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Journal of African Business Issue 4

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Welcome to Journal of African Business, your guide to business and investment on the continent. The fourth edition of Journal of African Business is the second issue of this magazine to be published as a quarterly. The first two journals were published as annual publications in 2020 and 2021. The Journal of African Business covers a wide range of subjects within the broader economic sectors: energy; mining and exploration; trade; finance; technology and tourism. In addition to this, special features on topical matters are included, along with country profiles.


THE MUSINA-MAKHADO SPECIAL ECONOMIC ZONE – A REGIONAL PLAN WITH CONTINENTAL IMPACT South Africa’s newest Special Economic Zone takes advantage of its strategic position to enhance regional and sub-regional links. TThe Musina-Makhado Special Economic Zone (MMSEZ) is an initiative of the Limpopo Provincial Government. The MMSEZ state-owned company (MMSEZ SOC) has been established as the implementing agent of the project and is a subsidiary of the Limpopo Economic Development Agency (LEDA), which reports to the Limpopo Department of Economic Development, Environment and Tourism (LEDET). Investment in infrastructure is underway with several levels of government contributing to new and upgraded facilities in areas such as water, electricity, ICT, roads, transport, human settlement, airport, education and training. REGIONAL IMPLICATIONS SADC enables dutyfree trade within a growing market of more than 360-million. The Musina-Makhado SEZ is located in the vicinity of the Beitbridge Border Post which is one of the busiest ports of entry to South Africa and a gateway to countries in the Southern African Development Community (SADC). The SADC Industrialisation Strategy and the African Continental Free Trade Area (AfCFTA) will boost regional and SADEC REGION inter-regional trade volumes, giving the MMSEZ’s prime location further importance. The MMSEZ has the potential to become an inland intermodal terminal, facilitated by its anchoring position along the North- South Corridor, and directly connecting to the country’s major ports through both the N1 highway and the Johannesburg- Musina railway line, for the trans-shipment of sea cargo and manufactured goods. With many companies and countries wanting to decentralise and diversify their distribution hubs (either because of Covid-19 or potential unrest in some areas), there is an opportunity for the MMSEZ North Site as a potential regional inland port. Credit: Pexels The position of the MMSEZ in South Africa in the north of the Limpopo province MMSEZ ABOUT SADC South Africa is a member of one of Africa’s oldest regional organisations, the 16-member Southern African Development Community (SADC). Country members include Angola, Botswana, Comores, Democratic Republic of Congo, Eswatini, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, Tanzania, Zambia and Zimbabwe. This enables duty-free trade within a growing market of more than 360-million people. All goods shipped under SADC Certificate of Origin receive duty-free status. FOCUS Credit: Wikipedia Developing small towns into cities The MEC of Limpopo Economic Development Environment and Tourism (LEDET), Thabo Mokone, stated 14 on the

SPECIAL ECONOMIC ZONE AfCFTA The African Continental Free Trade Area (AfCFTA) has been agreed on by almost all African nations and holds the potential to change the nature and size of trading on the continent in profound ways. The MMSEZ, located in Limpopo Province, is strategically positioned to offer companies a perfect launching pad into a wide range of countries served by good logistics and infrastructure. The burgeoning African middle-class is a global trend that economists are carefully watching. As more sophisticated infrastructure is rolled out across Africa, having a base with good connections via road and rail connectivity will be vital. Limpopo has all of that. Improving and increasing intra-African trade will change the way countries do business and include a much broader range of countries and products into the global market. Foreign direct investment is expected to grow rapidly, as investment opportunities such as those on offer at the MMSEZ attract the attention of international companies and institutions. The World Bank and other experts have estimated that AfCFTA could: • increase the continent’s exports by 0-billion • increase continental business and consumer spending to .7-trillion by 2030 • boost regional income by 7% or 0-billion • improve wages by up to 10%. The burgeoning African middle-class is a global trend that economists are carefully watching. NORTH SITE The environmental impact assessment (EIA) for the site has been approved, as has the engineering planning phase for bulk infrastructure. Infrastructure installation is envisaged to begin in the course of 2022. Phase 1 projects: • Fresh produce market: partnership • Regional fuel terminal: partnership • Trucks and buses manufacturing: investor • Chemicals manufacturing: investor • Vhembe TVET College • Rail connectivity • Solar energy plant Credit: Anglo Platinum Regional Integration - AfCFTA North Site Layout ENERGY The plan to build a coal-powered power station has been phased out. A memorandum of understanding was signed in December 2021 with a Chinese investor to build a 1 000MW solar power plant. A pre-feasibility study for the project has been done. A project-based EIA application will begin after a site has been chosen and confirmed. SOUTH SITE The South Site’s EIA application was approved on 23 February 2022. The action plan in the post-EIA approval phase encompasses: • Rezoning of the South Site • Finalising the short- and mediumterm water solution • Bulk infrastructure engineering design • Site clearance and fencing • Installation of bulk infrastructure • Ramping up skills development. 15

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