IMPRESSED WITH COEGA: (left to right) Ambassador Extraordinary and Plenipotentiary of the People’s Republic of China to the Republic of South Africa, H.E. Ambassador Songtian LIN and CDC’s Chief Executive, discussing cooperation agreement between China and CDC
According to the Ambassador, the Coega SEZ is “by far the most successful SEZ in the African Continent.” It is a good case study for Africa and the world on how to develop and operate a Special Economic Zone. This follows on the heels of Dr LI Yuanchao, the Vice President of the People’s Republic of China in 2016 when he said, “I’ve been to many developing countries and industrial development zones, and the Coega SEZ is by far the best of them all.”
The Ambassador’s comments comes soon after Coega’s recent announcement that the first six months of the 2017/18 financial year have been challenging with the country plunging into a recession in the first quarter yet the organisation still managed to swim against the tide to meet and exceed its half-yearly performance targets. The CDC, which released its mid-year investment performance report last week, highlighted it has signed eight (8) new investors (target = 3) exceeding its mid-year performance target by 167%. Last year, the CDC signed 16 new investors (target = 7) exceeding its annual target by 129%. Total investment contribution by 16 new investors signed last year was R11, 685 billion contributing approximately 0.23% to the Province Gross Value added (GVA). Over the past 6 years, the CDC has attracted 77 new investors with a combined investment value of R47,7 billion.
According to HE Ambassador LIN, the Coega SEZ is ready to take advantage of the increase in Foreign Direct Investment into Africa. South Africa remains the leading foreign direct investment (FDI) destination in Africa, with a 6.9% increase in FDI projects in 2016, according to financial services advisory firm EY’s latest ‘Africa Attractiveness’ report. This supports the Africa Attractiveness Index report, which identified 676 new foreign direct investment (FDI) projects in Africa in 2016. South Africa retains its top ranking in Africa as a destination for projects, with 139 projects in 2016 compared to 130 in 2015; followed by Morocco (81) and Egypt (79). Most notably, Chinese FDI into Africa increased dramatically; this made the country the single largest contributor of FDI capital and jobs in Africa in 2016.
According to Dr Ayanda Vilakazi, CDC’s Head of Marketing, Brand and Communications, the investment in the Coega Special Economic Zone (SEZ) reflects a positive trend identified in the Africa Attractiveness Index (AAI) Foreign Direct Investment (FDI) 2016 and 2017.
Since 1999, the Coega SEZ focussed on the development of the SEZ in terms of infrastructure. The road and rail infrastructure is in place, which connects the Coega SEZ with Northern Cape, Gauteng and other provinces. This purpose-built Coega SEZ, which is integrated into the deep water port of Ngqura, is part of the country’s leading edge in logistics and infrastructure. The modern port infrastructure, at the deep water Port of Ngqura, has a capacity in excess of 2 million TEU’s. The port is also going through expansions that would provide a great opportunity for investors and would effectively compete with other ports in the country in terms of efficiency and capacity to handle large volumes of cargo.
Of significant importance to Ambassador LIN is the Coega’s skills development centre where young people receive training on various traits including carpentry, plumbing, welding, painting, brick-laying, etc. Currently, there are 7243 people employed at Coega, more than 85% of them have been sourced from the local communities. This makes the Coega SEZ the largest employer in the Metro. Three years in a row, the Coega SEZ has been awarded the Top Employer Certification by the Top Employers Institute.
The relationship between China and South Africa is very good. “The South African government continues to create an enabling environment for Chinese investors,” says Charles Manuel, Minister Counsellor (Economic), South African Embassy, Beijing. “The South African Embassy in China works very well with Investors and welcomes companies to address any challenges with the Embassy to jointly find solutions and resolve them amicably. According to the latest Mckinsey report, South Africa offers Chinese investors a stable enabling environment and solid investment returns. This is why South Africa is often used as a launch pad into Africa. An important element of investor confidence and stability is the diligent implementation of laws, regulations and contractual obligations to ensure win-win cooperation,” concludes Mr Manuel.
An independent research on Coega’s current operational investors conducted in 2016 showed that 93% of current and operational investors at Coega felt the Coega SEZ was an ideal locations for Global Investors. The Coega position as an ideal investment location has been strengthened by the availability of incentives under the Special Economic Zone (SEZ) Act (Act No.16 of 2014). As a result, more international investors, particularly from China are now looking to invest at Coega.
This is good news for the Coega SEZ since these investors would create the much needed job opportunities as well as provide skills development and training to many young people in the Eastern Cape who are looking for employment and training. HE Ambassador LIN welcomes good cooperation between the CDC and the Chinese Embassy in promoting investment opportunities at Coega given the Coega SEZ’s position in Africa as “the most successful SEZ in the African Continent.” Well done Coega, concludes Ambassador Songtian LIN.
Issued by: Coega