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Limpopo Business 2021-22

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The 2021/22 edition of Limpopo Business is the 13th issue of this highly successful publication that, since its launch in 2007, has established itself as the premier business and investment guide for the Limpopo Province. Limpopo has been attracting significant investments in the mining sector in recent years and with commodity prices of certain minerals rising in response to demand in the renewable energy and automotive sector, mining houses are well-positioned to expand production even further. This journal carries messages of welcome to investors from the province’s Premier and the MEC for Economic Development, Environment and Tourism. In addition to the regular articles providing insight into each of the key economic sectors of the province, there is special feature on plans to catalyse investment and growth in the province through measures such as industrial parks and the Musina-Makhado Special Economic Zone in the province’s far north, which is attracting billions of dollars in investment. News related to mining, agriculture, tourism, construction and property, water, education and development finance is carried in overviews of the main economic sectors.


A REGIONAL OVERVIEW OF LIMPOPO PROVINCE Infrastructure investment is a priority as investments in mining, energy and agriculture keep the provincial economy on an upward trajectory. Tourism, on the other hand, has been badly hit by Covid-19. By John Young Several large water-supply projects such as the Mokolo Crocodile Water Augmentation Project and the Groot Letaba Water Augmentation Project have been implemented or are underway and both provincial and national agencies are working hard on building new roads, tarring gravel roads and repairing flooddamaged roads in all parts of the province. These infrastructure investments are vital, not only for the sake of the citizens of Limpopo whose needs are great, but to keep the economic wheels of the province turning and to convince investors that work is being done to make it possible to allow private enterprises to create functional and sustainable businesses. Part of the infrastructure plan is contained in the vision of Special Economic Zones, the first of which is being constructed in the far northern reaches of the province, the Musina-Makhado SEZ (MMSEZ). A steel foundry, a lime plant and a coal-fired power plant to support a smelter are among the planned industrial entities that will be built in an area that has large coal reserves. Environmentalists such as the Living Limpopo coalition have queried the wisdom of engaging in industrial activity in a waterscarce area. University of Cape Town economist Dr Gracelin Baskaran has argued that platinum group metal (PGM) miners in Limpopo and elsewhere should be focussed on the role that they can play in the transition to clean energy. The world’s biggest polluters have all recently adopted more stringent legislation on vehicle emissions and the EU is looking to hydrogen as the means to achieve carbon neutrality. After noting that several miners are investing in mechanised mining operations, Dr Baskaran wrote in Business Day, “Attracting supply LIMPOPO BUSINESS 2021/22 12

SPECIAL FEATURE The provincial government records that the province will be receiving a total investment from mining of R36.3-billion in the period to 2025. The multiphase Mokolo Crocodile Water Augmentation Project is an important component in the strategy to supply households, businesses and mines with water in Limpopo. Credit: Aurecon chain investments in manufacturing hydrogen fuel cell technology is an excellent opportunity for Limpopo given the sector’s growth.” Limpopo’s assets include the largest diamond mine in South Africa (De Beers Venetia mine), the biggest copper mine in South Africa (Palabora Mining Company), the biggest open-pit platinum mine in the country (Anglo America’s Mogalakwena) and the biggest vermiculite mine in the world. The province has 41% of South Africa’s PGMs, 90% of South Africa’s red-granite resources and approximately 50% of the country’s coal reserves. Antimony, a highly strategic mineral found in large quantities in China, is another of Limpopo’s major assets. In 2019, the mining sector in Limpopo employed 48 782 workers and paid out R39.7-billion in wages and salaries. The mining sector was less effected by shutdowns due to the Covid-19 pandemic than many other industries. Record prices for some commodities ensured that mining houses were able to post excellent results in June and July 2021 and expansion projects, such as the purchase of new rights by Amplats (platinum), the conversion to underground mining by De Beers (diamonds) and increased volumes promised by Exxaro (coal), point to confidence in the future of the sector and the resource beneath the ground. Agriculture The provincial government is putting considerable resources into agricultural infrastructure. This includes upgrading old irrigation schemes and building new ones, building a packhouse, investing in processing equipment at a tomato paste factory and constructing and supplying Farmer Production Support Units around the province. These all constitute attempts to bring smallscale farmers into the value chain at a point where more money can be made. Limpopo is home to some of South Africa’s largest commercial agricultural enterprises who are drawn to the fertile and varied soils that the province has to offer. This is one of the reasons why Limpopo punches above its weight in exports. One of the country’s biggest exporters, ZZ2, is in the process of building a giant new packhouse at its headquarters in Mooketsi. As one of the country’s largest agricultural companies, ZZ2 is famous for the large quantity of tomatoes and avocados produced but the company’s product range is also large: mangoes, onions, dates, cherries, apples, pears, stone fruit, almonds and blueberries. Potatoes are grown in great quantities in Limpopo, together with 75% of South Africa’s mangoes and tomatoes. Statistics in many categories are impressive: papayas (65%); tea (36%); citrus, bananas and litchis (25%) and 60% of the country’s avocados. Agro-processing is strong in several parts of the province, with Pioneer Foods, McCain, Granor Passi, Kanhym, Westfalia and Enterprise Foods all prominent, but this sector still has potential to grow. The best performing subsector of South African exports in recent years has been fruit and nuts. Limpopo has been a major contributor to the country’s excellent export record: fruit and nuts from the province’s eastern regions are hugely popular in international markets and Limpopo’s commercial farmers are extremely efficient. 13 LIMPOPO BUSINESS 2021/22

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