, in partnership with the Mondelēz International Foundation, launched a R37-million commercial-scale aquaponic system on the Missionvale campus of Nelson Mandela Metropolitan University (NMMU) in 2017. A total of 116 schools will benefit from the project. Waste water will be used to irrigate vegetables and used again to top up the fish tanks once the nutrients have been absorbed by the plants. Aquaponics Innovations produces red tilapia and catfish from its aquaponics tunnel in Grahamstown. “Karoo Catch” is the brand name for freshwater fish produced by Blue Karoo Trust, a project taking shape near the town of Graaff-Reinet. A central farm will be supported by 39 outgrowers and the aim is to produce about 14 000 tons of fish annually. The intended market is organisations that need protein in bulk such as hospitals, schools and government institutions. The risk capital unit of the Eastern Cape Development Corporation (ECDC) is supporting the venture. Aquaculture is an important part of the South African government’s Operation Phakisa strategy. The intention is to increase the aquaculture sector’s revenue from about half a billion rand, to R1.4-billion in 2019. Pure Ocean Aquaculture and Ocean Wise are located within the East London IDZ. At Zone 10 in the Coega IDZ, 250ha has been set aside for fresh fish farming and 100ha for marine farming. A processing plant and research and development and training facilities are planned. The Coega Development Corporation estimates that 34 250 tons of abalone, Dusky Kob and seaweed could be harvested. The National Department of Science and Technology (DST) is working with Irvin & Johnson in running a marine finfish growout pilot in Algoa Bay. A programme of the Department of Trade and Industry, the Aquaculture Development and Enhancement Programme (ADEP), offers a reimbursable grant up to R40-million. 47 EASTERN CAPE BUSINESS 2018

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