Transcript 3 - Nkomazi SEZ

NKOMAZI SEZ
UPDATE: NOVEMBER 2016
PRESENTATION OUTLINE
 NKOMAZI SEZ OVERVIEW
 SALIENT FEATURES OF THE SEZ
 RATIONALE FOR AGRO-PROCESSING
 LOGISTICS RATIONALE
 CONCEPTUAL DESIGN AND SITE LAYOUT
 SUPPORTING POLICY FRAMEWORK AND INCENTIVES
 CONCLUSION
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OVERVIEW OF NKOMAZI SEZ
• Nkomazi Special Economic Zone (SEZ) is a multi sectoral SEZ focusing
primarily
on agro-processing and agro-chemical
manufacturing
and
supported by a logistics sector.
• Nkomazi SEZ is strategically positioned in the border Town of Komatipoort.
• This multi-sector SEZ is the axis of economic integration between the South
African provinces of Mpumalanga, Gauteng and Limpopo and the Kingdom of
Swaziland and the Republic of Mozambique
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ABOUT NKOMAZI SEZ (CONT.…..)
SEZ
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SALIENT FEATURES OF THE SEZ
 Nkomazi SEZ presents unique strengths and strategic advantages for investors
to locate.
 Through the Port of Maputo the SEZ provides investors easy access to East African
market of about 146 million people.
 Secondly through the port investors are also able to tap into their global supply
chain network to source needed production inputs and distributing their end
products globally.
 Available input material and produce in Mpumalanga for agro-processing
 The Nkomazi SEZ is also located within an area which enjoys world class rail and
road infrastructure.
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SALIENT FEATURES (Cont.….)
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SALIENT FEATURES (Cont.….)
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SALIENT FEATURES (Cont.…..)
 The N4 road which forms the backbone of the Maputo Corridor provide efficient
movement of goods and service including access to source production inputs
across Mpumalanga, Gauteng and Northwest provinces.
 Nkomazi is also linked to Limpopo province through a railway network up to Musina,
making it easier to access Zimbabwe on the north and Botswana in the west.
• In summary location of Nkomazi SEZ makes it easier for any investor who locates
manufacturing capacity and capability in it, to have access to the SADC market of about
277 million people and 146million people East African Market.
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SALIENT FEATURES (Cont.….)
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Population
Estimate
277m
GDP
2013 Estimate
US$
1,193bn
Per capita
US$ 4,309
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SALIENT FEATURES (Cont.…..)
From input supply side, the province of Mpumalanga where the SEZ is located has a
well developed and highly competitive primary agricultural sector.
 The province is made up of two regions that specialises in different agricultural
output. The Highveld regions which produces in the main:
Winter cereals,
Legume,
Oil seeds and
Fodder crops
 Lowveld region in the main produces:
sugar cane,
tropical fruits,
nuts and
honey
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RATIONALE FOR AGRO-PROCESSING
The Table below reflects the potential for agro-processing in South Africa:
Commodity
Volumes (Tons)
Sugarcane
20 million
Banana
98 509
Citrus
7.1 million
Mango
50 440
Avocado
130 million
Macadamia Nuts
2000
Poultry
930 000
Pigs
2.6 Million
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SALIENT FEATURES (Cont.…..)
Lowveld Region
Highveld region
 Agricultural production in the Highveld region
comprises
 Summer and winter cereals: The summer
cereals that are grown in the Highveld are
maize and sorghum. The total production of
these cereals is approximately 1 119 488
metric tons, and the total cultivated area is
304 030 hectors.
 Winter cultivated cereal in the region is
mostly wheat and it covers 13 266 hectors
and total production is approximately 52 979
metric tons
 Oil seeds: Total area cultivated 15 194
hectors and total production of crops is 21
143 metric tons
 Fodder Crops: total area 23 799 hectors and
total production 70 666 metric tons
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 Citrus and, tropical fruits, sub tropic fruits
and nuts also provide trade and investment
opportunities: available opportunities are in:
•
•
•
•
•
•
•
Sugar refining
Processing of
 Fruits into juices and concentrates,
jams, canning and drying:
 Vegetables into canning, freezing and
drying
Value adding to nuts
Honey production
Processing fruits into pharmaceutical
industry
Essential oils from tropical, sub tropical and
citrus fruits and
Processing of tropical fruits with exotic
recipes.
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LOGISTICS - RATIONALE
•
Logistics has added potential benefits in the SEZ in that it can generate “savings provided by
collaborative logistics processes”
•
The logistics centre becomes the heart of collaboration in the SEZ.
•
Logistics investors attracted to the SEZ can harness logistics savings by enhancing synergies within the
following services:
 Cargo consolidation
 Container Facility Management
 Logistics Centre Management
 Production Logistics
 Vehicle distribution centre
 Intermodal logistic management
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SEZ POLICY FRAMEWORK AND
SUPPORTING INCENTIVES
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SEZ POLICY FRAMEWORK
The SEZ Policy through SEZ Act 16 of 2014 has four specific objectives, namely to:
•
Support the development of targeted industrial and agricultural capabilities and to attract foreign and
domestic direct investments in support of the Industrial Policy Action Plan (IPAP) and Provincial
Industrial Development Strategies (PIDS’s), under the over-arching National Development Plan (NDP);
•
Develop world-class infrastructure in line with the requirements of the targeted sectors and investments;
•
Promote beneficiation and further value addition of the country's mineral and agricultural resources; and
•
Contribute to the creation of sustainable quality jobs and increase exports of beneficiated commodities,
including agricultural produce, in the targeted regions.
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Major SEZ incentives
SUPPORTING INCENTIVES
1. Preferential 15% Corporate Tax. Businesses located in a SEZ may be eligible for tax relief, including
the reduced rate of corporate income taxation
2. Building Allowance. Businesses and Operators operating within an SEZ may be eligible for tax relief,
including the building allowance
3. Employment Incentive. the employment tax incentive subject to requirements contained in the
Employment Tax Incentive Act
4. Customs Controlled Area. will be eligible for tax relief as per the Value-Added Tax Act, the Customs
and Excise Act, the Customs Duty Act and Customs Control Act
5. 12I Tax Allowance. The 12I Tax Incentive is designed to support Greenfield investments such as new
industrial projects for both capital investment and training.
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CONCEPTUAL DESIGN AND SITE LAYOUT
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CONCEPTUAL DESIGN AND SITE LAYOUT
Phase 1
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CONCEPTUAL DESIGN AND SITE LAYOUT
Proposed phase 2:
400ha
Phase 1: 300ha
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PRIORITY PROJECTS
No.
Facilities
Distribution centre and Warehouse – ferrous and related mining (chrome)
Distribution centre and Warehouse – coal
Automotive warehouse – consolidation
Automotive warehouse – Vehicle Preparation Centre
General Logistics warehouse – Truck staging
General Logistics warehouse – Refuelling Station
Cold storage for meat, vegetables and fruit
Citrus fruit processing & packaging facility
Macadamia nuts processing & packaging facility
Sugarcane processing, storage & packaging facility
Mango fruit processing & packaging facility
Avocado processing & packaging facility
Multi-user shared administration facility
Land reserved for roads, servitudes, water, sanitation, electrical sub-stations,
ICT, open spaces
Sub-total hectares
Land reserved for other sectors (30%)
Total Land Area (hectares)
1
2
3
4
5
6
7
8
9
10
11
12
13
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No. of
Facilities
Hectares
1
1
1
1
1
1
1
1
1
1
1
1
1
3
3
3
3
3
3
6
3
3
3
3
3
3
18
60
78
138
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SEZ INVESTOR ROLL OUT
Period (Years)
No. of
investors
SEZ capital outlay Tenant outlay (R’
(R’ mil)
mil)
1–5
3
180
Nil
5 – 10
4
240
Nil
10 – 15
6
Nil
360
Total (15 yrs)
13
420
360
Seven (7) investors funded by SEZ Fund
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PROJECT COST AND FINANCE
Timelines
(Years)
*201
8
201
9
2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033
26.5
27.8
29.2
30.7
32.2
33.8
35.5
37.3
39.2
41.1
43.2
45.3
47.6
50.0
52.5
0
60.0
60.0
60.0
60.0
60.0
60.0
60.0
60.0
3.0
3.0
3.0
3.0
3.0
3.0
3.0
0
86.5
87.8
89.2
30.7
92.2
93.8
95.5
97.3
42.2
44.1
46.2
48.3
50.6
53.0
55.5
Operating
Cost (Rm)
Capital
(Rm)**
Cost
Total
Expenditure
(Rm)
No
Investors
of
3
4
6
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PROJECT SUMMARY
• The site is below the N4 is ideally suited for agro-processing, the expansion of
logistics support
• Nkomazi Local Municipality has taken a council resolution to make available
300ha of Portion 58 of the farm Komatipoort Townlands, 182-JU, for the
establishment of the Nkomazi SEZ .
• EIA and Traffic Impact Assessment (TOI) for 173 ha has been submitted to the
Department of Environmental Affairs for rezoning and industrial land use.
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PROJECT SUMMARY
• Thirteen (13) Sector Development projects mainly in the Agro-processing Sector
supported by logistics to mining, automotive and agriculture.
• This will include an innovation platform to house SMME agro-processors as well as
research and development facilities;
• A construction period of fifteen (15) years, 2018 – 2033, is proposed for the
Nkomazi SEZ;
• It is estimated that the SEZ will create about 2500 jobs during construction and
• 778 sustained operational jobs, which will be people working in the SEZ precinct
• The total economy wide, direct, indirect and induced jobs are estimated at 5254.
• This means that for every R1 million spend, 4 direct jobs are created.
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CONCLUSION
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Only 14hr flight
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THANK YOU
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