The Coega Development Corporation (CDC) has in the last two financial years seen its Foreign Direct Investment conversion rate ranked higher than the South African average in 2015.
According to the United Nations Conference on Trade and Development (UNCTAD) report (2016) which discusses the inward fixed FDI conversion rate for South Africa, the average rate for FDI conversion in South Africa in 2014 was (53%) and in 2015 (47%). The CDC on the other hand, has managed to hold a consistent FDI conversion rate for the same period at 50%.
“The report validates the CDC’s strategic approach of streamlining its operations to ensure a reduced timeframe for FDI conversion,” said Dr Ayanda Vilakazi, CDC unit head marketing and communications.
The CDC’s one stop shop (OSS) has yielded much needed results with investors afforded immediate access to utility related services such as municipal approvals home affairs visa approvals.
The OSS offers incentives such as providing specialist advisory services to investors, ensures facilitation of the entire investment value chain, offers a platform for investors to log their complaints or issues as well as ensuring that investors understand benefits and incentives available to them all of which enables an improved investor conversion rate.
In the financial year 2015/16, the CDC signed 17 new investors; of these six are currently busy with construction and five would be commencing operation before the end of this year. A Muffin consulting report (2016) highlighted that locating ones business in the Coega Industrial Development Zone (IDZ) could prove to be a profitable business decision for companies.
The study highlights that 84% of the companies that have invested in the Coega IDZ reported an increase in profitability year-on-year. In addition, over 85% of investors have increased their workforce since opening their businesses in the IDZ, and 62% have expanded their factories. More than 90% of CDC’s operational investors described the IDZ and its logistics park in particular as the ideal location for global industries.
In conclusion, the CDC’s global competitiveness and IDZ value proposition continues to offer investors a strategic location and a gateway to the African markets in the continent through wold-class infrastructure, including but not limited to rail, road, air and sea network, integrated logistics and advanced labour management systems.
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