2014/15 SEZ Performance Analysis Bulletin

Transcription

1 2014/15 SEZ Performance Analysis Bulletin REPORT SEZ KEY HIGHLIGHTS IDZs PERFORMANCE OVERVIEW No.1 August 2014 The Saldanha Bay IDZ was designated in August 2013, with Dube Trade Port (DTP) IDZ in Durban, KwaZuluNatal, designated in July The DTP IDZ will focus on two sectors, namely: 1. The Dube AgriZone to leverage highvalue niche agricultural and horticultural products; and 2. The Dube TradeZone to specialise in valueadded manufactured goods primarily for the automotive, electronics and fashion sectors. The MalutiAPhofung IDZ in Harrismith, Free State, is in the process of being designated. The IDZ will create an opportunity for the establishment of various downstream and upstream automotive, agriculture and food processing (valueadded) initiatives. Between 2002 and 2014, six IDZs have been designated, namely Coega, East London, Richards Bay, Saldanha Bay, OR Tambo and Dube Trade Port. To date, the dti has transferred a total of R6.9 billion to the operational IDZs for infrastructure development and operational expenditure. Fiftyone, with an estimated investment value of R4.8 billion, are on site in the operational zones. In addition, 29 with an investment value of R16. 4 billion have made commitments to locate in the zones. This means an estimated investment of more than R20 billion has been attracted into the zones. To date, approximately jobs have been in the IDZs, of which (9,6%) were direct and (90,4%) indirect jobs. Signed, but not yet operational are expected to create more than direct jobs in the zones. Land uptake has been slow, however, with Coega IDZ having 35% land occupied, ELIDZ 31% and RBIDZ 35%. Export sales from the IDZs have been far below expectation over the same period. Export sales by two enterprises located in Coega and one in RBIDZ totalled just more than R2.7 billion. With the SEZ Act (Act no. 16 of 2014) assented to by the President in May 2014 and expected to be effected in October 2014, more rigorous and streamlined processes are being developed to ensure a smooth implementation process. The 2013/14 financial year marked a transition process for the IDZ funding model to an SEZ model, in which improved cooperative governance is being introduced as provincial and local government will become the licensee holders and asset managers who will be responsible for the operational expenses of the SEZs. 2014/15 F/Y SEZ Performance Analysis Bulletin 1

2 A. LAND UPTAKE ANALYSIS OVERVIEW: 2014/15 IDZ Date designated Shareholding structure Land size Lattable land Developed land % of land required by to date Coega IDZ 2003/04 100% Eastern Cape ELIDZ 2003/04 74% Eastern Cape and 26% BC Municipality RBIDZ 2008/09 100% KwaZuluNatal 11500ha 6545ha 854ha 35% 440ha 213ha 213ha 31% 224ha 172ha 164ha 35% ORTIDZ 2010/11 100% Gauteng SBIDZ 2013/14 100% Western Cape 225ha 300ha While land uptake has been slow over the past 13 years, in the pipeline, if realised, will occupy a big share of land space in the zones. B. INVESTMENT ANALYSIS AS AT JULY 2014 Between 2002 and 2014, the three operational IDZs (namely, Coega,ELIDZ and RBIDZ) attracted a total of 51 with an estimated investment value of R4.8 billion. Of this, 25 located in Coega, with an estimated investment value of R2.4 billion; 25 in ELIDZ, with an investment value of R1.7 billion; and one in RBIDZ, with an investment value of R800 million. Pipeline Investors Signed Investors not operational Operational Investor IDZ No. of pipeline value of investment number of jobs to be by the Number of signed Value of Investment signed not operational number of jobs to be Number of operational Value of investment (R'000) Direct employment Indirect and construction jobs Total employ ment Export (R'000) COEGA 5 122,300,000 1, ,429,000 1, ,372,450 5,011 52,655 57, ,457 Import ELIDZ 55 23,715, ,373, ,651,700 1,711 11,274 12,985 RBIDZ 18 14,209,000 5, ,555, , ,941,023 SBIDZ _ 0 ORTIDZ _ 0 TOTAL ,224,000 12, ,357,000 2, ,824,150 6,896 65,637 72,533 2,662, /15 F/Y SEZ Performance Analysis Bulletin 2

3 C. IDZ FUNDING TREND ANALYSIS: Between the 2002/03 and 2013/14 financial years, the dti expended a total of R6.9 billion to the four operational IDZs, of which Coega received 67%, ELIDZ 22%, RBIDZ 7% and Saldanha Bay IDZ 3% to fund infrastructure and operational expenditure needed for effective operations and investment attraction in the zones. In 2013/14 financial year, the dti transferred a total of R824.4 million to operational IDZs for infrastructure development. Thirtyseven per cent was allocated to Coega, ELIDZ (16%), RBIDZ (22%) and SBIDZ (25%). IDZs YOY BUDGET ANALYSIS: 2002/ /14 R'million Coega ELIDZ RBIDZ % CHANGE BUDGET ANALYSIS: 2002/ /14 % Coega ELIDZ RBIDZ 2014/15 F/Y SEZ Performance Analysis Bulletin 3

4 D. SEZ IMPLEMENTATION STATUS Activity break down Status Completion target date Finalise and socialise SEZ Act 16 of /11/10 Current status Sessions being planned with external stakeholders to socialise the contents and implications. Finalise and publish regulations and incentives 14/11/17 Extensive reviews with SARS and National Treasury concluded. Legal review is now in process and external stakeholder consultations being planned. Conclude national SEZ strategy 2 Fri 14/10/03 Strategy was refined after three internal consultations. Final internal strategy review session is being planned with BPD with support from National Treasury. Develop and implement SEZ marketing and communications strategy 2 Fri 15/02/13 Communications and marketing strategy framework was compiled during the last month. Inputs from external consultants being sought. Develop and implement SEZ risk models 2 Fri 14/10/24 Requirements for risk assessment models have been defined and communicated. Support from the Risk and Compliance Unit secured to finalise the risk models. Finalise governance framework and appoint national SEZ Board 2 Wed 14/10/15 Governance issues being identified, Board member requirements drafted and advertisements have been published. Develop national SEZ skills framework and plan 2 Fri 15/02/13 Broad framework drafted for finalisation with all the dti stakeholders. Sectorspecific pilot initiatives have been defined. Develop and implement the onestopshop model 2 Tue 15/06/30 Agreement reached of initial focus for a pilot intervention to speed up standardisation of the model across all SEZs/IDZs. Develop and capitalise a SEZ fund 2 Wed 16/02/17 Urgent intervention being sought with National Treasury to confirm views on the principles and strategic intent of a fund. Develop monitoring and evaluation (M&E) system for SEZs 2 Fri 16/01/01 KPIs, methodology and standards defined and M&E system development has started and is progressing well. Identify, document and review the SEZ fund application business processes Develop project appraisal and designation tools Manage investorspecific feasibility assessments Support designation of two new IDZs and convert existing IDZs 14/10/06 2 Thu 15/09/17 2 Thu 15/04/30 16/07/20 Internal fund application and disbursement processes are being mapped for internal review by 29 August All internal templates for application and appraisal developed and being used. Two feasibilities on static fuel cell localisation and coking coal progressing according to schedule with draft market and technical feasibility work 60% complete. MAPIDZ public consultations concluded and designation is in progress. 2 In progress 3 Completed 1 Behind schedule 2014/15 F/Y SEZ Performance Analysis Bulletin 4

5 E. SEZ FEASIBILITY STUDIES STATUS 2014/15 F/Y SEZ Performance Analysis Bulletin 5