SPECIAL FEATURE Zoning
SPECIAL FEATURE Zoning in on fresh produce Mpumalanga’s mega-projects aim to attract investors in a wide range of sectors. • Vast mineral resources, which fire the province’s many coal-fired power stations and underpin the ferro-alloy complex around Middelburg, where Columbus Stainless runs the only stainless-steel mill in Africa. Several large private-sector investment projects are under way in Mpumalanga. These include the ongoing upgrades and conversions at the Ngodwana Mill by Sappi (forestry and paper) and the various plants of Sasol at Secunda (petrochemicals and liquid fuels), mining ventures in the coal sector (Anglo American coal, Sasol, Exxaro and Nkomati Anthracite are all spending heavily) and tourism (Thebe Tourism Group has multiple projects). These projects illustrate the diversity of the provincial economy which has large concerns in the sectors mentioned above and others in segments as different as stainless steel, sugar, ferro-alloys and potato chips. A provincial plan intends to use these strengths to further develop labour-intensive manufacturing industries and to encourage the development and localisation of supply chains. To achieve this, two major projects are being implemented: • the Nkomazi Special Economic Zone • the Mpumalanga International Fresh Produce Market. Both big projects leverage the province’s main strengths. These include: • Unique location and logistical advantages: Maputo Development Corridor; Moloto Corridor; borders with Mozambique and Swaziland; major highways and rail links; proximity to South African industrial heartland and large population of Gauteng Province • Mpumalanga generates 80% of South Africa’s energy and several pipelines run through the province • Extraordinary agricultural riches, which can be exported or used in agri-processing Nkomazi Special Economic Zone The Nkomazi Local Municipality has designated land for the SEZ which will be established in terms of the Special Economic Zones Act of 2014 (Act 16 of 2014). The act defines an SEZ as “geographically designated areas of the country that are set aside for specifically targeted economic activities and supported through special arrangements and systems”. Infrastructure at an SEZ supports the targeted sectors and attracts foreign investors with a strong focus on beneficiation of local produce or materials. Skills transfer is another stated aim behind the SEZ programme. Situated in the border town of Komatipoort, this multi-sector SEZ is the axis of economic integration between the provinces of Mpumalanga, Gauteng and Limpopo and the neighbouring states of Swaziland MPUMALANGA BUSINESS 2018/19 20
SPECIAL FEATURE and Mozambique. The region is one of the most industrialised and productive areas in Southern Africa and the Maputo Development Corridor provides linkages west to the economic heartland of South Africa and eastwards to the ports of Mozambique. Proximity to the Mozambican port of Matola would support a dry port or logistics base. The SEZ focus is on infrastructure and manufacturing: transport, warehousing and logistics facilities, agri-processing, automotive support platforms and infrastructure to support companies operating in the mining and mineral sectors. Options for investors include bonded warehouses, a distribution centre, a container yard, truck stops and a petrol depot (with maintenance, fitment, and repair facilities). Other opportunities include phosphate for fertilisers, the production of ammonia and urea and the beneficiation of fluorspar for downstream agri-chemicals and fluorine production. Food processing and packaging for large retailers is another option. Potential products to be made include subtropical juice concentrate, lemon oil and lemon juice concentrate. Mpumalanga International Fresh Produce Market An International Fresh Produce Market (IFPM) is under construction at Mbombela. To support the market, the Mpumalanga government is establishing seven Agri-hubs to provide a stable supply of fresh produce to the market. The 248ha site is in Mbombela, the provincial capital. It is situated within the Maputo Development Corridor (MDC), which is South Africa’s leading Spatial Development Initiative (SDI) linking Mpumalanga, Gauteng Province and the Nkomazi Special Economic Zone with the deep-water Port of Maputo in Mozambique. Private investors are sought to be partners in building the top structure; services are being laid on by the province. The SEZ’s location enables access to the SADC market with 280-million consumers, the EAC market with 140-million consumers and preferential access to lucrative Asian and EU markets. The market will serve farmers and customers from Mpumalanga, South Africa and regional markets in Swaziland and Mozambique. The market will cater for expected growth in the production of tropical and subtropical crops and vegetables. The potential is huge: • Mpumalanga currently generates R950-million in turnover from subtropical fruit. The sector employs about 13 000 people. • The region exports more than 10-million cartons of avocadoes every year. A large proportion of South Africa’s grain, citrus, sugar and soft fruits come from Mpumalanga. The province is one of the key exporters of macadamia nuts, a subsector that is growing rapidly. The plan intends for agri-processing in the province to grow exponentially. The tropical and subtropical crops which thrive in Mpumalanga include avocadoes, bananas, citrus, ginger, granadillas, guavas, litchis, macadamia nuts, mangoes, papayas and pineapples. Vegetables produced are potatoes, tomatoes, pumpkins, sweet corn, onions, sweet potatoes, beetroot, carrots, green peas, cauliflower, cabbage and green beans. The IFPM will provide trading halls for fruit and vegetables, markets for meat, fish, and flowers, complementary cold-storage and ripening facilities and pallet handling. There will also be processing facilities, an export hall and bulk-breaking facilities for retail outlets. There will be a customs office and commercial services such as banking and restaurants will be available. A food bank is to be established for NGOs. Helping small-scale farmers and co-operatives gain access to new domestic and international markets is among the aims of the Fresh Produce Market. 21 MPUMALANGA BUSINESS 2018/19
