By Ntando Thukwana.
South Africa plans to attract billions of dollars in investment into its specialised industrial hubs by April to revive a manufacturing sector that has been in decline for decades.
“We are targeting R750 billion ($46 billion) worth of investments in this current fiscal year,” Maoto Molefane, acting deputy director-general at the Department of Trade told Bloomberg News on the sidelines of the Special Economic Zones (SEZs) investment conference in Durban on Thursday.
The department plans to raise the capital from infrastructure investments, development finance institutions and other lenders, and commitments secured at South Africa’s investment conference earlier this year.
Investors pledged a record R890 billion at the forum, with much of the capital earmarked for designated industrial sites, President Cyril Ramaphosa said in address at the SEZ conference.
Reviving manufacturing is key to South Africa’s growth strategy, with SEZs at the heart of that effort.
The sector’s share of economic output has fallen to 11% from 24% in 1994.
South Africa was once “a shining example of how Africa should develop”, but chronic power shortages and port inefficiencies have eroded its competitiveness, causing manufacturing’s contribution to gross domestic product to decline, Molefane said.
“We’re using the SEZs to reverse deindustrialisation.”
The nation’s SEZs currently host 224 companies, with cumulative investment of R31.7 billion and more than 28 000 direct jobs created.