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KwaZulu-Natal Business 2022-23

  • Text
  • Trade
  • Africa
  • Invest
  • Investment
  • Business
  • Kwazulunatal
  • Kzn
  • Terminal
  • Industrial
  • Province
  • Provincial
  • Tourism
  • Economic
  • African
  • Sector
  • Richards
  • Durban
The 2022/23 edition of KwaZulu-Natal Business is the 14th issue of this highly successful publication that, since its launch in 2008, has established itself as the premier business and investment guide for the KwaZulu-Natal Province. In addition to the regular articles providing insight into each of the key economic sectors of the province, there is a special feature on national government’s campaign to encourage private investment in ports. The vital role of the ports of Durban and Richards Bay in the South African economy cannot be understated and putting them in a better position to deal with commodities and cargoes of every sort is clearly in the national interest. A special purpose vehicle is to be created within Transnet to make dealing with private companies less complicated. The increasing importance of the Oceans Economy to the future of the provincial and national economy is relevant to any examination of the economy of KwaZulu-Natal. This applies as much to trade and ship-repair as it does to the exciting gas discoveries which have been made off the coast of Mozambique and South Africa.

Agro-processing of the

Agro-processing of the province’s abundant natural resources is a major economic sector and the source of many jobs. Pioneer Food’s Sasko bakery at Shakaskraal north of Durban is the primary source of bread for the company in the province, and its distribution hub. Credit: Enterprise iLembe Dube TradePort attracted R7-billion between 2012 and 2019 and the same amount is expected to accompany the development of Phase 1A and Phase 1F of the Richards Bay Industrial Development Zone (RBIDZ). Investors include edible oils manufacturer Wilmar Processing SA, which is investing more than R1-billion in a plant, and Elegant Afro Line, which will spend about R900-million on its chemicals plant. Milestones have been reached in the plan for creating a provincial Clothing and Textile SEZ. A business case has been completed by units within the provincial government and land at Ezakheni (Ladysmith) in the uThukela District has been identified and secured. Dube TradePort will be the SEZ operator and R780-million in investments has been pledged by companies keen to relocate to the SEZ. To spread the benefits of the SEZ, the concept of “The Textile Belt” will be followed. The corridor approach will leverage comparative advantages of various regions in the clothing and textile value chain. This belt will start from Newcastle and link Ladysmith, Mooi River, Pietermaritzburg, Hammarsdale, Durban, Isithebe and the Dube TradePort to the Richards Bay Industrial Development Zone. Infrastructure The province’s existing infrastructure, good soils and fine weather provide a solid base for future growth. KwaZulu-Natal already has significant capacity in heavy and light manufacturing, agro-processing and mineral beneficiation, all of which is supported by South Africa’s two busiest ports (Richards Bay and Durban), the country’s most active highway (the N3), a modern international airport and pipelines that carry liquids of all types to and from the economic powerhouse of the country around Johannesburg in the interior. Sappi’s dissolving pulp mill at Umkomaas south of Durban is one of the province’s most significant industrial sites as it produces huge quantities of a material that is used in viscose staple fibre, which in turn is used in clothing and textiles. Together with production volumes from Sappi’s mill in neighbouring Mpumalanga province, the company is the world’s largest manufacturer of dissolving pulp. Mondi is the province’s other global giant in forestry, paper and packaging. Toyota and Bell Equipment are dominant players in the automotive sector. Oceans Economy KwaZulu-Natal province, has a long coastline that stretches from the Mtamvuna River in the south to the Isimangaliso Wetland Park in the north. The province’s contact with the sea has brought obvious benefits: fishing, fine beaches enjoyed by millions of tourists and two great ports. These ports export vast quantities of minerals (mostly through Richards Bay) and manufactured goods (Durban) and serve as an important conduit for imports of all sorts. The Richards Bay Coal Terminal exports massive quantities of coal while the Port of Durban is the busiest port in Africa. However, planners want to expand the economic benefits that the ocean can bring. Strategies to grow the Oceans Economy dovetail with ongoing projects to boost the capacity of the province’s ports and to explore for gas and oil in the Indian Ocean. If oil rigs were to start visiting the KZN coastline on a regular basis, the ship-repair industry would grow exponentially. The Oceans Economy is one of the focus areas that has been chosen by national government to be part of Operation Phakisa, a focused, goal-driven attempt to jump-start a specific economic sector. Overall, Phakisa intends creating a million jobs by 2033 and injecting R177-billion into national GDP. KWAZULU-NATAL BUSINESS 2022/23 10

SPECIAL FEATURE The decision to build a cruise-ship terminal at the Port of Durban is a good example of the kind of decision that is in line with an “Oceans Economy” approach. Geography The mixed topography of the province allows for varied agriculture, animal husbandry and horticulture. The lowland area along the Indian Ocean coastline is made up of subtropical thickets and Afromontane Forest. High humidity is experienced, especially in the far north and this is a summer rainfall area. The centrally-located Midlands is on a grassland plateau among rolling hills. Temperatures generally get colder in the far west and northern reaches of the province. The mountainous area in the west – the Drakensberg – comprises solid walls of basalt and is the source of the region’s many strongly running rivers. Regular and heavy winter snowfalls support tourist enterprises. The Lubombo mountains in the north are granite formations that run in parallel. Regions KwaZulu-Natal has 10 district municipalities and a metropolitan municipality, the most of any province in South Africa. In economic terms, the province offers diverse opportunities. Southern region This area is the province’s most populous. The city of Durban has experienced booms in sectors such as automotive, ICT, film and call centres. The promenade now reaches all the way to the harbour and the Point development will benefit. Major investments are taking place at the Port of Durban with the current centrepiece being the Durban Cruise Terminal. The Container Terminal is also undergoing an extensive overhaul. Durban’s conference facilities are well utilised, but many opportunities still exist in chemicals and industrial chemicals, food and beverages, infrastructure development and tourism. Further south, Margate’s airport and Port Shepstone’s beachfront are assets. Western region Also known as the Midlands, this is a fertile agricultural region which hosts the popular annual Royal Show. It produces sugar cane, fruit, animal products, forestry and dairy products. Pietermaritzburg is the provincial capital and home to a major aluminium producer along with several manufacturing concerns, including textiles, furniture, leather goods and food. The city has good transport links along the N3 national highway, excellent schools and a lively arts scene. The Midlands Meander is a popular tourist destination. Eastern region Although most of this area is rural, Richards Bay is one of the country’s industrial hotspots because of its coal terminal, port and aluminium smelters. The Richards Bay Industrial Development Zone is a major economic node and with the possibility of a power plant being built, the RBIDZ could become an energy hub. Mining is an important sector in this region. The other major urban centre is Empangeni which has several educational institutions. The King Shaka International Airport is adjacent to the Dube TradePort, a Special Economic Zone (SEZ) which is attracting investors. Northern region The economic powerhouse is Newcastle in the north-west: coal-mining, steel processing and manufacturing are major activities. Some old coal mines are being reopened by new coal companies to cater for the country’s power stations’ demand for the fuel. Game farms, trout fishing and hiking are part of an attractive package for tourists, and Zululand is a popular destination for cultural experiences. The region is rich in Anglo-Boer War history which includes battle sites such as Islandlwana and Rorke’s Drift. ■ The province’s substantial rivers flow from the Drakensberg mountains to the Indian Ocean. 11 KWAZULU-NATAL BUSINESS 2022/23

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