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South African Business 2019 edition

The 2019 edition of South African Business is the seventh edition of this annual guide to business and investment in South Africa. Regular pages cover all the main economic sectors of the South African economy and give a snapshot of each of the country’s provincial economies. Feature articles on topical issues such as Special Economic Zones and African trade provide unique insights, together with comprehensive overviews of critical economic sectors. Other special features focus on the exciting new possibilities in renewable energy, airports as engines of regional growth and the maritime sector as an entirely new prospect for South African entrepreneurs and businesses. South African Business is complemented by nine regional publications covering the business and investment environment in each of South Africa’s provinces. The e-book editions can be viewed at www.globalafricanetwork.com

The 2019 edition of South African Business is the seventh edition of this annual guide to business and investment in South Africa.
Regular pages cover all the main economic sectors of the South African economy and give a snapshot of each of the country’s provincial economies. Feature articles on topical issues such as Special Economic Zones and African trade provide unique insights, together with comprehensive overviews of critical economic sectors. Other special features focus on the exciting new possibilities in renewable energy, airports as engines of regional growth and the maritime sector as an entirely new prospect for South African entrepreneurs and businesses.
South African Business is complemented by nine regional publications covering the business and investment environment in each of South Africa’s provinces. The e-book editions can be viewed at www.globalafricanetwork.com

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SOUTH AFRICAN

2019 EDITION

BUSINESS

THE GUIDE TO BUSINESS AND INVESTMENT

IN SOUTH AFRICA

JOIN US ONLINE

WWW.GLOBALAFRICANETWORK.COM | WWW.SOUTHAFRICANBUSINESS.CO.ZA


Adorantha Investments

Improving the quality of health in South Africa.

Adorantha Investments (Pty) Ltd is a company

with a national footprint that provides

health awareness, healthcare counselling

and training services. The mission of

Adorantha’s HIV/Aids awareness programmes is to

help prevent HIV infections and to improve the lives

of those affected by HIV and Aids by providing education

and facilitating the free and open exchange of

knowledge and training.

The counselling and health awareness programme

is based on a holistic approach that encompasses

diseases management which impacts on

health lifestyle. The medium and long-term benefits

of this type of approach are unquestionable. The

company’s operations are managed and driven by

health professionals who bring with them many years

of experience in various health fields.

The company aims to improve the quality of

health in South Africa and help improve the levels

of productivity in the country via affordable health

counselling at strategic places throughout the country.

The EAP (employee assistance programme) is

designed to assist management, employees and

their dependants and various stakeholders within

the company in addressing productivity and absenteeism

issues in a confidential and effective manner.

Adorantha has established a reputation of service

excellence in the past eight years. Community and

healthcare programmes are designed towards

prevention rather than treatment of compromised

conditions, and a spectrum of services that are

integrated towards normalising the lives of the

afflicted, has set a pattern of excellent outcomes

that has the potential to be repeated.

These include areas such as lifestyle diseases and

work-life balance in order to enhance individual and

organisational wellness. These programmes include

health risk assessments, training, profiling, education

and awareness which is aligned to the country’s

health awareness days (World Diabetes Day,

World Aids Day, etc) and other programmes aimed

at improving the general health standard of employees

and communities. The company’s HIV/Aids

programmes follow an integrated approach, tackling

the epidemic on all fronts with various initiatives and

campaigns that include education and awareness,

comprehensive healthcare, risk management, community

involvement and monitoring and evaluation.

We have benchmarked our health awareness

programmes against the best programmes in the

country and we always aim to improve through

training and workshops. Our programmes utilise

specific core principles to enhance employee

and workplace effectiveness through prevention,

identification, and resolution of personal and workrelated

issues.

All wellness and health interventions at Adorantha


are planned, designed and implemented based on

consultation with our clients. Health screening tests

or analysis are conducted on-site at a nominated

venue by our competent health practitioners in an

atmosphere of confidentiality and privacy. These

interventions have been reinforced through strong

communication, awareness, education and prevention

drives through varied mediums.

Services

HIV and Aids education needs to motivate people

by making them aware that what they are learning

is relevant to their lives. Empowerment is also crucial,

as people must be in a position where they are able

to take control of their sexual behavior or methods

of drug use. Education is a crucial factor in preventing

the spread of HIV. Given the huge numbers of

deaths that might still be prevented, the importance

of effective education cannot be overestimated.

HIV/Aids and TB at the workplace

Management of TB

• Management of drug-resistant TB

• TB and HIV infection prevention and control

• HIV management

• General health awareness programmes

• Health roadshows

• Practical skills sessions for doctors and nurses

• Workshops and awareness sessions for lay people

These sessions cover the basics of TB and HIV and

bring together diverse groups of employees and

communities. We also supply technical support and

assist in creating health policies and protocols.

Staff

In addition to highly qualified doctors and nurses

Adorantha can call on a range of skilled professionals

in rolling out holistic services. All doctors are in

good standing with the Health Professions Council

of South Africa (HPCSA).

Educators

The health educator provides risk assessments

and health education to HIV-positive patients

and provides HIV testing and group education

to HIV-negative participants. The educator

maintains client confidentiality at all times.

Counsellors

Counsellors provide personal, behavioural and

vocational guidance for individuals and groups.

In collaboration with medical staff, they help to

determine when detoxification for a client is

appropriate and provide supportive counselling

and referrals.

In-house psychologists

They can assist where the problem goes beyond

the mere physical. A health psychologist

conducts surveys, personality tests, interviews

and interventions. Interventions might involve

chronic disease management, stress relief or

relaxation therapy.

Legal services

We can assist in the drafting of wills,

representation in disciplinary hearings, general

legal advice sessions and bail applications. We

can also provide representation in some criminal

(limited) matters.

Financial advisors

A highly-skilled team can advise any entity on financial

affairs, in association with Johan Eksteen

& Associates (FSB no 10930).

Other services

Insurance – Affordable Healthcare and Group

Schemes

Employee Assistance Programmes

Wellness Management

HIV/Aids Management Programmes

Student Life Skills training

Physical address: 107 Haymeadow Street, Block 4 Boardwalk Office Park, Faerie Glen, Pretoria 0081

Tel: +27 12 948 0410 | Email: info@adorantha.com | Website: www.adorantha.com


New team boosts

Durban’s prospects

A lifestyle of business and pleasure together, Durban

has the perfect mix for investors.

Team Durban has a new and dynamic team to

drive investment into the city. In September

2018, eThekwini Mayor Zandile Gumede inducted

the new members of Team Durban.

The team will provide strategic Foreign Direct

Investment (FDI) advice to the city leadership and

the new Invest Durban Unit on business and investment

promotion matters.

Mayor Gumede thanked the newly nominated

members of the team for agreeing to help accelerate

investment growth while looking to improve the

business environment of the city region.

The Deputy City Manager of Economic Development

and Planning Phillip Sithole will provide liaison and administrative

support to Team Durban. Sithole will also

provide progress reports to council on the functioning

and outputs of Team Durban. Members of the Team

Durban Advisory Forum from the Municipality comprise

eThekwini Mayor Zandile Gumede, who will serve as the

Chairperson of the Forum, Chairperson of the Economic

Development and Planning Committee Sipho Kaunda,

and City Manager Sipho Nzuza.

The external members are representatives of some

the biggest business in the city as well as representatives

from civil society, including youth and academia.

They are: Suben Moodley, Senior Vice President for

Corporate Affairs Toyota South Africa; Mike Deighton,

Managing Director Tongaat Hulett Developments;

Themba Ngcobo, Founder and Director Exel Petroleum;

Musa Makhunga, Managing Director of HR Matters and

President of the Durban Chamber of Commerce and

Industry; Sandile Zungu, Corporate Director Zungu

Investments Company Limited (ZICO); Steven Saad, Chief

Executive of Aspen Pharmacare; Mlungisi Ntombela,

General Manager eThekwini Disability Sport Forum;

Faisal Mkhize, KZN Provincial Managing Executive of

Absa; Zanamuhla Khanyile, Department of Correctional

Services; Samukelisiwe Nzimande, Managing Director

K2M Financial Services; Howard Arrand, Provincial Head

FNB; Manto Madlala, acting CEO Premier Soccer League;

Thulisa Ndlela Chair of Ayigobi Investments.

The non-executive members have been appointed

to serve on Team Durban for a period of three years

effective from 1 July 2018 to 30 June 2021.


Their service will be on a voluntary basis but the

municipality will cover their travel and accommodation

expenses where required and in accordance with travel

policy.

At the function to introduce the new team, Russell

Curtis, Head of Department, Invest Durban said, “Team

Durban marks the further sophistication of the city.”

He explained that the goal of Team Durban was to

improve partnerships and strengthen relationships

between different sectors in society. This forum he

said was a significant step change for Durban and in

line with global best practice.

INVEST IN DURBAN

Durban’s investment agency has a refreshed brand

name of “Invest Durban”. A partnership between the

Metro City Council and the private business sector,

Invest Durban offers a free investor advisory service

plus key promotion, facilitation, aftercare services

between all investment stakeholders.

Invest Durban was recommended by the Durban

City Council and organised private business as the

“First Stop Shop” to stimulate economic growth and

new investment in the Durban metropolis.

Main Purpose

To facilitate sustainable investment in Durban for

the benefit of all through the:

• expansion, retention and aftercare of existing

foreign corporate business

• proactive investment promotion and marketing

of Durban Metro

• proactive connection to, and marketing of the

city’s large investment projects

• attraction of prospective new foreign investors

Invest Durban works closely with the Department

of Trade and Industry including Invest SA, Trade and

Investment KZN (TIKZN), the Durban Chamber of

Commerce and Industry, the KZN Growth Coalition,

and State-Owned-Enterprises such as Dube

TradePort, the DBSA, IDC, Eskom and others. Key

partners include the largest banks, audit and advisory

firms, plus sector-based organised business bodies

working in concert to promote investment in Durban.

Physical address: Invest Durban,

eThekwini Municipality

11th Floor, 41 Margaret Mncadi Avenue

Durban 4001, South Africa

Tel: +27 31 311 4227

Email: invest@durban.gov.za

Website: www.invest.durban


CONTENTS

CONTENTS

South African Business 2019 Edition.

Introduction

Foreword12

A unique guide to business and investment in South Africa.

Special features

An economic overview of South Africa 14

South Africa has many attractive investment opportunities in

sectors ranging from agri-processing to renewable energy.

Provinces of South Africa 22

A snapshot of South Africa’s nine provinces.

Energy and the future 26

South Africa’s exciting renewable energy programme is back

on track.

Special Economic Zones 36

Promoting industrial development via incentives.

Healthcare 42

Health counselling at work is a growing trend.

SOUTH AFRICAN BUSINESS 2019

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CONTENTS

Regional trade 44

Trading with African neighbours is set to become easier.

A hub of economic activity 52

Airports can anchor economic growth in multiple sectors.

The Oceans Economy 56

There are massive opportunities in new maritime sectors.

Economic sectors

Agriculture 66

Increasing agri-processing volumes is a national priority.

Mining 70

Mine owners are preparing for change.

Oil, gas and petrochemicals 75

National policies are focussing on gas.

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CONTENTS

Water 82

Restructured water boards have greater responsibilities.

Engineering 90

Major restructuring is underway.

Construction and property 98

The shopping mall trend continues to grow.

Manufacturing 108

Incentives are in place to support new investment.

Food and beverages 116

Acquisitions are supporting backward integration.

Automotive 118

Chinese investors are building at the Coega Industrial

Development Zone.

SOUTH AFRICAN BUSINESS 2019 8


About Thebe

Founded

in 1992 as a pioneering

black-owned company,

ith an initial

Thebe opened for business in July 1992 with an initial

hareholder at the

capital investment of only Rl 00 000. A sole shareholder a

About About

d trust About Thebe Thebe

which included Thebe

time was the Batho Batho Trust, a community-based trust which

Founded

erend Beyers Naude as

Nelson Mandela Founded (Chairman), Walter Sisulu and Reverend Beyers

in 1992 Founded as pioneering

original in 1992 Trustees. as Founded a pioneering

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original Trustees.

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original Trustees.

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nergy, resources, power,

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areas of energy, resources, Services

key growth

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new norms and changing the face of business by establishing a socially strengthen areas of energy, its focus resources, on the key power, growth

f world class services for

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embedded company that uses its business success to transform lives, and areas infrastructure make of a energy, as resources, well as water. power, The

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by participating in

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facilitator South of Africa world and class the services rest of for the

ing sectors:

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South Africa sectors:

continent and the by rest participating of the in

which focuses on the African Renaissance. South continent Africa by and participating the rest of the in

tourism, media,

continent the by following participating sectors: in travel & tourism, med

The Energy and Resources division will continent the following by participating sectors: in

agro-processing,

the following travel sectors:

tourism, media,

strengthen its focus on the key growth

food & agro-process

the travel following & tourism, sectors: media,

travel

roperty.

food & tourism, agro-processing,

media,

areas of energy, resources, power,

and property.

THEBE

food travel & agro-processing,

tourism, media,

food & agro-processing,

and property.

infrastructure INVESTMENT as well CORPORATION as water. The food and & property. agro-processing,

and property.

Services Division seeks to become a and property.

facilitator of world class services for

South Africa and the rest of the

continent by participating in

the following sectors:

travel & tourism, media,

food & agro-processing,

and property.

THEBE

INVESTMENT CORPORATION

TIN


CONTENTS

Transport and logistics 120

Plans are in place to shift freight from road to rail.

Information and communications technology (ICT) 124

Incentives are encouraging investment.

Tourism and events 134

The events and conferences sector is growing across the

country.

Banking and financial services 140

New sectors and new licences are creating opportunities.

Development finance and SMME support 144

Prompt payment is vital for small businesses.

National Government

South African National Government 148

References

Sector contents 64

Index152

NAMIBIA

BOTSWANA

North West

6%

ZIMBABWE

Limpopo

7%

Gauteng

Mpumalanga

35%

7%

SWAZI-

LAND

MOZAMBIQUE

Maps

Northern Cape

2%

Free State

5%

LESOTHO

KwaZulu-

Natal

16%

Detailed map of South Africa. 20

Eastern Cape

8%

South African provincial map. 17

Western Cape

14%

SOUTH AFRICAN BUSINESS 2019

10


FOREWORD

South African Business

A unique guide to business and investment in South Africa.

Welcome to the seventh edition of the South African

Business journal. First published in 2011, the publication

has established itself as the premier business and

investment guide to South Africa, supported by an

e-book edition at www. southafricanbusiness.co.za.

Regular pages cover all the main economic sectors of the South

African economy and give a snapshot of each of the country’s provincial

economies. Feature articles on topical issues such as Special

Economic Zones and African trade provide unique insights, together

with comprehensive overviews of critical economic sectors. Other

special features focus on the exciting new possibilities in renewable

energy, airports as engines of regional growth and the maritime

sector as an entirely new prospect for South African entrepreneurs

and businesses.

South African Business is complemented by nine regional publications

covering the business and investment environment in each of

South Africa’s provinces. The e-book editions can be viewed online

at www.gan.co.za. These unique titles are supported by a monthly

business e-newsletter with a circulation of over 26 000.

Chris Whales

Publisher, Global Africa Network Media

Email: chris@gan.co.za

CREDITS

Publisher: Chris Whales

Publishing director:

Robert Arendse

Editor: John Young

Online editor: Christoff Scholtz

Art director: Brent Meder

Design: Tyra Martin

Production: Lizel Olivier

Ad sales: Sydwell Adonis, Sandile

Koni, Gavin van der Merwe,

Sam Oliver, Gabriel Venter,

Siyawamkela Sthunda,

Vanessa Wallace, Jeremy Petersen

and Reginald Motsoahae

Managing director: Clive During

Administration & accounts:

Charlene Steynberg and

Natalie Koopman

Distribution & circulation

manager: Edward MacDonald

Printing: FA Print

DISTRIBUTION

South African Business is distributed internationally on outgoing

and incoming trade missions; to foreign offices in South

Africa’s main trading partners; at top national and international

events; through the offices of foreign representatives in South

Africa; as well as nationally and regionally via chambers of

commerce, tourism offices, trade and investment agencies,

provincial government departments, municipalities, airport

lounges and companies.

Member of the Audit Bureau

of Circulations

COPYRIGHT | South African Business is an independent publication

published by Global Africa Network Media (Pty) Ltd. Full copyright to

the publication vests with Global Africa Network Media (Pty) Ltd. No part

of the publication may be reproduced in any form without the written

permission of Global Africa Network Media (Pty) Ltd.

PHOTO CREDITS | Pictures supplied by: Beier Group, Cape Town

International Convention Centre, Chris Kirchoff/Brand SA, Department

of Trade and Industry, Dube TradePort, eProp Commercial Property,

Graeme Williams/BrandSA, Impala Platinum, Indluplace Properties,

iStock, Kevin Wright/Vedanta Zinc International, Mainstream Renewable

PUBLISHED BY

Global Africa Network Media (Pty) Ltd

Company Registration No: 2004/004982/07

Directors: Clive During, Chris Whales

Physical address: 28 Main Road, Rondebosch 7700

Postal address: PO Box 292, Newlands 7701

Tel: +27 21 657 6200 | Fax: +27 21 674 6943

Email: info@gan.co.za | Website: www.gan.co.za

ISSN 2221-4194

Energy, Rodger Bosch/Media Club SA, SA Heavy Haul Association, SASOL,

Sutherland Engineers, SKA, Transnet Port Authority, Volkswagen SA.

DISCLAIMER | While the publisher, Global Africa Network Media (Pty)

Ltd, has used all reasonable efforts to ensure that the information contained

in South African Business is accurate and up-to-date, the publishers

make no representations as to the accuracy, quality, time-liness,

or completeness of the information. Global Africa Network Media will

not accept responsibility for any loss or damage suffered as a result of

the use of or any reliance placed on such information.

Join us!

Advertise your organisation in this journal to reach

business and government. Contact sales@gan.co.za


INTERVIEW

Making a difference

Adorantha founder Thami Ndlala explains how health

awareness, counselling and training can change lives.

Thami Ndlala

BIOGRAPHY

Thami Ndlala is an entrepreneur

and businessman at heart.

After working in the corporate

environment for a short period, he

focussed his energy on building

an empire. With the umbrella

company, Ndlalayemandla Group

of Companies (Pty) Ltd, he set

off on this journey. The various

subsidiaries reflect his interest in

transport, recreation, wellness,

insurance, hospitality, property

development, education, security

and media/entertainment. Thami’s

approach has always been to look

at ways in which he can make a

difference.

How did the business begin?

We are passionate about our country and its people. In 1996, then Minister of

Health, Nkosazana Dlamini-Zuma, told a conference in Vancouver that most

people infected with HIV live in Africa, where therapies involving combinations

of expensive anti-viral drugs are out of the question. We knew then

that we had to get involved. Our vision was to set up Employee Assistance

Programmes designed to assist management and employees in addressing

productivity and absenteeism in a confidential and effective manner.

What are the main services you provide?

Adorantha provides health awareness, healthcare counselling and training

services nationwide. Our mission with the HIV/Aids awareness programme

is to help prevent HIV infections and to improve the lives of those affected

by providing education and facilitating the free and open exchange of

knowledge and training. Counselling and health awareness is based on

a holistic approach.

What level of qualifications do your staff have?

Adorantha Investments has established a reputation of service excellence.

We pride ourselves on the services we render as well as the trained and

highly professional and qualified service professionals. We have qualified

doctors who are in good standing with the Health Professions Council of

South Africa (HPCSA).

Please tell us about the HIV/Aids in the workplace

programme.

We provide HIV testing and group education to HIV-negative participants,

training on Wellness Referral Programme and Student Life Skills Training.

Our wellness programme is about increasing the productivity, morale and

teamwork and strengthening the bonds between management, employees

and the organisation. The HIV/Aids workplace programme includes

creating a company policy, information on HIV/Aids, ways of preventing

the transmission of the disease, condom distribution, STI diagnosis and

referrals, mitigation services like counselling, community support and

home-based care.

Please share any success stories.

Our main success story has been to cater for thousands of hard-working

construction labourers who are exposed to extreme conditions through

our extensive wellness programme. In addition, Adorantha Investments

now offers an excellent range of health insurance packages at affordable

rates, in partnership with Johan Eksteen & Associates.

13 SOUTH AFRICAN BUSINESS 2019


AN ECONOMIC OVERVIEW OF

SOUTH AFRICA

A time of considerable political and economic uncertainty came to

an end in February 2018 with the resignation of President Jacob

Zuma and the election of President Cyril Ramaphosa.

By John Young

Serious allegations of fraud and looting

of state resources have been levelled

against many people in the public and

private sectors and a series of commissions

of enquiry has been launched by the new

administration. South Africa’s fourth president in

the democratic era has been secretary-general of

the country’s most important union and the biggest

political party, a leader of negotiations that

led to democracy, chairman of the Constitutional

Assembly that wrote the new Constitution and a

successful businessman. New ministers of state have

been appointed, boards of state-owned-entities

(SOEs) have been replaced and promises have been

made that corruption will no longer be tolerated

in state departments. International ratings agencies

seemed willing to hold off on downgrades of

the country’s investment status in response to the

changing of the political guard.

The fact that Ramaphosa is also a former coleader

of the National Development Plan (NDP) is

also good news for the possibility of more certainty

in policy-making. The NDP is a detailed blueprint for

how to move the country forward. Part of that plan

entails setting up deliverable schemes, such as the

plan called Strategic Integrated Projects.

One of Ramaphosa’s first actions was to appoint

a five-person investment panel whose task is to

persuade international decision-makers to invest

$100-billion in South Africa Inc. Coordinated by former


SPECIAL FEATURE

Rhodes Scholar Trudi Makhaya, the panel also includes

respected former finance minister Trevor Manuel. A

number of investment summits are planned.

The lifting of a long-term drought and big

improvements in the economic returns from the

agricultural sector encouraged South Africans to

think that the political changes would be a precursor

to a steady improvement in the economic field.

There were also good gains in sectors such as trade,

manufacturing, and finance and real estate.

However, depressed commodity prices and

the fact that South Africa is among the world’s

“emerging markets” meant that events in other

parts of the world put a damper on the country’s

economy going in to the third quarter of 2018. A

general election will be held in 2019. The results of

this election should allow for a calmer climate and

more political certainty.

There is a lot of work to do to get South Africa’s

economy back on a solid upward path, but the

country has tremendous advantages. Great mineral

wealth has underpinned the South African economy

ever since the first diamond was stumbled upon in

1867. Gold was found soon afterwards and that industry

effectively saw to it that South Africa became

an industrialised nation. Now those gold mines are

tapering off production but iron ore and platinum

reserves are impressively large.

The grains of the central regions of the country,

together with the fruits and vegetables of

Mpumalanga and Limpopo, the wines and grapes

of the Western Cape and the sheep and mohair of

the Eastern Cape, all contribute to a diverse and

vibrant agricultural sector. There are many strong

agricultural companies in the sector. KwaZulu-Natal

is the country’s leading sugar area, and has a strong

suite in forestry and paper production.

Automotive manufacturing and automotive

components are doing well, with major investments

by most of the major marques and increased exports

a feature of the sector.

The publication in 2018 of a new Integrated

Resource Plan (IRP) is another symptom of the type

of increased certainty that an economy needs in

order to thrive. The IRP is a road map for South

Africa’s electricity generation and the previous

administration seemed determined to push

for an expensive nuclear programme. The latest

plan confirms that the already hugely successful

drive for renewable energy will be continued and

expanded. Apart from being greener and cheaper,

the renewable energy programme has also attracted

lots of foreign direct investment (FDI) and provided

new employment opportunities. (The renewable

energy private investor programme is covered in

another article in this publication.)

The Drakensberg mountain range in KwaZulu-Natal is a key tourism asset.

SOUTH AFRICAN BUSINESS 2019

16


SPECIAL FEATURE

ZIMBABWE

NAMIBIA

BOTSWANA

Limpopo

7%

MOZAMBIQUE

North West

6%

Gauteng

35%

Mpumalanga

7%

SWAZI-

LAND

Northern Cape

2%

Free State

5%

LESOTHO

KwaZulu-

Natal

16%

Western Cape

14%

Eastern Cape

8%

Percentage contribution of each province to national GDP.

SOURCE: STATS SA WWW.STATSSA.GOV.ZA

Trends

Good signs for the economy include:

• Several provincial governments and investment

agencies are establishing trade relations and

study programmes with BRICS countries. State

visits to and from China immediately before and

after a major BRICS summit in 2018 gave an indication

that Ramaphosa holds high hopes for

increased trade with the biggest of the BRICS

nations. Two-way trade between the countries in

2017 was worth $39.1-billion. South Africa wants

to grow tourist numbers from China. South Africa

became the first country in the world to export

beef to China in 2017, to go with existing exports

of iron ore, platinum and fruit and wine.

• Tourists are visiting South Africa in record numbers

(Cape Town’s Air Access programme has

secured tens of thousands of new seats on direct

flights to and from the city).

• Companies are successfully trading into Africa.

• Niche agricultural markets are booming with

macadamia nuts being the most successful.

Pecan nuts have done well and wine and grape

exports to China are growing.

• Private education at school and tertiary level is

growing as a sector.

• New banking licences have been issued and

several more are in the pipeline.

• New stock exchanges came on line in 2017 and

more are expected.

• Investment in infrastructure (especially ICT and

railways) is strong. Nedbank’s report on capital

expenditure in South Africa stated that the

29 large projects announced in the first half

of 2018 were valued at R63.9-billion (Financial

Mail). The renewable energy programme

17 SOUTH AFRICAN BUSINESS 2019


SPECIAL FEATURE

attracted R38-billion and 95% of the capital

projects were driven by the private sector.

Geography

South Africa’s location between the Atlantic

and Indian oceans ensures a generally temperate

climate. The 2 954km coastline stretches

from the border with Namibia on the Atlantic

to the border with Mozambique in the east.

The cold Benguela current sweeps along the

western coast while the warm Indian Ocean

ensures that the Mozambique/Agulhas current

is temperate.

South Africa’s coastal plain is separated from

the interior by several mountain ranges, mostly

notably the Drakensberg which runs down the

country’s eastern flank. Smaller ranges in the

south and west mark the distinction between

the fertile coastal strip and the dry interior

known as the Karoo.

The city of Johannesburg is located on the

continental divide, whereby water runs south

of the city towards the Atlantic Ocean while

Embargoed until: 11:30am

GDP

Q4 2017

waters to the north drain towards the north and

east. Johannesburg is 1 753m above sea-level.

Most of the country has summer rainfall but

the Western Cape, which has a Mediterranean

climate, receives its rain in winter. Droughts are

not uncommon and although the national average

is 464mm, most of the country receives

less than 500mm of rain every year. The Western

Cape experienced a severe drought which was

broken in 2018.

The Orange and Vaal rivers play important

roles in water schemes and irrigation and the

Limpopo River defines the country’s northern

boundary. A number of rivers run strongly from

the Drakensberg to the sea, but South Africa has

no navigable rivers.

Maize is produced in large quantities in the

interior. The dry interior mostly supports livestock

in the form of sheep and cattle. South Africa is the

world leader in mohair production. Wines and

fruit are major export products for the Western

Cape while KwaZulu-Natal and the low-lying areas

of Mpumalanga are known for sugar cane and

tropical and subtropical fruits. Limpopo is a major

vegetable producer.

Sector

contribution

to GDP Q4

2017

CREDIT: STATSSA

SOUTH AFRICAN BUSINESS 2019

18


SCOUTS South Africa

Changing lives and fulfilling potential.

South Africa

SCOUTS South Africa (SSA) changes lives by providing

youth with education, skills, mentorship, values, opportunities,

resources, and safe places to be kids, so they can

get out of poverty and have a better future for themselves

and their families. However, many South Africans

cannot afford to participate. For every R42 donated we

help a youth experience Scouting!

Who is SCOUTS South Africa?

For over 100 years, SSA’s programmes have shaped the

lives and unleashed the potential of hundreds of thousands

of South Africans by following a learning-by-doing

programme. Central in the Scouting programme is the

continuous transference of values such as honesty, loyalty,

responsibility and respect; all aimed at empowering

the youth to govern their own individual behaviour and

to develop strong leadership skills that will equip them

to be of service to others and to their communities.

All youth (boys and girls) aged seven to 35 are eligible

to join. Our adult leaders are all volunteers.

Currently, 90% of the 190 000 members come from

townships and rural areas. SSA’s programmes address

the objectives set out in the National Development Plan.

Scouting complements the school and family roles and

fills unmet needs by:

• Equipping youth with practical leadership, communication

and vocational skills to embrace future education

and career opportunities

• Combating poverty and addressing hunger alleviation

through agricultural skills development

• Developing youth to be positive citizens and contributors

to their communities and country

• Enhancing HIV/Aids awareness and first-aid capabilities

• Enhancing environmental consciousness through

interventions and projects

• Providing positive peer-pressure and role models for

youth

• Building self-esteem and confidence

• Promoting a culture of peace

SSA is a recognised National Scout Organisation, affiliated

to the World Organisation of the Scout Movement and

is registered as a non-profit organisation.

Support your local community

Does your CSI policy address

supporting local communities? For

R1 680 annually you can assist a

group of 40 youth in developing the

skills required to succeed in their

professional and private lives. To

help, please contact SSA CEO Ms Milly

Siebrits at ceo@scouts.org.za, or find

more information about Scouting in

South Africa on www.scouts.org.za

GAVIN WITHERS PHOTOGRAPHY


SPECIAL FEATURE

SOUTH AFRICAN BUSINESS 2019

20


SPECIAL FEATURE

FACT FILE: REPUBLIC OF SOUTH AFRICA

President: Cyril Ramaphosa (African National

Congress)

Capitals: Pretoria/Tshwane (administrative,

seat of government), Cape Town (legislative),

Bloemfontein (judicial).

Time: GMT+2

Population: 55.91-million (2016)

Size: 1 220 813km²

Major languages: South Africa has 11 official

languages but the main language of government

and business is English. Zulu, Xhosa and Afrikaans

are widely spoken.

Religion: There is no state religion. The majority

of the population are Christian but many

other religions are followed such as Islam,

Jewish and Hindu.

Currency: rand (100 cents). R15.14 = $1

(September 2018)

Political system: South Africa is a republic with an

executive president who is appointed by the political

party that wins a majority in parliamentary

elections. There are three tiers of government:

national, provincial and local but the revenueraising

capacity of the latter two spheres is

limited. Allocations for health and education for

example, are made by national government and

then administrated by provinces. Eight of South

Africa’s nine provinces are run by premiers from

the African National Congress; the Western Cape

province and the city of Cape Town are administered

by the Democratic Alliance.

The third level of government is local. In

2016 the DA came to power in three of South

Africa’s biggest cities, supported by other parties

such as the Congress of the People and the

United Democratic Front. The Freedom Front said

it would support these anti-ANC alliances on a

vote-by-vote basis, but it would not sign up to

a coalition. In 2018 the FF tried to unseat the

DA in Nelson Mandela Bay (Port Elizabeth) and

Tshwane (Pretoria) but would not form a formal

alliance with the ANC.

Legal system: South Africa is a constitutional

state with separation of powers between the

legal and executive authorities. All laws must

pass muster with the Constitutional Court which

is the ultimate court of appeal on legislation.

South Africa’s legal system is based on Roman

Dutch law.

Infrastructure: Ports of Cape Town, Saldanha,

Mossel Bay, Port Elizabeth, East London, Durban

and Richards Bay. International airports at Cape

Town, Ekurhuleni and Durban and domestic airports

at all major cities. Special Economic Zones

(SEZs) have been established at major ports

and are in the process of being set up at inland

destinations.

South Africa has 34 000km of railway track

and half of the country’s road network is paved.

Most of South Africa’s power is generated by

coal-fired power stations run by the state utility

Eskom. A vigorous programme to encourage

private investment in renewable energy began in

2012, suffered a setback in 2016 but was reinstated

under the new administration of President

Ramaphosa in 2018.

Resources: Platinum, gold, iron ore, chromium,

vanadium, manganese, alumino-silicates, coal,

copper, diamonds, uranium, zirconium.

GDP: Nominal GDP estimated at R1 208-billion

for Q4 2017, R29-billion more than in Q3 2017

(StatsSA).

Exports: Precious and semi-precious stones, mineral

products, base metals, vehicles, machinery,

chemical products, vegetable products, fruits,

foodstuffs and beverages, paper and pulp.

Main export markets: China, USA, Japan,

Germany, UK, India. Membership of BRICS will

see focus on Brazil, Russia, India and China.

Imports: Machinery, mineral products, vehicles,

chemicals, original equipment, base metals,

plastics and rubber, textiles, optical and medical,

foodstuffs and beverages.

Main import markets: China, Germany, USA,

Japan, Saudi Arabia, Iran, UK, India, France,

Nigeria.

21 SOUTH AFRICAN BUSINESS 2019


Provinces of

South Africa

A snapshot of South Africa’s

nine provinces.

Eastern Cape

Capital: Bhisho

Main towns: Port Elizabeth, East London, Uitenhage,

Graaff-Reinet, Mthatha, Grahamstown (Makhanda).

Population: 6 916 200 (2015)

Area: 168 966km² (13.8% of South Africa)

Premier: Phumulo Godfrey Masualle (ANC)

Key sectors: Automotive, agriculture, agri-processing,

forestry, finance, retail, tourism, renewable energy.

Infrastructure: Coega Industrial Development Zone, East

London Industrial Development Zone, ports of East London,

Port Elizabeth and Ngqura, airports at Port Elizabeth and

East London.

Notable tourism assets: Addo Elephant National Park,

Mountain Zebra National Park, Wild Coast, Jeffreys Bay,

National Arts Festival.

Provincial government website: www.ecprov.gov.za

Eastern Cape Development Corporation: www.ecdc.co.za

Free State

Capital: Bloemfontein

Main towns: Welkom, Sasolburg, Parys, Kroonstad

Population: 2 817 900 (2015)

Area: 129 825km² (10.6% of South Africa)

Premier: Sefora Hixsonia Ntombela (ANC)

Key sectors: Agriculture, agri-processing, chemical

manufacturing, mining, transport and logistics.

Infrastructure: Maluti-A-Phofung Special Economic Zone,

Braam Fischer International Airport, University of Free

State, Central University of Technology, N8 Corridor.

Notable tourism assets: Vaal River, Gariep Dam, Golden

Gate Highlands National Park, Cherry Festival, Mangaung

African Cultural Festival (Macufe).

Provincial government website:

www.freestateonline.fs.gov.za

Free State Development Corporation: www.fdc.co.za


Gauteng

Capital: Johannesburg

Main towns: Tshwane (including Pretoria), Ekurhuleni,

Vanderbijlpark, Roodepoort

Population: 13 200 300 (2015)

Area: 18 178km² (1.5% of South Africa)

Premier: David Makhura (ANC)

Key sectors: Financial and banking, manufacturing, trade,

creative industries, media.

Infrastructure: OR Tambo International Airport, Gautrain,

major universities and research institutions, large convention

centres, FNB Stadium (Soccer City).

Notable tourism assets: Cradle of Humankind, Apartheid

Museum, Constitution Hill, Magaliesberg, Soweto tours,

Dinokeng.

Provincial government website: www.gauteng.gov.za

Gauteng Growth and Development Agency:

www.ggda.co.za

KwaZulu-Natal

Capital: Pietermaritzburg

Main towns: Durban, Newcastle, Ballito, Port Shepstone,

Empangeni, Ulundi.

Population: 10 919 100 (2015)

Area: 125 755km² (7.7% of South Africa)

Premier: Willies Mchunu (ANC)

Key sectors: Chemicals, dissolving pulp manufacture, sugar,

forestry, automotive, textiles and footwear, mining, oil and

gas, logistics.

Infrastructure: King Shaka International Airport, Dube

TradePort, Richards Bay Industrial Development Zone, ports

of Richards Bay and Durban, Albert Luthuli International

Convention Centre Complex.

Notable tourism assets: Hluhluwe-iMfolozi Park, the

Drakensberg mountains, iSimangaliso Wetland Park, Durban

beaches, South Coast, Zulu cultural heritage, historical

battlefields.

Provincial government website: www.kznonline.gov.za

Trade & Investment KwaZulu-Natal: www.tikzn.co.za


Limpopo

Capital: Polokwane

Main towns: Musina, Ba-Phalabora, Bela-Bela,

Steelpoort, Tzaneen, Thohoyandou.

Population: 5 726 800 (2015)

Area: 125 755km² (10.2% of South Africa)

Premier: Chupu Stanley Mathabatha (ANC)

Key sectors: Mining, agriculture, tourism, logistics.

Infrastructure: Musina-Makhado Special Economic

Zone, Tubatse Special Economic Zone, N1 highway

and rail network, new Medupi power station.

Notable tourism assets: Kruger National Park,

Mapungubwe Heritage Site, Makapans Valley, Marula

Festival, Waterberg Biosphere.

Provincial government website:

www.limpopo.gov.za

Limpopo Economic Development Agency:

www.lieda.co.za

Mpumalanga

Capital: Mbombela

Main towns: Emalahleni, Middelburg, Sabie,

Lydenburg

Population: 4 283 900 (2015)

Area: 76 495km² (6.3% of South Africa)

Premier: Refilwe Mtshweni (ANC)

Key sectors: Agriculture, forestry, mining, steel

manufacturing, petrochemicals, pulp and paper,

power generation, tourism.

Infrastructure: Nkomazi Special Economic Zone,

Mbombela International Fresh Produce Market,

Maputo Development Corridor, Kruger Mpumalanga

International Airport.

Notable tourism assets: Kruger National Park, Blyde

River Canyon, the Barberton Makhonjwa Mountains

(a UNESCO World Heritage Site).

Provincial government website:

www.mpumalanga.gov.za

Mpumalanga Economic Growth Agency:

www.mega.gov.za

Northern Cape

Capital: Kimberley

Main towns: Douglas, Upington, De Aar, Port

Nolloth, Colesberg.

Population: 1 185 600 (2015)

Area: 372 889km² (30.5% of South Africa)

Premier: Sylvia Lucas (ANC)

Key sectors: Agriculture, mining, renewable

energy, astronomy.

Infrastructure: Upington Special Economic

Zone, Sol Plaatje University, Vaalharts Irrigation

Scheme.

Notable tourism assets: Six national parks

including the Kgalagadi Transfrontier Park,

Orange River, spring flower displays, diamond

routes.

Provincial government website:

www.northern-cape.gov.za

Department of Economic Development and

Tourism: www.northern-cape.gov.za/dedat


North West

Capital: Mahikeng

Main towns: Klerksdorp, Rustenburg, Brits,

Potchefstroom

Population: 3 707 000 (2015)

Area: 104 882km² (8.6% of South Africa)

Premier: Professor Job Mokgoro (ANC)

Key sectors: Mining, agriculture, agri-processing,

automotive components.

Infrastructure: Hartbeespoort Dam, Pelindaba nuclear

research unit, North West University, Bakwena Platinum

Highway.

Notable tourism assets: Sun City, Mmbatho Palms

Hotel Casino Convention Resort, Pilanesberg National

Park, 18 luxury lodges in Madikwe Game Reserve.

Provincial government website:

www.nwpg.gov.za

North West Development Corporation:

www.nwdc.co.za

Western Cape

Capital: Cape Town

Main towns: Stellenbosch, George, Plettenberg Bay,

Beaufort West, Oudtshoorn, Worcester, Malmesbury.

Population: 6 200 100 (2015)

Area: 129 462km² (10.6% of South Africa)

Premier: Helen Zille (DA)

Key sectors: Agriculture, agri-processing, wine and

grapes, financial services, manufacturing, tourism, oil

and gas, boatbuilding.

Infrastructure: Ports of Cape Town, Saldanha and

Mossel Bay, Mossgas oil-to-gas refinery, Cape Town

International Airport, Cape Town International

Convention Centre, Koeberg nuclear power station.

Notable tourism assets: Table Mountain, Garden Route

National Park, Karoo National Park, West Coast National

Park, Kirstenbosch Botanical Gardens, Cape Point, the

Waterfront, Plettenberg Bay, Route 62, Zeitz Museum of

Contemporary Art.

Provincial government website:

www.westerncape.gov.za

Wesgro: www.wesgro.co.za


SPECIAL FEATURE

Energy and the future

South Africa’s exciting renewable energy programme is back on track.

A

new Integrated Resource Plan was released by South Africa’s

Energy Minister in August 2018. This was a major event because

the first Integrated Resource Plan (IRP) was printed in

2010 and was supposed to be updated regularly to guide

the nation’s approach to electricity.

Instead, the release of updated IRPs was delayed. In that uncertain

environment, there was a strong push for expensive nuclear options.

The release of IRP 2018 brings certainty to the market again. Nuclear

will not be considered again until at least 2030. The South Africa

Photovoltaic Industry Association (SAPVIA) welcomed what it calls the

“rational” draft Integrated Resource Plan.

When South Africa ran out

of power in 2008, a programme

to get private investors to build

renewable energy capacity

was instituted. It was called the

Renewable Energy Independent

Power Producers Procurement

Programme (REIPPPP). Between

November 2011 and July 2016,

South Africa received commitments

of investments to the value

SOUTH AFRICAN BUSINESS 2019

26


SPECIAL FEATURE

of nearly R200-billion through this innovative and efficient programme

with encouraged private investment into the South African power

generation sector.

According to the Department of Energy, the REIPPPP by 2016 had

not only delivered multiple millions in investments, it also created

more than 30 000 jobs and benefited local community development

to the tune of R256-million. Figures released by the South African Wind

Energy Association (SAWEA) showed shareholding for local communities

reached an estimated net income of R29.2-billion over the lifespan

of the projects. Some 14 000 new jobs are expected to be created,

mostly in rural areas, and more than R30-billion has already been spent

on Black Economic Empowerment (BEE) in the construction phase.

In April 2018, new Energy Minister Jeff Radebe restarted the

REIPPPP when he signed off on projects totalling R56-billion that

will add 2 300MW to the national grid. There had been a long delay

in the process as national utility Eskom argued against accepting

more power purchase agreements while they had a surplus. Most

of South Africa’s electricity comes from coal and Eskom is building

two huge coal-fired power stations.

Most commentators on the IRP 2018 have praised its basis in science

and the fact that it has adopted the “least-cost” method of analysing

options. With renewable energy costs having been dramatically reduced,

the IRP concludes that wind, gas and solar power (photovoltaic)

will be the three methods to be allocated the most new projects up

to the year 2030. The other form of solar power (concentrated solar

power, CSP) is very effective and some projects have been successfully

commissioned, but it is relatively expensive.

Despite the emphasis on renewables

in the IRP, SA’s energy

mix is still weighted towards

coal. Two new power

stations, Kusile and Medupi,

are being built by Eskom and

1 000MW has been allocated

to private producers to build

coal-powered stations known

as Thabametsi and Khanyisa.

The IRP has attracted criticism

for enabling an expansion of

the coal industry.

Koeberg nuclear power station

is due to be decommissioned

soon after 2045.

In commenting on the IRP

2018, SAPVIA raised a question

about the role of the Small-Scale

Embedded Generation market

in the form of facilities such as

rooftop-PV installations and the

growth in demand for LPG gas

for cooking. The association

stated that the 200MW allocation

is insufficient to address what it

believes is a growing market.

POWER GENERATION TO 2030

Technology New allocation to 2030 % of mix in 2030

Wind 8 100MW 15%

Gas 8 100MW 16%

Solar (photovoltaic) 5 670MW 10%

Concentrated solar power 300MW 1%

Hydro 2 500MW* 6%

Nuclear None 2.5%

Pumped storage None 4%

Coal 1 000MW 46%

* This takes into account the possible Inga project in the Democratic Republic of Congo.

27 SOUTH AFRICAN BUSINESS 2019


Gas

SPECIAL FEATURE

Gas in various forms is very much in the spotlight. South Africa’s neighbour

Mozambique has large offshore deposits and a sub-committee of

the Southern African Development Community (SADC) has been tasked

with working out a master plan for the region.

A study prepared by the Energy Centre of the Centre for Scientific

and Industrial Research (CSIR) reports that wind and solar power (supported

by natural gas, biogas and hydro-electric power) could be up to

the task of providing “baseload” power. The base load is the permanent

minimum amount of power that the grid must be able to deliver to keep

the country working. There is special interest in natural gas as a source

of a versatile and mobile back-up for the main types of renewable

energy: if the sun goes behind a cloud or the wind does not blow, it is

very easy to turn on the gas.

This fits in well with the Department of Energy’s enthusiasm for

gas-to-power. It is targeting the procurement of 3 126MW through its

programme and intends spending R64-billion on port, pipeline, generation

and transmission infrastructure in at three key ports, Richards Bay,

Coega and Saldanha Bay.

Hydraulic fracturing (fracking) has not been in the news for a long

time but it has not been ruled out by the government. Controversy arose

when this method of extracting gas was proposed for large parts of the

central Karoo region. A bill currently working its way through parliament,

the Mineral and Petroleum Resources Development Act (MPRDA), will

deal with gas supplies and the contentious fracking issue.

Financing

The creation of an entirely new economic sector in a very short timeframe

has been a boon for financing and banking.

An innovative project was announced in 2018 with the bundling of five

projects into one. All of the projects are being built by Enel Green Power

but by creating one holding company to distribute the funds, Absa and

Nedbank, the lenders, were able to reduce costs. Law firm Norton Rose

Fulbright concluded the R3.5-billion financing arrangement.

The support of two of South Africa’s biggest institutional investors,

the Industrial Development Corporation (IDC) and the Public Investment

Corporation (PIC), has been crucial in getting the renewable energy sector

off the ground. They have also played a role in helping communities

fund their participation in community trusts. According to Business Day,

the PIC has so far invested in 16 unlisted projects and its total investment

stands at R11-billion. The IDC’s 24 projects are valued at R14-billion and

will contribute 1 100MW to the national power grid.

Many partnerships between local and international companies

have been established. South African partners are often local energy

companies and representatives of

residents. Typically, a community trust

is established to represent the interest

of the local community.

Investment by black people into

the RE programme is not limited to

community trusts. Pele Green Energy

is engaged with a photovoltaic plant

at Touwsrivier in the Western Cape

as a shareholder and as a provider of

construction management services.

Once the facility starts generating

power, Pele will operate and maintain

the plant.

Among the international investors

active are Enel Green Power

(Italy), Scatec Solar (Norway),

Globeleq (UK), Mainstream

Renewable Power (Ireland),

Gestamp Renewable Energies and

Abengoa (Spain), Solar Capital

(Phelan Energy Group, Ireland),

SunEdison (USA), ACWA Power

(Saudi Arabia), China Longyuan

Power Group, (China), Engie (France),

juwi Group (Germany) and Tata

Power of India. The last-named

company has teamed up with the

energy unit of Exxaro Resources to

form a company called Cennergi.

Partnerships with foreign utilities

or power companies are becoming

more common, in part because the

competition is bringing down the

price which bidders are offering to

sell power. This makes it difficult for

South African firms to compete on

their own. Many foreign investors

such as large national utilities have

strong reserves of cash and don’t

need to borrow money.

The new bank created by the

five nations of BRICS, the New

Development Bank (NDB), has

made $180-million available to

Eskom to help it integrate power

from renewable energy sources to

the national grid.

SOUTH AFRICAN BUSINESS 2019

28


Realising Africa’s

Renewable Energy Potential

Wind - Solar PV - Commercial & Industrial Solar Rooftop - Hybrid Solutions

w www.genesis-eco.com

m +27 (0)83 460 3898

e davin@genesis-eco.com

c/o Unit B10, Century Plaza, Heron Crescent, Century City, Cape Town

PO Box 363, Newlands, 7725, Cape Town, South Africa


INTERVIEW

Utilising South Africa’s

natural assets more

effectively

The Director of Genesis Eco-Energy Developments,

Davin Chown, describes his company’s vision for

renewable energy in growing the economy.

Davin Chown

BIOGRAPHY

Davin has been active in Genesis

since becoming a shareholder

in 2002. His experience in the

renewable energy sector extends

from 1995. He has been part of

developing and commercialising

the various companies in the

Genesis group, which is developing

over 2 500MW of renewable energy

projects in South and Southern

Africa, 600MW of which is part of

the REIPPPP. Davin has been the

Chairperson for SAPVIA since 2014,

served on the board of SAWEA for

four years and was a co-founder

and Steering Committee member

of the SA RE Council. He has also

founded a number of sustainability

consulting companies.

What does your company do?

Genesis Eco-Energy is one of South Africa’s pioneering renewable

energy companies providing project development, management

and operations services across a range of renewable energy technologies.

This includes hybrid PV-biomass energy storage solutions

and smart power solutions coupled with energy efficiency. Genesis

develops, implements, owns and operates the projects.

Where did you start?

Jeffreys Bay Wind Farm was one of our first projects back in 2001.

That started as a very small project which was a 15MW wind farm

with 5.5MW pumped storage component. As the market changed

the project changed and it became one of the very first successful

large-scale wind farms as part of the Renewable Energy Independent

Power Producer Procurement Programme (REIPPPP).

That was a large project for a first project.

When we started with Genesis we were one of the pioneering

renewable energy companies in South Africa. Many people used to

say renewable energy is only fit to be rural energy. As technologies

matured the markets matured and people have come to understand

the scope and scale and application of renewable energy as a

modern energy source. We had an old saying which we borrowed

and adapted: think big, start small and scale fast. It’s very similar

to the succesful and rapid evolution of cellphones and personal

communications.

Obviously, the market changed once the national

government was looking for power?

We started off understanding that given climate change challenges

and global market shifts, the whole move to clean, decentralised

and distributed power would eventually catch up with South Africa.

We spent a lot of time and energy in working with government to

SOUTH AFRICAN BUSINESS 2019

30


INTERVIEW

get them to understand how renewable energy

could play a role in achieving government’s economic

and development objectives, ranging from

power supply at a much more affordable rate

right through to building new skills and catapulting

South Africa into a new era. We started with

that in 2001, way before the REIPPPP was even

dreamt of. We had the vision, we had the tenacity

and the wherewithal to stick it through – and

that still holds today. It’s in our pioneering DNA.

Together with others, we have been able to convince

policy-makers that renewable energy has

a fundamental role to play in reshaping the way

that we deliver and use energy.

I presume that you are pleased that there

is an Integrated Resource Plan (IRP) and

that RE is part of it?

Yes, we are pleased. Renewable energy is starting

to take its rightful place. The IRP in itself still needs

to go a long way to reflect adequately the realities

of the 4th Industrial Revolution. We think this will

happen as South Africa comes to terms with all the

demands for jobs and for economic growth. The

economic challenges that we have today need to

be reflected in the IRP. Renewables are uniquely

positioned to drive economic growth.

the needs of a local municipality and industries who

were struggling with power quality. The project was

born with the objective of strengthening the grid,

strengthening power quality and playing a major role

in economic development in the Jeffreys Bay area.

We exited the project when we sold it on at financial

close in Round One of the REIPPPP.

Where else are you active now?

We also secured two 50MW PV plants in Round One.

In Round Three we were successful with three wind

farms, all three of which are now operational and in

which we still retain a 15% shareholding. The wind

farms in the Northern Cape are Khobab, Loeriesfontein

and Noupoort. We are actively developing projects in

three Southern African countries.

Did retaining your share represent a shift in

thinking?

Genesis is a South African born and bred company.

We aim to hold on to our projects for the long term

if we can. We have a long-term vision of owning

and operating a significant portfolio of projects.

Genesis is one of the few 100% South African-owned

development companies that have been around for

some time. We believe that South Africa has wonderful

natural assets and they are under-utilised. The

country’s natural resources and its human resources

are under-utilised, and we’re finding innovative ways

to harness both to the benefit our country and its

people.

Are you interested in technologies besides

wind and solar?

We talk about hydro-marine and bio-energy because

we also have a very strong interest in the

full spectrum of renewables. It is still early days for

marine energy though it holds promise.

What underpinned the decision to develop

Jeffreys Bay and when did you exit the

project?

The team identified an opportunity for wind technology

to play a role at local scale and deliver on

31 SOUTH AFRICAN BUSINESS 2019


Insulation

> Hot insulation for piping, ducting, vessels and industrial

buildings

> Cold insulation for piping, vessels and the entire LNG

operation chain

> Acoustic solutions including silencers, noise hood,

acoustic panels around construction sites

Access Solutions Scaffolding

> System scaffolds e.g. Kwikstage

> Swing / Suspended or cradle scaffolds

> Rope access

> Mechanical lifts

Fireproofing

> Cementitious coatings

> Intumescent coatings

> Cable tray encapsulation

Surface Protection/Speciality Coatings

> Various abrasive blasting techniques including grit, hydro,

slurry, dry ice and soda blasting

> Application of specialised coatings to combat Corrosion Under

Insulation (CUI)

> Remedial coatings on online hot equipment and piping

operating up to 250°C

> Industrial cleaning including tank cleaning and lining

> Concrete protection

Asbestos Solutions

> KAEFER is a registered Asbestos removal specialist contractor

Industrial Sheeting and Cladding

> Sheeting of industrial buildings e.g. boilers and precipitators

Tel: +27 11 974 8123 | Fax: +27 11 974 4628

Email: sales@kaefer.co.za | www.kaefer.co.za


KAEFER

Celebrating 100 years of innovation and sustainable growth

While we are a global player, we adopt a very strong local focus and ensure that we make an indelible footprint

in all the locations where we are active.

KAEFER team with their 3rd

consecutive award for Painting

Contractor of the Year at RBCT.

Since its inception in 1918 in Bremen, a small town in

Germany, KAEFER has developed into a market leader

for asset integrity services and solutions in Industry,

Marine & Offshore and Construction. With over 27,000

employees in 30 countries at 2000 locations, we are a

true global player – there for you all over the world.

We offer a wide range of industry solutions such as

insulation, access, surface protection, passive fire

protection and asbestos removal to the South African

and Sub-Saharan market. In everything we do, the client

takes centre stage and we take pride in our efficient and

innovative approach to overcoming challenges and

providing services and solutions.

“Together, we support our clients’ asset integrity by

delivering reliable and smarter services and solutions

throughout the entire life cycle.”

We also pride ourselves in doing things the KAEFER way.

It’s what makes us Recognised, Efficient and Different

(RED) and is seen clearly in our consistent safety record,

cutting-edge technical expertise and strong ethical values

that guide us in everything we do. Furthermore, we’re

driven by innovation and by doing things differently. We

develop new and tailored solutions that benefit our clients

and are frontrunners in digitalisation in our industry. We

also assure quality, safety, cost-efficiency and continuous

improvement with our substantial in-house expertise and

fully integrated services.

While we are a global player, we adopt a very strong

local focus and ensure that we make an indelible

footprint in all the locations where we are active. We

have the pleasure to work with and contribute to the

success of projects and maintenance contracts for

clients such as SAPREF and Richards Bay Coal Terminal

(RBCT) in the KZN region as well as Eskom power

stations in Mpumalanga and Limpopo, namely Tutuka,

Majuba and Matimba and Medupi power station

among others.

“Increasing our competitive strength by being

Recognised, more Efficient and Different.”

As part of our commitment to corporate social

responsibility, we have completed several community

projects in the KZN, Mpumalanga and Limpopo provinces

where we operate. We strongly believe that sustainable

empowerment is achieved through education; children

are the leaders of tomorrow. With this focus on impacting

South Africa’s future through education, KAEFER has,

among other community projects:

› Partnered with SAPREF by contributing towards a

project that saw the building of two science labs at

the Ogwini and Menzi High Schools in Umlazi. The

project, owned and driven by SAPREF, involved

converting a classroom at both schools into a fully

equipped science laboratory complete with

workbenches, cupboards, Bunsen burners, science kits

and chemicals. Other teaching aids were also donated

to the schools.

› Given Phegelelo High School in Lephalale a much

needed facelift to their facilities including classroom

blocks, toilets and sports grounds.

At KAEFER, we rely on our long history and business

continuity which gives us stability and orientation. Our

successful track record speaks for itself. And it also serves

as a testament to the strength of our strategy, and our

vision – to eliminate the energy waste.


INTERVIEW

Kurt Maritz, Managing

Director

rt Maritz

BIOGRAPHY

Kurt Maritz holds a National

Diploma in Accountancy and

Computer Practice, but is

more accustomed to developing

businesses, as his track

record proves. His first job was

with First National Bank. While

IOGRAPHY

working in sales, Kurt met an

rt Maritz

electrical

holds

supplier

a

for

National

whom he

went to work. His contracting

loma section in Accountancy grew, and he decided and to

mputer go on his Practise, own and started but Maritz

Electrical in 2000. Through

is

re accustomed his leadership skills to and developbusinessesary

outlook, as he now his employs track in re-

vision-

excess of 150 staff. The company

has His benefited first small job busi-

was

rd proves.

th First nesses, National grown skills Bank. and given While

lifestyle improvements to staff,

rking

their

in

families

sales,

and

Kurt

communities.

met an

ctrical supplier for whom he

nt to SOUTH work. AFRICAN His BUSINESS contracting 2019

ction grew, and he decided to

on his own and started Maritz

World first for

Maritz Electrical

Lighting the way to

new possibilities

St George’s Park lighting quality is unique.

What sort of work did you do in the beginnin

Maritz Electrical is revolutionising stadium experiences.

When we started, we were two companies helping ea

Rosslind and I had a loose partnership. I did the mark

execution. We did some basic electrical contracting.

work we did on contract, we still have that relationshi

later. It was for Technical Services of the City of Cape T

electrical side of water and sanitation.

A massive contract to install world-class lighting at the St George’s

Park cricket ground in Port Elizabeth has given Cape-based lighting

company Maritz Electrical a head-start as a national leader in LED

and theatrics lighting for sports stadiums.

As company founder and Managing Director Kurt Maritz says,

“That’s the sort of project that comes around once in a lifetime.”

The project was a global first because it made St George’s the

So you found a niche?

first stadium to have LED lights fitted with theatrics that was also

compliant with International Cricket Council standards.

The R27-million project was completed on time and on budget,

despite installing lights on top of the Duckpond Pavilion at night

in high winds.

The response has been enthusiastic. For Kurt, the television

experts provided the really important feedback. “We cared about

SuperSport the most and they have been raving. If there are light

and dark spots on the field the cameraman must remember to

change the aperture. They said that the lighting was excellent.”

Maritz And Electrical beyond wants the to be work the “go-to” for company the city? with respect

to stadium lighting installations. Contracts in Bloemfontein and

closer to home suggest this is already happening. “I am pleased

to announce we are going to be doing something similar in our

backyard, at Coetzenburg, but not including theatrics. Stellenbosch

University has signed with us as part of a massive project.”

For Kurt, the learning process has been exciting. “We are learning

applications from our clients,” he says. “At St George’s for that

We actively started looking for things that other elec

either can’t do, don’t want to do or find really hard

for the city was very difficult, but we had those skills

work, which very few people specialised in. Certainl

black companies doing that sort of work.

We got more and more work and in 2004 we regist

continued operating two businesses and that ran o

years ago, when we very amicably parted ways.

How did the stadium work come about?

exciting time when you are waiting for an umpire’s decision, we did

a heartbeat with sound and the lights that go with it. We also put a

‘6’ in the lights. The umpires asked if we could keep the light level

on the pitch the same and do the theatrics at the same time. The

possibilities are endless. In athletics, for the 100 metres, you could

kill all the lights and follow the guys down the straight.”

Maritz Electrical is the approved installer of Musco Lighting.

A visit to Musco headquarters in the US made Kurt aware of how

the lighting system at a stadium can create new revenue sources

for clients. As Kurt comments, “If you have a light show before the

game, you have better crowd control and there is an opportunity for

We asked, “What else is nobody else doing?” The answ

and sports field lighting and maintenance. I had the p

ing on the old Green Point Stadium. Sports field ligh

most dynamic part of the business.

So the 2010 Soccer World Cup was good for

Interestingly, Maritz did not do one of the FIFA stad

still one of our busiest periods ever because FIFA c

Fund to 34build hundreds of community sports fields, a

we got involved.


INTERVIEW

vendors to sell memorabilia or food. The same when you leave, it

creates a new revenue stream. We are learning as we move along.”

Stadium lighting falls within the broader category of large-area

lighting. The global move to LED lighting has been a positive

thing for Maritz Electrical. In South Africa, however, Kurt notes that

there is difference between the indoor and outdoor scenarios.

For indoors, “everybody is going that route” but that return on

investment (ROI) is somewhat different in the outdoor setting.

“With street lighting and security lights (which burn for a

long time) the ROI is good. For large areas like sewerage works

or plants the ROI is something like three to five years and the

power saving is there. That is not the case with sport stadiums,

so the equation is different.”

Maritz Electrical is active in large areas such as Cape Town’s

Grand Parade, airport runway lighting and city council facilities.

The company operates in the commercial, industrial and public

sectors and offers a wide range of services.

A new area for Maritz Electrical is reticulation and electrification:

low-cost housing projects, street lights, road-side furniture

and mini-substations. Says Kurt, “It is a big market and we can’t

ignore it. Our new sales manager comes from this background

and we are building skills in this area. We are involved in two major

projects in the Western Cape, at Overstrand and Stellenbosch

municipalities.”

With an expanding workload,

Maritz Electrical made a

move in 2018 to new premises

in Athlone. “We have moved 150

staff from three branches into

one customised 3 000-squaremetre

facility. It is designed

in such a way that we have

enough space for 50% expansion.

Half of the massive space

we dry-walled so that we have

a suite of offices.”

There are no specific targets,

but Kurt is clearly looking

forward with anticipation: “We

don’t have any ceiling we want

to hit. Our engine is our sales

department. As much work as

they bring in, that’s how we

will grow.”

The staff of Maritz Electrical

includes three Master

Electricians and 75% of the staff

complement is technical.

35 SOUTH AFRICAN BUSINESS 2019


SPECIAL FEATURE

Special Economic Zones

Promoting industrial development via incentives.

South Africa is investing in Special Economic Zones

(SEZs) as a major plank of its industrial development

policy. A range of incentives are available

to attract new skills and develop new industries.

Key goals behind the establishment of SEZs

• To encourage industries to develop in clusters, leading

to economies of scale, skills-sharing and easier access

by suppliers

• To create industrial infrastructure to promote investment

• To promote cooperation between the public and private

sectors

• To use the zones as a launching pad for other plans to

further development.

Apart from attracting foreign direct investment

(FDI) and boosting employment,

SEZs can also play a role in helping to add

new sectors or subsectors to an economy.

South Africa is targeting a variety of

sectors in SEZs around the country, but

there is a emphasis on beneficiation,

mainly of minerals but also agricultural

processing. There is a strong feeling that

South Africa can do much more with

the product of its soils – whether that

be using manganese to convert iron

into steel or creating fruit juices out of

apples and pears.

Special Economic Zones are created

in terms of the Special Economic Zones

SOUTH AFRICAN BUSINESS 2019

36


SPECIAL FEATURE

Act of 2014 (Act 16 of 2014). The act defines

SEZs as “geographically designated areas of

the country that are set aside for specifically

targeted economic activities, and supported

through special arrangements and systems

that are often different from those that apply

to the rest of the country”. Lower corporate

tax rates and duty-free imports are among the

advantages that accrue to investors.

SEZs come in different forms: South Africa

has several existing Industrial Development

Zones (IDZs) and a Free Trade Port (FTP). The

Coega IDZ (Nelson Mandela Bay Metropole)

and the Dube TradePort at the King Shaka

International Airport outside Durban are two

well-known examples.

The most recently licensed SEZ is the

Musina-Makhado SEZ in Limpopo, where the

facility’s strategic location on the border with

Zimbabwe is allied to the strong mineral resource

in the surrounding countryside.

Other licenced IDZs are at Saldanha Bay, East

London and Richards Bay. The Dube TradePort

aims to leverage its proximity to an airport. In

the same way, aerotropolis developments are

mooted for Ekurhuleni (OR Tambo International

Airport) and Cape Town International Airport.

Coega IDZ has attracted huge investments

from a variety of Chinese firms in the engineering,

solar manufacturing and automotive sectors.

This includes an investment from Beijing

Automobile Corporation (BAIC) which took a

65% stake in a multi-billion-rand joint venture

with the Industrial Development Corporation

with the intention of producing 100 000 vehicles.

First Automotive Works (FAW) has a R600-

million assembly plant in Zone 2 at Coega.

Richards Bay (pictured), apart from being

the country’s main site for the export of coal, is

also a registered Industrial Development Zone

(IDZ) and consequently is in a position to attract

investors in a range of sectors. Recent developments

at RBIDZ have seen an investment in

an oil and gas facility and it is hoped that the

ocean will yield finds of gas to provide cheap

feedstock.

The Maluti-A-Phofung Special Economic

Zone takes advantage of the strategic position

Harrismith holds in the Free State’s northeastern

corner. The N3 highway carries huge

volumes of cargo between Gauteng and the

ports of KwaZulu-Natal so it is logical that the

first focus of this SEZ is logistics.

Plans are far advanced for the official recognition

of an SEZ at Upington in the Northern

Cape. The 400ha site of the Upington SEZ is

close to the regional airport and is well served

by access roads. One of the goals is to capitalise

on the existing solar power industry by

promoting special investment packages to

investors in that field, and encouraging the

development of skills and services to support

that sector within the SEZ.

Another type of SEZ is an Export Processing

Zone (EPZ). All of these interventions are intended

to form of broader trade and investment

plans such as National Development Plan

(NDP) and the Industrial Policy Action Plan (IPAP).

The NDP is a broad-strokes plan that seeks to

coordinate development in a range of sectors,

and promotes ambitious infrastructural projects.

South Africa’s most recent IPAP has a manufacturing

focus, so beneficiation fits well into

the idea of diversifying and strengthening the

country’s ability to make things.

In the context of the new and burgeoning

renewable energy sector, the state (through the

Department of Trade and Industry, dti) can pass

legislation that requires developers to increase

the level of local content on the solar panels or

wind turbines that are used.

Specific incentives relating to energy savings

and reductions in environmental impact

are available, both from Eskom and the dti.

Within the dti’s Manufacturing Competitiveness

Enhancement Programme, there is a Green

Energy Efficiency Fund, all of which are designed

to make investment more attractive.

37 SOUTH AFRICAN BUSINESS 2019


PROFILE

Upington Special

Economic Zone

More than 500 hectares of prime land is available for investors.

Upington, the second-biggest town in the Northern

Cape, is located along the banks of the Orange

River and is a popular tourist destination

with warm weather and long sunny days. The

Northern Cape is ideally situated to serve the following

industries: solar energy, mining, agricultural, aviation and

other industries. The Upington SEZ has a geographically

designated area set aside for specifically targeted economic

activities to accelerate industrial development.

In the heart of the Green Kalahari, right next to Upington

International Airport, there is more than 500ha of prime land

available to be utilised by investors (440ha for the Industrial

Park and 85ha for the Aviation Park).

Upington is situated 130km from the Namibian border

post and about 350km from the border post to Botswana.

Upington also has good access roads such as the N10 and

the N14, effectively linking up Namibia and Botswana.

The Upington International Airport has a 5km-long

KEY CONTACTS

Mr Thobela Dikeni, Chief Executive Officer, NCEDA

Tel: +27 53 833 1503 and 060 997 7202

Babalwa Mbobo, Sector Specialist, Upington SEZ

Tel: +27 54 333 1136 and 071 016 5813

Email: bmbobo@upington-sez.co.za

Dr. Mphulane Ramorena, Project Executive

Tel: 076 442 4437

Email: mramorena@upington-sez.co.za

Physical address: 24 Schroder Street,

Upington 8801

runway, the longest civilian runway in the southern

hemisphere. The airport’s location and the dry, arid

climate add to making the location particularly favourable

for the establishment of an Aviation Park to serve

the global markets.

The Dawid Kruiper Local Municipality (DKLM) has

made the land available for the development of the

Upington SEZ. The development will be divided into

seven phases. The ZF Mgcawu District has a well-developed

economy and active business community supported

by government and government parastatals.

Industrial hub

The main objective for the proposed Upington SEZ

in the Northern Cape Province is to establish a worldclass

industrial hub to service the Southern African

Development Community (SADC) region in the following

sectors:

• Renewable energy with the focus on solar

component manufacturing

• Aeronautics through the development of an

Aviation Park

• Mineral beneficiation

• Agro-processing

• Astronomy exploration

• High-value micro technology.

Together with our partners, the Northern Cape

Economic Development Trade and Investment Agency

(NCEDA), the Northern Cape Department of Economic

Development and Tourism, the National Department

of Trade and Industry (dti) and the Airports Company

South Africa (ACSA), we invite all interested investors

to contact us.

NCEDA: 6 Monridge Office Park, Cnr Kekewich &

Memorial Street, Kimberley 8301

Tel: +27 53 833 1503

Fax: +27 53 833 1390

Website: www.nceda.co.za

SOUTH AFRICAN BUSINESS 2019

38


The Upington SEZ

boasts several

advantages

INTERVIEW

Thobela Dikeni, CEO of the Upington SEZ, explains how

climate and location enhance the value proposition.

Thobela Dikeni

BIOGRAPHY

Thobela Dikeni has held various

managerial positions in the

private sector, including senior

positions at Standard Bank and

FNB (where he was Director Public

Sector Banking). He was Director

Business Development and Africa

for Naspers’ subsidiary Paarl

Media. He has studied Economics

and Management and attended

several executive development

programmes at international

institutions. He is currently studying

for a Master’s degree in Information

and Knowledge Management. He

has served on private and public

sector boards.

What sectors are you hoping to attract to the SEZ?

In the first phase, renewable energy and aviation. These sectors are the

focus of the Economic Development sector of the Northern Cape and

in line with the Provincial Growth and Development Strategy (PGDS).

How does the location of the SEZ support the business

case for investing?

Renewable energy: Upington is an area with warm weather and long

sunny days for solar energy generation. The increasing and sustained

demand for photovoltaic (PV) and concentrated solar power (CSP)

systems will produce a number of assembly opportunities for PV

panels and inverters as well as CSP in-field mirrors, structures and backward

integration of manufacturing facilities. European and Chinese

companies continue to express interest in establishing solar energy

component manufacturing and assembly plants. About 440ha of land

is set aside for the development of a solar farm with a complete EIA

for industrial development.

Aviation: An arid climate which is not susceptible to accelerated corrosion

and deterioration and the availability of relatively low-cost open

land are positive factors. Upington is close to the northern border of

South Africa which makes it convenient and strategic from the African

continental perspective and its relative remoteness enhances security

considerations.

How important is the airport?

Successful SEZs are attached to ports, whether airport or sea port.

Therefore, the proximity to an airport will assist the value proposition

and logistics connectivity of the SEZ. Upington Airport has an unusually

long runway (5km) that serves as a designated African landing site for

the shuttles of National Aeronautics and Space Administration (NASA).

What progress has been made in getting the SEZ off

the ground?

Positive feasibility studies have been conducted. Environmental Impact

Assessments have been completed. A Record of Decision has been

received. The application for designation was submitted in May 2018.

39 SOUTH AFRICAN BUSINESS 2019


PROFILE

Maluti-A-Phofung Special

Economic Zone

Attractive incentives and good infrastructure make for a compelling

investment proposition.

The Maluti-A-Phofung Special Economic Zone was officially

launched on 25 April 2017. The Maluti-A-Phofung Special

Economic Zone (MAP SEZ) is strategically located in the eastern

part of the Free State Province. Its location and access to good

transport infrastructure provides it with an advantage as a logistics hub.

The main objective of the MAP SEZ is to attract foreign and direct

investment and to stimulate the local economy as well as creating

meaningful work opportunities. The SEZ will further provide support

to local businesses, skills transfer and accelerate the establishment of

manufacturing activities in creating local and international trade with

value-added benefits.

The zone has 1 038ha of land which is divided into four precincts,

including one for cross-docking and a container terminal. The proximity

to major agricultural production areas makes an attractive investment

destination for food processors. Taking advantage of its central location

on the N3 road corridor between Johannesburg and the busiest port in

South Africa, Durban, the Maluti-A-Phofung Special Economic Zone’s

ultimate value proposition is to create a prosperous trade city with a

functional trade ecosystem.

Sectors

The main sectors of the Maluti-A-Phofung Special Economic Zone are:

• Automotive

• Agro-processing

• Pharmaceuticals

Incentives

A number of incentives are available to investors, including the use

of a Customs Controlled Area tailored for manufacturing, storage,

CONTACT DETAILS

SOUTH AFRICAN BUSINESS 2019

• ICT

• Logistics

• General processing.

Contact person: Maphoka Setai, Office Manager

Address: Cnr of De Lange and Amanda street, Sthiane,

Harrismith 9880

Tel: +27 51 4000 800

Email: maphoka@mapsez.co.za

Website: www.mapsez.co.za

40

repackaging, processing and

beneficiation: qualifying entities will

pay15% tax (not 28%), 10% rebate on

buildings or improvements for 10

years, employment tax incentives

reduces the amount of PAYE, grants

are available to support machinery

for production.

A One-Stop Shop strategy has

been introduced to reduce bureaucracy

and red tape for government

approvals and applications processing,

permits and licences.

Achievements

MAP SEZ has attracted a number

of investors which have been approved

by the National Department

of Trade and Industry (dti) for top

structure funding to the value

R200-million. The investment value

created as a result amounts to R550-

million over the period of five years.

A landmark investment into the

MAP SEZ occurred with the launch

in June 2018 of the Kevali Chemicals

plant. Kevali produces products for

use in hygiene and sanitation, watertreatment

and adhesives. The investment

forms part of the promotion of

black industrialists by the dti.

Small businesses have been

empowered through the awarding

of procurement contracts

for goods and services. The local

community has been empowered

through the provision of jobs to

locals on all the completed and

ongoing capital projects.


INTERVIEW

Bringing work

opportunities and skills

transfer

The CEO of the Maluti-A-Phofung Special Economic Zone,

Mpho Mgemane, relates how new investments are ramping up.

Mpho Mgemane

How does the MAP SEZ benefit from its strategic location?

The zone is strategically situated on the intersection of the N3 and N5

highways. These are some of the country’s most important and busiest

freight routes and provide the MAP SEZ with prime access to the busy

Durban port, the large Gauteng commercial market, the Port Elizabeth

and Cape Town ports and also provide a link to imports and exports to

and from SADC countries.

BIOGRAPHY

Mpho Mgemane graduated with

an honours degree in Industrial

Psychology from the University

of South Africa. She was born

in Soweto, Johannesburg, but

attended high school in Qwa

Qwa. She acquired considerable

knowledge in asset capital

funding and deal-making during

her time with Nedbank, Absa

and Standard Bank. After a

spell as Executive Director of

the Food Gardens Foundation,

Mpho led the Expanded Public

Works Programme of the Free

State Provincial Government and

became MAP SEZ CEO in 2016.

What are the main sectors you are targeting to invest in

the facility?

There are six priority sectors: automotive, agro-processing, logistics,

general processing, ICT and pharmaceuticals. Agro-processing is our

main targeted sector.

How far advanced is infrastructure development at the

SEZ?

Bulk infrastructure development of the park is being undertaken in three

phases. Phase 1 Bulk has reached over 75% completion and is scheduled to

be completed by January 2019. The subsequent phases will be led by the

coming of new investments. We have also signed on three new investors

with their top structure construction scheduled to start in February 2019.

What is the significance of a chemical company deciding to

locate their factory at MAP SEZ?

This is our first official investment as an SEZ. The chemical plant will be

relocated to its new custom-built facility following its construction. The

chemical plant has acted as a live advertisement for the SEZ to other investors

as the Harrismith area is not well known as an industrial hub. This facility

not only brings work opportunities to the area, but we are looking forward

to the skills transfer that will be made possible through its operations.

What other significant investments have there been?

We have two abattoirs (one beef abattoir and one pork abattoir) with construction

to commence in the near future. We are also finalising investment

deals with another chemicals plant, a human hair manufacturer, a beverage

processing plant, a farming vehicle assembly plant and a biogas facility.

41 SOUTH AFRICAN BUSINESS 2019


SPECIAL FEATURE

Healthcare

Health counselling at work is a growing trend.

One of South Africa’s most innovative and successful manufacturing

companies signalled in 2018 that its growth

path is continuing. Aspen Pharmacare sells medicines and

products in 150 countries from 25 manufacturing plants

at 17 sites. In 2017, revenue was R41.2-billion.

The opening in May 2018 of a R1-billion specialised product

facility in Port Elizabeth will add 500 jobs to the existing complement

of 2 000 staff members. The new plant will make products for

chronic conditions, a new departure for the company which until

now has focussed on generics. Annual production is planned of

about 3.6-billion tablets.

South Africa has one of the world’s biggest HIV/Aids programmes.

The National Department of Health’s Centralised Chronic Medicines

Dispensing and Distribution programme aims to reach six-million

patients on treatment by 2021: it is currently serving 4.4-million patients.

In mid-2018, Pharmacy Direct, an Afrocentric business, spent

R100-million on upgrading a warehouse for distributing medicines

to state patients.

This business is likely to grow if the state goes ahead with plans

for National Health Insurance. The NHI intends to create a single fund

that will buy services on behalf of all South Africans.

South Africa’s pharmaceutical sector is worth approximately

R20-billion annually. Although there are more than 200 pharmaceutical

firms in the country, large companies dominate, with Aspen

(34%) and Adcock Ingram (25%) the key players, followed by Sanofi,

Pharmaplan and Cipla Medpro. A number of large pharmaceutical

firms have made significant investments. The National Association

of Pharmaceutical Manufacturers (NAPM) has re-branded as Generic

ONLINE RESOURCES

Generic and Biosimilar Medicines of Southern Africa:

http://gbmsa.org

National Health Insurance: www.health.gov.za/index.php/nhi

Innovative Pharmaceutical Association South Africa:

http://ipasa.co.za/

South African Medical Research Council: www.mrc.ac.za

South African Medical Technology Industry Association:

www.samed.org.za

SECTOR INSIGHT

National Health Insurance

could be a game changer.

and Biosimilar Medicines of

Southern Africa.

A new field opened up in the

pharmaceutical industry when

the South African Health Products

Regulatory Authority (SAHPRA)

gave the go-ahead for the production

of a biosimilar drug in

July 2018, the first time this has

been allowed in South Africa.

Teva Pharmaceutical Industries

became the first company to

win a licence with its version of

Amgen’s filgrastim, a white blood

cell booster.

Taking health education and

counselling into communities

and the workplace is a trend that

is growing. A focus on prevention,

risk assessments and profiling

assists people in avoiding illness

or managing their health.

A cheap plastic heart valve, research

on radiation treatment of

cancer using Gold Nano particles

and posture support wheelchairs

and positioning devices that allow

greater independence and

participation of disabled people

– these are some of the inventions

and innovations coming out of

the Western Cape health research

and manufacturing sector where

provincial and national funding is

available for innovation.

SOUTH AFRICAN BUSINESS 2019

42


INTERVIEW

Selfmed Medical Scheme

Christo Becker, the Principal Officer at Selfmed Medical Scheme,

outlines the advantages of a self-administered scheme.

Christo Becker

BIOGRAPHY

Christo started his 21-year career

in healthcare as a paramedic in

Fire and Disaster Management

Services. In 2001 he completed

an MBA with the intention of

moving his career towards

hospital management. He has

worked as hospital manager

in several private facilities.

His passion for people and

strategy has ensured that the

hospitals he has managed have

grown rapidly while focusing

on sustainability. With selfmotivation

and a commitment to

continual improvement, Christo

implements positive changemanagement.

How did Selfmed begin and how has it evolved?

The Scheme initially formed part of the Sanlam Life Insurance stable, created

in 1965 and formally registered in 1972. This makes Selfmed one of the most

experienced medical aid schemes in the industry. At Selfmed we have a handson

approach, and this resulted in our taking control of our own Client Services

Centre, or Excellence Centre in 2006. We thereafter progressed to taking over

the full administration function in 2010; also recently bringing our Managed

Healthcare inhouse.

What is your market?

Historically membership comprised individuals and their families. The introduction

of the Selfnet options in 2015 and 2016 allowed us to reach a younger

audience. This was also the opportunity to branch out into corporate marketing,

offering membership to blue-collar employees. We have seen great success in

this area.

Is there flexibility for clients?

The scheme currently has five products: Selfmed 80%, Med Elite, Selfsure, Med

XXI, Selfnet and Selfnet Essential. Each product is designed specifically for a life

stage, as the needs of a member changes. As the person advances in life and

starts a family they will move towards the Med XXI or Selfsure options, for example,

which have a wider range of benefits relevant to a young family.

How is Selfmed handling ever-rising costs?

The biggest challenge facing the healthcare industry is the significant rise in

healthcare costs, with healthcare inflation exceeding general inflation. This

compels us to proactively introduce mechanisms to manage these costs. Selfmed

is applying machine learning to the claims database to draw a more accurate

picture of a member’s specific needs. The information can then be used to

engage members on an individual basis – if we can intervene early it is to the

benefit of all parties.

How does SelfMed Medical Scheme differentiate from competitors?

In a traditional medical aid/administrator environment all administered functions

rest with an administrator. As such, a medical aid would be fully dependent on

its outsourced administrator to inform it of any issues relating to its members.

Being fully self-administered allows Selfmed to take total ownership of all its

member interactions and can address any administrative problems or complaints

immediately. We do not have an electronic routing system, you speak to an

individual. This personalised hands-on approach is fundamental to our model

of building a credible member experience.

43 SOUTH AFRICAN BUSINESS 2019


SPECIAL FEATURE

Business in Africa

Trading with African neighbours is set to become easier.

The signing of the Kigali Declaration in March 2018 marks a significant

shift in expectations for intra-African trade. Regarded

as the first step towards the establishment of a Continental

Free Trade Area (AfCFTA), the commitment shown by African

political leaders shows that the issue is receiving priority status.

The continent’s population of 1.2-billion represents a huge and

potentially lucrative market, with the 55 members states of the

African Union having a combined gross domestic product (GDP)

of $2.5-trillion. However, many African countries have stronger

trading ties with countries on other continents that they do with

their neighbours.

The reasons for this are long-standing and complex and will require

investment in logistics and infrastructure to overcome. But political

will is a major component in the equation and the Kigali Declaration

shows an intention to make trading among Africans easier.

An AfCFTA Business Forum has

been established to allow for private

sector engagement with the

formulators of policy. This should

allow for realistic and workable

trade agreements. The United

Nations Economic Commission

for Africa (ECA) has suggested

that by the year 2022, the AfCFTA

could lead to an increase in intra-

African trade by as much as 52%.

Fully 30% of South Africa’s

exports are to other countries in

Africa, but a massive 83% of this

volume is into Southern Africa.

SOUTH AFRICAN BUSINESS 2019

44


SPECIAL FEATURE

This means that the potential for South Africa to grow its exports into

other parts of Africa is enormous, if the infrastructural obstacles can

be overcome.

The Southern African Development Community (SADC) is a

16-member inter-governmental organisation with its headquarters

in Gaborone, Botswana. Other members include South Africa, Lesotho,

Malawi, Namibia, Tanzania, Comoros and Mozambique.

SADC is one of several regional organisations on the continent and

there have been moves in the past for cooperation between these

bodies. For example, a tripartite summit was held between the leaders

of the Common Market for Eastern and Southern Africa (COMESA), the

East African Community (EAC) and SADC. The AfCFTA may supercede

these agreements as it applies to all of Africa.

SADC’s theme for 2018/19 is “Promoting Infrastructure Development

and Youth Empowerment for Sustainable Development”. This is an

extension of the body’s focus on industrialisation, while also putting

the focus on infrastructure development, youth empowerment and

sustainable development.

The 38th summit of SADC held in Namibia in 2018 approved the

creation of the SADC University of Transformation, in the form of a

virtual university. This is further intended to support industrialisation

through subjects such as technology transfer, innovation, digital

and knowledge economy, entrepreneurship, commercialisation and

enterprise development. SADC has a Revised Regional Indicative

Strategic Development Plan (RISDP) 2015-2020, which deals with

industrialisation, regional infrastructure, agriculture and strategy.

Corridor development is an important part of growing intra-African

trade. Within the corridors of development, red tape and infrastructure

are other key elements.

South African retailer Shoprite spends about R20 000 per week in

permits, and long waits at border posts are routine. But the Chirundu

one-stop border post in Zambia has reduced transit times by a third.

Passenger transport delays have been reduced from three hours to

30 minutes and freight is now cleared in one day instead of three.

A number of corridor projects are in the pipeline or have already

been implemented. The Maputo Development Corridor has successfully

linked the thriving industrial and business centre of Gauteng Province

in South Africa with the Mozambican port city of Maputo. The idea

of corridors has been adopted by the Infrastructure Consortium for

Africa (ICA), and several corridors have been conceptualised since that

decision, for example the Northern Corridor of Central and East Africa.

A corridor strategy relies on infrastructure, with inter-related plans

being developed involving the upgrading and standardisation of

facilities at ports, railway lines, customs posts and energy projects.

South African rail, ports and pipeline operator Transnet is already

very active in African countries north of the South African border and

is intending to offer its services more widely.

The Sustainable Development

Investment Partnership (SDIP)

comprises 30 institutions which

aim to see 16 African infrastructure

projects (valued at more

than $20-billion) carried out. The

founders of the SDIP were the

World Economic Forum (WEF) and

the Organisation for Economic

Co-operation and Development

(OECD) and other members now

include the Bill and Melinda Gates

Foundation, the Senegal Strategic

Investment Fund (FONSIS), the

US Agency for International

Development (USAID), the

Industrial Development

Corporation of South Africa (IDC)

and the Development Bank of

Southern Africa (DBSA).

The Export Credit Insurance

Corporation of South Africa

(ECIC) exists to help trade and

investment across borders. ECIC

can provide insurance for bank

loans that are taken by investors

and South Africans can get insurance

for investments and for small

and medium enterprises there is

a product available (performance

bonds to anyone exporting

capital goods and services.

The South African Department

of Trade and Industry plays a key

role in terms of promoting trade

between South Africa and the

rest of Africa, but also supports

regional bodies such as SADC

and promotes the kind of integration

contained in the plans of

the New Partnership for Africa’s

Development (NEPAD) and the

African Union’s Agenda 2063. The

dti’s Africa Export Council (AEC)

was inaugurated in 2016 with the

goal of promoting South African

products and services in Africa.

45 SOUTH AFRICAN BUSINESS 2019


FOCUS

Billion-dollar intra-African

financing programme

launched

The ECIC proudly supports South African exporters and investors.

A $1-billion financing

programme

The Export Credit Insurance Corporation of South Africa SOC

Limited (ECIC) was formed as a dedicated export credit

agency to cater for medium to long-term export transactions.

The short-term transaction market was amply catered

for, but medium to long-term export transactions still had a need for

a dedicated export credit agency, hence the formation of the ECIC.

Acting as a catalyst for private investment, the ECIC steps in where commercial

lenders are either unwilling or unable to accept long-term risks.

Along with the ECIC’s major shareholder, the Department of Trade and

Industry, the ECIC makes use of market research tools and specialised

business development units to create new insurance products that

support the government’s export promotion objectives. The revised

performance bond insurance product, which was launched in 2016,

is one such example.

“The ECIC has recently developed new products, including lines of

credit, lease and return of plant equipment. It also continues to be a

catalyst for an increased lending capacity by financial institutions by

entering agreements with other export credit agencies (ECAs). In this

way, it creates a framework for both re- and coinsurance,” explains the

Chief Executive Officer, Kutoane Kutoane. To this end, it has adopted

a comprehensive plan of action aimed at actualising cooperation

programmes for mutual benefit in conjunction with, among others,

BRICS ECAs, Afreximbank and African Trade Insurance. The ECIC is also

able to price African risk more competitively, given its knowledge of

the African market.

In 2018 the ECIC, in partnership

with the African Export-

Import Bank (Afreximbank),

launched the South African-

Africa Trade and Investment

Promotion Programme

(SATIPP), a $1-billion financing

programme to promote and

expand trade and investments

between South Africa and the

rest of Africa.

The financing institutions

will work together to identify,

prepare and appraise trade

transactions and projects,

explore co-financing and

risk-sharing opportunities

and share knowledge, with

particular emphasis on intra-

African trade matters, through

technical cooperation, staff

exchange, research and joint

events.

The joint initiative will support

businesses through capacity

building and market information

initiatives. It will also

provide advisory services and

guarantees to South African

investors seeking trade and

investment opportunities in

selected African countries.

SOUTH AFRICAN BUSINESS 2019

46


SUCCESSFULLY GROWING OUR

PORTFOLIO IN FRONTIER MARKETS

Since 2001 we have continued to provide commercial and political risk insurance for cross-border

transactions, offering risk mitigation solutions to South African exporters of capital goods and

investors . We have partnered with credible financial institutions and believe through partnerships

economic growth can be achieved. As Export Credit Insurance Corporation of South Africa (ECIC) we

are committed to supporting our South African businesses who export and invest in capital projects

beyond our borders.

If youʼre planning on exporting to or investing in capital projects beyond our

borders, contact ECIC for assistance

+27 12 471 3800 | info@ecic.co.za | www.ecic.co.za

ECIC is a registered service provider with the FSB No. 30656

In partnership with


SPECIAL FEATURE

Investing in Lesotho to

become easier and faster

The new Lesotho National Development Corporation (LNDC) Strategic

Plan is outlined by the incoming Chief Executive, Mohato A Seleke.

As the main parastatal of the Government of Lesotho, the

Lesotho National Development Corporation (LNDC) is

charged with the implementation of the country’s industrial

development policies. The corporation’s role is to promote

Lesotho as an attractive investment location for foreign, domestic

and indigenous investors. The LNDC is the first point of contact for

investors who intend to set up operations in Lesotho. In 2016, the

LNDC received an Investment Promotion Award from UNCTAD (United

Nations Conference on Trade and Development) at the 14th UNCTAD

Conference.

We are a commercially operated entity that has been making good

profit and maintaining a healthy balance sheet in striving to pursue

its founding mandate and higher purpose to the people of Lesotho.

We are committed to moving into the next five years with a new and

strong sense of meaning: to make an impact in a truly fundamental way

in Lesotho’s economy. To this effect we have developed and launched

a Strategic Plan 2018-2022 which intends to mobilise our private sector

and the resources at our disposal around one common purpose, to

develop the first generation of Basotho industrialists. This is crucial to

lifting thousands of rural communities out of poverty and unemployment

by consciously mainstreaming their participation in the supply

chains of strategic investments.

This is not only about jobs. It is

also about raising income levels

and creating generational wealth

and capital gains for the people of

Lesotho. This is our raison dêtre.

We seek to put significant financial

resources and technical know-how

into a sector where over just 70% of

our people earn a living, subsistence

agriculture. This is critical to realising

the ideals of shared, inclusive and

sustainable growth as espoused in

the National Strategic Development

Plan II (NSDP II). We are repositioning

the country as an agricultural

powerhouse in Southern Africa by

developing local supply chains and

plugging into regional value chains.

We have identified 21 priority

products which already have

international market access or hold a

great potential to do so. These include

meat and meat products, fruits and

vegetables, utilising our abundant

and quality natural resource. The

textiles and apparel manufacturing

value chains also hold potential and

we aim to gain a bigger share in the

light-engineering value chain.

We are aiming to partner with,

support, incentivise and reward

leading export-oriented companies

by scaling up their productive

capacity, facilitating international

market access and integrating them

into supply chains.

SOUTH AFRICAN BUSINESS 2019

48


National champions

Secondly, we are going to set up new companies, or national

champions, within the priority areas and related product categories.

We have already made great strides here to attract the necessary

Foreign Direct Investment by initiating partnerships with renowned

regional and global players in those target product lines. We

can no longer afford to look only inward within the geographic

borders of Lesotho in diversifying our economy. We are talking to

strong partners and are seeking more of those to initiate, promote

and facilitate the development of vertically integrated industrial

activities. The intention is to establish national champions that are

capable of competing at par with their regional and global peers

in strategic industries, particularly in manufacturing and hightech

agri-processing. For the first time, building industries and

diversifying our economy will mean cross-border acquisitions of

strategic assets, raw materials, distribution channels and technology

by these national champions. This represents a real chance to

turn the tide for Lesotho. These companies will be pitched at the

necessary scale and scope with the right technology, product and

process certifications and with top talent to lead them.

Entering foreign and regional markets early is no longer an

option for us as a country, but it has now become a vital necessity.

With this strategic roadmap, we are flipping our resource allocation

almost completely, to cover talent, capital and time commitment.

Activities in high-value manufacturing and high-tech agri-business and

related supply chains will consume a significant portion of these resources.

In the next five years, we are looking at modern high-tech agriculture

as an area for big business, big investment,and big impact in terms of

jobs, incomes and overall economic competitiveness. In manufacturing,

Basotho entrepreneurs will be integrated into local, regional and global

supply chains. We will meticulously assess and evaluate the impacts of

these investments on the economy, on social equity and the environment.

Thirdly, in line with the NSDP II, we aim to facilitate further investments

in our national priority sectors such as tourism and the

creative industries as well as the development of infrastructure and

CONTACT DETAILS

Lesotho National Development Corporation

Address: Development House, P Bag A96, Kingsway

Road, Maseru 100

Contact person: Marina Bizabani, Foreign

Investment Manager

Tel: +266 22 312012

Email: bizabani@lndc.org.ls or ip@lndc.org.ls

Website: www.lndc.org.ls

SPECIAL FEATURE

Mohato Seleke joined the

Lesotho National Development

Corporation in December 2017.

Within six months he released

a five-year corporate strategy

mapping the direction for the

development of industry, and

its contribution to the creation

of inclusive economic growth

in Lesotho.

technology-based industries. We are

keen to welcome the world to experience

our mountainous scenery, green

summers and snowy winters on their

visits to Lesotho or in consuming film

and digital products made in Lesotho.

We recognise that a superior strategy

and a winning business model are

not enough. We are therefore building

our nation brand “Brand Lesotho”

and undertaking a reform process to

streamline our investment climate

to deliver on our promise. This new

strategic posture also demands a reconfigured

organisational platform.

The LNDC is therefore being realigned

to deliver on its key performance parameters

with speed and excellence

in execution.

I invite investment and technical

partners to come and build this new

impactful and rewarding journey of

Lesotho’s with us.

49 SOUTH AFRICAN BUSINESS 2019


SPECIAL FEATURE

Botswana: investment and trade hub

A fast-growing economy at the heart of Southern Africa.

diamonds in the world by value. Its people have a

rich, diverse culture and embrace all who come to

Botswana with a welcoming warmth. The official

language of the country is English; Setswana is the

national language.

• Gross Domestic Product 2016: $15.6-billion

• Per capita GDP: $7 018

Investment Opportunities

Botswana is a peaceful country with a

fast-growing economy at the heart of

Southern Africa, bordered by Namibia,

Zambia, Zimbabwe and South Africa. Its

central location makes Botswana the perfect gateway

for reaching the whole of the Southern African

Development Community (SADC), making it the

ideal investment and trade hub.

With a stable political system, real GDP growth

rate of 4.3% (2016) and an adult literacy rate of 83%

(World Bank), Botswana truly is an ideal investment

destination.

Botswana has deservedly become a favoured

destination for international tourists as a land of unmatched

beauty, plentiful in wildlife and rich in culture.

The landscape gives it a magical and dreamlike

quality, from its prominent salt pans to diamond-rich

deserts and lush flood plains. The business potential

of this friendly nation is less well known.

Since peacefully gaining its independence in

1966, Botswana has managed to exploit its wealth

of underground resources, especially diamonds,

to develop not only its diverse economy but also

its people. Botswana is the biggest producer of

There are investment opportunities in each of the

following sectors:

• Mining, including diamond beneficiation, coal

and soda ash

• Cargo, freight and logistics

• Leather and leather goods

• Automotive

• Agriculture

• Financial and business services

• ICT

• Health

• Education

The Big Five – reasons to invest

Botswana provides a peaceful and stable environment

to its citizens and investors and has maintained peace

since independence in 1966. Reasons to invest include:

• Zero tolerance for corruption, a sound legal

system and adherence to the rule of law

• Botswana is the least corrupt country in Africa,

ranked 35 out of 176 in the world in 2017

(Transparency International)

• World’s second most attractive investment

location (Altman’s Baseline Profitability Index

(BPI), New York University)

• Highest sovereign credit rating in Africa

• One of the world’s fastest growth rates in per

capita income.

SOUTH AFRICAN BUSINESS 2019

50


SPECIAL FEATURE

Trade agreements and access

Easy to do business

Botswana provides preferential access to the entire

marketplace of the Southern African Development

Community (SADC) which has more than 292-million

people, duty-free access to South Africa, Namibia,

Lesotho and Swaziland, and duty-free and quota-free

access to the European Union (EU) market. Imported

machinery and equipment for manufacturing

purposes do not attract duties.

In addition, Botswana is signatory to an extensive

range of protocols and trade agreements that give

access to lucrative markets around the world.

Incentives for investors

• No foreign exchange controls or restrictions on

business ownership

• Taxes are very low, 15% for manufacturing and

International Finance Service Centre (IFSC) companies,

22% for other businesses and 25% for individuals

• Remittance and full repatriation of profits and

dividends is allowed

• Development Approval Order: tax holiday (zero

corporate tax) can be available to investors for a

period of five to 10 years

• Operational double taxation avoidance agreements

with South Africa, United Kingdom, Sweden, France,

Mauritius, Namibia, Zimbabwe and Russia

• Companies accredited by the Innovation Hub pay

tax at 15% of profit.

CONTACT DETAILS

Botswana Investment and Trade Centre (BITC) is an

integrated investment and trade promotion authority

with an encompassing mandate of investment

promotion and attraction, export promotion

and development, including management of the

nation’s brand.

The organisation plays a critical role of driving

Botswana’s economic growth through attraction of

FDI, domestic investment, facilitation of expansions

and further spearheads the growth of exports by

promoting locally manufactured goods to regional

and international markets.

BITC has committed to deliver on making

investment as easy a process as possible, through

facilities such as the One Stop Shop. Services include

helping with office space and registrations, visas

and licences.

Botswana Investment and Trade Centre (BITC): Private Bag 00445, Gaborone, Botswana

Plot 54351, off PG Matante Road, Exponential Building, Central Business

District (CBD), Gaborone, Botswana

Tel: +267 363 3300 | Fax: +267 317 0452

South Africa: 88 Sandown Mews, West Wing, Stella Street, Sandton, Johannesburg

Tel: +27 11 884 8959 | Fax: +27 11 883 7798

Website: www.bitc.co.bw

51 SOUTH AFRICAN BUSINESS 2019

Doing Business

Doing

in Botswana

Business in Botsw


SPECIAL FEATURE

A hub of economic activity

Airports can anchor economic growth in multiple sectors.

Shopping, trading and entertainment are now accepted parts

of the airport experience for travellers, but new thinking is

being applied to how airports can spark economic growth

in surrounding areas.

By definition, airports play a role in tourism, logistics and trade

but the concept of an aerotropolis takes this further in finding ways

to leverage the advantages that the facility brings to the region. The

airport becomes a hub of economic activity in the same way that cities

anchor different economic sectors that grow up around the centre.

Several South African airports and regions are using this thinking

to underpin new approaches to

economic planning.

OR Tambo International

Airport is the biggest airport in

Africa. The City of Ekurhuleni,

where OR Tambo is located, is

hoping to be the national centre

for logistics and to boost its

already impressive manufacturing

capacity by building more

SOUTH AFRICAN BUSINESS 2019

52


SPECIAL FEATURE

infrastructure and freight hubs. It also wants the aerotropolis concept

to play a role in helping to consolidate the integration of the nine town

councils that went into making up the current metropole.

The Tambo Springs inland port and logistics gateway has been

established near Katlehong as an inter-modal facility which can transfer

containers from rail or road to storage facilities and ultimately to the

customer. Existing freight rail lines run through the site and link it to

the seaports of Durban, Cape Town and Ngqura (Port Elizabeth). The

aim with this new facility is to improve efficiency. It is run by the Tambo

Springs Development Company.

Logistics is obviously a major part of the equation and facilities

such as the Tambo/Springs inland port will add capacity to the region.

However, using closeness to the airport as a factor in driving down

costs can also be a way of promoting manufacturing. When this factor

is supported by national, provincial and local government incentives,

the business proposition for investors becomes very attractive.

The OR Tambo Industrial Development Zone is one of several sites

allocated by the South African government to stimulate investment

in targeted sectors. The OR Tambo IDZ supports the development of

businesses that work in the beneficiation of precious metals and minerals

sector, with a focus on light, high-margin manufacturing of South

African precious and semi-precious metals. Export is encouraged.

The National Department of Trade and Industry (dti) is the lead

agent in the creation of Special Economic Zones, which are part of the

national Industrial Policy Action Plan (IPAP). SEZs are designed to attract

investment, create jobs and boost exports. Industrial Development

Zones are a type of SEZ.

Other important participants in building on the aerotropolis concept

include Airports Company South Africa (ACSA), operator of nine

of the country’s airports, Air Traffic Navigation Services (ATNS) and local

and provincial governments and their agencies.

In the Free State, Bloemfontein is pursuing an Airport Node project

within a broader N8 Corridor development scheme. A project covering

2 000ha and expected to cost in the region of R100-billion over several

phases has been initiated at the Bram Fischer International Airport. A

development plan for the area has designated five precincts: Terminal,

Boulevard, General Aviation, Airport Industria and Grasslands. The Road

Lodge Hotel was built within this conceptual plan. A range of land

uses beyond the hotel are envisaged, including warehousing, hospital

care, commercial, service stations, conferencing, retail, motor vehicle

dealerships, car rental, logistics hub and a showground.

A major reason for the building of a new airport north of Durban

was to stimulate cargo volumes, particularly in the agricultural sector.

King Shaka International Airport (KSIA) and the nearby Dube TradePort

are intended to complement one another, a good example of the

aerotropolis idea. The opening of a R99-million cold-storage facility at

Dube TradePort in 2017 gives farmers and exporters additional flexibility,

allowing them to store chilled and

frozen perishable goods.

Dube TradePort is a 3 000-hectare

development that encompasses

the airport and is ideally

situated for any logistics business

as it is very close to Africa’s busiest

cargo port (at Durban) and 140km

from the deepest natural harbour

in the southern hemisphere

where the Port of Richards Bay

and the Richards Bay Industrial

Development Zone (RBIDZ) are

located.

Dube TradePort is a Special

Economic Zone and it encompasses

a cargo terminal, a serviced

industrial estate, 12 hectares of

office, retail and hospitality space

and an agri-zone for growing,

packaging and distribution of

high-value perishables and horticultural

products.

The focus in Cape Town in recent

years has been on growing

the number of direct flights to

the city. A record 10-million arrivals

passed through the gates of

Cape Town International Airport

in 2016 as a result of a programme

called Air Access. The next big

thing at CTIA is going to be a

new runway. Airport Industria is

already a well-established commercial

and industrial zone. With

increased volumes into the airport,

it likely to continue to grow.

The re-aligned new runway will

also open up new commercial

opportunities. ACSA is looking

to promote economic activity

in the previously undeveloped

Symphony Way area through site

zoning. Commercial and logistics

are the two most likely kind

of activities suited to the newly

targeted area.

SOUTH AFRICAN BUSINESS 2019

54


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SPECIAL FEATURE

The Oceans Economy

There are massive opportunities in new maritime sectors.

A

new university campus, a new institute, new training programmes

at several venues across the country, investment

in ports and equipment – the Oceans Economy is no longer

just a concept talked about at conferences, it is a reality that

is starting to have an impact on South Africa.

South Africa has 3 000km of coastline and the extent of the country’s

territorial waters is greater than its land size. And yet the country

does not have a merchant marine fleet and only scrapes the surface

in terms of the percentage of repair and maintenance of boats and oil

rigs which could potentially bring work to its ports.

What is also called the Blue Economy has enormous potential for

economic growth and concomitant job creation. National government

wants to see the Oceans Economy contribute a R177-billion to gross

domestic product by 2033. This is

part of the National Development

Plan (NDP).

National strategy on the

Oceans Economy is also aligned

with Operation Phakisa, a plan

that targets sectors that can best

achieve quick returns in terms of

growth and job creation. The four

target areas within the maritime

strategy are: aquaculture; offshore

oil and gas; marine protection and

governance; marine transport

SOUTH AFRICAN BUSINESS 2019

56


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Promoting business, trade and investment in SA’s nine provinces

www.gan.co.za

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Web www.gan.co.za


SPECIAL FEATURE

and manufacturing. Transnet National Ports Authority is spending

heavily on upgrading the nation’s ports.

One statistic illustrates the potential: South Africa does maintenance on

only 5% of the 13 000 vessels that uses its ports and services 4-5% of the

approximately 130 rigs that pass along the coast each year. Large quantities

of oil are transported around the Cape of Good Hope every year: 32.2% of

West Africa’s oil and 23.7% of oil emanating from the Middle East.

South African companies are alert to this potential. More than

7 000 direct jobs were created in the Western Cape ship and rig repair

sector in 2015.

Port Elizabeth has positioned itself at the centre of the academic

side of the Oceans Economy. Nelson Mandela University launched the

Ocean Sciences Campus in 2017 and the South African International

Maritime Institute (SAIMI) has chosen the city as its base as it sets about

supporting the sector through research and training. SAIMI runs the

National Cadet Programme which is paid for by the National Skills Fund.

The curriculum for these institutions ranges from the law of the

sea, shipping and transport, to aquaculture, boat-building, oil and gas

exploration, repair and maintenance and environmental management.

The university has four marine sector chairs funded by the South

African Research Chair Initiative (SARChI) and the National Research

Foundation (NRF).

Special Economic Zones

South Africa has a number of licenced Special Economic Zones (SEZs),

some of which are called Industrial Development Zones (IDZs). The

best established of these are the coastal IDZs at Saldanha, Coega (Port

Elizabeth), East London and Richards Bay.

These areas are central to the Oceans Economy strategy because

of their strategic positions and the favourable environment created

for investment by specific legislation related to SEZ tariffs, tax deductions

and grants. The first illustration of national commitment to the

strategy came late in 2016 with the allocation by the Department of

Energy of two Liquefied Natural Gas (LNG) plant options, one each to

the IDZs of Richards Bay and Coega.

The Saldanha Bay Industrial Development Zone is central to a plan

to grow the oil and gas sectors although it was not allocated a possible

LNG plant. Large industrial operations already exist at Saldanha and the

Port of Saldanha Bay is the portal for the export of South Africa’s iron

ore. The SBIDZ is set to become a hub for a range of maritime repair

activities and oil rig maintenance and repair.

The ports of Ngqura and East London are well positioned to act

as container transit points and the skills set of the Eastern Cape’s

workforce, particularly in the automotive and automotive parts

sector, could be attractive to repairers and manufacturers in marine

subsectors. Both Eastern Cape

IDZs have aquaculture sections.

The East London IDZ already has

investors such as Pure Ocean

Aquaculture and Ocean Wise.

Durban’s annual throughput

of containers is about one-million,

more than 60% of the country’s

total. As part of Operation Phakisa,

the Port of Durban is upgrading

its dry dock and buying new

cranes to speed up operations.

There is also an ambitious plan

to dig out the old airport south of

the city, connect the big hole to

the sea and make it a harbour; this

would allow Toyota to roll their

new vehicles directly from the

factory floor to the hold of a ship.

The Port of Durban is already

home to a variety of maritime

companies. EBH-SA has been in

the business marine engineering

and repairing ships since it began

as Elgin Brown and Hamer in 1878.

To improve their competitiveness,

three South African shipbuilders

(SAS, Damen Shipyards Cape

Town and Nautic Africa) have

agreed to pool their resources

on contracts.

Cooperation pacts like this one

might be a good template for the

nation’s ports and the rig/boat repair

and servicing sector. With the

Angolan and Mozambique oil and

gas industries growing bigger every

day, it is unlikely that one port

could cope with demand anyway.

The Port of Richards Bay has

added a new berth on average

every second year. It has deepwater

infrastructure and the huge

Richards Bay Coal Terminal, the

country’s primary site of export

for coal. The Richards Bay IDZ intends

becoming an energy hub.

SOUTH AFRICAN BUSINESS 2019

58


FOCUS

Partnering for

maritime growth

SAIMI supports maritime research and innovation.

SAIMI hosted maritime business students from the Massachusetts

Maritime Academy, USA, on an experiential learning tour in January 2018

to understand the South African maritime sector. Pictured with the group

at the Port of Ngqura are (front, from left) senior student Nick Zaia, the

academy’s South African-born Dr Portia Ndlovu and Transnet representative

Ntshantsha Buyambo.

The South African International Maritime Institute (SAIMI)

supports research and innovation that will help unlock

the growth potential of the local maritime industry.

SAIMI worked in collaboration with other research roleplayers

to draw up the Maritime Research, Innovation and Knowledge

Management Roadmap which presents a vision, and sets objectives

and action steps for South Africa to be globally recognised as a

maritime nation by 2030.

The map provides direction for research, innovation and technology

development to support achievement of the Operation Phakisa growth

objectives in the Oceans Economy. It also guides SAIMI’s knowledge

management strategy.

The next step is dissemination and implementation of the road

map, and SAIMI is working with the Council for Scientific and Industrial

Research (CSIR), universities and leading research centres, to support

postgraduate studies and commission new high-level research in

key areas.

Launched in late 2016, the road map is the result of an extensive

review of existing tertiary qualifications, research and innovation activity

and current strategies, together with wide-ranging stakeholder

consultation in charting the way

forward.

It is aligned to the vision and

objectives of Operation Phakisa

in the Oceans Economy and

integrates the research and innovation

needs of the maritime

economy, which takes in everything

from aquaculture to tourism,

environmental protection

to oil and gas exploration, and

maritime transport and manufacturing.

Another initiative is to drive

a maritime awareness campaign

to develop a national maritime

culture and consciousness,

contributing to awareness of

maritime economic opportunities,

the development of a

sustainable blue economy, and

the profile of South Africa as a

maritime nation.

SAIMI also acknowledges the

importance of interacting with

other major institutions, not

only in South Africa, but also on

the African continent and in the

global maritime industry.

Work on SAIMI’s Africa Focus

is well underway with leading

teams from Kenya, Ghana and

Nigeria all part of the research

process. Partnerships are also

being explored with universities

and maritime authorities

in China and Southeast Asia.

59 SOUTH AFRICAN BUSINESS 2019


PROFILE

The South African

International Maritime

Institute

SAIMI is at the helm of maritime skills development.

SAIMI works with organisations such as the NSRI to support programmes developing life skills and maritime skills for

school learners and future seafarers.

South Africa’s blue economy offers a beacon of hope for

sustainable job creation and economic growth in a field of

almost unending potential.

Playing a vital role in developing this burgeoning industry,

the South African International Maritime Institute (SAIMI) facilitates the

skills development to support growth in the sector and the country’s

aim to be a leading maritime nation.

“Essentially, our role is to help South Africa steer the right course in

growing the skills needed for the rapid development of the maritime

sector as envisaged under Operation Phakisa,” says SAIMI’s acting chief

executive Odwa Mtati.

Boasting, as it does, more than 3 000km of coastline and territorial

waters larger than its land size, South Africa is extremely well positioned

to explore the diverse economic

and job creation opportunities

that lie within the marine sector.

“All the natural foundations

are in place. South Africa is the

African continent’s only country

with access to and control

over sea waters covering three

oceans,” says Mtati.

“While South Africa’s land

surface is 1.21-million square

kilometres, the waters under its

control cover some 1.6-million

SOUTH AFRICAN BUSINESS 2019

60


PROFILE

square kilometres. The coastline stretches from the cold Atlantic Ocean

in the west to the Southern Ocean in the south, and then to the warm

Indian Ocean in the east.”

Headquartered in Port Elizabeth, and with plans to eventually be

represented in all of South Africa’s major coastal cities, SAIMI works with

educational institutions, government departments and the private

sector across South Africa.

Its primary role is to respond to industry needs by identifying skills

gaps, facilitating collaboration and development of new programmes,

and coordinating maritime education and training in areas across the

diverse maritime economy spectrum – from shipping and transport,

to aquaculture, boat-building and oil and gas exploration, through to

ocean governance and environmental management.

One way of doing this is by reaching out to the younger generation,

educating them about sea-going career opportunities and also

offering training facilities through its management of the National

Cadet Programme.

Funded by the National Skills Fund, the programme – which was

SAIMI’s first and still its largest project – offers practical training and

sea time with international shipping lines, enabling maritime diploma

students to obtain the internationally recognised Standards of Training,

Certification, and Watch-keeping (STCW) qualifications and become

globally sought-after seafarers.

Innovative approaches to seafarer training, which have the potential

for replication if successful, are being followed with some of the partner

shipping companies, which recruit a small number of cadets into an

intensive programme aimed at developing their own future officer

corps from cadet to apprentice to fully-fledged officer.

The programme has also extended its reach to school level in an

effort to encourage interest in maritime careers, sponsoring holiday

camps and maritime experiential programmes for school learners,

along with maths and science support to ensure entry to maritime

studies programmes.

In addition, the institute is currently facilitating a pilot project

with the Transport Education and Training Authority (TETA) for

CONTACT DETAILS

Physical address: Ocean Sciences Campus, Gomery Avenue,

Summerstrand, Port Elizabeth, South Africa

Postal address: PO Box 77000, Nelson Mandela University, Port

Elizabeth 6031, South Africa

Tel: +27 41 504 4038

Email: info@saimi.co.za

Website: www.saimi.co.za

training of deck and engine

ratings towards Certificates of

Proficiency as Able Seafarers,

to work in areas such as vessel

maintenance, rigging and cargo

handling for merchant shipping

and the fishing industry.

In a long-standing partnership

with the Africa region

of the International Oceans

Institute, SAIMI supports the

annual IOI Ocean Governance

for Africa course which equips

public sector officials from

South Africa and the African

continent to understand the

maritime aspects of environmental

management and

planning.

SAIMI is funded by a threeyear

grant of R296-million from

the National Skills Fund for the

skills and capacity-building

work to support Operation

Phakisa, an initiative of the

South African government.

The initiative was designed

to fast-track the implementation

of the oceans economy

and address issues highlighted

in the National Development

Plan 2030 such as poverty, unemployment

and inequality.

A common thread running

through all Operation Phakisa

initiatives is the need to develop

the skills to operate

the engine room, as well as

to navigate the way forward.

SAIMI is at the helm of this

skills development as well as

capacity building and empowerment

of people to support

the goals of Operation

Phakisa and growth of the

maritime economy.

61 SOUTH AFRICAN BUSINESS 2019


PROFILE

EBH South Africa

High-quality ship repair and marine engineering.

Achievements

The Oliver Top Empowerment

Awards honours and awards

outstanding contribution to the

national vision of the country.

In 2016 EBH-SA won the Oliver

top empowerment award for

skills development.

In 2017/18 Transnet awarded

EBH with the best-performing

ship repairer of the year.

In 2018 EBH was once again

nominated as finalist for skills

development in the Oliver Top

Empowerment Awards.

Elgin Brown and Hamer, proudly a level 2 B-BBEE contributor,

is among one of the largest and oldest shipyards in Southern

Africa, having been founded in 1878. EBH South Africa was

originally known as James Brown and Hamer. The company

was later acquired in December 2012 by the DCD Group and then

became known as EBH-SA.

Operations

EBH South Africa provides the international shipping industry as well

as the oil and gas sector with a full in-house service in all aspects of

ship repair through its operations in Durban, Cape Town and East

London. The company offers a dedicated team of employees focused

on superior quality service, delivered by skilled craftsmen, and an extensive

network of experienced subcontractors through a full range

of utilities. This ensures efficient ship repairs, conversations or new

construction projects.

What sets us apart?

In addition to all our service offerings, Elgin Brown and Hamer purchased

its first floating dock, Eldock, in 1998, which was originally built

in Russia. EBH South Africa has a privately-owned floating crane which

has a lifting capacity of 60 tons at 10 metres.

Services

• Pipe repairs

• Steel repairs

• Underwater services

• Electrical

• Scaffolding

• Mechanical

• Blasting and coating

• Riding crew

• Hydraulics

Skills development

EBH-SA passionately believes in

artisan and engineering training

and development. We regard

apprenticeships and engineering

investments as being key

to the ongoing success of our

organisation. Our involvement in

these programmes since 2010 has

produced numerous qualified

artisans and engineers.

SOUTH AFRICAN BUSINESS 2019

62


KEY SECTORS

Overviews of the main economic sectors in

South Africa.


Agriculture​ 66

Mining​ 70

Oil, gas and petrochemicals ​ 75

Water 82

Engineering 90

Construction and property 98

Manufacturing​ 108

Food and beverages​ 116

Automotive 118

Transport and logistics​ 120

Information and communications technology​ 124

Tourism and events​ 134

Banking and financial services​ 140

Development finance and SMME support​ 144


OVERVIEW

Agriculture

Increasing agri-processing volumes is a national priority.

South Africa produces a wide variety of crops in every category

but in recent times there has been a rapid expansion in the

production of nuts. Macadamia nuts is one of the fastestgrowing

sectors in South Africa. Most nuts are exported,

and the global market is expanding: nearly 2 000ha are added to

the land under macadamias every year. Mpumalanga and Limpopo

provinces are big nut-growing provinces. Another sector enjoying a

boom (mainly because of Chinese demand) is avocadoes, with almost

1 000ha per year of new land being planted.

Peanuts are farmed in the Northern Cape, North West and Free

State with the Vaal River having the highest concentration of growers.

Some analysts believe that the Northern Cape could become a global

centre for pecan nut production. Production of pecan nuts grew from

5 000 tons in 2010 to 10 500 tons in 2015.

The Northern Cape is home to the Vaalharts Irrigation Scheme, one

of the biggest systems of its kind in the world. Spread over more than

30 000ha, it has transformed a semi-desert zone into a productive area

that sustains cotton, wheat, maize, lucerne, citrus, peanuts, fruit, grapes,

olives and pecan nuts. Consulting firm Aurecon has done a feasibility

study and a business plan for the rehabilitation and upgrading of the

irrigation scheme.

A priority for South African agriculture is to increase the number of

agri-processing businesses which in turn will mean that agricultural

SECTOR INSIGHT

The Mpumalanga International

Fresh Produce Market will

boost farming in the region.

production will have to increase.

More than 50% of agricultural export

is currently made up of processed

agricultural products.

The most recent version of

the South African government’s

Industrial Policy Action Plan (IPAP)

flags agri-processing as a key sector

for value addition and job creation.

According to McKinsey, South

Africa’s agri-processing industry

contributed R78-billion in 2014 to

South Africa’s GDP and employed

362 000 people.

In anticipation of increased

volumes, and to assist small-scale

SOUTH AFRICAN BUSINESS 2019

66


OVERVIEW

farmers get access to mainstream markets, agri-parks are being rolled

out at district level in every province. These parks aim to combine production

facilities, logistics, marketing, training and extension services.

The other way in which small-scale farmers are connecting to

the mainstream economy is through the supplier development

programmes of major retailers. For example, Woolworths receives

“indigenous” eggs from Bosveld hens from an independent farmer

in Bela Bela, cabbage and butternut produced by five smallholders

is channelled by Spar through its Fresh Assembly Point in Mopani

and the Ezemvelo Direct Farm Programme of Massmart left behind

a legacy of small-scale farmers now connected to the fresh produce

supply chain – and a packhouse in Limpopo run by a co-operative.

Major agricultural companies

In 2017 Kaap Agri listed on the main board of the JSE. Although the

agricultural sector contributes just 4.3% to the stock exchange’s total

market capitalisation, the percentage is expected to grow.

Companies like Kaap Agri provide services beyond speciality agricultural

services such as grain handling. Activity in areas such as fuel

retailing and building materials give these companies a broad retail

footprint.

When South Africa’s first alternative stock exchange in South

Africa started trading in February 2017, the first listing was agricultural

company Senwes and its holding company. The JSE has also launched

a wool futures contract as the sector strives to add 25-million kilograms

to the existing crop of about 44-million kilograms.

Afgri, biggest of the former co-operatives that are now multidimensional

companies, has delisted from the JSE but in 2017 bought

the South African Bank of Athens.

Zeder Investments is the agricultural arm of investment holding

company PSG Group (which is well known through Capitec Bank

and Curro schools). Zeder has been increasing its stake in agricultural

companies, most notably Capespan. Capespan has a turnover of

R7.6-billion across three divisions: farms, logistics and fruit.

Zeder also owns 27.1% of Pioneer Foods which makes and distributes

many big food and drink brands across Southern Africa, including

Weet-Bix, Liqui-Fruit, Ceres, Sasko and White Star. The company has

an annual turnover of R20-billion and it has two Bokomo facilities in

the United Kingdom.

Most former co-operatives which are now agri-businesses have

a specific geographic and farming sector focus (BKB is strong in the

eastern Free State and Eastern Cape and concentrates on wool and

mohair) while others like Afgri have a national presence.

Senwes has a strong grain division and it controls 68 silos. Its operations

are run from Klerksdorp in the centre of the country in North

West Province. Other companies

include NTKLA (Limpopo), GWK

(Northern Cape), Klein Karoo

Agri, VKB (eastern Free State and

Limpopo), Kaap Agri (from the

Boland to the Eastern Cape and

up to Namibia), SSK (Overberg)

and TWK (KZN and Mpumalanga).

These facts show the large

influence which the agricultural

sector has in South Africa. When

national agricultural output

surged in mid-2017 on the back

of good rains and harvests, the

country was lifted out of the technical

recession into which it had

fallen in the first quarter.

A bumper maize crop of

16.4-million tons for 2016/17

provided evidence that the

long drought was over, at least

in the central and northern regions.

Local demand for maize

is 10.8-million tons. The Western

Cape drought continued for

longer, but decent rains were

recorded in the first half of winter.

Investment

The Land Bank intends to invest

R1-billion in supporting black

agricultural entrepreneurs. The

hope is that by making the sector

more inclusive, long-term food

security will be ensured.

Statistics SA reports that

about 847 000 people work

in agriculture in South Africa.

Wandile Sihlobo of the

Agricultural Business Chamber

notes that two-thirds of these

jobs are in the field crops and

horticultural sectors, which

should therefore be the focus of

future investment. Other areas

67 SOUTH AFRICAN BUSINESS 2019


OVERVIEW

where investment will pay off are bringing under-utilised land (in

communal areas and land reform farms) into commercial production,

expanding irrigation schemes and targeting areas that have

the highest potential for growth.

Fruit, sugar and wine make up about 7% of the country’s total export

basket. Avocadoes, tomatoes and macadamias are among other

important export crops. Primary agriculture provides 5% of formal

employment in South Africa.

Several of the Special Economic Zones around South Africa either

have or will in the future have, agri-processing facilities. Examples

include existing tomato paste and dairy facilities at Coega IDZ and

plans to develop the SEZ at Harrismith (Maluti-A-Phofung) into a hub

for agri-processing. The Nkomazi SEZ in Mpumalanga will promote

agri-processing and the Mpumalanga International Fresh Produce

Market currently under construction in Mbombela will boost the

agricultural sector in the region.

ONLINE RESOURCES

Agricultural Research Council: www.arc.agric.za

Fresh Produce Exporters’ Forum: www.fpef.co.za

Grain SA: www.grainsa.co.za

National Department of Agriculture, Forestry and Fisheries:

www.daff.gov.za

SA Table Grape Industry: www.satgi.co.za

Agricultural variety

A total of 70% of South Africa’s

grain production is maize, which

covers 60% of the cropping area

of the country. The South Africa

feed industry has an annual

turnover of about R50-billion with

most of the raw material being

soya and maize.

KwaZulu-Natal and

Mpumalanga produce sugar,

but volumes are down. The Free

State Province supplies significant

proportions of the nation’s

sorghum, sunflower, potatoes,

groundnuts, dry beans, and almost

all of its cherries.

Products distinctive to

South Africa, such as rooibos

tea (Western Cape) and marula

berries (Limpopo) hold great potential

to capture niche markets

internationally.

South Africa is famous for its

fruit, of which 35% is citrus, 23%

subtropical and nuts, 26% pome

fruIt, 11% stone fruit and 9% table

grapes. Export volumes, particularly

in tropical fruits such as

mangoes and avocadoes, have

been growing rapidly. Most of

South Africa’s citrus and subtropical

fruit comes from the eastern

part of Limpopo.

There are about 3 500 wine

producers in South Africa, with

the large majority located in the

Western Cape. The industry earned

R17.5-billion in exports in 2016.

Livestock farming is the largest

agricultural subsector in South

Africa and the Eastern Cape is the

largest livestock province. South

Africa has a beef-herd of 14-million.

South Africa produces about

55% of the world’s mohair.

SOUTH AFRICAN BUSINESS 2019

68


facilitator of world class services for

South Africa and the rest of the

Realising continent long-term

by participating in

the following sectors

travel & tourism, media,

value and driving

food & logistics, and

property.

transformation

Thebe Food and Agro-processing.

areas of energy, resources, power,

infrastructure as well as water. The

Services Division seeks to become a

FOCUS

The Thebe Food and Agro-processing subdivision

of Thebe Investment Corporation

aims to realise long-term value from its

investments in the food production and

preparation sectors and to drive and champion

transformation in the agro-processing sector. We

achieve this through investing in and managing

strategic agro-processing assets with an explicit aim to

develop and facilitate the integration of black farmers

and agro-processors into established supply chains.

The long-term aspiration is to be invested in leading

operators that operate across the continent.

Thebe Food and Agro-processing intends

to continue to build a significant food services

CONTACT DETAILS

Contact person: Mokgethi Tshabalala

(General Manager, Thebe Food and

Agro-processing)

Tel: +27 11 447 7800

Email: mokgethi@Thebe.co.za

Website: http://new.thebe.co.za/

company by 2020. Key to this strategic intent are four

main drivers, namely food production and exports,

food processing and distribution, food marketing,

and an emerging farmers development programme.

Thebe is currently exposed to the food sector

through its investment in Compass Group SA, a leading

industrial caterer, and GROW (formerly BothaRoodt),

a fresh produce market agent at the Johannesburg

Fresh Produce Market and HarvestFresh.

In South Africa, CGSA, in which Thebe has a

significant shareholding, caters for a variety of clients

including private sector, government and education

institutions. Partner company Compass Group PLC is

one of the largest food services and facilities company

in the world, operating in over 50 countries.

HarvestFresh, a recent acquisition, is a leading

grower, packer, processor and distributor of fresh

produce to the retail market.

Global trends indicate an increasing demand for

“ready-to-eat” meals. South Africa has seen giant

retailers respond to this through various offerings

with the scope and demand increasing. Thebe is

responding to this opportunity.

Transforming the sector

The development of farmers for food security is at the

core of Thebe’s strategy. Thebe will partner with key

agricultural formations and management companies

to develop land owned and managed by emerging

farmers and communities, in partnership with the

relevant beneficiaries. Existing Thebe investments will

be leveraged to provide critical market intelligence

to assist farmers to understand market dynamics to

compete effectively. Thebe will also explore development

funding models for feasible development

projects as appropriate.

69

SOUTH AFRICAN BUSINESS 2019


OVERVIEW

Mining

Mine owners are preparing for change.

The South African mining industry is going through a time of

change. Gold and platinum mines are under pressure because

of global price fluctuations and the cost of doing business.

Safety issues are to the fore and national mining policy is the

subject of heated debate.

The body that has represented mine owners since 1889 has undergone

a re-branding, a strong symbol that change is under way. What used to

be the Chamber of Mines is now the Minerals Council South Africa. The

Minerals Council wants to reposition the South African mining sector so

that it regains its place as the country’s “foremost industrial sector”. It aims

to double real investment in mining by 2030. The council wants to assist in

obtaining the objectives of the National Development Plan (NDP) regarding

economic growth, development and transformation.

The gold sector has shed several thousand jobs in the last five years

and in mid-2018 a large cutback in platinum sector employment was announced.

A proposed new mining charter (Mining Charter 3) did not go

down well with mining companies, and the new President of South Africa,

Cyril Ramaphosa, appointed a new mining minister to come up with a

better arrangement. Both Ramaphosa and Minister Gwede Mantashe have

held the post of Secretary-General of the National Union of Mineworkers

so there is no shortage of first-hand knowledge of the sector in the upper

echelons of government.

SECTOR INSIGHTS

The Gamsberg zinc and lead

project (pictured) is South

Africa’s biggest.

• Afrimat has expanded into

mining.

The level of black ownership and

whether that percentage must

be “topped up” every time a black

shareholder sells are two of the

contentious issues that must be

resolved. A court ruling in favour

of “once-empowered, alwaysempowered”

will probably not

be the end of the debate. The

Minerals Council says that the

value of BBBEE deals since the

year 2000 is R205-billion.

SOUTH AFRICAN BUSINESS 2019

70

cont on pg 72


E&T Minerals

A hands-on approach is paying dividends for

this coal business and its clients.

PROFILE

E&T Minerals is a South African-based commodity brokerage and trading

house specialising in coal, coking coal and other coal products.

Vision

E&T envisages building an African business with global reach which

capitalises on the continent’s rich natural resources while guaranteeing

efficiency, reliability, excellence and transparency to and for its clients.

Services

• commodity trading

• sampling

• contract management

• management of performance risk

• logistical management

Reliability and efficiency

Founded in 2013, E&T Minerals is poised for a new dawn as the enterprise

has matured with experience. Supported by a far-reaching network of

suppliers and producers in addition to a very hands-on approach, what

sets the E&T team apart is a constant physical presence in the coal fields

which ensures the smooth running of all supply contracts. This includes

quality maintenance by efficient sampling of all product stockpiles,

management of logistics by

supervision of all trucks loading

material from the different sites up

to the clients’ point of delivery. As a

result of this approach, reliability of

services to clients is assured.

Emmanuel Ngulube

Emmanuel Ngulube is the cofounder

and current CEO of E&T

Minerals. His responsibilities

include sales, marketing, business

development and the client

relationships.

Having worked for many

years as a yellow metal trader,

Emmanuel has an extensive

network within the mining

industry along with an excellent

understanding of the processes

of the domestic and international

commodities market. Emmanuel

studied finance at the University

of Johannesburg.

71

SOUTH AFRICAN BUSINESS 2019


OVERVIEW

Guided by the Zambezi Protocol, the Minerals

Council wants mining to be more positive and constructive,

working better with the communities in

which it operates. New CEO, Mxolisi Mgojo, is simultaneously

leading his company, Exxaro Resources, on a

programme to make mining sustainable through water

sharing with local communities and finding ways to

help communities gain access to energy.

Access to energy is something that mining concerns

and related industries are working on. Many mines are

putting plans in place to go “off-grid” as far as possible.

Steel producer ArcelorMittal South Africa has

asked the National Energy Regulator of South Africa

(Nersa) for a negotiated price agreement (NPA) to help

it cope with the volatility in exchange rates and lower

domestic demand. Silicon Smelters, which has plants

in Mpumalanga and Limpopo, has asked for a two-year

negotiated price agreement (NPA) on electricity, which

would allow it to resume production. Nersa has the

power to grant such exemptions in a strategic industry.

Investments

Limpopo Province is the site of two new Special

Economic Zones which will have a mining focus. Mineral

beneficiation is a key component of the newly accredited

Musina-Makhado Special Economic Zone (SEZ) in the

far north of Limpopo. In 2018 nine Chinese companies

committed to investing more than $10-billion in projects

related to the zone’s four main areas of activity: a coking

plant, a power plant, an alloy factory and the manufacture

of steel. Shenzhen Holmor Resources Holdings, as the

manager of the Energy and Metallurgical Cluster within the

SEZ, will invest about R40-billion to create infrastructure.

The planned Tubatse Platinum SEZ (for which accreditation

has been submitted) will focus on platinum

group metals beneficiation. According to the Limpopo

Economic Development Agency, 17 new mines were

established in the greater Tubatse/Burgersfort/

Steelport area between 2001 and 2016, and a further

22 new mines are planned. The completion of the

large new De Hoop Dam makes these plans possible.

A Mining Supply Park is envisaged which will be a big

boost for local businesses and suppliers. Getting local

small businesses supplying to the mining sector is a

goal of the provincial authorities.

E&T MINERALS SUCCESS STORY

It’s said that the true content of one’s

character is not defined by good times but

rather by times of adversity. This rings true

with E&T Minerals. Being in a volatile sector

such as commodity trading, we found

ourselves in dangerously troubled waters

in the last quarter of 2015 through to the

first half of 2016. We took this experience

as an opportunity to introspect, assess

the market, re-evaluate our strategy

and organisational

structure to map

a sustainable path

forward. In 2018,

we have not only

survived, we have

built a solid team

and organisation

that is growing at a

healthy pace.

Emmanuel Ngulube

Impala Platinum (Implats) has created Tubatse

Platinum, a vehicle in which local businesses

hold a nine percent stake in the Marula platinum

mine which is located north of Burgersfort. Two

other empowerment partners are involved.

A black empowerment deal in the Northern

Cape recently reported good returns. Hotazel

is the site of a relatively new manganese mine,

Tshipi é Borwa. Tshipi e Ntle Manganese Mining

(Tshipi) is a joint venture between Pallinghurst Co-

Investors and a black empowerment company

representing several groups called Ntsimbintle

Mining. A number of non-government organisations

(NGOs) such as the Black Sash have a 2.2%

stake in the mine through Ditikeni Investment

Company. Indications are that Tshipi can produce

about 2.2-million tons of ore per year, for about

60 years. Engineering News reported in 2017 that

Ntsimbintle celebrated a R300-million dividend

pay-out in July, with a further R500-million agreed

on for disbursement in September.

Australian miner Orion is putting considerable

resources into investigating the possible

SOUTH AFRICAN BUSINESS 2019

72


Modi Mining

PROFILE

Modi offers differentiated contract mining services in a

variety of fields across three provinces.

About Modi Mining

Modi Mining is a 100% black South African owned company

founded and owned by mining engineer and entrepreneur Mr

Samuel Molefi and a female entrepreneur, Christina Motlapele

Molefi. Modi Mining started operations in 2011 and has grown to

be operational in three provinces.

In the North West Province, Modi Mining serves corporate mining

houses in the platinum sector (RBPlats, Impala Platinum and Lonmin).

In Mpumalanga Province, Modi works with South32 in the coal sector.

The company also manufactures and supplies products for mines

such as Sibanye Gold, Gold 1 and Harmony Gold, all of which are

based in Gauteng Province.

Vision

To be the preferred service provider and supplier in the mining

industry.

Services

Modi Mining is a multi-faceted company within the mining industry

focusing on contract mining services (surface and underground),

civil and bulk earth works, crushing and screening, load and haul,

mine rehabilitation, manufacture and supply of blasting barricades.

A detailed breakdown of services is as follows:

Underground mining services

• Conventional mining method:

stoping; developing; vamping and

sweepings

• Equipping and reclamation

• Mechanised mining method: capital

development (TMM); board and

pillar

• Hybrid mining method

Open cast mining services

• Top soil and overburden stripping

• Coal seam mining

• Rehabilitation, dump/stockpile management

Manufacturer and supplier of:

• LDPE blasting barricades and pipes

Civil services

• Civil and bulk earth works

• Screening and crushing

• Load and haul

www.modimining.co.za

73

SOUTH AFRICAN BUSINESS 2019


OVERVIEW

Sasol Mining is very active in Mpumalanga.

revival of the Prieska Zinc-Copper Project in the same province. A

maiden mineral resource estimate was published in February 2018

and 14 drill rigs (above and below ground) are at work looking into

the site’s prospects.

Vedanta Zinc International’s nearby Gamsberg zinc and lead project

is the biggest current mining project in South Africa. The mine, near

Aggeneys, has resources and reserves of 214-million tons. The mine is

already having a significant impact on employment. In the first phase,

4Mtpa of ore will be mined, producing 250 000tpa of zinc concentrate.

Aggeneys is responsible for approximately 93% of South Africa’s lead

production, and 12% of all world lead exports. Zinc is less abundant,

but the province is still responsible for about 43% of South Africa’s

overall zinc production.

Afrimat, a listed construction materials supplier and industrial minerals

group, has added open-pit mining to its portfolio with the R322-

million acquisition of the Diro mine (Northern Cape), which had been in

business rescue. Production was on track for the target of one-million

tons per year, but a problem on the railway line that delivers iron ore

to the port of Saldanha led to production being scaled down. Afrimat

had a transport deal with Transnet and is selling iron ore in China.

Anglo American is investing R2-billion to expand production at

its Venetia diamond mine near the town of Musina in Limpopo. The

project to convert the open-pit mine to a vertical-shaft mine will

substantially extend the life of the mine.

ONLINE RESOURCES

Minerals Council of South Africa: www.mineralscouncil.org.za

Geological Society of South Africa: www.gssa.org.za

Mining Qualifications Authority: www.mqa.org.za

National Department of Mineral Resources: www.dmr.gov.za

South African Institute of Mining and Metallurgy:

www.saimm.co.za

Ivanplats has started sinking

shafts at its new mine

near Mokopane south-west of

Polokwane. If the mine achieves

the projected production rate of

12Mtpa with 1.2-million ounces

of PMG, it will rank as the biggest

PGM mine in the world. Northam

Platinum has invested R900-

million on a smelter expansion

project at its Zondereinde mine

south of Thabazimbi.

A R1.6-billion processing plant

is being built at Cullinan by Petra

Diamonds, with a throughput capacity

of 6Mtpa. The mine’s orebody

contains a diamond resource

of 194Mcts which is why Petra is

expanding with a goal of annual

production of 2.2Mcts by 2019.

Nkomati Anthracite in

Mpumalanga has been revived

after an investment from Unicorn

Capital Partners, formerly Sentula

Mining. The Mpumalanga

Economic Growth Agency (MEGA)

and local communities are also

shareholders. The mine has proven

resources of 8.7-million tons and

upwards of 400 jobs were created

over the last two years. The highgrade

anthracite that the mine

will produce is suitable for the

ferro-metals industry because it

has low phosphorus and sulphur

levels and high fixed carbon

percentages.

Coal giant Exxaro has

committed R3.8-billion to its

Belfast project, an investment

that will create 1 160 jobs and

have an impact on the GDP (over

the life of the mine) of R39-billion.

Exxaro is also extending the life

of its Leeuwpan Mine by another

10 years. The mine has 1 200

permanent employees.

SOUTH AFRICAN BUSINESS 2019

74


Oil, gas and

petrochemicals

National policies are focussing on gas.

The Liquefied Natural Gas Independent Power Producer

Procurement Programme (LNG IPPPP) is part of the programme

of the Department of Energy which encourages private

investment in renewable energy, namely the Renewable

Energy Independent Power Producer Procurement Programme

(REIPPPP). The total allocated to gas-to-power in the national power

plan is 3 726MW, of which 3 000MW is for LNG.

In 2016, the Department of Trade and Industry (dti) established a

Gas Industrialisation Unit (GIU). The first two sites identified by the DoE

for LNG plants are Richards Bay (2 000MW) and the Coega Industrial

Development Zone (1 000MW) in the Eastern Cape. This has the potential

to turn the Richards Bay Industrial Development Zone (RBIDZ) and its

Eastern Cape counterpart into energy hubs. The fact that Mozambique

has significant offshore deposits is a factor in this ambition.

Large commercial gas companies such as Afrox and Air Products

have plants within the Coega IDZ. First Automobile Works has established

its motor assembly plant next door to Air Products’ air separation

unit, giving it ready access to industrial gas.

The Coega IDZ is also home to the country’s first gas-fired plant to

be run by a private consortium, the Dedisa power plant. A new gas

turbine open cycle power plant near Durban has been commissioned

by Avon Peaking Power.

The regulator and promoter of oil and gas exploration in South Africa,

Petroleum Agency South Africa, has awarded coalbed-methane-gas

SECTOR INSIGHTS

Large gas-to-power plants

are planned at two major

ports.

• The Port of Saldanha has

launched a new LPG plant.

exploration rights in KwaZulu-

Natal and natural gas exploration

permits in the Free State. Early surveys

suggest that the Free State

has 23-billion cubic feet of gas

underground. If this is confirmed,

then four new power stations

could be built in the province.

Afrox is spending R200-million on

a plant to extract helium in the

Free State. Tests have begun in

the Karoo in search of shale gas.

A new addition to South Africa’s

pipeline network is a pipe to get

natural gas from Mozambique to

SOUTH AFRICAN BUSINESS 2019


OVERVIEW

Gauteng. SacOil’s R90-billion project aims to deliver gas to Johannesburg

and the nearby towns in 2020.

The Port of Saldanha in the Western Cape launched a new openaccess

liquefied petroleum gas (LPG) plant in 2017. It will be run by

Sunrise Energy.

The major economic sectors using gas are the metals sector and

the chemical, pulp and paper sector. Brick and glass manufacturers

are also big consumers.

An agreement has been signed between PetroSA and Russia’s

geological exploration company, Rosgeo, which will see $400-million

invested and gas delivered to the gas-to-liquids refinery at Mossel

Bay (Mossgas).

Assets

The South African oil industry generates annual sales of about

R365-billion and includes global giants such as Engen, BP, Shell,

Total and Caltex. In 2016, Chevron began the process of exiting

South Africa. Sinopec of China has bought a 75% share in Chevron

South Africa for R12.6-billion. Assets include a lubricants plant

in Durban, an oil refinery in Cape Town and 820 petrol stations

across South Africa and Botswana. South Africa’s own global giant,

Sasol, is a major player in the oil sector and the only player in the

petrochemicals sector.

Most of the oil that feeds the country’s four crude-oil refineries is

imported. In addition to South Africa’s crude-oil refineries, natural-gas

conversion plant, coal-to-fuel and gas-to-liquid crude-oil refineries,

Sasol produces fuel from coal at its Secunda facility and PetroSA has

the country’s only gas-to-liquid (GTL) facility at Mossel Bay.

The Chevref oil refinery in the Cape Town suburb of Milnerton produces

about 110 000 barrels a day of South Africa’s total production

of 703 000 barrels a day. The Natref refinery is strategically placed at

Sasolburg near to the industrial hub of southern Gauteng. The petrochemical

complex at Sasolburg is a major national asset. One of Sasol’s

many companies, Sasol New Energy, is moving the group away from

reliance on fossil fuels. The Natref refinery is a joint venture between

ONLINE RESOURCES

Independent Power Producers Programme:

www.ipp-projects.co.za

National Energy Regulator of South Africa: www.nersa.org.za

Petroleum Agency SA: www.petroleumagencysa.com

South African National Energy Association: www.sanea.org.za

South African Petroleum Industry Association: www.sapia.co.za

Sasol Oil (64%) and Total SA (36%). It

is a technologically advanced facility,

which refines heavy crude oil into

petrol, diesel, commercial propane, jet

fuel and bitumen.

KwaZulu-Natal hosts two oil

refineries which jointly account

for more than 300 000 barrels of

refined crude oil. South Africa’s

biggest refinery is Sapref in Durban.

Owned jointly by Shell SA Refining

(25%), Thebe Investments (25%) and

BP Southern Africa (50%), it has a

capacity to produce 180 000 barrels

per day. The Enref refinery owned by

Engen can produce 135 000 barrels

per day.

Safor is a base-oil production facility

(jointly owned by Engen, Caltex and

Total but operated by Engen) that produces

45% of Southern Africa’s base

oils. Engen also owns the adjoining

Lube Oil Blend Plant, which produces

more than 72-million litres of finished

lubricants annually.

A new facility is the 118 000m³

Bergan fuel storage unit. It comprises

12 tanks located on the Eastern Mole

of the Port of Cape Town.

Getting fuel to the province of

Gauteng is the key mission of the new

multi-purpose pipeline (NMPP) which

started delivering fluids in 2012. The

NMPP terminals allow for greater flexibility

in supply. Refined products such

as jet fuel, sulphur diesel and both

kinds of octane petrol are carried.

The liquid fuels and gas networks

of Transnet Pipelines has intake stations

at both Durban refineries (petroleum),

while the gas pipeline runs

from Secunda to Durban, with diversions

to the manufacturing hubs of

Newcastle and Richards Bay, and

along the coast between Durban

and Empangeni.

SOUTH AFRICAN BUSINESS 2019

76


Poised for growth

INTERVIEW

Dickson Ramokone, CEO of Bakone Holding Investment,

outlines his company’s ambitious expansion plans.

What drives your business

strategy?

Initially, it was to achieve control

of the ore itself. I was interested

in base metals and I pursued a

career trading in diamonds and

gemstones for almost 20 years. That

was my passion.

When did you start?

It was a long time ago, about 2005.

Things were hectic in the early

days. It takes a number of years to

put something together and we

were not financed by banks, we had

to do it all ourselves.

BIOGRAPHY

Growing up in a business-oriented

household in Soweto, Dickson

Ramokone quickly learnt “the

value of a penny”. Exposed as he

was to family spaza shops and

other ventures, he learnt to deal

with figures and became very

aware of what was happening in

the business world. He has been

involved in base metals, diamonds

and the construction business for a

number of years.

Now you are quite diverse?

I have a whole lot of things that I have put

together. We have several companies that we

operate, to align with different sectors. In addition

to metals and agriculture, we also have logistics

and prospecting rights for different minerals. We

are always looking for opportunities.

Can you give us an example?

If we see that the market needs diesel, then I will

look to find the concession or be the licensee to

make sure that it happens. We will see to it that

people and companies get their diesel. This year

I’ve done about 30 deals. Things fall in place.

What are some of your current projects?

We are getting into commercial farming, with

several farms between 800ha and 1 500ha under

irrigation. The aim is to build vegetable sorting

and packing facilities for the market. We have also

done several property deals and we are in the

process of setting up a finance company.

Do you own all your subsidiaries?

Yes, I am the sole owner, but I am going to be

buying equity in an existing manufacturing facility

soon.

And future plans?

We are buying equity in ore concessions and

gems and we intend to list. We are on the verge

of listing 12 companies on the main board of

the JSE.

77 SOUTH AFRICAN BUSINESS 2019


PROFILE

Bakone Holding

Investment

Professionals in investment and wealth growth.

Bakone Holding Investment is a holdings and

investment company focused on growing and

investing in various ventures. To work on such

a complex and powerful financial market as an

investor is not easy. It is necessary to have not only expertise,

but also a great positive experience. Otherwise,

the investor risks losing all of his or her investments.

Bakone Holding Investment has mastered the skills of

investment and has built a large investment portfolio.

Bakone Holding Investment offers customers the

opportunity to earn and grow in the investment industry.

The company has an investment portfolio in

various companies.

Leadership

Dickson Ramokone, CEO of Bakone Holding

Investment, is a seasoned businessman and entrepreneur

with many years of experience in various

sectors. Having learnt from his parents’ retail

enterprises, he worked in minerals for many

years and more recently has been branching

out into property, agriculture, logistics and

construction.

Mother of companies

The companies that make up the Bakone

Holding Investment portfolio cover a wide

range of sectors:

• Financial

• Commodities (Coal, diamonds and

minerals)

• Fuel and logistics (including Bakone Fuel)

• Trade

• Construction and civils

• Agricultural produce

• General.

CONTACT DETAILS

Contact person: Mr DK Ramokone (CEO), Bakone Holding Investments

Tel: +27 78 868 9377 | Fax: 086 525 9190

Email: dickson@bhinvestments.co.za

Website: bhinvestments.co.za

SOUTH AFRICAN BUSINESS 2019

78


Financial

North Capital First

Specialists in capital investment and growth. We

know when to invest and how to grow. Our main

goal is to assist businesses achieve their ambitions

for growth. Our target market is to invest in businesses

over which we have management control or

an ability to exert significant influence. To promote

opportunities for professional achievement for talented,

motivated and suitably qualified black executives

to participate in the economic transformation

of South Africa. North Capital First offers investors

long-term capital appreciation by investing in a diversified

portfolio of unlisted investments managed

by North First Capital.

Tel: 078 868 9377

Email: dickson@northcapitalfirst.co.za

Website: www.northcapitalfirst.co.za

Commodities

Fency Diamonds

The company currently provides services to companies

ranging from small-scale mining to large commercial

mining projects. Fency Diamonds is a clientdriven

commodity trading company that puts the

needs of clients first. Our goal is to deliver a superior

advantage to all our business partners, providing them

with specialist expertise and deep market knowledge.

Our dedicated team of specialists balance daily activities

and long-term strategies, seamlessly connected

with a worldwide network of suppliers, manufacturers

and jewelers. Over the years we have demonstrated

supreme competence in service delivery and living up

to the commitments made to our clients.

Tel: 078 868 9377

Email: dickson@fencydiamonds.co.za

Website: www.fencydiamonds.co.za

White Blue Insurance

Life insurance services tailored products for lowincome

families. Affordable life cover and funeral

cover for individuals and families. The company

aims to partner with insurance brokers who can sell

services in remote areas.

Tel: 076 900 3933

Email: dickson@wbinsurance.co.za

Website: www.wbsinsurance.co.za

Kgwale For Projects

Established in 2005, this business has a professional

and committed team, specialising in commodities

trading, marketing, brokerage and finance. The focus

is on food-stuffs, farming, export and import and big

brand retailers. Other services include marketing,

advertising, branding and developing a corporate

identity for clients.

Tel: 078 868 9377

Email: dickson@kgwaleprojects.co.za

Website: www.kgwaleprojects.co.za

Master Ore & Diamonds Holdings

Specialists in Iron ore & Diamond mining, sales and

distribution, including the sale of individual stone

diamonds. Master Ore & Diamond Holdings is a diversified

business group with interests in mineral

resources and industrial sectors. We believe that the

best way to stay ahead is to think ahead and are confident

of leading the way as we move into the future

guided by thought leadership which has multiple

years of experience of building successful businesses

and a highly talented and culturally diverse team.

Connecting decision makers to a dynamic network

of information, people and ideas with unrivalled expertise

in the exploration and mining.

Tel: 078 868 9377

Email: dickson@modholdings.co.za

Website: www.modholdings.co.za

79 SOUTH AFRICAN BUSINESS 2019


FOCUS

Far East Coal

Far East Coal is a coal mining company with a focus

on thermal coal production in South Africa, resource

exploration and development. The company aims to

create shareholder value through the acquisition, exploration

and development of coal projects in South

Africa. Our focus is on being a diversified operation

which focuses on commodity processing with special

interest in coal processing and advancing the development

of coal projects in Mpumalanga and other

regions, to service the public and private sector for

power generation and industrial use.

Tel: 078 868 9377

Contact for all subsidiaries Tel: 078 868 9377

Email: dickson@fareastcoal.co.za

Website: www.fareast.coal.co.za

Obovu Coal

Is a coal mine situated in Mpumalanga Province which

will supply bituminous coal to inland areas and the

export market. Obovu Coal serves customers in the

public and private sector by supplying coal in bulk

for industrial, domestic and export use. We supply

coal to the power generation industry, as well as

other coal traders and end users. Obovu Coal aims

to be is a national distributor, covering all provinces in

South Africa as well as many countries on the African

continent. Obovu Coal is a subsidiary of Far East Coal,

where a coal processing plant will be situated.

Tel: 078 868 9377

Email: dickson@obovucoal.co.za

Website: www.obovucoal.co.za

Black Ingwe Coal

Our main function is coal mining. Coal is valued for its

energy content and, since the 1880s, has been widely

used to generate electricity. The steel and cement

industries use coal as a fuel for extraction of iron from

iron ore and for cement production.

We offer the following underground coal mining

services: new development, board and pillar mining,

mining with continuous miners, conventional drilling

and blasting, continuous miner pillar extraction (total

and partial extraction), establishing box cuts and edits

into high walls, underground engineering infrastructure

and beneficiation of coal services.

Tel: 078 868 9377

Email: dickson@blackingwecoal.co.za

Website: www.blackingwecoal.co.za

Fuel and Logistics

Bakone Fuel and Logistics

An integrated South African company engaged in

the supply and delivery of petroleum and petroleumrelated

products to niche markets within the bulk

fuels trading environment, both locally and globally.

What we do: Our operational footprint in Africa allows

us to offer a full bouquet of oil and gas services,

backed by international alliances, thereby ensuring

world-class delivery every time.

Our vision: To become the leader in petroleum supply

based on our expertise and our commitment to

sustainable earnings, growth, value creation and the

re-investment in human capital.

Transportation of fuel: Product transportation,

market intelligence, distribution, marketing,

trading and finance.

Tel: 076 900 3933

Email: dickson@bakonefuelandlogistics.co.za

Website: www.bakonefuel.co.za

Construction and civils

Versich Construction and Civil

Construction of township development infrastructure

and general municipal services. Construction and

servicing of bulk and internal water and sewer systems.

Tel: 078 868 9377

Email: dickson@versich.co.za

Website: www.versich.co.za

Red Construction & Civil

Red Construction & Civil is a construction and

maintenance company offering building and road

construction and maintenance, sewer and drainage

systems construction, industrial structures and

general construction services. Customers include

municipalities and industrial and domestic clients.

Tel: 078 868 9377

Email: dickson@redconstruction.co.za

Website: www.redconstruction.co.za


Cambium Development

Cambium Development is a professional South

African civil construction service provider. The

company was established to absorb the previously

disadvantaged into mainstream economic activity for

the betterment of life for the majority. The company

has set its objective to improve the living conditions

of communities.

Tel: 078 868 9377

Email: dickson@cambiumdevelopment.co.za

Website: www.cambiumdevelopment.co.za

Agricultural produce

Mr Harvest Veggies & Fruit

FOCUS

We supply quality organic premium-quality fresh

fruit and vegetables directly to the consumer. Mr

Harvest Veggies & Fruit is a dynamic and progressive

fresh-produce marketing and processing company.

Tel: 078 868 9377

Email: dickson@mrharvest.co.za

Website: www.mrharvest.co.za

Altitude Construction and Civil Consultants

Altitude plans and constructs roads and streets. From

residential streets to national highways connecting

the whole country, Altitude Construction and Civil

Consultants has it all covered.

The company offers construction and maintenance

services for roads, buildings, industrial structures,

sewer and drainage systems, water drainage system

construction and maintenance, water drainage

systems along roads, pavements and within cities

and shopping centres.

Type of work: Commercial and residential

construction, road construction and maintenance,

drainage and sewer systems construction and

maintenance. Shopping centres, office spaces and

general commercial structures.

Tel: 078 868 9377

Email: dickson@accconsultants.co.za

Website: www.accconsultants.co.za

DKR Aluminium and Wood

A specialist designer and manufacturer of aluminium

and wooden door and window frames. We can

design, manufacture and install most architectural

aluminium door and window systems, including

sliding/folding doors, casement windows, shop

fronts, sliding doors and double-glazed units for the

domestic and commercial markets. Our windows

and doors are manufactured from the highest quality

architectural aluminium. Our aim is to become the

biggest provider to the architectural aluminium

manufacturing trade.

Tel: 078 868 9377

Email: dickson@dkraw.co.za

Website: www.dkraw.co.za

Dickson Import and Export

Dickson Export and Import helps feed the world

by sourcing and exporting or importing complete

food product lines and brands from fresh produce

to beverages. We export fresh produce fruits and

vegetables from South Africa to the world. Our fresh

produce reaches its destination as fresh as when it

was picked from the farm.

Sea and air shipments transport organic, frozen and

dry foods. We have developed strong relationships

with many small, medium and large food

manufacturers willing to offer their product range

internationally.

Tel: 078 868 9377

Email: dickson@dicksonexportimport.co.za

Website: www.dicksonexportimport.co.za

General

Boys Will Be Boys Entertainment

Specialist event planning and management, festivals

and concerts.

Tel: 078 868 9377

Email: dickson@bwbbentertainment.co.za

Website: www.bwbbentertainment.co.za


OVERVIEW

Water

Restructured water boards have greater responsibilities.

SECTOR INSIGHT

Companies and households are

focussed on water saving like

never before.

• An agency has been created

to help municipalities deliver

water.

A

new organisation has been formed to help municipalities

deliver services. Research has shown that many municipalities,

which in South Africa are the main delivery agent of

water and waste-water services, are either functioning very

badly or barely functioning at all.

According to Water Wheel magazine, 37% of water delivered to

the nation’s municipalities is lost, at a cost of R7-billion per year. This

presents an opportunity for innovative companies to provide better

pipes and smart meters.

The Municipal Infrastructure Support Agency (MISA) falls under the

Ministry for Cooperative Governance and Traditional Affairs and will

assist municipalities to plan for, provide and maintain infrastructure.

The first action of MISA was to commission 81 engineers and town

planners to get to work in areas that need the most help.

A study jointly commissioned by the Water Research Commission

and the South African Local Government Association (SALGA) found

that the country’s four-in-a-million ratio of engineers is a long way from

the required 50-per-million. One response at national level was the

importation of Cuban engineers to assist in the short term.

Another response to the municipal problem is a new national

strategy which gives a bigger role to well-resourced water boards such

as Umgeni Water and Sedibeng

Water. Rand Water has expanded

its original footprint and now

serves an area which includes

Gauteng, and parts of Limpopo,

North West, Mpumalanga and the

Free State. The national Minister

of Water and Sanitation is the

shareholder, representing the

government of South Africa.

In terms of the National Water

Resource Strategy, catchment

area management agencies

have been established to oversee

water resource management

on a regional basis. The

Imkomati-Usuthu Catchment

Management Agency covers

Mpumalanga, parts of Limpopo

and part of the Kingdom of

Swaziland. Another example

of a CMA is the Breede-Gouritz

Catchment Management

Agency in the Western Cape.

The National Water Resource

Strategy takes into account

groundwater to a far greater

degree than previous plans.

Extracting groundwater takes skill

and money, but with droughts

becoming commonplace it is

likely to become a much higher

priority in water planning.

SOUTH AFRICAN BUSINESS 2019

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Innovation

A long drought was finally broken in most of the country in late 2016,

but the Western Cape continued to experience severe shortages until

mid-2018. Tenders for desalination in various guises (including barges

in Cape Town harbour) were issued and there is no doubt that a new

phase in water management has begun.

Water harvesting (including installing tanks to collect rain water from

roofs) has not been comprehensively exploited. Innovators and investors

in the sector have a lot of scope to develop products and systems to help

South Africa harvest rain water, store water and reduce consumption.

The Danish government has an agreement to help the South African

government with water management and water efficiency. Companies

such as smart-meter specialists Kamstrup are already active in the

country.

A Western Cape company has developed a mobile unit for the

South African National Defence Force that can produce drinkable

water from any source, including sea water. Malutsa’s Blesbok Project

has the potential to be converted to civilian use in situations such as

refugee camps or remote and dry areas which services cannot reach.

The National Department of Science and Technology is piloting

a Point-of-Use (POU) project in Malatane village in Limpopo,

Eastern Cape and North West. The project is part of the department’s

Innovation Partnership for Rural Development Programme (IPRDP),

which is supported by the European Union.

Large projects

The distribution of South Africa’s water means that large quantities

must be piped to urban concentrations. The Vaal basin, which serves

the most populated and industrialised part of the country including

Johannesburg, receives water from seven inter-basin transfer schemes.

In 2017/18 the National Department of Water and Sanitation spent

R12.5-billion on dams, water transfer schemes and bulk distribution.

The completion of the De Hoop Dam in eastern Limpopo means

that people living in small municipalities can now expect bulk water

delivery. The Trans Caldeon Tunnel Authority (TCTA) is responsible

ONLINE RESOURCES

National Department of Water and Sanitation: www.dwa.gov.za

South African Water Research Commission: www.wrc.org.za

Trans Caledon Tunnel Authority: www.tcta.co.za

Umzimvubu Catchment Partnership Programme:

www. umzimvubu.org

Water Institute of South Africa: www.wisa.org.za

OVERVIEW

for bulk water supplies. The De

Hoop Dam is the centrepiece

in the large Olifants River Water

Resource Development Project.

In KwaZulu-Natal, the first

phase of the Spring Grove Dam

in the Mooi River area has been

completed on schedule and has

increased water supplies in the

Umgeni River catchment area. A

new reservoir (Waterloo) near the

King Shaka International Airport,

and serving this northern area,

has been constructed as part

of the master plan that will see

water delivered to this reservoir

from the Northern Aqueduct

Augmentation Project.

The Western Aqueduct

project (valued at R864-million)

and the associated Northern

Aqueduct Augmentation

Project will inject water into the

rapidly developing area north of

Durban. The Tugela Bulk Water

Scheme (valued at R1.4-billion)

will supply water to KwaZulu-

Natal’s North Coast.

A water supply and hydropower

project is planned on the

Umzimvubu River in the Eastern

Cape, under the control of the

National Department of Water

and Sanitation. The Umzimvubu

catchment and river system

stretches for over 200km from its

source in the Maloti‐Drakensberg

watershed on the Lesotho

escarpment to Port St Johns.

Amatola Water is a leading

water provider in the Eastern

Cape. The body manages bulk

water infrastructure across

50 000km², encompassing the

district municipalities of Chris

Hani and Amathole and portions

of other municipal areas.

83 SOUTH AFRICAN BUSINESS 2019


PROFILE

Malutsa

A leading South African water treatment company,

specialising in the design, engineering and manufacturing

of water treatment equipment and systems.

World class

In 2005 Malutsa played a role in relief efforts around the Indian

Ocean tsunami, having been approached by government departments

of the Maldives and South Africa, the Red Cross and the

United Nations Children’s Fund.

Co-founder of Malutsa,

Nathan Herbert.

What we do

Malutsa constructs fully functional

water treatment plants using the

latest technology sourced locally

and globally in order to meet the

particular need of each client.

Malutsa often supplies

reverse osmosis water treatment

plants to rural municipalities in

water-stressed areas. Complex

treatment processes ensure that

the wastewater is compliant for

discharge into environmentally

sensitive areas.

Key markets

Anywhere that desalination, water

treatment, effluent treatment

and specialised separation of process

streams is required. All major

industrial sectors, municipalities,

aid organisations, NGOs, military.

Staff

A staff complement of between 120 and 150 has extensive experience

in water and wastewater treatment. The founders of the company

have decades of high-level experience: Bernard Cannon in

chemical engineering, Nathan Herbert in mechanical engineering.

Since the 1980s both men have been pioneers in the development

of industrial applications for tubular reverse osmosis and

ultrafiltration membrane technology and systems.

In terms of technology and chemical process engineering,

Malutsa has the backing and support of some of the most experienced

professional engineers in water and wastewater treatment.

Malutsa also has supply agreements with and access to the

technology of leading international companies in the chemical

manufacturing, membrane and ultraviolet technology fields.

Innovative technology

The landmark Blesbok Project has created a cutting-edge

mobile water purification plant for the South African National

Defence Force through Armscor. This extremely adaptable,

robust and efficient unit is now the focus of the world’s first

continuous-line production of the mobile water plant at the

new custom-built Malutsa factory in Wellington.

Installer of ultraviolet (UV) disinfection

systems

Malutsa is the Southern African representative of the largest supplier

of ultraviolet (UV) disinfection systems in the world, Trojan

Technology. Malutsa has established the largest UV plants in Africa

on behalf of Trojan.

SOUTH AFRICAN BUSINESS 2019

84


PROFILE

The new office block and factory premises that Malutsa built to create an assembly line for production

of the cutting-edge Blesbok water treatment plant.

Vision

We aim to be the leading local and global

brand in bespoke and line-produced mobile

and static water treatment and desalination

systems.

Mission

Design, engineer, manufacture and install

water treatment systems to empower industry,

municipalities, militaries, hospitality and allied

institutions with cutting-edge technology that

meets immediate and strategic water needs.

Strategic objectives

Five fundamentals identified:

• Create unique environment where selfactualisation

meets excellent market

offering.

• Develop human capital holistically.

• Excel in product offering.

• Ensure company existence.

• Develop a culture of ownership.

Strategic intent

Malutsa has an unwavering commitment to

becoming a leading local and international player

in a fiercely competitive and dynamically evolving

water treatment environment.

The uniqueness of the post-apartheid industrial

engineering landscape allows our innovative and

entrepreneurial company to model a new paradigm

in developing human capital. We intend to fulfil

the desire for world-class attitude and world-class

capability.

Our objective of redefining the stereotypical

opinion of an African world player and leader in an

intensely technical field is paramount to the passion

and drive we advocate internally at Malutsa.

CONTACT DETAILS

Malutsa House, 1 Meent Street, Wellington

Industrial Park, Wellington 7655

Tel: +27 (0)21 864 2620

Email: admin@malutsa.co.za

Website: www.malutsa.co.za

85 SOUTH AFRICAN BUSINESS 2019


FOCUS

Ground-breaking

mobile unit delivers

pure water – anywhere

The Blesbok Project is a game changer for water specialists Malutsa.

Blesbok is a mobile water provisioning system

for the military which is able to purify

all types of water including ground water,

sea water and reclaimed water. In addition,

the unit can exploit surface water, store water and

deliver water packaging via sachets and bottles.

The problem

The South African National Defence Force needed

to update its water provisioning systems for rapid

deployment forces. Eight companies submitted

bids. The signing of the deal by the Armament

Corporation of South Africa (Armscor) to develop

the state-of-the-art Blesbok Project was a watershed

moment for Malutsa.

Long associated with 21st-century technology

and world-class standards in the field of water treatment

plants, the large and sophisticated Blesbok

Project has given the Malutsa staff a chance to shine.

Experience

The Malutsa team has experience of delivering highquality

water in remote areas. With the North-West

University, the Water Research Commission and

the Meridian Trust, Malutsa delivered a desalination

plant to the village of Madibogo, converting polluted

ground water to potable water. When the Indian Ocean

tsunami hit in 2005, Malutsa was part of the solution in

providing water to disaster-struck communities.

The solution

Conceived and designed by Malutsa engineers and

staff, the Blesbok mobile plant is tough enough to

cater for bone-dry deserts and the bucking decks

of navy boats at sea: it goes where the military goes.

It is also versatile enough to use whatever water is

available to produce drinkable water. The unit needs

to be configured to cope with each kind of source

SOUTH AFRICAN BUSINESS 2019

86


FOCUS

water (it can’t do two kinds at the same time) but

easy-to-follow instructions are built into the unit and

every component has its place so it’s easy to see if

something is missing.

Storage and delivery

Water is stored in two ways: self-supporting tanks

and bladder tanks. The self-supporting tanks have

a capacity of between 10 000 and 40 000 litres

while the bladder tanks can hold between 3 000

and 10 000 litres.

Blesbok is also a self-contained packaging unit.

In an hour, the unit can either produce up to 1 200

sachets of purified water or can fill up to 1 200

one-litre bottles.

Factory

With the contract won, Malutsa had to produce 60

mobile purification plants in short order. Having

built and developed Malutsa House themselves

(and essentially sponsored the creation of a construction

company to get it done), Malutsa set

about building another new warehouse and office

complex across the road from headquarters in

2015 to accommodate the punishing production

schedule for Blesbok.

By 2017, the spanking new factory space was

up and running, together with an office complex.

Altogether the new space covers about 4 000

square metres within the Wellington Industrial Park.

Applications

The Blesbok Project was designed for military use

and so there will be other militaries around the world

who become potential buyers for this innovative and

successful product.

But the potential applications of the technology

are vast. Few clients will be as demanding as the military

and so there is enormous potential for producing

versions of Blesbok that might be less robust but no

less effective. Villages in remote areas that need pure

water, aid agencies that regularly need to respond to

crises such as flooding or earthquakes, refugee camps

that spring up overnight without any infrastructure,

government departments or research bodies doing

work in water-scarce areas – all of these are possible

applications for future iterations of Blesbok.

Empowerment

As much as Bernard Cannon and Nathan Herbert are

the company founders and the institutional memory of

Malutsa, the young staff members who are taking the

tubular reverse osmosis and membrane technology

forward are clearly committed to the project and eager

to learn. The work ethic at the company is strong, and

the sense of pride in the Blesbok Project is tangible.

87 SOUTH AFRICAN BUSINESS 2019


INTERVIEW

Bernard Cannon

BIOGRAPHY

Bernard Cannon is a founder

and Managing Director of the

Malutsa Group of Companies

which includes Malutsa Water

and Bernali Designs. He is an

entrepreneur who diversified the

business to secure collateral for

expansion of the group with the

view to the creation of employment

and opportunities. An analytical

chemist by profession, he was

part of the pioneering team that

introduced tubular membrane

systems into the water and

wastewater treatment market in

South Africa.

Meaningful

empowerment:

being the change in

people’s lives

Malutsa Managing Director Bernard Cannon

shares his views on bringing the latest in

water purification technology to market.

How did you get started in this business?

My business partner Nathan Herbert and I have been in the water purification

business for the past 30 years, being involved since the advent

of membrane technology in South Africa. Support and research by the

Institute of Polymer Science at Stellenbosch University was formatively

critical at this stage. Ground-breaking work on tubular reverse osmosis

and ultrafiltration membranes led to pilot plant construction and work

being conducted in the ‘80s. This led to accelerated industrialising of

the novel technologies with the help of facilitating organisations like

the CSIR and WRC.

What is the ownership structure of Malutsa?

The ownership has changed over the years. After the democratic

elections, we had investment from a Scottish company, which took

30% in 1997. In 2005 that shareholding was sold to Veolia Water but

we bought out the whole company in 2016. Nathan is a mechanical

engineer and I have the chemical engineering background, so we

complement each other well.

Why is empowerment so important for you?

Historically, chemical engineering was a no-go for our people. We are

very aware of the injustices of the past, and so empowerment is at the

core of what we do. In everything we have done, it has been to grow

people and expand their skills base. We have always done things for

ourselves; we empower ourselves and others by this ethos.

Please give an example.

Even in construction of this building (Malutsa House, pictured

above), we took people and helped them learn the skills to go into

construction. After this building was finished, that group went on

to form a construction company, and that has formed part our enterprise

development drive. We have helped them financially, and

SOUTH AFRICAN BUSINESS 2019

88


INTERVIEW

with business skills. This is enterprise development in real terms.

We are exposing young people to opportunities and giving

them choices. Studies are paid for and are actively encouraged

and suppported.

Tell us about your expansion across the road.

Construction of the new factory and offices across the road (about

4 000sqm) began in 2015 and was completed in 2017. We realised we

need more space for the Blesbok Project. We needed to manufacture

60 mobile purification plants, quickly. We needed to make a plan.

We have also developed the idea of a continuous production line

for mobile purifiers, the first of its kind in the world. We developed this

entirely with our own in-house architects and engineers.

How up-to-date is the technology you are using?

We were part of the team that pioneered tubular membrane technology

in South Africa, so we have been aware of all the changes along

the way. This has allowed us to stay current. We can say with pride that

we have been part of this technology journey all the way.

Has your business journey been interesting?

There have been many challenges along the way, but it has been

exciting! The Blesbok Project was really delivered against all odds. We

have been the developers and designers of these very unique mobile

purification units, mobile bottling and sachet plants.

Does the unit have wider applications?

The military option is obviously quite expensive because of the very

high specifications for the military. If we produce something that is

less robust, then it will cost less. It

can have multiple applications, in

remote areas, for flood relief, etc.

The list goes on. We are certainly

looking at developing it further.

Please comment on the

South African water sector.

It was intimated 20 years ago that

South Africa was on the way to

being an arid country. People

ridiculed the idea, but now water

is being talked about as “liquid

gold”. For us it is not just about

business, it is about keeping our

people-centred approach. We

really want to be the change in

other people’s lives.

We believe that water re-use

is the key. The only thing holding

back the development of

this strategy is the psychological

block. We are helping developers

and building owners who want to

make their buildings “green” or

get off the grid. The hotel sector

is another important sector. We

also specialise in bespoke plant

construction.

89 SOUTH AFRICAN BUSINESS 2019


OVERVIEW

Engineering

Major restructuring is under way.

For many years leading up to the Soccer World Cup hosted

by South Africa in 2010, the bigger engineering companies

developed into conglomerates with several divisions and

international operations. But the latest trend is for these

large companies to unbundle and narrow their focus.

Some firms have kept their focus on niche areas such as electrical

engineering, construction, fluids control and project management.

These firms continue to build on their expertise.

The reason normally given for the move to restructure is the fact

that the expected infrastructure spending boom after the World

Cup has not materialised. This has led to many companies aiming

to become more flexible and better able to pursue projects in other

countries in Africa and overseas.

With slow growth, national freight and logistics company

Transnet has not been able to pursue its R300-billion infrastructure

programme at the speed that it wanted to.

SECTOR INSIGHT

Renewable energy projects

are creating opportunities for

engineers.

Aspects of the programme,

such as the acquisition of

locomotives, are going ahead

(despite some of the projects

being the subject of corruption

investigations) and the expansion

programmes of the Gautrain

and the Passenger Rail Agency

of South Africa (PRASA) are

providing work for engineers.

SOUTH AFRICAN BUSINESS 2019

90


OVERVIEW

Infrastructure spending has only slowed, not

dried up entirely. One province alone, Gauteng,

spent R30-billion on infrastructure between

2013 and 2016. A further R46-billion has been

pledged for the years to 2019. In addition,

Gauteng municipalities will spend R94-billion

over the next five years using their city budgets.

Some 31 major housing developments have

been approved for the various development

corridors around Johannesburg. These projects

will attract public and private money.

A study carried out by KMPG found that

spending on infrastructure resulted in additional

economic activity worth R26-billion and created

92 000 direct jobs. A major provincial infrastructure

project was the technically demanding

Gauteng Freeway Improvement Project, which

involved many companies and several joint ventures.

GOBA Consulting Engineers and Project

Managers supervised the design and construction

of the project, as it did the even bigger Vaal

River Eastern Subsystem Augmentation Project

(VRESAP). This water project entailed redirecting

water flows from one system to another to

feed the petrochemical and mining industries

of Mpumalanga.

The Renewable Energy Independent Power

Producer Procurement Programme (REIPPPP)

has created an entirely new industry in less than

seven years, with investment of about R200-

billion in solar parks and wind farms. This has

created huge opportunities for engineers of

every sort.

Two of the world’s largest coal-fired power

stations are still under construction in Limpopo

(Medupi) and Mpumalanga (Kusile) and there

are several coal and platinum projects in both

of those provinces that are also sources of work

for engineering companies. The Northern Cape

and North West are attracting new mines (zinc,

copper) or investments in new smelters and

processing facilities (platinum, manganese).

South Africa has one engineer to every 3 166

citizens, compared to Malaysia where the figure is

543 citizens per engineer. The Skills Development

Amendment Act is intended to improve the situation.

Universities, universities of technology and

TAKING THE INITIATIVE IS FAR BETTER

Maitazwifoma Engineering and Consulting

takes its name from the Tshivenda proverb

“Maitazwitoma hafani na madzulafhedzi”, which

means that an innovative person who takes

initiative is far better than one who is idle.

Scanning the list of services offered by

Maitazwifoma, it is easy to see that this is a

group of committed contractors, engineers and

plumbers who really want to work.

Services range from electrical, construction

and civil construction, to plumbing, road construction,

concrete coring and waterproofing.

The company is also available to provide cleaning

services, staff transport and general tasks

such as painting, paving, partitioning and rubble

removal.

With more than seven years of experience

in building expertise in a range of construction

and engineering disciplines, the leadership and

staff of Maitazwifoma are enthusiastic and

hard-working.

Clients include Attaq and Broll, WBHO

(Maitazwifoma were subcontractors on the

Newtown Junction Project), Jozi@Work, on

behalf of the City of Johannesburg and the

Johannesburg Development Agency.

91 SOUTH AFRICAN BUSINESS 2019


OVERVIEW

companies are increasing their focus on

the training of engineers.

The Engineering Council of South

Africa (ECSA) has started a programme

where trainees can earn certificates in

specific disciplines from a range of institutions.

The qualifications are in line

with the council’s Exit Level outcomes.

Six of South Africa’s biggest construction

companies have established a

R1.25-billion skills fund.

POLYURETHANE PRODUCTS AND REFURBISHMENT

Restructuring

Murray & Roberts, a giant and diverse

company, disposed of Murray

& Roberts Infrastructure and Building

Platform (MRIB) in 2016 to focus on

procurement, project engineering

and construction in certain resource

sectors. Firefly Investments, the consortium

that bought MRIB, is led by

Southern Palace, which includes among

its shareholders some MRIB managers

and the Government Employees

Pension Fund (GEPF). The transaction

goes a long way to creating more diversity

in the ownership in the construction

and engineering sector.

Netha Engineering Technology supplies high-quality

processing equipment for the relevant application.

The company specialises in polyurethane screen

panels.

Dedicated on-site teams deal with screen panel

maintenance. The removal and installation of screen

panels is done on-site.

Netha Engineering Technology also offers polywedge

wire panels, spray nozzles, polyurethane liners

and self-cleaning spray bars. The company aims to

become a diversified supplier of processing equipment.

The refurbishment processes offered by Netha

aims to restore the condition of equipment at minimal

cost. Equipment is considered refurbish-able if

the cost of repair is less than 70% cost of new item.

Refurbishment is done with both ceramic and rubber.

Refurbishments can either take place on- or off-site

depending on the degree of work and turnaround

time needed to complete the work. Refurbishment

and manufacture of the following equipment is currently

done: hydro-cyclones, tanks and sumps, transfer

chutes, screen under-pans, steel pipes, plastic

pipes and HDPE pipes.

Genrec, a large steel engineering and fabrication business

company that started out on the gold fields of early

Johannesburg, was another Murray & Roberts company to

be sold to the Southern Palace Group. It has a large plant

outside Johannesburg at Wadeville and is involved in South

Africa’s two biggest power station construction projects at

Medupi and Kusile.

SOUTH AFRICAN BUSINESS 2019

92


OVERVIEW

Group Five also sold part of its business (Group Five Pipe) to a

black-owned entity in 2017 but the most significant change came

in the group’s structure. A stand-alone construction division for

South Africa (where the company has more than 7 400 employees)

is part of a drive by the company to focus on smaller infrastructure

projects and to dispose of manufacturing assets. Like most

large South African firms in the sector, Group Five has significant

investments offshore.

Transnet Engineering is in the process of changing its focus

from only providing engineering services to other com-

ONLINE RESOURCES

Consulting Engineers South Africa: www.cesa.co.za

Engineering Council of South Africa: www.ecsa.co.za

National Department of Public Works: www.publicworks.gov.za

South African Consulting Engineering Firms:

www.consultsa.co.za

Southern African Institution of Civil Engineering:

www.civils.org.za

panies in the Transnet group

to becoming a multi-faceted

business. The company is exploring

opportunities in Africa

to provide maintenance, repair

and overhaul services (MRO). As

an original equipment manufacturer

(OEM) with the ability

to manufacture locomotives,

rail wagons and coaches, TE

is opening up a wide range

of markets not only in South

Africa but in Africa and the rest

of the world. The Trans-Africa

Locomotive is the first locally

designed locomotive produced

by TE in its Koedoespoort factory.

There are seven business

units located at Koedoespoort,

including a foundry.

Maitazwifoma Engineering and Consulting

Be part of the solution.

Maitazwifoma Engineering and

Consulting is a 100% black-owned

full-service construction engineering

company based in Johannesburg.

The company specialises in the

following trades of the construction

industry:

• electricity

• building construction

• civil construction.

The staff of Maitazwifoma comprises

qualified individuals who have extensive

experience in the fields of civil, building

and electrical engineering.

The company is registered with the

Construction Industry Development

Board (CIDB) and is compliant with the

following bodies: SARS, NBCEI, ECA,

COIDA and CIDB.

In electrical engineering services include:

Heavy current engineering, electrification,

general electricity maintenance and COC

issuing on completion of the job or project.

Other services:

• Concrete coring and waterproofing.

• Plumbing: professional, fast and

dependable services. Fully licensed

plumbers, drain technicians, HVAC

and water restoration technicians

can handle any plumbing, sewer,

furnace or restoration problems.

• General services: Transport is available

for our teams of contracted

labourers to sites. Tasks can include

garbage and refuse removal, painting,

brick-laying, paving, rubble removal

and partitioning.

Contact details: Physical address: 209 Silverdale, No 69 Claim Street, Hillbrow, Johannesburg 2001 | Tel: +27 11 048 2907

or +27 11 049 6297 Mobile: 072 829 8852 | Email: info@maitazwifoma.co.za | Website: www.maitazwifoma.co.za


PROFILE

Netha Engineering

Technology

Get it right the first time.

Netha Engineering Technology is a proprietary limited company

located in Alberton. The company offers off- and onsite

engineering services to the minerals processing plants

generally within the Southern African mining industry.

The company is under the leadership and directorship of Neo

Gumede. She is the founder and owner of the company and has 12

years’ experience in process engineering, manufacturing and process

equipment supply.

Vision

To become a leading supplier of high-quality products and engineering

solutions to the mineral processing industry, within the shortest

turnaround time and the most cost-effective price. Through dedicated

people, Netha Engineering Technology endeavours to provide an

unparalleled aftermarket support to our clientele, backed by stringent

in-house quality control systems.

Services

• Equipment manufacturing and refurbishment including wear

lining solutions (tiling). Refurbishment is done with both ceramic

and rubber and the scope of refurbishment and manufacture

currently includes the following equipment: tanks and sumps,

transfer shuts, steel and plastic pipes.

• Polyurethane products, including screen panels, spray nozzles,

liners and self-cleaning spray bars.

CONTACT DETAILS

Physical address: 10 Launceston Road, Unit 6 St Teresa Estate,

Alberton, Johannesburg

Contact person: Neo Gumede, Managing Director

Email: gumeden@netha-tec.co.za

Tel: +27 11 044 9015 | Cell: 081 458 8798

Fax: 086 541 8615

Email: enquiries@netha-tec.co.za

Website: www.netha-tec.co.za

Mission

To provide high-quality engineering

solutions and services at

a highly competitive price within

the shortest lead times possible.

“Get it right the first time”. It is the

company’s goal to have 100% customer

satisfaction with respect

to quality, professionalism and

speed to market.

Values

Netha Engineering Technology

strives to achieve and live the

following non-negotiable values:

• Integrity and trustworthiness:

We earn your trust by doing

what we say we will do.

• Respect: We respect our clients

and our employees.

• Accountability: We take ownership

for our own actions.

• Quality: We do it right the

first time.

• Innovations: We use innovative

technologies and ideas to stay

ahead of our competitors.

Netha Engineering Technology

continues to seek opportunities

to add to the list of processing

equipment we supply in order

to become a diversified supplier

that complements market

needs for innovative technologies

that are efficient and costeffective.

SOUTH AFRICAN BUSINESS 2019

94


INTERVIEW

A winning combination

in serving the mining

sector

Netha Engineering Technology Managing Director Neo

Gumede explains her company’s competitive edge.

Neo Gumede

What are the core services that Netha Engineering

Technology provides?

Netha Engineering Technology is a wear-lining solution company

based in Meadowdale. We protect the steel and increase the life of

the steel by installing high alumina tile and polyurethane liners. Netha

manufactures and maintains cyclones, transfer chutes, steel tanks and

launders. Netha Engineering manufactures vibrating screen panels for

the mining industry.

In what sectors do you operate and where are you noting

growth?

Mining industries: coal, gold and platinum. Coal mining in Mpumalanga

is showing good growth potential.

BIOGRAPHY

Neo Gumede is the founder

and owner of Netha Engineering

Technology and has 12

years’ experience in process

engineering, manufacturing

and process equipment supply.

She has extensive metallurgical

experience in gold, platinum,

iron ore and diamonds. She

has also worked in the mining

industry as a metallurgist and

as an equipment supplier in

the manufacturing sector. After

conducting sales for some time,

Neo moved up the ranks to take

on leadership roles within the

same sectors.

What gives Netha the competitive edge?

Our competitive prices, unbeatable lead times, metallurgical expertise

and best-quality products in the market.

How did your journey in engineering begin?

It began in 2003 when I started my career as a chemical engineer at

Vaal University of Technology. I then practised metallurgy for 12 years

in various industries like mining, manufacturing and sales.

How did you overcome the obstacles faced by women in

the field?

By developing a thick skin and becoming highly knowledgeable in

everything I do.

Have things improved in the current era?

Yes, things have definitely changed. Women are now recognised, and

people are more curious about the capabilities of women in mining

or engineering.

95 SOUTH AFRICAN BUSINESS 2019


The Black Management Forum

The BMF is a thought leadership organisation founded in

1976, with the main purpose of influencing socio-economic

transformation of our country, in pursuit of socio-economic

justice, fairness and equity.

The organisation stands for the development and

empowerment of managerial leadership amongst black people

within organisations and the creation of managerial structures

and processes, which reflect the demographics, and

value of the wider society.

For detailed information on how to become a member, please contact

Thulisile Simelane. Email: thulisile@bmfonline.co.za

www.bmfonline.co.za BMFNational@ BMFNational @BMFNational


ETHICAL LEADERSHIP

AS A CATALYST FOR TRANSFORMATION

AND INCLUSIVE ECONOMIC GROWTH

WHAT WE DO

• BMF Branch, Provincial and National Events

• BMF Networking & Engagement Opportunities

• BMF Managerial Leadership Development Programmes

• BMF Mentoring & Coaching Programmes

• BMF Leadership Executives Search

• BMF Advisory Services

• BMF Achievement Awards

• BMF Publication

• BMF Apparel

KEY INITIATIVES

• Young Professional Development Programmes

• Duke Corporate Education Programmes

• Maduke Lot Ndlovu Legacy Trust

• Gender Equity Catslysts

• SMME Desk

• Managerial Leadership

Development Programmes

Provided by Various

Corporate Members (e.g

Deloitte, Sanlam, PwC,

PPS, Nedbank, Allan Gray)

Corporate Member

Fee: R34,500 incl. VAT

Contact:

leswene@bmfonline.co.za

Individual Member

Fee: R747.50 incl. VAT

Contact:

thulisile@bmfonline.co.za

Young Professional

Fee: R747.50 incl. VAT

Contact:

thulisile@bmfonline.co.za

Student Chapter

Fee: University Specific

Contact:

leswene@bmfonline.co.za


OVERVIEW

Construction and property

The shopping mall trend continues to grow.

A

big new development on Oxford Road in the Johannesburg

suburb of Rosebank says a lot about the South African construction

and property sector. The 300 000m² Oxford Parks

mixed-use development by Intraprop began construction

in 2017 and the first phase is expected to be valued at about R1-billion.

Firstly, South Africans love shopping malls. The South African

Council of Shopping Centres calculates that the country has the sixthhighest

number of shopping malls in the world. R2-billion was recently

spent on Menlyn Park in Pretoria to expand it to 177 000m² of gross

lettable space while the Gateway Theatre of Shopping in Durban,

South Africa’s second-biggest mall, will spend R750-million in 2018.

Limpopo’s provincial capital Polokwane has had the super-regional

Mall of the North since 2011.

Secondly, development often follows existing patterns (Rosebank-

Sandton is already the richest and densest retail and office precinct in

Africa). Many of South Africa’s biggest firms have their headquarters

in this area: BPSA will take up residence in Oxford Parks. Thirdly, the

SECTOR INSIGHT

More South Africans live in

flats than ever before.

concept of “lifestyle” malls (combining

apartments with office,

entertainment and retail space)

has caught on. The best known

of these is Johannesburg’s

Melrose Arch.

Finally, the Oxford Parks

project illustrates a big shift in the

construction sector away from

large conglomerates towards

smaller, black-empowered

SOUTH AFRICAN BUSINESS 2019

98

cont on pg 100


Mueletshedzi Logistics

Meeting and exceeding the petroleum needs of clients.

FOCUS

Mueletshedzi Logistics (trading as MLTL) runs a dedicated

fleet of trucks and tankers to provide a logistical backbone

in order to meet and exceed the petroleum needs

of clients.

Mueletshedzi Logistics supplies petroleum products to other companies,

retailers’ partners and all types of industries across Africa. MLTL

is an Authorised Distributor for Total South Africa in the Southern

African market. The company also offers storage facilities for petroleum

products.

Mission statement and values

To supply in a safe, dependable and reliable manner all products and

related services throughout sectors and industries in chosen South

African regions.

• Reliability

• Integrity

• Accountability

• Commitment

CONTACT DETAILS

Tel: +27 11 695 4845

Mobile: +27 76 847 2030 and +27 81 359 4807

Fax to email: 086 566 3606 | Email: info@mltl.co.za

Website: www.mltl.co.za

Services

Supply and installation of fuel

tanks. Supply of petroleum products

(aviation gasoline, biofuels,

diesel, jet fuel, liquefied petroleum

gas, paraffin and petrol).

Lubricants. Bitumen. Garage

cards. Earth-moving equipment

(yellow machines) including excavator,

TLB, grader, roller, frontend

loader and articulated dump

trucks. Parrot Products.

Transportation of a wide range

of machinery and products using

the following vehicles and

equipment: low-bed, flat-deck,

fuel tanker, side tipper, six cube

tipper and 10 cube tipper.

Target markets

The target markets are haulage

companies, white-site (unbranded)

filling stations, truck stops

and end users. The company

intends to be the biggest supplier

in the South African provinces

of Gauteng, North West,

Northern Cape and the Eastern

Cape. Externally, the focus is on

Botswana, Zimbabwe, Malawi

and Zambia.

99 SOUTH AFRICAN BUSINESS 2019


OVERVIEW

companies. Like many such multi-disciplinary

construction and engineering firms, Murray &

Roberts has decided to unbundle and the sale

in 2017 of Murray & Roberts Construction to a

black-led consortium is part of a wider trend. The

Southern Palace Group is the majority shareholder

of the company (renamed Concor) with the Public

Investment Corporation (PIC) holding 25%.

Supporting this trend is the fact that two of

South Africa’s nine listed construction companies

(Ensor and Basil Read) entered businesses rescue

in mid-2018.

Away from the glitz of multi-purpose malls and

towering office blocks, Statistics SA has found that

the percentage of South Africans living in flats has

risen markedly. Whereas 26 out of 100 approved

plans in 2013 were for flats, this figure reached 59 in

2016. Although the total number of people living in

flats is still relatively small (5.4%), this figure will rise

as urbanisation increases.

BAKENBERG READY MIX STAFF READY TO SERVE

Bakenberg Ready Mix is a dynamic company

operating in the Waterberg District Municipality.

Founder and owner David Mnisi pulled together

resources and skills which he acquired in more

than a decade of working in a variety of sectors.

He has worked extensively as a marketing

executive for FMCG firms in Gauteng. Other

business experience ranges from working as a

sales representative and restaurant owner to

mention a few.

Frans Makgoka is the operations man at

Bakenberg Ready Mix. With experience in the

mining sector, he moved into the business

management field where he is now responsible

for the coordination of operations of the

company and batching.

Transport and client relations are the domain of

Jimmy Tlhabane. An enthusiastic businessman

himself and a people-oriented person, Frans

brings energy and vibrancy to the organisation.

He is obsessed with efficient service delivery.

SOUTH AFRICAN BUSINESS 2019

100


an Development Zone

perty regeneration and growth through tax incentives.

OVERVIEW

uplace Properties is investing in providing accommodation in central Johannesburg.

In order to fight urban decay and to encourage investment in inner

cities, a tax incentive was created called the Urban Development huge potential. The develop-

believes the rental market has

rder to fight Zone urban tax incentive. decay The and UDZs to for encourage Johannesburg investment and Cape Town in were inner ers of the trendy Maboneng

first allocated in 2004. The inner city of Johannesburg, comprising Precinct are also very upbeat.

es, a tax incentive was created that applied to major South African

just less than 18km², is the largest UDZ in South Africa and it is Boost Property Management

es. This is called expanding the its Urban footprint. Development Zone tax incentive. The is building a 10-storey apartment

block in Hillbrow. The

Zs for Johannesburg Making inner and cities Cape more Town liveable were is a first global allocated trend. The in move 2004.

back to cities is spurred partly by the relative cheapness of property R40-million Kaptejn Corner will

nner city of Johannesburg, comprising just less than 18km², is the

in CBDs, legislation encouraging inner-city investment and even a have 128 apartments.

st UDZ in South perception Africa that and suburbs it is expanding are boring. its footprint in response An innovative approach

nificant successes Private that developer have Indluplace been achieved. Properties has purchased nine large to unlocking the value of land

he Urban Development

apartment blocks,

Zone of

tax

which

allowances

is shown above,

(Section

taking its

13quat)

total in the traditional areas is under

consideration. The hous-

buildings in central Johannesburg CBD, Berea and Hillbrow to 23:

ide for an

33%

accelerated

of the units

depreciation

are bachelor pads,

allowance

22% are two-bedroomed

on the costs

flats.

of

ing

development:

agency of the Limpopo

ings erected, The added listed company to, extended (its major or shareholder improved is Arrowhead) inside a UDZ. intends The Economic Development Agency

h African Revenue to “aggressively Service grow (SARS) its portfolio” has of extended high-yielding the properties incentive as it to (LEDA) has proposed a plan for

the conversion of Permissions to

arch 2020. Municipalities can apply for extension to the existing

ONLINE RESOURCES

Occupy (PTO) to title deeds in

s via the National Treasury. There are five requirements to qualify deep rural areas such as Vhembe

Black Business Council in Built Environment: www.bbcbe.org

UDZ tax deduction. These relate to the building, the nature of the and Sekhukhune. The National

Construction Industry Development Board: www.cidb.org.za

Home Builders Registration

, trade considerations, Construction the Industry specifics Training of Authority: ownership www.ceta.org.za and to the dates

Council (NHBRC) will consider

e applications. South The African fact Property that the Owners incentive Association: has been www.sapoa.org.za extended to the proposal. centre planned.

gives investors a good chance to take advantage of favourable

itions in Johannesburg.

he Johannesburg Social Housing Company (Joshco) has plans to

ide affordable rental accommodation in 12 inner-city buildings

were recently identified for that purpose. But the main target for

reaching out to other areas a

regions on the city’s outskirts. T

city wants to achieve nothing l

than the “structural transform

tion of the inner city’s econom

and physical landscape”.

The City of Johannesburg h

identified the following nodes

• Carlton Precin

Johannesburg’s tall

building attracts touri

undergoing revamp; S

Rink TV and film studio b

ing developed; conferen

• Park Station: intermo

node catering for cars, b

es, rail commuters and ta

Gautrain link to OR Tam

International Airport; w

101 SOUTH AFRICAN BUSINESS 2019


PROFILE

Maritz Electrical

Delivering projects within budget, on time and

to clients’ expectations, every time.

From commercial electrical applications to

high-end floodlights and sports stadiums

and spotlights using state-of-the-art products,

Maritz Electrical delivers end-to-end

electrical solutions tailored to clients’ needs.

Delivering service excellence and exceptional

quality are key differentiators for Maritz Electrical

and what clients have come to expect.

Maritz Electrical is an empowerment company

established by Kurt Maritz in January 2000. Maritz

Electrical is BBBEE compliant (Level 1 contributor).

It is ISO 9001 certified and fully compliant with the

Occupational Health and Safety Act with a full-time,

trained safety representative.

In 2018 the company’s three branches were

consolidated, with all 150 staff members now

working out of a newly renovated 3-000-squaremetre

factory and office facility in Athlone. The

company employs full-time, licensed installation

and master electricians. The company’s artisans

have completed the ORHVS.

Maritz Electrical places great emphasis on its

relationship with clients, private or commercial,

and prides itself on the ability to respond to any

contracting requirements in an efficient and costeffective

way. Maritz Electrical aims to contribute

positively to the South African economy, provide

excellent workmanship and be a leader in quality

service provision.

World first

In 2017, St George’s Park became the world’s first

International Cricket Council-compliant, LED-lit stadium

and the first such stadium to be fitted with

theatrics. Maritz Electrical won the contract to install

the Musco Lighting system at the venue after visiting

the US with officials from Eastern Province Cricket

and the national cricket board.

Over four days in December 2017, the famous

ground celebrated the landmark of being the first

South African venue to host a day-night Test match,

against Zimbabwe. The R27-million contract was

completed on time and on budget by a team from

SOUTH AFRICAN BUSINESS 2019

102


PROFILE

Maritz Electrical led by Warren Williams. Two project

managers from Musco Lighting supported the

installation. The lights on top of the Duck Pond

Pavilion were hoisted at night, the process being

illuminated by floodlight.

Select current projects

Coetzenburg Athletics Stadium is undergoing a R40-

million revamp and Maritz Electrical is part of the

team of contractors charged with making it happen

to the highest specifications. Apart from Varsity

Athletics and national championships, Stellenbosch

hosted more than 150 international athletes over

the summer as they prepared for the World Athletic

Championships.

Maritz Electrical has been contracted by the

municipalities of Stellenbosch and Overstrand for

electrification of large housing projects. This is a

relatively new area for Maritz and one in which the

company is building specialist skills.

Other flagship projects

• Cape Town Grand Parade: Re-lit with Musco

fixtures to improve the lighting level to reduce

the personal crimes being committed because

of poor lighting.

• Cape Town Festive Lights including Adderley,

Strand and Main streets: Maritz Electrical installs

the popular Festive Lights.

• Security Lighting for Waste Water Treatment

plants: Musco’s metal halide and LED system is the

preferred product of Cape Town’s Department

of Water and Sanitation and Maritz Electrical is

the proud installer.

Services

Maritz Electrical works closely with its customers,

ensuring that the task or project is completed on time

and on budget, using the highest quality products

available. In particular, Maritz Electrical has become

a premier supplier and installer of dedicated sports

lighting. This includes schools, universities and multisports

stadia.

The company works in all residential and commercial

areas of electrical installation and maintenance.

Its electrical services include project

management, design, supply and installation of

electrical systems including:

• Electrical and reticulation services

• Testing and commissioning

• Water analysis, monitoring, management and

purification systems

• Lighting and power

• External lighting

• Mechanical services integration

• Emergency switchgear

• HV and LV switchgear

• Pre-planned maintenance.

Professional memberships

BBBEE Level 1. ISO 9001 certified. Electrical

Contractors Association. Master Builders

Association member. Member of South African

Institute of Lighting (SAIL).

CONTACT DETAILS:

Physical address: 11 Noll Avenue, Athlone, Cape Town 7764

Tel: +27 21 703 0867

Fax: 0864 552 436

Email: tenders@maritzelectrical.co.za

Website: www.maritzelectrical.co.za

103 SOUTH AFRICAN BUSINESS 2019


PROFILE

Mamli Projects

Experienced staff offer expert construction services.

Objectives

To expand our business coverage

area in terms of rendering

services. To render high-quality

services, thus maintaining the

good reputation of the company.

To empower as many communities

as possible, especially black

communities, taking into consideration

the youth in our region.

To stimulate local and regional

economic growth.

Mamli Projects is a BBBEE Level 1 construction company

providing services in building construction, renovations,

alterations, paving, demolition and refurbishment.

Mamli Projects is a broad-based black economic

empowerment company, 100% owned by an indigenous woman,

Josephine Mamlingaphi Nkosi. It strives to attain success through determination,

focus and hard work, giving special attention to training

of the unskilled youth, women, disabled people and the previously

disadvantaged.

Mission

Mamli Projects strives to be a leader in providing value-added construction

services to our clients by creating a successful partnership

with them throughout the construction process. Our pledge is to

establish lasting relationships with our clients by exceeding their

expectations and gaining their trust through exceptional performance.

Vision

Our goal is to become the preferred company for construction in both

the public and private sectors through diligent commitment and to

provide self-sustainability to all our employees.

Our services

The company has extensive

experience in providing expert

building services on a wide range

of demolition, construction and

refurbishment projects across all

sectors of the industry:

• building construction

• renovations and alterations

• paving.

Equipment

To enable our experienced workforce

to do quality work, good

equipment and tools have been

acquired over the years. This

includes six bakkies, a six-ton

Toyota truck, two soil compactors,

five generators, two dumpy

levels and a V-Tec trailer. We also

use a roller, scaffolding, a Bobcat

JCB155, a Bomag Single Drum VIB

Roller BW55E, Bomag Vibrating

Plates BT65/4, a Bomag Double

Drum Roller and a Bomag Stroke

Tamper BVP18/4.

SOUTH AFRICAN BUSINESS 2019

104


PROFILE

Completed projects

Some of the projects completed by Mamli Projects for the

Department of Public Works include the construction of MC

Zitha Combined School at Masibekela, the erection of palisade

fencing and water supply at Soshanguve High School, the

construction of 19 VIP toilets at Mgubho Primary School and

the construction of six water-borne toilets at Engwenyameni

Primary School.

Other projects and clients include the construction of

Thembisile Fire Station at Tweetfontein (Nkangala District

Municipality), construction of an animal clinic at Casteel

Bushbuckridge and the renovation of the Lowveld Agricultural

College (Mpumalanga Department of Agriculture) and the

renovation of chalets in the Kruger National Park (SANParks).

For the National Department of Public Works, Mamli Projects

worked for five years on the maintenance and servicing of buildings,

civil mechanical, electrical infrastructure and installation at

the Lebombo Port of Entry.

Current projects

Three current projects show Mamli’s versatility:

Project Client Value Engineers

Construction of Bhambanana campus

Department of Higher Education

R167.4-million

Hector Makgatho

of Umfolozi TVET College

and Training

Installation of generator sets at police

station

Department of Public Works R4.1-million AES Consulting

Installation and upgrade of kitchen

equipment at military base

Department of Public Works R2.4-million Seabo Consulting Engineers

CONTACT DETAILS

Contact person: Mamlingaphi Josephine Nkosi

Physical address: 189 Schoemansdal, Shongwe Mission 1331

Postal address: PO Box 861, Shongwe Mission 1331

Tel: +27 13 781 0702 | Fax: 27 13 781 0701

Fax 2 email: 086 514 5811 | Email: admin@mamliprojects.co.za

Website: www.mamliprojects.co.za | Company registration: 2013/175770/07

105 SOUTH AFRICAN BUSINESS 2019


PROFILE

Bakenberg Ready Mix

A competitive edge in concrete supply.

price structure that is differentiated

to accommodate various levels of

affordability. It is, however, our passion

for great service and commitment

to excellence that make us

the ideal professional service provider

to partner with you for you.

Bakenberg Ready Mix is a division of Mnisi Turnkey Projects

(Pty) Ltd, a proudly South African, black-owned company

based in Bakenberg Village, Mokopane, Limpopo Province.

It was founded in 2016 by David Walter Mnisi. He saw an opportunity

to create a professional, client-oriented, ready mix concrete

supply company to cater for those who value professional services. The

building industry is gaining momentum in the villages and elsewhere

in Limpopo. Bakenberg Ready Mix currently operates a mobile batch

plant with two ready mix trucks for any project needs.

The company is involved in all kind of road building, RDP housing

and the mining sector. Job opportunities for local communities is a

high priority and the company engages in social responsibility projects.

Mission

To be a supplier of choice and offer the best product (concrete) in the

Waterberg region of Limpopo.

Competitive offering

Clients place a high premium on value for their money. In order to

maintain a satisfied client base, Bakenberg Ready Mix has designed a

CONTACT DETAILS

Physical address: 93A Mmotong Village, Bakenberg,

Mokopane, 0611

Tel: +27 15 110 0150/ 083.317.0294 | Fax: 086.564.1645

Email: info@bakenbergreadymix.co.za

Website: www.bakenbergreadymix.co.za

Branches

Mokopane, Lephalale and

Rustenburg.

Current project

Client: Conco Group/ Eskom

Borotho Powerline Project. Supply

of 35mpa and 40mpa ready mix

concrete since November 2017.

Our plant is based in Marken,

Limpopo.

Client: Stefanutti Stocks.

Concrete supply on Rietfontein

tar road project.

Other services

Building materials, crusher sand

and dust, manufacture of bricks,

concrete and stone.

SOUTH AFRICAN BUSINESS 2019

106


INTERVIEW

Concrete opportunities

in rural areas

Bakenberg Ready Mix founder David Mnisi explains how

the home-building industry is booming in Limpopo.

David Mnisi

What are your main services?

We supply ready mix concrete, concrete stone, 13mm and 19mm stone,

and bricks.

Where did you get the idea for starting this business?

The idea to start this business came through research into the market. In

travelling around Bakenberg and surrounding areas for other business

that I was doing, I became aware of the need for a professional, clientorientated

ready mix concrete supply company to cater for those who

value professional services.

In what sectors do you operate?

We deal with both the public and private sector, mostly in the

construction industry.

BIOGRAPHY

For more than a decade, David

Mnisi worked in the business

world, gaining experience in a

wide range of positions in different

economic sectors. Having

been a marketing executive in

the fast-moving consumer goods

field, a restaurant owner and at

one point being responsible for

sales, David developed a sound

appreciation of customer needs

and the market. In 2016 he decided

to harness these skills and

resources into starting a business

in the Bakenberg area.

Where has the growth been in the last few years?

House building is the subsector that has grown the most in the last few

years. The building industry is gaining momentum in our villages and in

Limpopo Province more generally. We currently operate a mobile batch

plant with two ready mix trucks for any project needs.

What areas do you operate in?

We are based in Bakenberg (Mokopane, Limpopo) but our mobile batch

plant allows us to go anywhere in the country.

Please tell us about any projects you have successfully

completed.

We supplied Stefanutti Stocks Roads & Earthworks for a rural road they built

to connect villages in the Rietfontein area. We were also contracted as a

supplier for Eskom’s Medupi-Borutho powerline project from Lephalale

to Bakenberg.

Do you plan to expand in the near future?

We have plans to buy new plant and two new trucks in order to expand

our footprint throughout South Africa.

107 SOUTH AFRICAN BUSINESS 2019


OVERVIEW

Manufacturing

Incentives are in place to support new investment.

SECTOR INSIGHT

US tariffs on steel imports

will affect South Africa.

• The leather sector is making

a comeback.

The manufacturing sector employs the third-most people of

South Africa’s economic sectors, about 1.7-million, after financial

services and retail.

The Department of Trade and Industry (dti) is the state’s

lead promoter of the sector. The main vehicle for the dti is the Industrial

Policy Action Plan (IPAP) which is periodically updated with particular

focus areas. In marking the 10th version of IPAP in 2018, the department

noted that some “deep-seated structural problems” in the domestic

economy are still in place.

The Manufacturing and Competitiveness Enhancement Programme

(MCEP) of the National Department of Trade and Industry (dti) announced

in 2017 that it had disbursed a total of 1 552 grants to the

value of R5.8-billion which had resulted in 230 000 jobs being “sustained”.

Plastics, pharmaceuticals and chemicals received 31% of the

money, metal fabrication, capital and real transport equipment 28%

and agri-processing 21%.

Because of the dti’s Clothing and Textile Competitiveness Programme,

that sector currently employs around 95 000 workers, contributing 8%

to manufacturing GDP and 2.9% to overall GDP. In the leather sector 22

new factories have been opened, supporting 2 200 jobs. Manufacturing

value addition for companies receiving the incentive has grown by

60.8%, and productivity by 22.3%.

The various IPAPs are intended to create policy certainty to stimulate

investment. The creation of an investment “one-stop shop” is another measure

aimed at the same goal. Investor support is also available in terms of

tax incentives, on budget support measures and Special Economic Zones

(SEZs). Increasing demand for goods manufactured locally through government

procurement programmes is

yet another way of stimulating the

manufacturing sector.

Growth elsewhere in Africa and

beyond is something that South

Africa’s manufacturers are increasingly

turning their attention to.

Relationships with other Southern

African countries through SADC,

and to Brazil, Russia and India

through the BRICS grouping hold

tremendous potential for makers

of goods in South Africa.

Innovation

The Support Programme for

Industrial Innovation (SPII), run

by the Industrial Development

Corporation (IDC) on behalf of

the dti, promotes technology development.

New technology has

been embraced by some innovative

manufacturers. Desert Wolf’s

Skunk Riot Control Chopper is an

unmanned light aerial vehicles

(UAV) that has proved popular in

the world market. Denel makes a

drone product that can be adapted

for use by conservationists.

Another IDC initiative has allocated

R23-billion over three years

SOUTH AFRICAN BUSINESS 2019

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to support the Black Industrialist Programme to

help existing entrepreneurs grow.

Additive manufacturing is receiving support

from the state through the Department of Science

and Technology and a strategic business unit with

a focus on new industries at the dti. Additive manufacturing

uses 3D data.

The main sectors receiving support (and R358-

million in public money has been invested in research

since 2014) are jewellery, tooling, medical

and dental and aerospace. Products such as titanium

medical implants and aerospace components

have come out of the programme.

The Centre for Advanced Manufacturing

(CFAM) is housed at North-West University in

Potchefstroom. The centre specialises in extruder

technology, an important component in

the food-manufacturing process. CFAM works

with Gaborona Consulting, the Vaal University of

Technology, Thripp (a dti technology programme)

and ChemCity, an initiative of Sasol.

Metals

Among other important sectors are metals beneficiation

(more than 50% of the world’s ferrochrome

is produced in South Africa), coke and

refined petroleum products and information and

communication technology. Steel and petroleum

collectively make up about 45% of South Africa’s

total manufacturing production capacity.

Steel has been experiencing a volatile few

years, with reduced demand from China severely

reducing production volumes in South Africa. The

Steel and Engineering Industries Federation of

Southern Africa (Seifsa) reported that 19 000 jobs

were lost in the metals and engineering sector in

the nine months to September 2016. New import

tariffs of 25% imposed by US President Trump will

further hurt the SA steel sector.

This sector makes up 28% of manufacturing

in the country. The country consumes about 150

000 tons of stainless steel every year. South Africa

makes about 500 000 tons of primary stainless

steel (most of which is exported) and imports a

further 40 000 tons.

OVERVIEW

SOLUTIONS FOR AFRICA

Modern manufacturers are coming up with ways

to improve efficiency. In Africa, water saving and

conservation is becoming a vital part of doing

business.

Marley Pipe Systems has released a revolutionary

new hot and cold water supply solution called Profit.

Not only is Pro-fit made from the highest grade

PE-RT (Polyethylene with Raised Temperature

Resistance), which reduces loss through punctures

and tears, but it also reduces installation costs

by 50% and is resistant to corrosion and impact.

Water passing through the system is healthier

and by avoiding the use of metal any scrap value is

eliminated, thus making the product more secure.

The recent extended drought has reminded all

South Africans of how fragile water supply can

be. The Marley Vynadeep® Rainwater System

efficiently channels roofwater into tanks,

reducing demand on ground water and supplying

vital back-up for individual private or corporate

premises.

Marley Pipe Systems is active in several parts

of Africa and with an increased uptake in the use of

gas, Marley’s presence is growing. As big retailers

expand their footprints in Namibia, Mozambique

and Malawi, so Marley distributes larger volumes

through those channels. With the mining sectors

of countries such as Zambia, Tanzania and the DRC

showing signs of recovery, so the gas market is

growing further still.

Cheap imports have been at the heart of problems for

the steel sector, as they have for textiles, but other issues

include energy prices and labour costs.

The dti has moved to try to protect the local steel

industry by regulating the use in the construction sector

of locally produced and manufactured steel and steel

products. Another possible intervention is related to

109 SOUTH AFRICAN BUSINESS 2019


OVERVIEW

energy prices. Silicon Smelters, which has plants in

Mpumalanga and Limpopo, has asked for a two-year

negotiated price agreement (NPA) on electricity,

which would allow it to resume production. The

National Energy Regulator of South Africa (Nersa)

has the power to grant such exemptions where the

industry is regarded as strategic.

The structural mill of Evraz Highveld Steel in

Witbank was officially relaunched in June 2017 after

ArcelorMittal South Africa signed a contract to supply

blooms and slabs for the mill to make into heavy

structural steel. Evraz Highveld went into business

rescue in 2015. The contract is for two years with

an option to renew for another year. Alternately,

ArcelorMittal may buy the mill after the two years.

Elsewhere in Mpumalanga, the presence of

Ferrometals means that Mpumalanga is still an important

place for metals and machinery manufacturing,

but the turbulence in the steel sector has reminded

everyone of the need to diversify. Samancor Chrome

(which runs Ferrometals) is the second-largest ferrochrome

producer in the world with three plants.

Middelburg-based Columbus Stainless is a major

supplier of stainless-steel products to the domestic

and international market. The Manganese Metal

Company in Nelspruit is the largest producer of

pure electrolytic manganese metal in the world.

Iron production at Saldanha in the Western Cape

includes hot-rolled coil produced by ArcelorMittal

and cold-rolled and galvanised steel by DSP, a

joint venture between South Africa’s Industrial

Development Corporation (IDC) and a Belgian

company, Duferco.

VARIETY AND QUALITY

Tirisano Holdings manufactures between 200

and 1 700 pairs of shoes per day at its facility

in Phuthaditjhaba in the Free State.

The factory produces formal shoes and

school shoes, sneakers and pumps. The pumps

are adorned with artistic designs, including

African print designs.

Some testimonials attest to the professionalism

of Tirisano.

“Since our involvement with Tirisano Shoe

Company, they have been professional, dependable

and competitively priced with good aftersales

support. Tirisano supplies shoes to many

of our beneficiary schools.”

– Rivers Foundation

“We have had various engagements with

Tirisano (Pty) Ltd with regard to conducting

assessments and due care with a view of considering

development support to them in the

future. To this end we had a site inspection at

their facilities in Qwaqwa. The school shoes were

manufactured on time, with the requisite quality.

Tirisano’s conduct was always professional.”

– National Development Agency

ONLINE RESOURCES

Aluminium Federation of South Africa:

www.afsa.org.za

Centre for Advanced Manufacturing:

www.cfam.co.za

Manufacturing Circle:

www. manufacturingcircle.co.za

Steel and Engineering Industries Federation

of Southern Africa: www.seifsa.co.za

South African Textile Federation:

www.texfed.co.za

SOUTH AFRICAN BUSINESS 2019

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Service that

delivers the

Difference

Air Products South Africa (Pty) Limited manufactures, supplies and distributes a diverse portfolio

of atmospheric gases, specialty gases, equipment and services to the Southern African region.

Air Products touches the lives of consumers in positive ways every day, and serves customers

across a wide range of industries from food and beverage, mining and petrochemicals, primary

metal and steel manufacturers, welding and cutting applications to laboratory applications.

Founded in 1969, Air Products South Africa has built a reputation for its innovative culture,

operational excellence and commitment to safety, quality and the environment. In addition the

company aims to continue its growth and market position in the Southern African region.

www.airproducts.co.za


INTERVIEW

Stepping out to create

quality products

The CEO of Tirisano Holdings, Kgotso Ramooana, relates

how a revitalised shoe factory is creating employment.

What is your main business?

We manufacture a variety of shoes, including pumps, sneakers and

school shoes. Our production capacity varies from 200 pairs a day to

1 700 pairs a day.

Kgotso Ramooana

BIOGRAPHY

Kgotso Ramooana is the youngest

black shoe manufacturer in South

Africa. He has a diploma in Arabic

for Non-Arab speakers and is

currently studying for a diploma in

digital marketing. Growing up in a

rural area, he succeeded against

the odds. Kgotso has been part

of the Standard Bank Accelerator

Programme for Entrepreneurs

and in 2018 participated in a

seminar on footwear designing

and manufacturing technology

organised by the International

Business Vocational College in

China. His long-term vision is

to see the factory expanding its

branches worldwide.

How was Tirisano established?

I took over a factory which was previously owned by a co-operative

which had collapsed. I had the privilege to have worked within the

co-operative while in school, assisting with marketing and research.

Seeing the rising unemployment within my community, I took it upon

myself to re-establish the factory. We inherited a few machines from

the co-operative which we had to refurbish to industry standard. We

targeted the CSI school initiatives and pitched to manufacture school

shoes for donations. We built traction which enabled us to approach

government agencies for both funding and as potential clients.

Did you have tough times?

Market penetration was really difficult due to entry barriers. The wellestablished

players dominate the market. From the beginning I knew

that market analysis as well as establishing strong ties with other

players in the industry would help me to have a strong foundation.

We conducted a lot of research by visiting factories in Durban and

gaining industry insight.

What is the secret of your success?

The success of our business lies in creating enduring relationships

within the industry, producing high-quality goods for our clients, and

a dedicated team that is always willing to go the extra mile.

Is your business helping to uplift the community?

Yes, we provide employment and we have up-skilled our team. We

also donate shoes to our local community.

What area of your business is growing?

Our main focus has been to manufacture leather school shoes. We

are in the process of increasing our production line to include the

manufacture of PVC school shoes.

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Tirisano Holdings

Building a reputation in shoe manufacturing.

PROFILE

What we do

We manufacture a variety of shoes, including school

shoes, pumps and sneakers. These are manufactured

from a variety of materials. The success of the shoe

factory is founded on the creation of enduring relationships

within the industry, and the importance

of maintaining high-quality products and solid partnerships

with our clients.

Customer focus

Key factors that help us succeed are: customer satisfaction,

continuous staff training, a highly talented

and experienced management team and maintenance

of existing contracts.

Vision

Working together, our vision is to provide our customers

with uncompromising quality, innovation

and continuous improvement, which will result in

profitable growth and financial strength for our

company.

Mission

To build consistent business relationships and a

good reputation among all of our customers. To

encourage innovation and new ideas with new business

approaches to keep a competitive edge. To

become one of the most reliable and trusted shoe

manufacturers in the market so all of our clients

can completely rely on us. To consider and cater to

potential wider market requirements. By drawing

upon our experience in industrial manufacturing

and distribution, we focus on delivering optimal

solutions in the least time possible, through collaboration,

knowledge sharing and improved efficiency.

Skills development

Management will need intensive training on various

managerial fields to consolidate their knowledge.

We will be working with various service providers

and networking with other business organisations.

Establishment of affirmative action or equity for

the company will be enhanced. We will embark on

programmes to familiarise ourselves with quality

management protocols. We are committed to obtain

advanced learning and prepare ourselves for any

joint venture in order to expand.

CONTACT DETAILS

Physical address: Factory No 95 Site 140,

Industrial Area 3, Phuthaditjhaba, Free State

9866

Tel: +27 (0) 71 747 2280

Email: info@tirisanoholdings.com

Website: www.tirisanoholdings.com

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OVERVIEW

Food and beverages

Acquisitions are supporting backward integration.

Food and beverages make up 26% of the South African consumer

products sector, just ahead of agri-business (25%), diversified

companies (23%) and sugar producers. Between 2009 and 2016

the sector grew by 2%. Most recent capital expenditure has

targeted improving efficiency rather than expansion of production.

Some of the biggest companies in the sector are Tiger Brands, RCL

Foods, Pioneer Foods, Clover, AVI and Astral.

The food and beverages sector employs about 230 000 people.

Beverages account for just over 4% of all manufacturing sales while

food is responsible for 13.5%. Within the sector, beverages accounts for

24% of sales. One quarter of the 37% of national GDP that is generated

by agri-industries derives from agri-processing.

Gauteng, the Western Cape and KwaZulu-Natal are the leading

provinces, with about half of the companies in the sector located in

Gauteng. There are approximately 4 000 food-processing companies

in Gauteng, employing more than 100 000 people. South African

Breweries is spending R2.8-billion on expanding two of its three

Gauteng breweries. Heineken’s brewery at Sedibeng is undergoing

its second expansion since it opened in 2010.

Nestlé operates four manufacturing plants in the province and has

invested heavily in increasing production volumes. Tiger Brands runs

six plants in Germiston that produce a range of meat products, and the

establishment of a new tomato sauce plant and pasta plant rank among

the company’s recent investments in the province. McCain Foods

SECTOR INSIGHT

Unilever has invested

R4-billion recently.

produces frozen vegetables for

the Gauteng market.

Global consumer goods company

Unilever, whose plant in

Durban is shown above, has invested

nearly R4-billion in recent

years, including R600-million in a

Gauteng ice-cream factory that

will boost the company’s drive

into Africa.

This highlights a trend across

the food and beverage sector. In

2016 Nestlé South Africa invested

R1.2-billion in adding instant coffee

to the products it makes in

South Africa.

RCL Foods, formerly Rainbow

Chickens, has been on an aggres-

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OVERVIEW

sive run of acquisitions. RCL is reconsidering its business model with

a thought to producing fewer frozen chickens and doing more in the

fast-food sector.

Although the South African poultry business took a knock because

of the relaxation of import duties, it is still a big sector. Earlybird Farm,

one of Astral’s operations, processes 800 tons of chicken per day at its

two factories in Olifantsfontein. RCL operates 18 farms and two feed

mills in Gauteng alone. Daybreak Farms, an AFGRI operation in Springs,

produces about 650 000 broilers every week.

By volume and value, the Joburg Market is the biggest in Africa.

There are 55 cold rooms that can accommodate 4 561 pallets of fresh

produce at any one time. An average of 10 000 buyers congregate

daily on the market’s 65 000m² of trading space.

The Eastern Cape provides approximately a quarter of South Africa’s

milk, and the industry is further expanding as producers tend to favour

high-rainfall coastal areas. The Coega Dairy in the Coega IDZ produces

the brand Coastal, sells milk to all parts of South Africa and manages

the Famous Brands Cheese Company.

The province’s farmers mostly sell raw milk to two processors:

Parmalat and Clover. Small-scale dairy farming presents an opportunity

to develop the industry in the former homeland areas, especially in a

range of previously untapped products such as milk powder, speciality

cheeses and long-life milk.

Clover makes UHT/fresh milk in Port Elizabeth and Dairybelle manufactures

natural cheese, processed cheese and speciality cheeses in

Cookhouse near Somerset East. Ouma Rusks are still made in Molteno,

the small rural town where they were invented. Cabdbury Chocolates

operates a big site in Port Elizabeth and Nestlé makes 11 kinds of

chocolate at its factory in East London.

Excellent agricultural produce, good manufacturing capacity and

a skilled workforce give the Western Cape a competitive advantage.

Famous Brands has bought a famous Western Cape brand in its

drive for greater backward integration. Lambert’s Bay Foods supplied

Famous Brands restaurants with chips for two decades. With its purchase

from Oceana, Famous Brands now has greater control over one

of the vital items on the menu of its 26 restaurant brands, including

Wimpy, Steers, Fishaways and Mugg & Bean.

The wheat-growing areas of the Swartland host several mills such

ONLINE RESOURCES

Agricultural Research Council: www.arc.agric.za

National Agricultural Marketing Council: www.namc.co.za

FoodBev SETA: www.foodbev.co.za

Perishable Products Export Control Board: www.ppecb.com

South African Association for Food Science and Technology:

www.saafost.org.za

as Sasko’s facility in Malmesbury.

Bokomo has several manufacturing

facilities in areas such as Atlantis,

Epping, Ndabeni near Pinelands,

Worcester and Bonnievale. Safari

Vinegar is based in Strand and

there are two Heinz manufacturing

plants at Wellington and Atlantis.

The Western Cape has about 16 000

commercial pork sows and produces

a quarter of South Africa’s milk.

Nestlé produces condensed

milk and milk powder in Mossel

Bay and canned pet food in Cape

Town. Tiger Brands makes mayonnaise

in Bellville and has also

invested heavily in its prepared

meals plant in Cape Town.

SABMiller’s Newlands brewery

is one of the busiest in the country

as it is responsible for providing

product for a very large geographical

area.

The fast-food and familyrestaurant

franchise sectors

are sophisticated and cover a

broad range, from the indigenous

Spur and Nando’s brands

to international giants such as

KFC, McDonald’s and recent

arrival of Burger King. Nando’s,

the Portuguese-chicken chain,

has done very well internationally,

and is a phenomenon in Britain.

Wimpy is the second largest-franchise

operation in SA (after KFC).

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OVERVIEW

Automotive

Chinese investors are building at the Coega Industrial Development Zone.

SECTOR INSIGHT

Manufacturers are eyeing the

African market for growth.

• Exports have doubled in 10

years.

The automotive sector contributes 33% to manufacturing GDP

and about 6% to overall GDP. It produces approximately 600

000 vehicles per year, supporting 113 000 jobs in three provinces.

Exports have doubled in the 10 years to 2018.

Some of the world’s leading original equipment manufacturers

(OEMs) have recently made large investments in new plant and technology.

According to the National Department of Trade and Industry (dti),

the figure invested since 2009 is approximately R45-billion.

Long-term state support of the industry through the Automotive

Production and Development Programme (APDP) is a major reason for

the continuing health of this vital sector. The industry itself is looking

to Africa for new markets. By increasing total production numbers to

one-million vehicles, the sector will be more viable.

The dti, working together with the NAAMSA, has set targets for 2035

to increase production to 1% of world volumes (1.4-million vehicles), to

increase local content and to double employment and black-owned

businesses in the sector. Automotive and automotive components

make up 30.2% of total manufacturing output and about 7% of the

nation’s Gross Domestic Product (GDP).

Beijing Automotive Industry Group (BAIC) expects to be building

50 000 vehicles per year at its site at Coega Industrial Development

Zone (IDZ) by 2022. BAIC’s investment follows that of another Chinese

firm, First Automotive Works (FAW).

Companies like BAIC may be positioning themselves to push

into Africa, not only for selling vehicles but for automotive parts and

partly-assembled kits. A new pan-

African organisation has been

established to promote the auto

industry on the continent, the

African Association of Automotive

Manufacturers (AAAM). Most

international brands such as

Volkswagen have given responsibility

for Africa to their South

African offices. VWSA is in a joint

venture in Kenya and is exploring

opportunities in Rwanda.

VWSA is based in the Eastern

Cape where it manufactures

half of the country’s passenger

vehicles and provides 51% of

South Africa’s vehicle exports.

The sector accounts for over 40

000 formal sector jobs in the

Eastern Cape.

Volkswagen’s two new types

of Polos started rolling off the

production line in Uitenhage in

2018. Volkswagen’s R6.1-billion

investment will take production

up to full capacity of 160 000

vehicles in 2019, from 110 000 in

2017. The increase will mean that

a third shift will be introduced.

In addition, VWSA makes

130 000 engines for local demand

and for export. Ford in

Port Elizabeth is the country’s

other engine manufacturer.

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OVERVIEW

Smart factories are the subject of research being undertaken by

the Department of Computing Sciences at the Nelson Mandela

Metropolitan University (NMMU). The research is supported by

Volkswagen SA and Mercedes-Benz SA.

In January 2018, Mercedes-Benz South Africa (MBSA) started producing

the Mercedes-AMG C 63 S at its East London factory, after an investment

of R200-million. MBSA started exporting record volumes in 2016.

BMW South Africa has invested R6-billion in its Rosslyn plant to

prepare for the manufacture of the new BMW X3 model. Nissan is

another big automotive manufacturer with a plant at Rosslyn, northwest

of Pretoria. Ford announced in 2017 that it would put R3-billion

into taking the production of the Ranger vehicle to 167 00 per year.

Gauteng is also home to a strong automotive components industry,

together with several bus and truck assembly plants. These include

Scania, TFM Industries and MAN Truck and Bus South Africa, as well as

the Chinese truck manufacturer FAW, which owns an assembly plant

in Isando. Bejing Automotive Works (BAW) assembles taxis at Springs.

DCD Protected Mobility manufactures armoured cars in Boksburg,

which are branded as Vehicle Mounted Mine Detectors. In Benoni, BAE

Systems OMC designs and manufactures protected vehicles.

In 2016, Toyota invested R6.1-billion into its massive plant at

Prospecton, Durban. The company regularly sells about a quarter of

the vehicles sold in South Africa, and accounts for the same proportion

of exports. The Corolla car, the Hilux bakkie and the Fortuner SUV are

manufactured at the plant.

KwaZulu-Natal’s other large OEM, Bell Equipment, is transferring

production of its current truck range to its factory in Germany. Bell’s

Richards Bay plant will start assembling Kamaz heavy-duty trucks in

2019 for the African market.

Automotive components

South Africa has a sophisticated automotive component sector. The

catalytic converter sector experienced incredible growth for a number

of years but volatility in the platinum mining sector, together

with increased interest in electric vehicles and hybrids, means that

exporters (largely based in Port Elizabeth) have had to work harder.

Tyre and glass manufacturers are clustered around the areas

ONLINE RESOURCES

Automotive Industry Development Centre: www.aidc.co.za

National Association of Automotive Component and Allied

Manufacturers: www.naacam.co.za

National Association of Automobile Manufacturers of South

Africa: www.naamsa.co.za

where the automotive industry

is active. Sumitomo

Rubber South Africa which

includes Dunlop among its

brands, is spending R2-billion

on expanding production in

Ladysmith, KwaZulu-Natal.

Bridgestone Tyres has plants

in Port Elizabeth and Brits

and Continental makes tyres

in Port Elizabeth.

The large number of vehicle

models produced in South

Africa is a complicating factor

for the components sector:

low volumes often mean

high prices. Two Port Elizabeth

companies export significant

portions of their production

to overcome this: Schaeffler

SA exports to its international

parent so that it can achieve

higher volumes. Shatterprufe

supplies the majority of windscreens

to the South African

market but there are 12 model

ranges to serve.

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OVERVIEW

Transport and logistics

Plans are in place to shift freight from road to rail.

The decision by Imperial Holdings to create a separate stock

exchange listing for its automotive division marks an interesting

departure for one of the biggest logistics companies

in South Africa.

Imperial Holdings employs 49 000 people and Imperial Logistics,

apart from its large South African footprint, has a presence via

multiple companies in other African countries and in Europe, the

Americas, the Middle East and the Far East. The Motus division

represents 22 OEMs through 358 vehicle dealerships and runs two

car rental companies, Europcar and Tempest.

Companies like Imperial Logistics and Barloworld carry just about

anything while other listed companies specialise. Cargo Carriers has

a fairly broad range of specialised services: fuel, steel, chemicals,

gas, powders and services to the mining and sugar industries.

Other companies specialise even further, for example CSS Logistics

operates 12 refrigerated warehouses around South Africa. Laser

Logistics describes itself as a specialist in distribution for retailers

and wholesalers in the clothing, footwear, lifestyle, electronics and

appliance markets.

Industry news

• DHL Express has launched a green distribution centre in

Johannesburg. Energy consumption will be reduced by 55%.

SECTOR INSIGHT

A new Special Economic

Zone will boost logistics in

Limpopo.

• The inland manganese terminal

at Lohatlha in the Northern

Cape has been taken over

by Transnet Port Terminals.

Allowing miners to move ore

by rail reduces costs. Transnet

also operates inland terminals

in Brits (North West) and

Newcastle (KwaZulu-Natal).

• The building of the Musina-

Makhado Special Economic

Zone (SEZ) will boost

Limpopo’s role as a transport

and logistics hub. The Musina

Intermodal Terminal, which

was officially opened in June

2017, is 15km from the busy

Beit Bridge border crossing.

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OVERVIEW

It will boost efforts to move cargo from road to

rail. Warehousing facilities on-site make for loading

efficiencies in the main cargoes such as chrome,

fertiliser, coal, fuel and citrus.

• The Nkomazi SEZ near the border with Mozambique

in Mpumalanga has similar advantages as it forms

part of the Maputo Development Corridor.

• The purchase of 75% of German logistics company In

Time for €137.2m in 2015 has paid off well for South

African logistics company Super Group.

Road and rail

South Africa has 21 000km of railway lines and 747 000km

of roads, 325 019 heavy-load vehicles and the road freight

industry employs 65 000 drivers. The logistics and courier

market is worth R10-billion. There are 135 licensed airports

in the country, 10 of which have international status.

Investment in improved infrastructure is being

made at all of South Africa’s ports. Special Economic

Zones are in place at the ports of Saldanha on the

West Coast, Coega (Port Elizabeth), East London, and

Richards Bay in northern KwaZulu-Natal. The Maputo

Development Corridor is Africa’s most advanced

Spatial Development Initiative. Run by the Maputo

Development Corridor Logistics Initiative (MCLI),

the corridor runs from near Pretoria in Gauteng, to

Maputo in Mozambique.

The Harrismith Logistics Hub at the Maluti-A-

Phofung SEZ on the N3 is an inland port that can

handle cargo containers and shift cargo from road

to rail, reducing congestion and costs.

Transnet is the state-owned enterprise focussed

on transport and logistics. It comprises Transnet

Freight Rail, Transnet Engineering, Transnet National

Ports Authority, Transnet Port Terminals and Transnet

Pipelines. Transnet Freight Rail’s operations represent

about 80% of Africa’s rail infrastructure. With 25 000

employees TFR has specialist divisions for hauling coal

and iron ore together with a general freight division

which transports everything from grain to chemicals.

The major rail haulage lines are the manganese

line from the Northern Cape to Port Elizabeth; from

Sishen in the Northern Cape to the Port of Saldanha

GROWING WITH AFRICA

Mueletshedzi Logistics (MLTL) believes

Africa is fast becoming the hub of economic

growth and there are opportunities to

invest. The growth economy needs welldeveloped

skills and services to efficiently

keep up with the expansion. There

must be a reliable supply of equipment,

transportation, proper facilities as well as

bringing together other logistics solutions

to sustain the growth. With the experience

and commitment that we have at MLTL,

we’re well equipped to take on these

challenges. We understand the needs of

business and, based on our experience and

commitment, we stand out as a preferred

choice for reliable and sustainable logistics

solutions. Mueletshedzi Logistics is a

unique logistics company that offers a

range of solutions in one basket. That factor

makes us easy to work with as we deliver

quality work at once. The company is still a

growing business, but the goal is to develop

into the biggest logistics company in Africa.

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OVERVIEW

Coast toll road project. The bridge over the

Mtentu River will be the highest bridge

in the country at 217m and will cost R1.6-

billion.

Air transport

(iron ore); and from the coal fields of Mpumalanga to

Richards Bay. More than 55-million tons is regularly

transported along the former and upwards of 70-million

tons can travel annually along the latter.

Almost 90% of freight is transported by road and the

logistics sector is very reliable. However, these volumes

are not good for the condition of the country’s roads and

Transnet is working hard to attract more business to the

rail network. TFR has put 28 new electric locomotives

on the line supporting steel producer ArcelorMittal to

improve service.

The rail sector is receiving many investments. The

speedy Gautrain which started life as a service to the main

airport in Johannesburg has been tremendously popular

and there are plans to expand its network. Bids to supply

12 new trains will be adjudicated on in 2018.

A total of 600 new passenger trains will be added to

Metrorail’s fleet at a cost of R51-billion. Transnet Freight

Rail has ordered 1 064 diesel and electric locomotives

from four suppliers.

Sheltam Group is expanding its services beyond rail

services. A new lease company (for rolling stock) and an

investment company (focussed on rail infrastructure) underpin

the group’s African ambitions.

Multi-billion- rand road projects planned by the South

African National Roads Agency Limited (Sanral) include a Wild

ONLINE RESOURCES

Airports Company South Africa: www.acsa.co.za

National Department of Transport: www.transport.gov.za

Road Freight Association of South Africa: www.rfa.co.za

South African Association of Freight Forwarders:

saaff.org.za

South African Heavy Haul Association:

www.saheavyhaul.co.za

Airports Company South Africa (ACSA)

owns and operates the country’s 10 biggest

airports. The company also manages

airports in India and Brazil. In 2016/17 the

company reported a profit of R2-billion.

Ekurhuleni wants to leverage the location

of South Africa’s biggest airport, OR

Tambo International, into a major economic

asset. OR Tambo International in Gauteng

caters for more than 17-million passengers

every year. The Cape Town International

Airport has been expanded and improved

and recorded 10-million passengers in 2016.

King Shaka International Airport (KSIA) is

north of Durban.

Several airports are possible future

regional freight nodes: Wonderboom

Airport in Pretoria, Polokwane Airport in

Limpopo and Mafikeng Airport in North

West Province.

The South African Ministry of Transport

has several agencies and businesses reporting

to it: Air Traffic and Navigation

Services Company, Airports Company

South Africa (ACSA), National Transport

Information System, Road Accident Fund,

South African Civil Aviation Authority,

South African Maritime Safety Authority

(SAMSA), the South African National Roads

Agency Limited (Sanral) and the Passenger

Rail Agency of SA (PRASA).

The Polokwane International Airport

(PIA) is wholly owned by the Limpopo

provincial government and run by the

Gateway Airport Authority Ltd (GAAL), an

agency of the Department of Roads and

Transport. It has the potential to be an important

regional cargo airport.

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Safety is a priority at

logistics company

PROFILE

Mueletshedzi Logistics aims to take logistics to another level.

Environment and Quality (SHEQ)

and Compliance Manager. He is

currently enrolled on a strategy

management programme with

Unisa.

Mueletshedzi Logistics (trading as MLTL) was founded in

2009 by Benedict Mudumela, an experienced metallurgist

with an appetite for entrepreneurship.

He saw a gap in the market where everyone was

thinking about logistics as just the transport of goods. Mueletshedzi

Logistics was founded with goal of changing that thinking. The aim is

to deliver logistics solutions in a far more encompassing way: to bring

logistics to clients in a way that had never been done before. To bring

all solutions under one roof and to take logistics to another level. The

company is able to assist clients in developing sensible, cost-effective

solutions, be it in logistics, training or delivery of services.

At Mueletshedzi Logistics, the goal is to have a long-term and sustainable

relationship with clients based on honesty, trust and integrity.

Business Development Manager

Busani Sibanda holds a Diploma in Transport Management from ABMA

(UK), a Diploma in Banking from the Institute of Bankers, Zimbabwe, a

certificate in Store Administration and a certificate in Sales. He joined

the Mueletshedzi Group of Companies in 2015 and has added value

to to an already robust team of managers.

SHEQ Manager

Simba Gapara has a National Diploma in Analytical Chemistry (Harare

Polytechnic), a certificate in Quality Assurance Management from City

& Guilds of London Institute, and a certificate in Quality Management

System Development and Maintenance. He is national Safety, Health,

Safety, health, environment

and quality

The safety, health and environment

policies of Mueletshedzi

Logistics encompass:

• to comply with environmental

legislation and regularly assess

the impact of all current and

future activities, products and

services on the environment

• to provide training and tools

for a good working environment

and deliver a quality service

in a consistent and timely

manner

• to implement mechanisms

for the regular and continual

review of business practices

• to develop and implement

mechanisms to identify health

and safety issues

• to impart training and awareness

to employees to ensure

employees are made aware

of their legal obligations in

respect of their own and

others’ health and safety

• make available adequate resources

for the establishment

of a quality and environmental

management system.

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OVERVIEW

ICT

Incentives are encouraging investment.

Companies and educational bodies in the ICT sector can

apply for incentives from the National Department of Trade

and Industry (dti). These include:

• The Technology and Human Resources for Industry Programme

(THRIP): companies and educational institutions working to improve

technology; 50/50 cost sharing grant to a maximum of R8-million

• Technology Development Fund: the Technology Innovation Agency

makes up to R50-million available for up to 10 years

• Technology Venture Capital: managed by the Industrial Development

Corporation; commercialisation of innovative products, processes

and technologies.

Liquid Telecom paid R6.5-billion in 2017 to buy South African network

operator Neotel. Liquid Telecom is part of the Econet group. Royal

Bafokeng Holdings will take up a 30% shareholding in Neotel as part

of the deal. The transaction significantly expands the reach of the fibre

network which, it is claimed, will be Africa’s largest broadband network.

Twelve countries are currently connected by 40 000km of fibre network,

with more expansion part of the business plan.

The Information Technology Association (ITA) is the trade

and employer body of the Information Technology industry in

South Africa. The ITA represents more than 200 companies which

SECTOR INSIGHT

Fibre is being rolled out in

some low-income areas.

• Neotel has changed hands

for R6.5-billion.

supply information technology

equipment, systems, software

and services. Members include

IBM, Microsoft SA, Siemens, SAP

and Axiz.

A new technology venture

was launched when Cape Town

hosted AfricArena 2017, a conference

that aimed to be a “bridge

between international technology

stalwarts and African technology

innovators”. A collaboration

between Silicon Cape and

La French Tech Cape Town, it

brought together investors,

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OVERVIEW

venture capitalists, start-ups and entrepreneurs. The

French government has officially designated the city

as one of six global French Tech Hubs. Other hubs

include Tokyo and San Francisco.

French Tech Labs was launched as a fintech incubator

in 2016. The same company earlier established

Methys Labs. The new incubator offers mentoring

support for innovators, connections to possible investors

and a chance for selected candidates to travel

to France.

Major banks are feeling pressure from new companies

who can connect with customers without having

to build bricks-and-mortar infrastructure. They are

responding by spending heavily on ICT. One example

is Barclays Africa Group’s expenditure of R3.1-billion

on ICT in 2016. The Big Four banks spent R30-billion

in the year to June 2016, with Standard Bank laying

out R14-billion in that period (Tech Central).

They are also investing in innovation. Barclays Bank

have invested in a fintech incubator in Cape Town,

Rise. There are six other Rise sites around the world,

including New York and Mumbai.

The Cape Innovation and Technology Initiative

(CiTi) is another support system for the ICT sector.

There are 2 000 ICT firms in the Western Cape and

they have 17 000 employees.

South Africa’s appetite for fast Internet connectivity

is growing. The state-owned company Telkom

controls most of the country’s fibre cable but several

smaller private companies are winning contracts to

lay fibre optic cables around the country.

Wider access

Allowing access to the Internet to rural people and

poorer people in urban areas is a policy priority. As

part of its mandate, the Independent Communications

Authority of South Africa (ICASA) has organised that private

operators have connected more than 623 schools

around the country.

Dark Fibre Africa, a Remgro subsidiary, has established

a Digital Villages unit to roll out fibre in lowincome

areas. Another company in which Remgro has

a stake, Vumatel, plans to offer uncapped broadband

services in Alexandra (Johannesburg) for less than

R100 per month.

Marketing and delivering solutions

As a professional distribution company,

Kemtek is gratified to be entrusted with

the channel responsibility for many of the

world’s leading brands. Presently, Kemtek

focuses on the following industry sectors:

• Printing – digital and conventional

• 3D Printing – manufacturing, medical,

dental, jewellery and automotive​

• Auto identification and barcoding

systems

• Labelling – home, office and industrial

systems.

Kemtek’s marketing approach is based

on developing a detailed understanding

of the markets served and the needs of

the end user. The aim is to marry the technologies

and solutions provided by the

principal brands to these needs, creating

value on a sustainable basis. A cornerstone

of Kemtek’s success is ongoing technical

support and after-sales service, which all

employees are passionate about providing.

At Kemtek, there is a commitment to

investing in leading systems to enhance

the channel and distribution efficiencies,

whether this be CRM and sales, procurement

planning, inventory management,

warehouse management and logistics.

The specialised distribution division

operates in excess of 25 delivery vehicles

nationwide, performing approximately

15 000 deliveries per year from five

dedicated sales and distribution sites

nationwide. Delivery services are also

extended by the use of most major

courier companies for the retail chains

and outer-lying regions.

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OVERVIEW

If developers have an opportunity to put fibre into a new township’s

infrastructure when it is built, a new level of affordability can

be achieved. DFA is active in Gauteng Province and by August 2018

had installed connections in 1 000 units.

Private companies like Vodacom allocate specific budget items

to rural access and in September 2017 it announced that it would

zero-rate its services for university student and staff who are

Vodacom subscribers. To illustrate the vastly different uses to which

technology can be put, Vodacom is also developing an affordable

sheep-tracking collar with farmers in the Eastern Cape.

Statistics South Africa reports that nearly 60% of households

in the Gauteng city region have direct access to the Internet. This

provides an opportunity to both the private and public sector, but

also a challenge to ensure that government improves its online

services. More than 1 500 kilometres of network fibre has been connected

throughout the province, with 1 066 sites such as schools,

health facilities, libraries and community centres giving community

members and entrepreneurs the chance to be connected with the

digital world. The aim is to have 100% broadband connectivity in

Gauteng by 2020. A provincial government initiative known as

eKasiLabs Innovation Centres supports entrepreneurs and young

people with good business ideas.

Both Johannesburg and Tshwane have free Wifi networks with

Tshwane’s covering 780 zones in places such as libraries, educational

institutions and clinics.

The Small Enterprise Development Agency runs ICT incubators

in several parts of South Africa. The SoftstartBTI ICT incubator is

in Midrand and Tuksnovation, a high-tech incubator, is at Pretoria

University. In the Nelson Mandela Bay Metropolitan Municipality

there is the SEDA Nelson Mandela Bay ICT Incubator (SNII). A new

research and development laboratory was established by SNII in

2016, focussing on apps, mechanical and technical prototypes and

software solutions.

SNII also hosted a national conference on “Universal Affordable

Access to Communications in South Africa”. An example of

ONLINE RESOURCES

Cape Innovation and Technology Initiative: www.citi.org.za

Independent Communications Authority: www.icasa.org.za

Information Technology Association of South Africa:

www.ita.org.za

State Information Technology Agency: www.sita.co.za

Technology Innovation Agency: www.tia.org.za

what can be done to reduce

telecommunication costs in

rural areas was presented by

the University of the Western

Cape, who teamed up with the

Mankosi community in a rural

part of the Eastern Cape to

create the Zenzeleni Network.

This is essentially a community

telecoms company where local

calls are free, data is considerably

cheaper and calls to other

networks half the normal cost.

The Universal Service and

Access Agency of South Africa

(USAASA) is providing connectivity

for schools in five provinces

and smart devices have been

distributed to schools.

There are many opportunities

for employment in the sector.

It is ironic that in a country

with a very high unemployment

rate, the Johannesburg Centre

for Software Engineering (JCSE)

in 2016 put the number of vacancies

in software and application

development, cloud computing

and information security

at 40 000 (Sunday Times).

Training is available from

organisations such as the Quad

Digital Academy, a Standard

Bank initiative, an ICT Incubator

in Port Elizabeth run by the

Small Enterprise Development

Agency (Seda) and from the City

of Johannesburg (which runs a

digital intern programme called

COJEDI). Scarce skills training is

offered by the City of Cape Town

(in partnership with SAP Africa)

in software programming. The

programme is called “Western

Cape Skills for Africa”.

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PROFILE

Khabane Majestic

Consulting

Agile software development and consulting.

Khabane Majestic Consulting is a software development

company. We pride ourselves on implementing and

perfecting our clients’ IT strategy. We build digital solutions

which give our clients a competitive edge.

Our people have delivered solutions on five continents and we

bring that experience to bear on providing Agile delivery practices

to gain the optimal result. We deliver quality software and solutions

which provide business value to clients. We are BEE Level 1 black

women-owned.

Sectors

Our responsive digital business helps organisations achieve their

ambitious missions – whether they are in the commercial, social or

government sectors.

Four key services

Agile software development and consulting

We deliver high-quality software products by being truly agile –

beyond daily standups and other arbitrary Agile rituals. We focus

on stimulating the culture of our client. We bring our international

consulting expertise and get things done – faster and more efficiently.

User experience design

We give our clients’ software product a personality by using different

UX techniques combined with design thinking approaches. This

produces usable software and delightful user experiences.

We combine this with a thorough testing approach that allows

us to quickly validate design assumptions with real users. We can

CONTACT INFO

Physical address: 207 Market Up Office Park, 10 Van Beek Street,

New Doornfontein, Johannesburg 2094

Tel: +27 11 404 5004

Email: info@khabane.co.za

Website: www.khabane.co.za

quickly know if the desired outcomes

have been achieved. At

each step, you can be comfortable

that we will:

• ensure that we are solving real

user problems

• ensure that the problem is

worth solving

• ensure that the solution is

usable.

Agile delivery coaching

We train client teams on how to

adopt Agile software delivery in

their day-to-day processes. We

then combine what our clients

have learnt in training and

implement it via co-delivery.

Here we work together, richly

integrated with our clients’

delivery teams to enrich the

understanding of Agile.

This process allows for a more

practical and richer Agile learning

experience for software delivery

teams.

DevOps delivery

We turn the experience of

software deployment into

a pleasant experience. We

automate even the most

mundane tasks. We turn big and

slow organisations into lean and

sexy machines.

Clients

Include Liberty, Absa, Discovery,

Unicef and Sigidi Solutions.

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INTERVIEW

Creating innovative

IT products

Kgomotso Sediane, MD of Khabane Majestic Consulting,

shares her vision for the future.

Kgomotso Sediane

BIOGRAPHY

Kgomotso Sediane founded

Khabane Majestic Consulting

in 2015 and spearheads the

company’s operations as the

Managing Director with more

than 15 years’ experience in IT.

Graduating with a BSc Computer

Science (Software Engineering),

she started her career in 1998

in the software development

field as a programmer. She

is passionate about making a

difference to customers through

collaboration between business

and IT, while promoting gender

equality. Kgomotso cares

about upskilling people and

contributing to Africa’s future.

How did the business begin?

Khabane Majestic Consulting was created by a group of young black

technologists who believed there was a gap in the South African

software development industry. This industry is notorious for being

predominantly white-male owned and run. KMC’s vision was to create

a female-led IT company which celebrates diversity and innovative

thinking. What started as a humble company running from a garage

has morphed into a hub for young futuristic thinkers.

Describe the journey so far.

It has been an interesting journey so far. Trying to get new clients

and building credibility was hard. Competing with companies with

decades of experience and existing relationships with potential clients

was a good lesson for our young company. This battle to earn our slice

of the cake helped us hone our brand, build awesome software, get

people talking about us and attract some of the best talent in South

Africa. Today, we are expanding our consultancy operations to service

clients outside our country.

What sets you apart?

When you walk into our Maboneng offices, you are greeted with stickies,

whiteboards, doodles, collaboration and all-round awesomeness.

This sums up the culture within KMC. Our unique service offering

allows us to create innovative and disruptive digital products using

Agile, Design Thinking and Extreme Programming practices. KMC is

a diverse company that encourages collaboration despite seniority.

What gives you the most satisfaction?

Seeing young black technologists go to infinity and beyond.

Is SA ready for the 4th Industrial Revolution?

The ideas are there, but the problem is the lack of accessibility to

tech for all South Africans. Good broadband infrastructure will allow

kids from rural areas to have the same exposure to technology and

information as a child from Sandton.

129 SOUTH AFRICAN BUSINESS 2019


PROFILE

Prompt IT Solutions

Working together for high-impact ICT solutions.

Prompt IT Solutions is 100% black women-owned IT company which

has been in existence since 2004, with Level 1 BEE Status.

Vision

Being a partner in identifying impactful Information and

Communications Technology solutions.

Client as partner

Our knowledgeable technology team produces work that is up to

standard with our clients’ expectations through solid as well as professional

strategising, conceptualising and implementation of IT solutions.

Every Information and Communications Technology service provided

must involve, engage and build upon the company’s image and,

most importantly, strengthen the consumer/product bond.

The challenge for the private and public sector is to find innovative

and alternative solutions that adhere to business needs. Solutions

need to be understood, relevant and experienced on an intensely

personal level by the consumer to strengthen the relationship they

have with their service providers. The service provider should know

the needs of their consumers to make sure that they work efficiently

and productively.

Company focus

Our strategy is to ensure that we offer our clients the best highquality

and cost-competitive service, thereby enabling them to

respond quickly to any changing market dynamics and increasing

their competitiveness.

Services

• Infrastructure development data

• Voice and wireless connectivity

CONTACT DETAILS

Address: 56 Cetu Street, KwaMagxaki, Port Elizabeth 6201

Tel: +27 (83) 585 4822

Website: www.promptit.co.za

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PromptIT

J O U R N E Y I N G W I T H Y O U

• Networking installations

and maintenance (Molex

Certification)

• End User Computing

(Accredited with MICSETA)

• Server support and maintenance

• Electrical and CCTV installation

and maintenance

• Laptop, computer, printer

repairs and service

• Computer consumables sales

• Computer hardware and

software sales

Staff

Prompt IT has a dedicated team of

software and hardware engineers.

We derive from a base of freelance

specialists should the need arise,

because core to sustainability for

us is job creation. The approach of

combining a wealth of expertise on

a project basis enables us to meet

each of our clients’ specific needs

in the most suitable, creative and

cost-effective manner.

Clients include

The Post Office, Aberdare

Cables, Shoprite, Enel Green

Energy, Airports Company

South Africa, Sarah Baartman

District Municipality, Eastern

Cape Provincial Government

Departments (Social Development,

Health, Education).


PromptIT lives its

name with on-time

delivery

INTERVIEW

The CEO of PromptIT, Azola Socenywa, recounts how a

gap in the market became a thriving business.

Azola Socenywa

BIOGRAPHY

PromptIT

J O U R N E Y I N G W I T H Y O U

Port Elizabeth-born Azola

Ngwekazi Socenywa completed

courses on the technical side

of computers and a national

diploma with Damelin. Work

for Coca-Cola Sabco led

to a posting to Business

Connexions, the only female

among 16 technicians. Success

in the SAB Kickstart Programme

was the stimulus to start

PromptIT. In 2015 she joined

VW’s incubator programme,

Raizcorp. Azola is a board

member of the Eastern Province

Children’s Home and on the

Advisory Committee of MES, a

poverty relief organisation.

How did PromptIT come into being?

I worked for Coca-Cola Sabco before being outsourced as a junior

technician to Business Connexion. I proposed projects because there

were not many black children exposed to the ICT sector. In 2004 I saw

a gap in the market and started PromptIT. Having done well in the SAB

Kickstart Programme I started an Internet cafe in the township which

was registered with MICSETA to teach Computer Literacy. Since 2015

the incubator Raizorp has mentored me in business.

What have been the highlights in your business journey?

After 14 years of being in business I have been recognised and a few

ICT organisations are seeing the need of partnering with PromptIT. The

journey has not been easy, but we are still standing and growing our

network. We would like to continue to grow our skills.

What are your company’s key services?

Our core services are network cabling, data, voice, fibre installation and

maintenance, cyber security and professional IT support.

Please tell us about the capabilities of your workforce.

Most of our staff are project managers and qualified Cisco engineers.

We assign junior technicians to shadow the seniors to grow their skills

as it is important for us that we give them exposure.

What sets you apart in terms of your business processes?

Our philosophy is Trade not Aid. We are a black woman-owned and

managed business in a male-dominated industry. Despite this we

have managed to thrive and grow. This is the spirit that sets us apart.

We deliver customer centrality, delivery on time, co-creating with our

customers. Our staff has joint ICT experience of 25 years, having worked

for multinationals such as Microsoft, SAP and IBM.

Do you have experience with projects in the public sector?

We have contracts with the Coega IDZ, Transnet PE College and the

Department of Health. We believe that ICT should be an enabler

towards service delivery.

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PROFILE

Emalangeni Technologies

Global standard and innovative technology solutions.

Emalangeni Technologies is a specialised systems

integrator, website development, graphic design,

networking, hardware and software troubleshooting

and solutions provider in the information technology

and security fields. Emalangeni Technologies is a

100% black-owned company with extensive experience in

a range of ICT services.

Originally founded with a main focus on website

development, software development, graphic design,

computer hardware and software trouble-shooting and

networking solutions.

Emalangeni Technologies has gained valuable in-depth

knowledge and expertise in these fields and the best

practice of ICT. The company has over the years increased the

amount and quality of services rendered, including Internet

connectivity and VoIP system connectivity. The team has

grown continuously, and the company strives to remain at

the forefront of the latest technological innovations.

From the outset the aim with Emalangeni Technologies

was to provide clients with the best possible information

technology products. To this end, diversification has led to

increased service offerings over the years.

Emalangeni Technologies can today cater for the information

technology needs of clients in every possible way.

Emalangeni Technologies has distinguished itself not only

for the originality and quality of its products, but also for its

comprehensive services.

Services

• Domain and email hosting

• Website development

• E-commerce web development

• Corporate branding

• Full-service graphic design

• Specialised software engineering

• CCTV installation

• Content management systems (CMS)

• Search engine optimisation

• Google adwords management

• Basic and advanced flash animation

• Monthly maintenance and support

• Point of sale installation and maintenance

• Hardware supply and maintenance

• Rocketseed authorised key reseller

• VoIP telephone system and connectivity

• Internet connectivity

Clients

We have worked with a range of start-ups, SMEs

and large corporate companies. Projects include

provision of Internet to Mpumalanga Public Libraries

for three years, installation and maintenance of VoIP

system for Chief Albert Luthuli Local Municipality

and Bushbuckridge Local Municipality, installation

of CCTVs, networking and setup equipment for

OTJ Holdings, and development of a website for

Phumelela Bible College. Also, integrating client

websites with Basecamp, YouTube and Facebook

APIs and the development of various CRM systems.

CONTACT DETAILS

Address: Suite 146 Ground Floor, Caltex Building, 32 Bell Street, Nelspruit 1200

Tel: +27 13 004 0180 and Cell: +27 76 303 3278

Email: info@emalangenitech.co.za

Website: www.emalangenitech.co.za

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Striving for the best way

INTERVIEW

The CEO of Emalangeni Technologies, Sifiso Magonyane,

explains how his company’s growth path began.

What is your main service offering?

Our main service is VOIP, hardware supplier, software development

and point of sales.

How have you diversified over the years?

We have grown from just focussing on website development to

software development, VOIP, Internet connectivity, hardware supply

and point of sales. Growing in these different spheres has also led to

us growing our list of clients, providing our services to bigger entities

in the public and private sectors.

Sifiso Magonyane

How did you get started in the business?

We started as a small web and graphic design company that was

just focussed on small private clients. At the time our clients were

either individuals or SMMEs which themselves were trying to break

into the business sector. We had to give a lot of discounts or even

cancel our invoices at times. However, this never interfered with our

work ethic. We believe that in technology, you either do it the best

you can, or you don’t do it at all.

What gives you the most satisfaction when you tackle

a project?

Even before the completion of a project, it is always satisfying to

know that we were trusted by the client. The fact that our company

can be seen as competent enough to be handed any project is always

an honour. This fuels our team to apply their abilities in a project and

to find innovative ways to execute a project.

BIOGRAPHY

Sifiso Magonyane was born in

the Shabalala area of Hazyview,

Mpumalanga. He has more than

five years’ experience working as a

systems analyst. As the founder and

CEO of Emalangeni Technologies,

Sifiso is a visionary who strives for

perfection in his work and the work

of his company which was founded in

2009 and officially registered in 2013.

Please tell us about some of your clients.

• The Mpumalanga Department of Sports, Culture and Recreation:

we work on providing Internet connectivity to public libraries.

• City of Mbombela Municipality: providing maintenance and

support of all computer hardware and CISCO devices.

• Retail shops: installations and maintenance of point of sale

systems.

What principles underlie the way you run your business?

Integrity, respect and transparency is the core of our business. We

make sure that these principles are implemented in every project

and with every client.

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OVERVIEW

Tourism and events

The events and conferences sector is growing across the country.

South Africa gained its 10th World Heritage Site in 2018, opening

up the possibility of a new type of niche tourism for the

country and Mpumalanga in particular.

A three-billion-year-old micro-fossil found in the

Makhonjwa Mountains near Barberton and the border with

Swaziland is thought to be the oldest sign of life on the planet.

Now the Makhonjwa Mountains, themselves somewhere between

3.2-billion and 3.6-billion years old, have been declared a

World Heritage Site by the United Nations Educational‚ Scientific

and Cultural Organisation (UNESCO). The tourist offering near

Barberton has been branded the Genesis route.

There are 711 745 people employed in the tourism industry,

with road transport (29%), food and beverages (20%) and accommodation

(19%) absorbing the largest numbers. The sector

contributes 9% to South Africa’s gross domestic product (GDP)

and the National Department of Tourism has ambitious growth

targets. It wants to see tourism contribute R1-trillion to GDP and

create an additional 300 000 jobs by 2026.

Tourist numbers are going up, both from traditional markets and

from newer markets like China and India. In 2017, South Africa hosted

SECTOR INSIGHT

A new World Heritage

Site has been declared in

Mpumalanga.

• The Cape Town International

Convention Centre (pictured)

has increased capacity and

flexibility.

10.2-million tourists. This represented

a small increase of just 2%

over the previous year, but that

figure was a 10% improvement

on the year before.

The rise in tourist numbers

follows determined efforts by

national and provincial tourism

bodies to promote the country.

In Mpumalanga, links to BRICS

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OVERVIEW

countries have yielded results and in KwaZulu-Natal there has

been a strong focus on the meetings, incentives, conference and

exhibition sector (MICE).

A Western Cape project to increase the number of seats on

routes to and from Cape Town called Cape Town Air Access has

been spectacularly successful. Cape Town International Airport’s

capacity has increased by more than 600 000 seats in the two

years that the programme has been running.

The Port of Cape Town has launched its dedicated cruiseship

terminal, and the area between the terminal and the Cape

Town International Convention Centre is being developed. The

precinct, called the Yacht Club, includes a hotel, residential and

commercial complex owned by the Amdec Group, and is linked

to the Waterfront via an extension of the existing canal.

In Durban, a joint venture between MSA Cruises SA and Africa

Armada Consortium will spend R175-million on the financing‚

construction‚ maintenance and operation of a cruise terminal for

a 25-year concession period. The terminal should be operational

in October 2019.

A lot of effort has gone into increasing the number of South

Africans who take trips within the country. A Tourism Incentive

Programme (TIP) has been launched by the National Department

of Tourism. Tourism has been earmarked as one of the six key

growth sectors in national government’s New Growth Path.

The Industrial Development Corporation has committed to

investing R2-billion in local resorts (and in the African hotel market).

There are several unused or under-used facilities. One suggestion

is that former military bases could be converted into

low-fee resorts. Other possible niche sectors include astrology

and adventure tourism.

An Enterprise Development Project Management Unit (PMU)

has been established. Among the PMU’s tasks will be to manage

an Enterprise Development Online Information Portal for SMMEs.

South Africa’s tourism offering is incredibly diverse. Superb

natural beauty, excellent beaches (45 have Blue Flag status), incomparable

wildlife, vibrant cities and cultural and heritage attractions

that represent a heterogeneous population and a dramatic

history, South Africa has it all. Every province has superb natural

assets. In the Northern Cape these include wonderful spring

flower displays, spectacular arid areas and brilliantly clear night

skies for sky-gazers. There are no fewer than six national parks and

five provincial reserves in the province, each showing off distinct

geographical and biological features.

Culture and heritage accounts for 40% of world tourism

and is one of the fastest-growing sub-sectors. The other nine

UNESCO World Heritage Sites in South Africa are: Robben

Island Museum, Cradle of

Humankind, Mapungubwe

Cultural Landscape, iSimangaliso

Wetland Park, uKhahlamba

Drakensberg (newly

named Maloti Drakensberg

Transfrontier Park), Richtersveld,

Cape Floral Kingdom, Khomani

Cultural Landscape and

Vredefort Dome.

Popular history or cultural

sites include the Nelson Mandela

Museum, Hector Petersen

Memorial, Apartheid Museum,

Freedom Park, Voortrekker

Monument, Constitution Hill,

District Six Museum and the

Bo-Kaap Museum. There are opportunities

to further develop

the full potential of tourism at

heritage sites.

Events

A total of 34 000 international

delegates attended conferences

in Cape Town in 2017, helping to

secure the city’s number one spot

in Africa for the 10th year in a row

for the African city hosting the

most international association

meetings. The ranking is awarded

by the International Congress and

Convention Association (ICCA).

The Cape Town and the

Western Cape Convention

Bureau, a Wesgro unit, promotes

the Cape as a venue and

assists with bids, planning support

and on-site services. In the

first quarter of 2018, nine bids

were won with an estimated

economic impact of R336-

million and attendance of more

than 9 000 delegates.

135 SOUTH AFRICAN BUSINESS 2019


OVERVIEW

The annual AfriCom event, hosted by the CTICC, regularly attracts

up to 14 000 visitors who can choose from 400 exhibits and 450

speakers in the fields of telecoms, media and technology.

The R900-million expansion of the Cape Town International

Convention Centre (CTICC2,) has given the city’s biggest venue additional

volume and flexibility. The new section of the centre hosted

its first conference in September 2017, the 21st Annual Congress of

the South African Council of Shopping Centres (SACSC) at the same

time as the CTICC was hosting another major conference.

Johannesburg and Durban are the other two South African

cities with large MICE sectors, but towns linked to research universities

(like Potchefstroom and Stellenbosch) and game and

nature reserves are also popular destinations for conferences.

Most hotels have conference facilities.

Sun City in the North West has a wide range of venues and

has recently won bids to host big events such as the SAFTAS, the

South African Film and Television Awards.

A new event on Limpopo’s calendar caused great excitement in 2018

with the first riding of the Tour de Limpopo, a four-day cycling event.

Structure of the industry

The South African tourism industry is well segmented. The distribution

channel is dominated by four major groups, each of which runs several

companies in different parts of the value chain. The biggest groups are:

• Imperial Holdings: mostly logistics, companies include Europcar

and Tempest Car Hire.

• Bidvest Travel and Aviation: Budget Rent a Car, Bidvest Sky Lounge,

Rennies Foreign Exchange, BidTravel, Harvey World Travel, HRG

Rennies Travel and BidAir Services.

• Cullinan Holdings: iKapa Tours and Travel, Thompsons, Hylton Ross

Tours, Pentravel, Grosvenor Tours and Springbok Atlas.

• Tourvest: The group controls 63 companies dealing with many

aspects of the tourist experience: tour operators and conference

organisers, foreign exchange, retail (gift shops and duty-free shops)

and hotels (African Hotels and Adventures).

ONLINE RESOURCES

African Business Travel Association: www.abta.co.za

South African Golf Tourism Association: www.sagta.co.za

South African National Parks: www.sanparks.co.za

South African Tourism: www.southafrica.net

South African Tourism Services: www.satsa.com

Casinos are a popular part

of many entertainment and

accommodation complexes

around the country, although

relatively few licences are

in operation. Private game

reserves and golf resorts

has been one of the fastestgrowing

markets in recent

years. The South African Golf

Tourism Association says that

up to 10% of visitors to the

country are attracted by its

golf courses.

The Garden Route and

the KwaZulu-Natal coastline

are rich in golfing venues.

Between George and Cape St

Francis there are many highlyrated

golf courses including

Pinnacle Point, Fancourt (three

courses), Simola, Plettenberg

Bay Country Club and St Francis

Links. Limpopo has two highend

golf resorts fairly near

Johannesburg: Zebula Golf

Estate and Spa and the Legend

Golf and Safari Resort which has

the world’s most dramatic golf

hole, a par-three where golfers

are ferried to the top of a mountain

by helicopter and take aim

at an Africa-shaped green at the

bottom of the mountain.

Wine tourism contributes

indirectly more than R4.5-

billion to the South African

tourism sector (South African

Wine Industry Information and

Systems, SAWIS). According to

Wine Tourism South Africa, a

website and publishing concern

that provides information

about the wine industry, 43% of

visitors to South Africa visit the

Cape Winelands.

SOUTH AFRICAN BUSINESS 2019

136


Everyone went the extra mile

and worked together with our

team as ‘partners’ to ensure

the success of our Annual

Congress event.

Amanda Stops

CEO

South African Council of Shopping Centres

(SACSC)

Nestling in the shadow of the majestic Table Mountain, and overlooking the

spectacular Atlantic Ocean, the CTICC is a magical place where the imagined becomes

real, visions turn into strategies, consumers become customers, and strangers from

across the globe become colleagues, partners and friends.

So much more than a multi-purpose event destination, this African icon combines

expansive venues, impeccable service, cutting-edge technology and the finest global

cuisine, to transform your convention, conference, exhibition, banquet or meeting

into an extraordinary experience.

For more information, or to book your event at the CTICC, call +27 21 410 5000,

email sales@cticc.co.za or visit www.cticc.co.za.


INDABA HOTEL, SPA & CONFERENCE CENTRE

YOUR AFRICAN DESTINATION IN JOHANNESBURG

Just north of the fast paced business world of Sandton in the upmarket residential suburb of Fourways, lies

the 258 bedroom Indaba Hotel, Spa & Conference Centre. It is a compelling blend of business-like

convenience and efficiency, with a relaxed and warm country atmosphere.

Coupled with easy and convenient access to all main highways, OR Tambo International Airport and a

mere 15km from Lanseria International Airport, the hotel features an impressive selection of some 24

multi-purpose conference venues that can accommodate up to 2 000 delegates in total with banqueting

facilities for up to 500 guests.

With two restaurants on property, there is no need to leave the comfort of the hotel to enjoy world class cuisine.

Our 300 seater Chief’s Boma Restaurant caters for all tasted with over 120 African inspired dished ranging from

North African Moroccan cuisine to Koeksisters and Melktert from the cape – and with a “Shisa Nyama” grill

boasting a variety of game meats sizzled to your specification, everyone is sure to find their favourite.

Well known for the lavish full South African Breakfast Buffet, the Epsom Terrace Restaurant also boasts an

evening Bistro Menu which will delight even the most demanding gourmet’s exacting standards. A

traditional Carvery Lunch with live music can be enjoyed every Sunday with limited outdoor seating

available for those who prefer dining al fresco – after all, Jo’burg really has the best weather in South Africa.

INDABA HOTEL, SPA & CONFERENCE CENTRE

C/O WILLIAM NICOL DRIVE & PIETER WENNING ROAD, FOURWAYS

Phone: +27 11 840 6600 | Email: indaba@indabahotel.co.za | Website: www.indabahotel.co.za


Take a wander through the 17 hectares of lush bushveld gardens and you will find the Mowana Spa - a

wellness sanctuary which will revive your senses, rejuvenate your body and soothe your soul. The Mowana

Spa, which takes its name from the majestic Baobab Tree of African Lore and Legend, offers wellness

journeys based on the recognized healing energy of Tribal Massaging.

Signature Pamper Journeys include the decadent Mowana Full Day African Rejuvenation Spa pamper

which is an indulgent spa experience including breakfast, lunch, complimentary beverages and six

revitalizing treatments; the romantic Mowana African Skies Night Spa pamper with includes dinner,

complimentary beverages and 3 relaxing treatments; and the indulgent Mowana African Escape Spa &

Stay Pamper Journey for the ultimate decadent relaxation.

Our commitment to service excellence and staff empowerment through training and mentoring will ensure

that your needs are met and your expectations exceeded as you enjoy a Day of Pampering at Mowana Spa.

The Indaba Hotel and Mowana Spa are also PROUDLY GREEN ensuring responsible tourism and minimising

carbon foot print through extensive recycling of waste products, water-wise gardening, greening

conference initiatives, better material choices, minimising power usage and buying local - after all, a better

place to live is a better place to visit.

The Indaba Hotel is sure to meet all your business and leisure requirements. We look forward to welcoming

you to our oasis in the City.

15 MINUTES FROM SANDTON ... A MILLION MILES AWAY


OVERVIEW

Banking and financial

services

New sectors and new licences are creating opportunities.

SECTOR INSIGHT

African Rainbow Capital has

acquired a majority share in

Tyme Digital Bank.

An entirely new economic sector has opened up in South

Africa within the last decade – renewable energy. Financing

for this investment segment has come from South Africa’s

sophisticated banking sector and from the cash reserves

of some European utilities. The Power and Infrastructure division of

Standard Bank, one of Africa’s biggest companies, was involved in

about 40% of the projects approved within the first four rounds of

the bidding process.

South Africa’s banking and financial services sector looks quite different

compared to 10 years ago in two other important ways. Firstly,

the move to ever-more sophisticated IT applications has accelerated

(and moved a long way from the first ATMs launched by Standard

Bank in 1981). The related change is the issuing of banking licences to

newcomers offering digital banking instead of tellers and deposit slips.

The first new bank to receive a licence since Capitec in 1999 was

Tyme Digital in 2017. Tyme stands for Take Your Money Everywhere

and refers to its plans which do not include a branch network.

Commonwealth Bank of Australia bought a controlling share of

Tyme when it was a loans company and African Rainbow Capital

(ARC) was originally the venture’s BEE partner, but in August

2018 ARC bought out the Australians. The bank is targeting the

lower-income segment and is rolling out access to its services

through machines in major retailers

like Shoprite and Pep and

Boxer stores.

A study by EY reports that

35% of digitally active South

Africans use fintech and banks

are responding quickly to this.

Bank Zero, which has a provisional

licence and is led by former

FNB bank leaders, calls itself

an “app-driven” bank. Discovery

Bank has the advantage of having

access to vast stores of data

through all the other businesses

in the Discovery group. The

other bank close to gaining a

licence is Post Bank, a division

of the Post Office.

In 2019, the banking

sector globally will spend

more than R100-billion on

artificial intelligence (Citi GPS).

Moneyweb calculated that

the Big Four banks spent R30-

billion on ICT in 2016, a sign of

how seriously the technology

challenge is being taken.

Capitec, which is counted in

some quarters as part of a new

Big Five, recently spent R348-

million on Creamfinance which

will allow for machine learning

SOUTH AFRICAN BUSINESS 2019

140


OVERVIEW

to be applied to online credit applications. Fifteen new Capitec

branches will have no cashiers. Since its listing in 2012, Capitec

shares have risen by 52 000%, a better performance even than

Apple, which achieved “only” 9 000% (Business Times).

PwC’s Major Banks Analysis reported that the four banks in

its study had combined headline earnings of R76.1-billion at 31

December 2017, an annualised improvement of 5.2%. The banks covered

were Barclays Africa, FirstRand, Nedbank and Standard Bank.

Merchant banking and investment banking are the most competitive

sectors in South Africa with companies such as BoE Private

Clients, Rand Merchant Bank and Investec prominent.

Afgri, South Africa’s largest agricultural company, which already

offers financial services, bought the South African Bank of

Athens in 2017. Most South African agricultural companies have

financial divisions.

Financial services group Old Mutual (a 54% stakeholder in

Nedbank) is in the process of creating four stand-alone businesses

out of the Old Mutual Group.

The insurance market has become more varied over time, with

a greater variety of products available to more market segments,

including middle-income earners. An example of a product responding

to new realities is Old Mutual’s iWYZE medical gap cover,

designed to pay the difference between what a medical aid scheme

is willing to pay and what the hospital or doctor is charging.

The Chartered Institute of Government Finance, Audit and Risk

Officers advises institutions, trains it members in public finance

and promotes the interests of professionals in the public sector.

It also develops and assesses qualifications and advises tertiary

institutions on the requirements for courses.

The African Institute of Financial Markets and Risk Management

at the University of Cape Town has a strong focus on research.

Among the alumni of the Vunani Securities Training Academy,

sponsored for a decade by Coronation Fund Managers, is First

National Bank chief economist Sizwe Nxedlana.

ONLINE RESOURCES

Banking Association of SA: www.banking.org.za

Financial Services Board: www.fsb.co.za

Insurance Institute of South Africa: www.iisa.co.za

South African Institute for Chartered Accountants:

www.saica.co.za

South African Reserve Bank: www.resbank.co.za

Stock exchanges

The JSE is the world’s 19th biggest

exchange and nearly 400

companies are listed on the JSE

or AltX, the JSE-owned exchange

for smaller companies. Other investment

options that are available

through the JSE are Yield X

(interest rate and currency instruments),

the South African Futures

Exchange (SAFEX) and the Bond

Exchange of South Africa (BESA).

In 2017, several new exchanges

won regulatory approval,

with ZAR X winning the

nod from the Financial Services

Board (FSB) against objections

by the established JSE and

another new exchange, 4AX.

Shortly after winning its court

case, ZAR X started trading in

Senwesbel, the holding company

of one of South Africa’s

biggest agricultural trading

companies, Senwes. There is

no trading in derivatives or

high-frequency trading on this

exchange.

A2X will offer secondary

listings platform for JSE-listed

companies and aims to cut

costs for investors. African

Rainbow Capital is an investor

in A2X. 4 Africa Exchange (4AX)

will focus on companies with

market capitalisation of up to

R8-billion. Agricultural trading

company NWK is a shareholder

in this venture.

The newcomers all promise

to use the latest technology to

make trading simpler, quicker

and cheaper.

141 SOUTH AFRICAN BUSINESS 2019


The hustle to be the best you can be, never stops. It involves deciding

what your Next is and going for it. But many budding entrepreneurs

remain side-hustlers, because they need a steady income to make that

Next a reality.

Winning a R1 million salary for the next year in Standard Bank’s My Fearless

Next has made that dream a reality for Nonhlanhla Mthethwa.

Nonhlanhla, an HR practitioner from Pietermaritzburg, believes the win

will allow her company, Girlz Ink, and the African dolls they manufacture to

become the next big thing.

“My Fearless Next has provided me with a key to open the door to Girlz Ink a

bit wider. I am going forward knowing that, even if I hadn’t won, I am wiser

and better equipped to survive in a competitive business world.“

Nonhlanhla really took to the business boot camps on the business reality

TV show and is using lessons learned about marketing and direct selling to

boost her business.

“This opportunity means so much to me. We lost a lot of stock of our Baby

Thando dolls in a fire, which put a deal with Toys R Us on hold. Now we’ll be

able to seal that deal. I also met so many smart people with great businesses

on the show — even a new business partner to design clothes for our dolls.”

Nonhlanhla’s plans to grow self-love through her black dolls will also see

the Girlz Ink brand expand to children’s accessories including clothing,

schoolbags and luggage.

“I wanted to celebrate our vast ethnic diversity by giving kids a chance to play

with dolls that reflect their own identities. We’re not only helping them build

positive self-images and pride in who they are, but also fostering a society

where children can learn about each other’s cultures, because all kids can

play with our dolls.”


OVERVIEW

Development finance and

SMME support

Prompt payment is vital for small businesses.

SECTOR INSIGHT

SAB aims to create 10 000

jobs by 2022.

Portia Mngomezulu, the founder and managing director of

Portia M, told the host of a radio business show in 2018 that

one of the most important factors in allowing her to scale up

her skin products business was the willingness of Pick n Pay

to pay her within seven days.

The entrepreneur was named in 2018 as Pick n Pay’s Small Supplier

of the Year and her sales topped R10-million. From an initial investment

of R200, she now employs 27 full-time staff and her range of products

is available in four African countries outside South Africa.

One of biggest problems faced by small, medium and microenterprises

(SMMEs) is cash flow. Most government departments have

rules about procurement which are biased in favour of purchasing

from SMMEs or co-operatives. However, for many South African

entrepreneurs, the inability or unwillingness of government to pay

within 30 days presents a major risk to sustainability. The Enterprise

and Supplier Development (ESD) Programme of Pick n Pay addresses

and goes a step further with the seven-day rule.

Public procurement from township enterprises from provincial and

municipal governments in Gauteng, the province where more than half

of the country’s SMMEs are located,

increased in 2017 to R17-billion, up

from just R600-million in 2014. This

expenditure has allowed many

township businesses to enter the

formal economy and for them to

become more sustainable. The City

of Johannesburg runs seven SMME

hubs where office space, Wifi and

advice and training are available for

small business operators.

All South African retailers

have ESD programmes which

typically create or support small

businesses along their supply

chain. A small community in rural

Mpumalanga is remote and

difficult to get to, but 13 farmers

at Elukwatini Farm sell tomatoes

to Woolworths. According to a

Business Day report, Woolworths

works through Technoserve (an

NPO) and Qutom (a large supplier)

for produce to be collected.

De Beers Venetia Mine in

northern Limpopo has chosen

the transport of its workers as an

area for business creation. Two

small bus businesses servicing

its labour-sending areas have

been created with a wide range

of ownership and with potential

to expand.

SOUTH AFRICAN BUSINESS 2019

144


OVERVIEW

South African Breweries, a subsidiary of AB InBev, wants to use its

four entrepreurship programmes to create 10 000 jobs by 2022. In 2018,

Coca-Cola Beverages South Africa launched the Mintirho Foundation,

a R400-million fund to pay for training of farmers and support business

in the agricultural value chain.

Toyota South Africa Motors is funding the newly created Toyota

Empowerment Trust (TET) to the tune of R42-million. Beginning in

2018, the trust will at first train specialised automation technicians

with the long-term intention of helping qualified technicians to start

their own maintenance firms.

The National Department of Small Business Development (DSBD)

has several programmes to assist small, medium and micro enterprises

(SMMEs) and co-operatives. These include:

• The Black Business Supplier Development Programme, a costsharing

grant to promote competitiveness

• The Co-operative Incentive Scheme, a 100% grant.

The Small Enterprise Development Agency (Seda) is a subsidiary of the

DSBD. Seda has 42 incubation centres in South Africa under its Seda

Technology Programme (STP).

In a 2018 publication, Seda reported that the number of SMMEs in

South Africa increased by only 3%, from 2.18-million to 2.25-million,

between 2008 and 2015.

The National Department of Trade and Industry (dti) is trying to

stimulate township and rural economies. Various programmes within

the dti and its agencies contribute to the creation of SMMEs or to the

rescue of ailing SMMEs in tough times.

The Enterprise Investment Programme (EIP) has achieved considerable

success. Having received a grant in 2014, Thorax LP Equipment, a

100% black-women-owned company based in Gauteng, has subsequently

turned over more than R8-million and employed many young

people. A grant to Kalagadi Manganese in the Northern Cape helped

to create 8 857 jobs.

The National Gazelles is a national SMME accelerator jointly funded

by Seda and the DSBD. The aim is to identify and support businesses

with growth potential across priority sectors. Businesses can receive

ONLINE RESOURCES

Gazelles: www.nationalgazelles.org.za

National Small Business Chamber: www.nsbc.org.za

Small Business Institute: www.smallbusinessinstitute.co.za

Small Enterprise Development Agency: www.seda.org.za

Small Enterprise Finance Agency: www.sefa.org.za

SMME Opportunity Roadshow: www.smmesa.co.za

up to R1-million for training, productivity

advice, business skills

development and the purchase

of equipment.

The Industrial Development

Corporation (IDC) supports

SMMEs either by disbursing

loans or by taking minority

shares in enterprises and

giving advice. An agricultural

project in the Northern Cape

is an example of the kind of

work it does. Through the

IDC’s Transformation and

Entrepreneurial Scheme, a

black economic empowerment

project is underway at

Kakamas. The emerging farmers

of Vaal Community Citrus

are planting citrus.

The president of Business

Leadership South Africa, Jabu

Mabuza, expressed concerns

about at a small business summit

in July 2018 about the number

of different agencies working

on diverse programmes

to promote SMMEs. He also

called for big businesses to pay

SMMEs promptly.

At about the same time

as Mabuza’s speech, some of

the early findings of a baseline

study of the SMME sector

were released. The study is

being conducted by the Small

Business Institute (SBI) and

SBP, a business environment

specialist. The study suggests

that definitions of enterprise

size vary too much, that there

is not sufficient coordination in

support of the sector and that

entrepreneurs face an enormous

amount of red tape.

145 SOUTH AFRICAN BUSINESS 2019


PROFILE

VeriFi

VeriFi is the leader in the business of verification and

certification for BBBEE recognition.

South Africa requires an economy that can meet the

needs of all its economic citizens, its people and their

enterprises in a sustainable manner. Government’s

objective is to achieve this vision of an adaptive

economy characterised by growth, employment

and equity. Achieving authentic BEE has required a

reassessment of traditional business models and corporate

cultures. The Bill, code and strategy document

rely upon core policy instruments that have been

designed to bring about BEE. These instruments are

essentially measurement tools that will permit the

public and private sectors to evaluate the BEE status

of a particular enterprise. Failure to adapt to the new

paradigm will have significant consequences. A real

commitment to BEE is now a business imperative.

Description of services

• assess and certify BBBEE rating;

• provide insight into BBBEE challenges facing

various organisations;

• provide insight and guidance on the actions

required to elevate BBBEE status; and verification

of supplier BBBEE status.

With BBBEE recognised as an imperative by companies

committed to building an equitable South

Africa, verification is an essential requirement that

confirms a company’s participation and contribution.

Verification is performed in a manner similar to

that of a financial audit: it provides an independent

assessment of investment, performance and initiatives

in a control system. Criteria against which

companies are measured are provided by government

and like an audit, verification must be

performed annually.

Target markets

Small, medium and large enterprises achieving

an annual turnover of below R10-million and over

R50-million respectively (including all charter

sectors).

Pricing

Pricing for BEE consultancy services is based on

the client’s requirements and can be structured

on an hourly or monthly basis.

For BEE verification and issue of a BEE Compliance

Certificate, please contact the office for the

current rates.

SOUTH AFRICAN BUSINESS 2019

146


PROFILE

The value of verification

With BBBEE recognised as an imperative by companies

committed to building an equitable South

Africa, verification is an essential requirement that

confirms a company’s participation and contribution.

Verification is performed in a manner similar to that of

a financial audit: it provides an independent assessment

of investment, performance and initiatives as

a control system. Criteria against which companies

are measured are provided by government, and like

an audit, verification must be performed annually.

BBBEE explained

Government BBBEE legislation consists of:

• The Strategy for Broad-Based Black Economic

Empowerment

• The Broad-Based Black Economic

Empowerment Act, No 53 of 2003

• The Codes of Good Practice for Black Economic

Empowerment

• Various sectoral BEE Charters or Codes

In terms of these Codes of Good Practice,

businesses are divided into three categories:

• Where turnover is less than R10-million a year,

or when in the first year of incorporation, a

business is categorised as an Exempt Micro

Enterprise (EME). However, it is necessary

to confirm this status by providing proof of

annual income.

Businesses with a turnover of between

R10-million and R50-million a year are categorised

as Qualifying Small Enterprises (QSEs).

The criteria for each of these elements are less

onerous for QSEs than for companies with

turnovers exceeding R50-million per annum.

Advantages of BEE certificate

from VeriFi

• proposals for new business with government;

• the licensing of regulated activities which include

mining, liquor sales and the granting of

credit; leasing of premises from government or

private businesses; and

• the creation or continuance of business relations

with clients seeking assurance of a

company’s BEE compliance.

Once a verification and certified rating through VeriFi

is accomplished, a company can perform business in

confidence, as its commitment to equality, nationbuilding

and unique South African business processes

will be recognised.

Key facts and figures

Year established: 2005

No of staff: 15

Major clients: BP, Public Investment Corporation

Limited, IBM South Africa, Saab Grintek Defence,

Independent Newspapers, Premier Fishing & Brands

Limited, African Equity Empowerment Investment

Limited, South African Express Airways SOC Ltd.

CONTACT INFO

Tel: +27 86 175 3233

Email: info@verifibee.co.za

Website: www.verifibee.co.za

147

SOUTH AFRICAN BUSINESS 2019


LISTING

South African National

Government

An overview of South Africa’s national government departments.

The Presidency

Tel: +27 12 300 5200 | Fax: +27 12 323 8246

Website: www.thepresidency.gov.za

Website: www.economic.gov.za

Department of Agriculture, Forestry and

Fisheries

Tel: +27 12 319 6000 | Fax: +27 12 319 6681

Website: www.daff.gov.za

Department of Arts and Culture

Tel: +27 12 441 3000 | Fax: +27 12 440 4485

Website: www.dac.gov.za

Department of Basic Education

Tel: +27 12 357 3000 | Fax: +27 12 323 5989

Website: www.education.gov.za

Department of Communications

Tel: +27 12 473 0000 | Fax: +27 12 462 1646

Website: www.doc.gov.za

Department of Cooperative Governance and

Traditional Affairs

Tel: +27 12 334 0705 | Fax: +27 12 326 4478

Website: www.cogta.gov.za

Department of Correctional Services

Tel: +27 12 307 2934/2884 | Fax: +27 12 323 4111

Website: www.dcs.gov.za

Department of Economic Development

Tel: +27 12 394 3747 | Fax: +27 12 394 0255

Website: www.economic.gov.za

Department of Defence

Tel: +27 12 355 6101 | F ax: +27 12 347 0118

Website: www.dod.mil.za

Department of Energy

Tel: +27 12 406 8000 | Fax: +27 12 319 6681

Website: www.energy.gov.za

Department of Environmental Affairs

Tel: +27 12 310 3537 | Fax: 086 593 6526

Website: www.environment.gov.za

Department of Finance (National Treasury)

Tel: +27 12 315 5111 | Fax: +27 12 315 5126

Website: www.treasury.gov.za

Department of Health

Tel: +27 12 395 8086/80 | Fax: +27 12 395 9165

Website: www.doh.gov.za

Department of Higher Education

and Training

Tel: +27 12 312 5555 | Fax: +27 12 323 5618

Website: www.dhet.gov.za

Department of Home Affairs

Tel: +27 12 432 6648 | Fax: +27 12 432 6675

Website: www.dha.gov.za

Department of Human Settlements

Tel: +27 12 421 1310 | Fax: +27 12 341 8513

Website: www.dhs.gov.za

Department of International Relations and

Cooperation

Tel: +27 12 351 1000 | Fax: +27 12 329 1000

Website: www.dirco.gov.za

Department of Justice and Constitutional

Development

Tel: +27 12 406 4669 | Fax: +27 12 406 4680

Website: www.doj.gov.za

SOUTH AFRICAN BUSINESS 2019

148


LISTING

Department of Labour

Tel: +27 12 309 4000 | Fax: +27 12 320 2059

Website: www.labour.gov.za

Department of Military Veterans

Tel: 080 232 3244 (SA only)

Website: www.dmv.gov.za

Department of Mineral Resources

Tel: +27 12 444 3000 | Fax: +27 12 341 2228

Website: www.dmr.gov.za

Department of Police (Civilian Secretariat for

Police Service)

Tel: +27 12 393 2800 | Fax: +27 12 393 2812

Website: www.saps.gov.za

Department of Public Enterprises

Tel: +27 12 431 1000 | Fax: +27 12 431 1039

Website: www.dpe.gov.za

Department of Public Service and

Administration

Tel: +27 12 336 1700 | Fax: +27 12 336 1809

Website: www.dpsa.gov.za

Department of Public Works

Tel: +27 12 406 2000 | Fax: 086 272 8986

Website: www.publicworks.gov.za

Department of Rural Development and

Land Reform

Tel: +27 12 312 9300 | Fax: +27 12 323 3306

Website: www.ruraldevelopment.gov.za

Department of Science and Technology

Tel: +27 12 843 6300 | Fax: +27 12 349 1041/8

Website: www.dst.gov.za

Department of Small Business Development

Tel: +27 12 394 5535 | Fax: +27 12 394 0339

Website: www.dsbd.gov.za

Department of Social Development

Tel: +27 12 312 7479 | Fax: 086 715 0829

Website: www.dsd.gov.za

Department of State Security

Tel: +27 12 367 0700 | Fax: +27 12 367 0749

Website: www.ssa.gov.za

Department of Sport and

Recreation

South Africa

Tel: +27 12 304 5000

Fax: +27 12 323 7196 / 086 644 9583

Website: www.srsa.gov.za

Department of Tourism

Tel: +27 12 444 6000 | Fax: +27 12 444 7000

Website: www.tourism.gov.za

Department of Trade and Industry

Tel: 086 184 3384 | Fax: 086 184 3888

Website: www.thedti.gov.za

Department of Transport

Tel: +27 12 309 3000 | Fax: +27 12 328 3370

Website: www.transport.gov.za

Department of

Telecommunications and Postal

Services

Tel: +27 12 427 8000 | Fax: +27 12 427 8110

Website: www.dtps.gov.za

Department of Water and

Sanitation

Tel: +27 12 336 8733 | Fax: +27 12 336 8850

Website: www.dwa.gov.za

Department of Women

Tel: +27 12 359 0000 | Fax: 086 765 3365

Website: www.women.gov.za

149 SOUTH AFRICAN BUSINESS 2019


INDEX

INDEX

Adorantha Investment​s............................................................................................................................................................ IFC, 13

Afrimat........................................................................................................................................................................................................ ​7

Air France ​................................................................................................................................................................................................51

Air Products.........................................................................................................................................................................................111

Air Traffic Navigation Services (ATNS)​...................................................................................................................................11, 53

Bakenberg Ready Mix​...................................................................................................................................................................... 106

Bakone Holding Investment​.....................................................................................................................................................77-81

Black Management Forum​ (BMF)..................................................................................................................................................96

BlueBiz​......................................................................................................................................................................................................55

Botswana Investment and Trade Centre (BITC)​........................................................................................................................50

Cape Town International Convention Centre (CTICC)​........................................................................................................ 137

EBH SA​.......................................................................................................................................................................................................62​

Emalangeni Technologies​.............................................................................................................................................................. 132

E&T Minerals​...........................................................................................................................................................................................71

Export Credit Insurance Corporation of South Africa (ECIC)..............................................................................................46

Genesis Eco-Energy Developments​.......................................................................................................................................29-31

ICT Training..........................................................................................................................................................................................127

Indaba Hotel, Spa & Conference Centre​................................................................................................................................... 138

Invest Durban ​......................................................................................................................................................................................... 2

Kaefer Thermal Contracting Services​...........................................................................................................................................32

Kemtek Imaging Systems​................................................................................................................................................................... 5

Khabane Majestic Consulting​...................................................................................................................................................... 128

KLM ​Royal Dutch Airlines................................................................................................................................................................​IBC

Lesotho National Development Corporation (LNDC)​...........................................................................................................48

Maluti-A-Phofung Special Economic Zone (MAP SEZ).........................................................................................................40

Malutsa​..............................................................................................................................................................................................84-89

Mamli Projects​....................................................................................................................................................................................104

Maitazwifoma Engineering and Consulting​.............................................................................................................................93

Maritz Electrical​...........................................................................................................................................................................34, 102

Marley Pipe Systems​........................................................................................................................................................................ 112

Modi Mining​...........................................................................................................................................................................................73

Mueletshedzi Logistics (MLTL)​..............................................................................................................................................99, 122​ ​

Netha Engineering​Technology.......................................................................................................................................................​94

Prompt IT​.............................................................................................................................................................................................. 130

Selfmed.........................................................................................................................................................................................43, OBC

Scouts South Africa​.............................................................................................................................................................................19

South African International Maritime Institute (SAIMI)​.................................................................................................59-61

Standard Bank​....................................................................................................................................................................................142

Thebe Investment Corporation​.................................................................................................................................................9, 69

Tirisano Holdings​...............................................................................................................................................................................114

Transnet Pipelines​.............................................................................................................................................................................150

Upington Special Economic Zone ​................................................................................................................................................38

Verifi​........................................................................................................................................................................................................146

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