South African Business 2021

Welcome to the ninth 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. This issue has a focus on economic recovery plans which have been put in place to tackle the challenges thrown up by the global Covid-19 pandemic. National government’s focus on infrastructure and the use of Special Economic Zones is highlighted, together with a feature on the nascent maritime economy. 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. 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.globalafricanetwork.com.

Welcome to the ninth 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.

This issue has a focus on economic recovery plans which have been put in place to tackle the challenges thrown up by the global Covid-19 pandemic. National government’s focus on infrastructure and the use of Special Economic Zones is highlighted, together with a feature on the nascent maritime economy. 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.

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.globalafricanetwork.com.


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<strong>2021</strong> EDITION<br />





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Let’s come together and heal as a nation.<br />

Let’s focus on Renewing, Restoring and Rebuilding<br />

successful partnerships and investment opportunities so we<br />

can get back to promoting our city as the ideal destination<br />

for business and pleasure to the rest of the world.<br />

Your support coupled with our world-class infrastructure,<br />

innovative business environment and ever evolving<br />

investment opportunities, means we can get back to<br />

‘connecting continents’ in no time.<br />

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Tel: +27 31 311 4227<br />

Email: invest@durban.gov.za<br />

web: invest.durban<br />


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The city of<br />

Durban (eThekwini<br />

Municipality) is <strong>South</strong><br />

Africa’s second most<br />

important economic<br />

region<br />

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Extensive first-world<br />

road, rail, sea and air<br />

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Dube<br />

TradePort<br />

and King<br />

Shaka<br />

International 1<br />

Airport - 60-<br />

year Master<br />

Plan - driving<br />

growth of<br />

aerotropolis,<br />

or airport<br />

city<br />

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001<br />

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Rated in top 5<br />

‘Quality of Living’<br />

cities in Africa and<br />

Middle East by<br />

Mercer Consulting in<br />

2015<br />

Named one of the<br />

New 7 Wonders Cities<br />

by the Swiss-based<br />

New 7 Wonders<br />

Foundation in 2014<br />

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Coega fast-tracking<br />

economic recovery<br />

Cecilia Makiwane Hospital is a large,<br />

provincial, government-funded hospital<br />

situated in the Mdantsane township<br />

of East London, Eastern Cape.<br />

Coega’s expertise in Infrastructure Project Management will help <strong>South</strong> Africa fast-track<br />

economic recovery amid the Covid-19 pandemic.<br />

The Coega Development Corporation (CDC),<br />

developer and operator of the number-one<br />

Special Economic Zone (SEZ) on the <strong>African</strong><br />

continent, namely the Coega SEZ, provides<br />

expertise in the fast and efficient delivery of minor and<br />

mega complex infrastructure development projects<br />

in <strong>South</strong> Africa and the rest of the <strong>African</strong> continent.<br />

The CDC has a 20-year proven record in infrastructure<br />

development and facilities maintenance.<br />

“We can assist all government departments to<br />

fast-track the implementation of their infrastructure<br />

projects, amid the coronavirus pandemic challenges,<br />

to stimulate the local economy, lift local SMMEs,<br />

and create job opportunities.<br />

“We are the infrastructure implementing agency<br />

of choice in the country because of our cuttingedge<br />

customised solutions, international best<br />

practices and methodology. Coega has ISO-certified<br />

systems and processes that guarantee<br />

the effective delivery of the projects<br />

within scope, time and budget. We<br />

can even save our clients money through<br />

our project accounting solutions. Our<br />

record of unqualified audit opinion<br />

by the Auditor General of <strong>South</strong> Africa<br />

on our projects speak for itself,” said<br />

Dr Ayanda Vilakazi, CDC’s Head of<br />

Marketing, Brand and Communications.<br />

Lusikisiki Village Clinic opened by<br />

the President of <strong>South</strong> Africa, HE Cyril<br />

Ramaphosa, in 2019.

The CDC’s Infrastructure Project<br />

Management Services include:<br />

• Project methodology and system.<br />

• Development of reporting and monitoring<br />

services.<br />

Nolitha Kingsburgh Clinic Primary opened School, by the Honourable Premier<br />

• Stakeholder analysis and engagement<br />

of Lovu the Town, Eastern KwaZulu-Natal.<br />

Nolitha Clinic op<br />

Cape, Lubabalo Oscar Mabuyane,<br />

programmes.<br />

of the Eastern C<br />

on 22 November 2019.<br />

• Integrated planning and budgeting.<br />

Eastern Cape Departments of Health. Furthermore, on 22 Novembe<br />

• Development of business plans.<br />

the CDC has worked with other clients outside of<br />

• Procurement of service providers and required these Furthermore, departments to fast-track the CDC the implementation has worked<br />

Nolitha Clinic opened Furthermor by Hon<br />

equipment.<br />

of their with projects. other These clients include, outside among others, of these<br />

of the Eastern Cape, with Lubabalo other O<br />

• On-the-job training and contractor development. Mpumalanga departments Economic Growth to on 22 fast-track Agency<br />

November<br />

(MEGA), the<br />

• Human capital solutions.<br />

Northern Cape Development Agency (NCEDA) department<br />

2019.<br />

implementation of their projects;<br />

and<br />

• Post-implementation monitoring and facilities Richards Bay SEZ.<br />

implementa<br />

these include, Furthermore, amongst others,<br />

maintenance.<br />

On the <strong>African</strong> continent, the CDC is taking these<br />

CDC incl<br />

Mpumalanga Economic full advantage of inter-Africa with trade, other which clients Growth<br />

Mpumalang<br />

has outs<br />

The CDC’s infrastructure project expertise and strategic<br />

solutions are utilised by various government Continental Development Free Trade Agency Area implementation (AfCFTA) (NCEDA), agreement and<br />

Developmen of th<br />

Agency (MEGA),<br />

been made possible by the departments Northern Cape<br />

signing of the <strong>African</strong><br />

Agency to fas ef (M<br />

departments and the private sector, locally and in by Richards <strong>African</strong> countries Bay to promote SEZ. these greater On the include, economic <strong>African</strong><br />

w<br />

INFRASTRUCTURE the rest of the <strong>African</strong> continent. DEVELOPMENT<br />

Richards amon B<br />

INFRASTRUCTURE integration continent, DEVELOPMENT<br />

across the continent. CDC Mpumalanga<br />

To is this taking end, the full<br />

PROJECTS: Our clients (left) include, Cecilia among Makiwane others, the Hospital<br />

Eastern CDC’s International <strong>Business</strong> under Coega Africa<br />

continent, Econom ca<br />

PROJECTS: (left) advantage Cecilia Makiwane of the - Cape a large, and provincial, KwaZulu-Natal government-funded<br />

Agency Hospital Inter-Africa (MEGA), trade,<br />

Departments of Basic Programme is managing the implementation advantage Nor<br />

of<br />

- a large, provincial, which government-funded<br />

has been th<br />

hospital Education, situated Eastern Cape in the and Mdantsane National Departments<br />

township<br />

Development made possible by<br />

infrastructure projects in Zimbabwe, Central <strong>African</strong> which Agency has (<br />

hospital situated the in signing the Mdantsane of the of Public East London, Works and Eastern Infrastructure, Cape and in <strong>South</strong> National Africa;<br />

and Republic and Cameroon, among Richards township Africa Free<br />

other countries. Bay Trade<br />

the ■SEZ. signing On<br />


London, Agreement Eastern Cape by in <strong>South</strong> <strong>African</strong> S<br />

(right) and the Kingsburgh Primary School -<br />

continent, Africa; countries the to<br />

Agreement CDC is<br />

PROJECTS: (left) (right) Cecilia and Makiwane the<br />

Lovu Town - in KwaZulu-Natal.<br />

promote Kingsburgh Hospital greater Primary economic School - integration<br />

La Mercy Maths, Science and Technology (MST) Academy advantage in KwaZulu-Natal. of the Inter au<br />

- a large, provincial, Lovu government-funded<br />

Town - in across KwaZulu-Natal.<br />

promote gre<br />

Coega is an Infrastructure Implementing Agency. the continent. which To has this end, been the<br />

hospital situated in the Mdantsane CDC’s township<br />

across made the c<br />

International the <strong>Business</strong> signing under<br />

of<br />

of East London, Eastern Cape Coega in <strong>South</strong> Africa;<br />

CDC’s of the Inter Afric<br />

Programme Agreement is managing<br />

(right) and the Kingsburgh Primary School -<br />

Coega by <strong>African</strong><br />

sp<br />

the implementation of infrastructure<br />

Lovu Town - in KwaZulu-Natal.<br />

promote greater the implem econom<br />

projects in Zimbabwe, across Central the continent. <strong>African</strong><br />

projects in<br />

VTo<br />

Z<br />

Republic, and Cameroon, CDC’s International amongst<br />

Republic, Bu<br />

other countries.<br />

Ba<br />

Lusikisiki Village Clinic opened by the President<br />

Coega Africa other Programm count<br />

of <strong>South</strong> Africa, H.E. Cyril Ramaphosa,<br />

Lusikisiki on 17<br />

Village Clinic opened by the the President implementation of i<br />

September 2019.<br />

of <strong>South</strong> Africa, H.E. Cyril Ramaphosa, on 17<br />

projects in Zimbabwe, C<br />

September 2019.<br />

Republic, and Camero Th<br />

For more information on the CDC’s Project Management Services,<br />

other countries.<br />

M<br />

For please more contact information our<br />

Lusikisiki on expert<br />

Village For the CDC’s in Infrastructure<br />

Clinic more opened information by Project Management Project<br />

the President on the CDC’s Project Managem<br />

Management,<br />

of <strong>South</strong> Africa, H.E. Cyril Ramaphosa, on 17<br />

Services, Mr. Chuma please Mbande INFRASTRUCTURE<br />

please contact<br />

contact on:<br />

our expert in Infrastructure<br />


our expert in Infrastructure Project M<br />

September 2019. Mr. Chuma Mbande on:<br />

•<br />

Project Management, PROJECTS: Mr Chuma Mbande. La Mercy Maths, Science<br />

For more information on the CDC’s Project Management Services<br />

and<br />

please<br />

Technology<br />

contact our<br />

(MST)<br />

expert in<br />

Academy<br />

Infrastructure<br />

in<br />

Email: chuma.mbande@coega.co.za<br />

Project Management •<br />

Tel:<br />

KwaZulu-Natal.<br />

+27 Mr. 43 Chuma 711 1600 Mbande Coega on: is an Infrastructure<br />

Fax: +27 43 721 0210<br />

E-mail: chuma.mbande@coega.co.za<br />

Telephone: +27 43 711 1600<br />

E-mail: chuma.mbande@coega.co.za<br />

Implementing Agency.<br />


Fax: +27 43 721 0210<br />

Telephone: +27 43 711 1600 ISO 9001:2015 ISO 14001:2015 ISO 45001:2018<br />


Fax: +27 43 721 0210<br />

ISO 20000-1:2011 ISO 27001:2013<br />

•<br />

PRETORIA Address: OFFICE: 145 Herbert Road, East Wood,<br />

145 Herbert Road, East Wood, Arcadia,<br />


www.coega.co.za<br />

Pretoria, Arcadia, 0083<br />

Pretoria 0083<br />

145 Herbert Road, East Wood, Arcadia, •<br />

Telephone: Tel: +27 12 +27 451 12 8300 451 8300<br />

Pretoria, 0083<br />

The Coega E-mail: Development chuma.mbande@coega.co.za<br />

Telephone: +27 12 451 Corporation<br />

8300<br />

Telephone: +27 43 711 1600<br />

•<br />

BBB<br />

Fax: +27 43 721 0210<br />

ISO 9001:201



<strong>South</strong> <strong>African</strong> <strong>Business</strong> <strong>2021</strong> Edition<br />

Introduction<br />

Foreword 8<br />

A unique guide to business and investment in <strong>South</strong> Africa.<br />

Special features<br />

An economic overview of <strong>South</strong> Africa 10<br />

Building a more sustainable future while reducing debt will<br />

require great skill from the country’s leaders.<br />

Provinces of <strong>South</strong> Africa 16<br />

A snapshot of <strong>South</strong> Africa’s nine provinces.<br />

Building infrastructure is a<br />

presidential priority 22<br />

Projects worth R340-billion have been gazetted<br />

for implementation.<br />

The Maritime Economy offers blue<br />

water opportunities 32<br />

Contribution to GDP could rise to R177-billion by 2033.<br />

Economic sectors<br />

Agriculture 40<br />

Berry production is up as exports rise.<br />

Mining 44<br />

Exploration is the next frontier.<br />

Energy 56<br />

Solar and wind projects are regularly coming onstream.<br />

ICT 61<br />

Data centres are booming.<br />

Oil, gas and petrochemicals 62<br />

Exploration for gas off the south-eastern coast is hotting up.<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />


SABS_SA-Bus.Journal_09/2020<br />

SABS - 75 Years of dedication to Quality Compliance<br />

The <strong>South</strong> <strong>African</strong> Bureau of Standards supports the industrialisation effort of the dtic.<br />

SABS has an established network of national, regional and international partners that<br />

develop technical solutions adopted as <strong>South</strong> <strong>African</strong> National Standards (SANS), this<br />

in return enables business and government to:<br />

Improve the quality of products and services<br />

Enhance competitiveness and access to markets<br />

Ensure that procurement of products and services meet quality standards<br />

Improve the delivery of services underpinned by best practice<br />

and support policy and regulatory objectives<br />

SABS provides services to assist the implementation of best practice solutions<br />

• More than 7000 <strong>South</strong> <strong>African</strong> National Standards<br />

• Laboratory Testing Services for a diverse range of Products<br />

• Certification of Companies to Management System Standards<br />

• Certification of Products and the Application of the SABS Mark Scheme<br />

• Training of Management and Employees on Implementations of SANS<br />

• Local Content Verification for <strong>South</strong> <strong>African</strong> manufacturing industry<br />

SABS a Trusted Partner in Delivering Quality Assurance.<br />

Contact SABS to establish support for your Standardisation,<br />

Testing, Training and Certification Aspirations.


Water 66<br />

Infrastructure spending will have to be consistently high.<br />

Engineering 70<br />

Many engineering groups are selling off assets.<br />

Construction and property 72<br />

Logistics property is strongly placed for growth.<br />

Manufacturing 74<br />

TFG plans to double manufacturing capacity..<br />

Food and beverages 76<br />

Starch mills are changing hands.<br />

Automotive 78<br />

The automotive sector makes up a third of<br />

<strong>South</strong> Africa’s manufacturing capacity.<br />

Transport and logistics 80<br />

Decongestion of ports is a priority.<br />

Tourism and events 82<br />

The MICE sector faces special challenges.<br />

Banking and financial services 84<br />

Investors are getting behind fintech.<br />

Development finance and SMME support 86<br />

A new fund aims to make R5-billion available at a fair price.<br />

References<br />

Key sector contents 38<br />

Overviews of the main economic sectors of <strong>South</strong> Africa.<br />

Index 88<br />


Sasol One at Sasolburg was established in<br />

1950 and converted from coal gasification<br />

in 2004. It now uses more efficient natural<br />

gas in its production processes of products<br />

such as ammonia, ammonium nitrate,<br />

catalyst, ethylene, mining chemicals,<br />

phenolics, solvents and wax. With more<br />

than 25 000 employees, Sasol is a global<br />

integrated chemicals and energy company<br />

active in 33 countries.<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />


FOCUS<br />

FOCUS<br />

reliability The reliability of forehead of forehead infrared infrared<br />

thermometers in <strong>South</strong> in Africa <strong>South</strong> Africa<br />

blic can check The public with the can National check with Metrology the National Institute Metrology of <strong>South</strong> Institute Africa. of <strong>South</strong> Africa.<br />

e screening The of people screening using non-contact of people using The non-contact National Metrology The National Institute Metrology of <strong>South</strong> Institute of <strong>South</strong><br />

hermometers has thermometers become one of has the become Africa one (NMISA), of the has established Africa (NMISA), a platform has established where a a platform where a<br />

any striking images many to come striking out images of the to come Team of out Experts, of the representing Team of Experts, the relevant representing public the relevant public<br />

ovid-19 crisis in <strong>South</strong> Covid-19 Africa. crisis in <strong>South</strong> Africa. entities as well as private entities calibration as well as laboratories,<br />

private calibration laboratories,<br />

d (forehead) Infrared thermometers (forehead) are thermometers widely are able are to widely review and are able provide to review reliable and responses provide reliable responses<br />

creen people used for to high screen fever, people one for of the high fever, to topical one temperature of the to topical screening temperature related questions. screening related questions.<br />

s of the coronavirus, symptoms of to the identify coronavirus, people to identify A video people on temperature A video screening on temperature is available screening is available<br />

be infected that thereby may be reducing infected the thereby risk reducing and the the Team risk of Experts and the can Team be of contacted Experts can at: be contacted at:<br />

ing the virus of spreading workplaces, the virus schools in workplaces, and www.nmisa.org/Pages/Temperature.aspx.<br />

schools and www.nmisa.org/Pages/Temperature.aspx.<br />

as. Since an public elevated areas. temperature Since an elevated does temperature does<br />

lusively indicate not conclusively a Covid-19 indicate infection, a Covid-19 About infection, NMISA About NMISA<br />

edical evaluation further medical is necessary evaluation to is Mandated necessary by to the Measurement<br />

Mandated by the Measurement<br />

if a person determine is infected. if a person is infected. Units and Measurement<br />

Units and Measurement<br />

Standards Act, 2006, Standards NMISA Act, 2006, NMISA<br />

provides for the accuracy provides and for the accuracy and<br />

international recognition international of recognition of<br />

local measurement local results. measurement results.<br />

This enables trade, This component enables trade, component<br />

manufacturing, legal manufacturing, acceptance legal acceptance<br />

of measurement of results measurement for results for<br />

law enforcement, law accurate enforcement, accurate<br />

measurement in environment<br />

measurement in environment<br />

and safety, and is and crucial safety, for and is crucial for<br />

healthcare. healthcare.<br />

NMISA is part of the NMISA Department is of of the Trade, Department of Trade,<br />

Industry and Competition’s Industry (the and dtic) Competition’s family of the (the dtic) family of the<br />

Technical Infrastructure Technical (TI) Institutes, Infrastructure which (TI) also Institutes, which also<br />

includes the <strong>South</strong> includes <strong>African</strong> Bureau the <strong>South</strong> of Standards <strong>African</strong> Bureau of Standards<br />

ver, many questions However, have many been questions raised by have (SABS), been raised National by (SABS), Regulator National for Compulsory Regulator for Compulsory<br />

s about the businesses reliability of about the measurement<br />

the reliability of the Specification measurement (NRCS) Specification and the <strong>South</strong> (NRCS) <strong>African</strong> and the <strong>South</strong> <strong>African</strong><br />

btained results from such obtained thermometers. from such thermometers.<br />

National Accreditation National System Accreditation (SANAS) that System (SANAS) that<br />

ctors influence Several the factors accuracy influence of these<br />

accuracy together of provide these for together confidence provide in local for goods confidence and in local goods and<br />

ment results, measurement including results, the type including of products the type and allows of products for successful and allows prosecution for successful in prosecution in<br />

t used, the instrument accuracy of used, the thermometer accuracy of the cases thermometer of non-compliance. cases of ■non-compliance. ■<br />

through (obtained calibration), through the measurement<br />

calibration), the measurement<br />

followed, procedure ambient conditions, followed, ambient etc. conditions, etc.<br />

details Contact details<br />

12 841 4152Tel: + 27 12 841 4152<br />

fo@nmisa.org Email: info@nmisa.org<br />

: www.nmisa.org Website: www.nmisa.org<br />


SOUTH AFRICAN <strong>2021</strong> BUSINESS <strong>2021</strong>56<br />



<strong>South</strong> <strong>African</strong> <strong>Business</strong><br />

A unique guide to business and investment in <strong>South</strong> Africa.<br />

Credits<br />

Publishing director:<br />

Chris Whales<br />

Editor: John Young<br />

Managing director: Clive During<br />

Online editor: Christoff Scholtz<br />

Designer: Simon Lewis<br />

Production: Lizel Olivier<br />

Ad sales:<br />

Gavin van der Merwe<br />

Sam Oliver<br />

Jeremy Petersen<br />

Gabriel Venter<br />

Vanessa Wallace<br />

Shiko Diala<br />

Administration & accounts:<br />

Charlene Steynberg<br />

Kathy Wootton<br />

Printing: FA Print<br />

Welcome to the ninth edition of the <strong>South</strong><br />

<strong>African</strong> <strong>Business</strong> journal. First published in<br />

2011, the publication has established itself<br />

as the premier business and investment<br />

guide to <strong>South</strong> Africa, supported by an e-book edition at<br />

www.southafricanbusiness.co.za.<br />

This issue has a focus on economic recovery plans which<br />

have been put in place to tackle the challenges thrown up<br />

by the global Covid-19 pandemic. National government’s<br />

focus on infrastructure and the use of Special Economic<br />

Zones is highlighted, together with a feature on the nascent<br />

maritime economy. Regular pages cover all the main<br />

economic sectors of the <strong>South</strong> <strong>African</strong> economy and give<br />

a snapshot of each of the country’s provincial economies.<br />

<strong>South</strong> <strong>African</strong> <strong>Business</strong> is complemented by nine regional<br />

publications covering the business and investment<br />

environment in each of <strong>South</strong> Africa’s provinces. The e-book<br />

editions can be viewed online at www.globalafricanetwork.<br />

com. These unique titles are supported by a monthly<br />

business e-newsletter with a circulation of over 23 000.<br />

In 2020, the inaugural <strong>African</strong> <strong>Business</strong> joined the Global<br />

<strong>African</strong> Network stable of publications. ■<br />

Chris Whales<br />

Publisher, Global Africa Network Media | Email: chris@gan.co.za<br />


<strong>South</strong> <strong>African</strong> <strong>Business</strong> is distributed internationally on outgoing<br />

and incoming trade missions, through trade and investment<br />

agencies; to foreign offices in <strong>South</strong> Africa’s main trading<br />

partners around the world; at top national and international<br />

events; through the offices of foreign representatives in<br />

<strong>South</strong> Africa; as well as nationally and regionally via chambers<br />

of commerce, tourism offices, airport lounges, provincial<br />

government departments, municipalities and companies.<br />

COPYRIGHT | <strong>South</strong> <strong>African</strong> <strong>Business</strong> is an independent publication<br />

published by Global Africa Network Media (Pty) Ltd. Full copyright to<br />

the publication vests with Global Africa Network Media (Pty) Ltd.<br />

No part of the publication may be reproduced in any form without<br />

the written permission of Global Africa Network Media (Pty) Ltd.<br />

PHOTO CREDITS | Africamps at Ingwe, Amatola Water, AngloAmerican,<br />

Betterect,Buckler’s Africa Lodge, Council for Geoscience, Data Centre<br />

Map, De Beers Group, ELIDZ, Equites, 5M2T, Fortress Fund, Implats,<br />

Khobab Wind Farm, Nissan, Perdekraal East Wind Farm, Port of Cape<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

Town, SA Furniture Forum, SA Heavy Haul Association, SANRAL, SASOL,<br />

THEGIFT777/iStock, TNPA, Tongaat Hulett, Utopia_88/iStock.<br />

.<br />

DISCLAIMER | While the publisher, Global Africa Network Media (Pty) Ltd,<br />

has used all reasonable efforts to ensure that the information contained in<br />

<strong>South</strong> <strong>African</strong> <strong>Business</strong> is accurate and up-to-date, the publishers make no<br />

representations as to the accuracy, quality, timeliness, or completeness of<br />

the information. Global Africa Network will not accept responsibility for any<br />

loss or damage suffered as a result of the use of or any reliance placed on<br />

such information.<br />

8<br />


Global Africa Network Media (Pty) Ltd<br />

Company Registration No: 2004/004982/07<br />

Directors: Clive During, Chris Whales<br />

Physical address: 28 Main Road, Rondebosch 7700<br />

Postal address: PO Box 292, Newlands 7701<br />

Tel: +27 21 657 6200 | Fax: +27 21 674 6943<br />

Email: info@gan.co.za | Website: www.gan.co.za<br />

Member of the Audit Bureau<br />

of Circulations ISSN 2221-4194

Early engagement with<br />

the private sector is vital<br />


Jason Lightfoot, Portfolio Manager at Futuregrowth, assesses the latest moves to<br />

attract the private sector to invest in infrastructure.<br />

What is constraining infrastructure investment in <strong>South</strong> Africa?<br />

The concern is that a lot of noise has been made previously around<br />

government’s infrastructure plans which have in few instances<br />

resulted in real opportunities for investors to play a role. Many of these<br />

issues have been around policy certainty and also ensuring that such<br />

projects actually reach a level of bankability for such investors to make<br />

an investment that will offer a proper risk-adjusted return. Perhaps this<br />

time is different with the recent engagement with the private sector.<br />

Jason Lightfoot<br />


Jason is the Portfolio Manager of the<br />

flagship Futuregrowth Infrastructure<br />

& Development Bond Fund, as well<br />

as the Yield Enhanced ALBI benchmarked<br />

range of portfolios. In addition,<br />

he plays a mentoring role within<br />

the Credit team and is involved in<br />

various aspects of risk assessment<br />

within the investment process.<br />

Do you mean the Sustainable Infrastructure Development<br />

Symposium of <strong>South</strong> Africa (SIDSSA)?<br />

This is a step in the right direction. It crowds in potential private sector<br />

investors in a much more coordinated manner and includes them in<br />

assessing how these various initiatives can be funded.<br />

Why is gross fixed capital formation an important benchmark?<br />

This measure captures how much money as a proportion of total<br />

economic activity is being invested in capital goods, such as<br />

equipment, tools, transportation assets and electricity and various<br />

measurable outputs of these. The extent of infrastructure spending<br />

in an economy is reflected in the level of gross fixed capital formation<br />

(GFCF) as a percentage of Gross Domestic Product (GDP) which is an<br />

important precursor of economic growth.<br />

What can be learnt from the Renewable Energy Independent<br />

Power Producer Procurement Programme (REIPPPP)?<br />

Before capital market players invest, they need to have confidence<br />

that the policy environment is stable and that such potential<br />

investments will offer sufficiently attractive risk-related returns. To a<br />

great extent, the Renewable Energy Independent Power Producer<br />

Procurement Programme (REIPPPP) met these criteria, enabling the<br />

private sector to play an important role. REIPPPP is an important<br />

success story.<br />

Of the major infrastructure projects being discussed at the<br />

moment, which are the most significant?<br />

Energy generation remains of utmost importance in an environment<br />

where a massive strain on the system remains and the launch of<br />

Emergency Procurement round of up to 2000MW will address that. ■<br />

41 9<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong>



Building a more sustainable future while reducing debt will require<br />

great skill from the country’s leaders.<br />

By John Young<br />

Build back better has become the new<br />

catchphrase. There is a lot of building to<br />

do for the <strong>South</strong> <strong>African</strong> economy after<br />

two recessions, a decade of looting of state<br />

resources and a health crisis that all but shut down<br />

the economy for several months.<br />

The Chief Executive Officer of the<br />

Johannesburg Stock Exchange, Leila Fourie,<br />

wrote in June 2020 that she wants to “contribute<br />

towards a better, fairer, more sustainable<br />

world” (<strong>Business</strong> Day). As co-chair of the Global<br />

Investors for Sustainable Development (GISD)<br />

Alliance, a grouping of banks, bourses and asset<br />

managers, Fourie has been working to promote<br />

investment in Covid-19 bonds, the Sustainable<br />

Development 500 fund and renewable energy.<br />

This kind of thinking informs many of the plans<br />

that were put forward by business, labour and<br />

political parties as the Covid-19 lockdown served<br />

to focus the minds of all <strong>South</strong> <strong>African</strong>s about the<br />

need to plot a better way forward. The National<br />

Economic Development and Labour Council<br />

(Nedlac) came up with an agreement which<br />

focussed on infrastructure investment, creating a<br />

supportive policy environment and the promotion<br />

of “strategic localisation” and exports. An umbrella<br />

business body, <strong>Business</strong> for SA (B4SA), identified<br />

12 initiatives which, if accompanied by policy<br />

reforms, would boost the economy significantly.<br />

The <strong>African</strong> National Congress (ANC) produced its<br />

own economic recovery document.<br />

Having consulted with all these bodies,<br />

President Cyril Ramaphosa on 15 October<br />

revealed government’s recovery plan. The<br />

Economic Reconstruction and Recovery Plan<br />

(EcoRRP) names infrastructure investment and<br />

building up the country’s manufacturing base as<br />

priorities. The plan intends to unlock R1-trillion in<br />

private investment. Furthermore, a commitment<br />

is made to improving the capability of the state<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



and to remove barriers to doing business or<br />

investing in the country.<br />

Soon afterwards, Finance Minister Tito<br />

Mboweni announced the medium-term budget<br />

policy statement where the most significant<br />

promise related to reducing the state’s wage<br />

bill. Mboweni is a former Reserve Bank Governor<br />

and Labour Minister. The President is a former<br />

miner and trade unionist. Both men have been<br />

engaged for years in drafting the economic policy<br />

of the ANC but it remains to be seen if they can<br />

persuade the unions representing workers in the<br />

public sector to accept a three-year freeze on<br />

wage increases. This will be a major test because<br />

<strong>South</strong> Africa’s debt to GDP ratio is high. The cost of<br />

servicing debt is equal to nearly 14% of revenue.<br />

A step that President Ramaphosa took in<br />

July did not receive many headlines, but his<br />

amendment of the regulations governing the<br />

enquiry into state capture made a big difference<br />

to the work of the National Prosecuting Authority<br />

(NPA). Enabled by the amendment to work with<br />

the evidence presented to the commission,<br />

prosecutors quickly finalised cases and arrests<br />

started happening. After a decade in which<br />

it seemed that immunity was guaranteed for<br />

corrupt officials and employees of state-owned<br />

enterprises, the tide started to turn.<br />

Prosecutions obviously do not provide<br />

certainty against future corruption, but at least<br />

the prospect of arrest might be a deterrent. One<br />

of the biggest obstacles to economic recovery<br />

is <strong>South</strong> Africa’s level of debt, and that is caused<br />

largely by the state electricity utility, Eskom,<br />

where corruption was rife for years.<br />

The government’s directory lists 131 stateowned<br />

entities but there are said to be about 700<br />

altogether, at various levels of government. The<br />

three biggest, all of which fall under the Department<br />

of Public Enterprises, are Eskom, <strong>South</strong> <strong>African</strong><br />

Airways (SAA) and Transnet, with five large divisions<br />

covering ports, railways and logistics. Eskom and<br />

SAA are significant drains on the country’s finances<br />

and getting control of all of the country’s SOEs is<br />

another major priority.<br />

Agriculture was one industry that saw<br />

some positives during the Covid-19 lockdown.<br />

Although sectors like wine suffered badly, a<br />

reported increase in maize exports, as well as<br />

greater international demand for citrus fruits and<br />

pecan nuts, helped the industry expand by 15%<br />

(StatsSA). Grain crops such as maize, wheat, barley<br />

and soya beans are among the county’s most<br />

important crops. Only rice is imported. Wine, corn<br />

and sugar are other major exports.<br />

Basing economic growth on a devaluing<br />

currency is not always the best long-term method<br />

of boosting economic growth, but high-value<br />

agricultural exports and increased numbers of highspending<br />

international tourists hold some promise<br />

for helping to get the <strong>South</strong> <strong>African</strong> economy back<br />

on a growth path. Horticulture in particular is seen<br />

as holding great potential not only for increased<br />

earnings, but for creating jobs.<br />

New economic sectors<br />

Another new area that holds great potential for the<br />

<strong>South</strong> <strong>African</strong> economy is the Oceans Economy.<br />

<strong>South</strong> Africa has 3 000km of coastline and the<br />

extent of the country’s territorial waters is greater<br />

than its land size. And yet the country does not<br />

have a merchant marine fleet and only scrapes<br />

the surface in terms of the percentage of repair<br />

and maintenance of boats and oilrigs which could<br />

potentially bring work to its ports.<br />

The introduction of renewable energy into the<br />

<strong>South</strong> <strong>African</strong> energy market via the Renewable<br />

Energy Independent Power Producer Procurement<br />

Programme (REIPPPP) was successful but the<br />

programme stalled.<br />

Hopes were raised with the publication of<br />

a new Integrated Resource Plan (IRP) because<br />

investors crave certainty. The IRP is a road map<br />

for <strong>South</strong> Africa’s electricity generation and the<br />

previous administration seemed determined<br />

to push for an expensive nuclear programme.<br />

The latest plan confirms that the already hugely<br />

successful drive for renewable energy will be<br />

continued and expanded.<br />

<strong>South</strong> Africa’s traditional strength in minerals<br />

still holds good. Although gold mining is<br />

declining in volumes (even while prices rise), the<br />

major investment of Vedanta Zinc International<br />

in a project in the Northern Cape and Sibanye-<br />

11<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong>


New roads such as this link to the North West from Gauteng are important parts of infrastructural<br />

development. Credit: SANRAL<br />

Stillwater’s acquisition drive in the platinum group<br />

metals (PGM) sector are significant economic<br />

drivers. Coal and iron ore continue to be exported<br />

in large volumes through the Richards Bay<br />

Coal Terminal on the east coast and the Port of<br />

Saldanha on the west coast.<br />

Automotive manufacturing and automotive<br />

components continue to thrive, with large<br />

investments by most of the major marques and<br />

increased exports a feature of the sector. There<br />

has been inward investment in recent years, most<br />

notably by the Beijing Automotive International<br />

Corporation (BAIC) in the Coega Special Economic<br />

Zone outside Port Elizabeth. The Tshwane<br />

Automotive Special Economic Zone (TASEZ) has<br />

been launched at Silverton in Pretoria.<br />

A new SEZ has been formally declared in the<br />

northern part of Limpopo, the Musina-Makhado<br />

SEZ. The Namakwa SEZ in the Northern Cape<br />

is awaiting its licence, as is the Tubatse SEZ in<br />

eastern Limpopo.<br />

Geography<br />

<strong>South</strong> Africa’s location between the Atlantic and<br />

Indian oceans ensures a generally temperate<br />

climate. The 2 954km coastline stretches from the<br />

border with Namibia on the Atlantic to the border<br />

with Mozambique in the east. The cold Benguela<br />

current sweeps along the western coast while the<br />

warm Indian Ocean ensures that the Mozambique/<br />

Agulhas current is temperate.<br />

<strong>South</strong> Africa’s coastal plain is separated from<br />

the interior by several mountain ranges, most<br />

notably the Drakensberg which runs down the<br />

country’s eastern flank. Smaller ranges in the<br />

south and west mark the distinction between the<br />

fertile coastal strip and the dry interior known as<br />

the Karoo.<br />

The city of Johannesburg is located on the<br />

continental divide, whereby water runs south of<br />

the city towards the Atlantic Ocean while waters<br />

to the north drain towards the north and east.<br />

Johannesburg is 1 753m above sea-level.<br />

Most of the country has summer rainfall but<br />

the Western Cape, which has a Mediterranean<br />

climate, receives its rain in winter. Droughts<br />

are not uncommon and although the national<br />

average is 464mm, most of the country receives<br />

less than 500mm of rain every year. The Western<br />

Cape experienced a severe drought which was<br />

broken in 2018. The Orange and Vaal rivers play<br />

important roles in water schemes and irrigation<br />

and the Limpopo River defines the country’s<br />

northern boundary. ■<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />


10 REASONS<br />


01.<br />


MARKET<br />

Growing middle class, affluent consumer<br />

base, excellent returns on investment.<br />

02.<br />



<strong>South</strong> Africa (SA) has the most industrialised economy in Africa.<br />

It is the region’s principal manufacturing hub and a leading<br />

services destination.<br />



SA is the location of choice of multinationals in Africa.<br />

03.<br />

Global corporates reap the benefits of doing business in<br />

SA, which has a supportive and growing ecosystem as a<br />

hub for innovation, technology and fintech.<br />

05.<br />





SA has a sophisticated banking sector with a major<br />

footprint in Africa. It is the continent’s financial hub,<br />

with the JSE being Africa’s largest stock exchange by<br />

market capitalisation.<br />

The <strong>African</strong> Continental Free Trade Area will boost<br />

intra-<strong>African</strong> trade and create a market of over one<br />

billion people and a combined gross domestic product<br />

(GDP) of USD2.2-trillion that will unlock industrial<br />

development. SA has several trade agreements in<br />

place as an export platform into global markets.<br />


09.<br />

SA has a number of world-class universities and colleges<br />

producing a skilled, talented and capable workforce. It<br />

boasts a diversified skills set, emerging talent, a large pool<br />

of prospective workers and government support for training<br />

and skills development.<br />

07.<br />

04.<br />

06.<br />

08.<br />





SA has a progressive Constitution and an independent judiciary. The<br />

country has a mature and accessible legal system, providing certainty<br />

and respect for the rule of law. It is ranked number one in Africa for the<br />

protection of investments and minority investors.<br />



SA is endowed with an abundance of natural resources. It is the leading producer<br />

of platinum-group metals (PGMs) globally. Numerous listed mining companies<br />

operate in SA, which also has world-renowned underground mining expertise.<br />




A massive governmental investment programme in infrastructure development<br />

has been under way for several years. SA has the largest air, ports and logistics<br />

networks in Africa, and is ranked number one in Africa in the World Bank’s<br />

Logistics Performance Index.<br />

10.<br />

SA offers a favourable cost of living, with a diversified cultural, cuisine and<br />

sports offering all year round and a world-renowned hospitality sector.<br />


OF LIFE<br />

Page | 2<br />

19<br />


Why Invest<br />

in Space<br />

OUR IMPACT is derived from our national capacity, experience<br />

and expertise in space science and technology through six thematic focus areas:<br />

• Earth Observation - SANSA collects, assimilates and disseminates<br />

Earth observation data to support <strong>South</strong> Africa’s policy making,<br />

economic growth and sustainable development initiatives. Earth<br />

observation data is used for human settlement growth mapping,<br />

infrastructure monitoring, as well as disaster and water resource<br />

management. Earth observation satellite data contributes to<br />

monitoring environmental variables in the water cycle such as<br />

water quantity, quality, soil erosion and vegetative health which<br />

ensures water safety and security for the country.<br />

• Space Operations - SANSA provides global competitive space<br />

operations and applications, tracking, telemetry and command<br />

services while managing ground stations for international clients.<br />

Space Operations provides world class launch support for space<br />

missions (from Earth into our solar system) and ensures satellites<br />

are continuously monitored when they are travelling over <strong>African</strong><br />

skies.<br />

• Space Science - SANSA conducts cutting edge space science<br />

research, development and magnetic technology innovation.<br />

Space science research is vital for gaining a deeper understanding<br />

of our space environment in order to protect essential<br />

infrastructure such as power grids and communication and<br />

navigation systems on Earth and in space. SANSA operates the<br />

Space Weather Regional Warning Centre for Africa, providing<br />

forecasts and warnings on space weather conditions. Extreme<br />

space weather may impact technological systems such as<br />

satellites, power grids, avionics and radio communication.<br />

• Space Engineering – SANSA aims to provide access to state-ofthe-art<br />

satellite assembly, integration and testing services, as well<br />

as satellite systems coordination and development, to ensure<br />

an environment conducive to industrial participation in satellite<br />

programmes.<br />

• Human Capital Development - SANSA aims to advance human<br />

capital development to grow the knowledge economy and<br />

create awareness about opportunities in engineering, science and<br />

technology. This is achieved through scarce skills development,<br />

summer and winter schools, the supervision of MSc and PhD<br />

students, and teaching at partner universities.<br />

• Science Advancement and Public Engagement - SANSA<br />

promotes science advancement and public engagement through<br />

participation in national science awareness events and through<br />

using the fascination of space to drive a greater uptake of studies<br />

in science, maths, engineering and technology.

SANSA<br />

provides stateof-the-art<br />

ground<br />

station facilities and<br />

services including<br />

satellite tracking, launch<br />

support, mission<br />

control and space<br />

navigation.<br />

SANSA monitors<br />

the Earth’s magnetic<br />

field and space weather<br />

storms to assist in<br />

protecting technology<br />

on Earth and in space.<br />

Satellite imagery<br />

helps manage food<br />

and water security as<br />

well as natural disasters<br />

on Earth like floods,<br />

droughts and fires.<br />

In a country faced with numerous challenges in<br />

housing, crime, poverty and the provision of basic<br />

necessities, you may ask why invest in space?<br />

The answer is clear.<br />

Space investment is essential<br />

for economic sustainability<br />

and development!<br />

Without space applications we would not be able to mitigate<br />

disasters or effectively manage our resources such as water, food, land<br />

and housing. Mobile phones, internet, GPS, ATMs, meteorological<br />

forecasting and safe land and sea travel all rely on satellites positioned<br />

in space. Government, industry and academia also rely on space<br />

data to deliver on their priorities through the creation of applied<br />

knowledge, products and services.<br />

SANSA provides value-added products and services that are utilised<br />

in both space and non-space applications. Space information<br />

enables everyday decision making at all levels of society. SANSA has<br />

contributed towards goals within the National Development Plan<br />

(NDP) and the goals of the Department of Science and Technology<br />

(DST) by delivering products and services to its stakeholders and the<br />

public.<br />

<strong>South</strong> Africa’s next earth observation satellite is an example of one of<br />

these deliverables and is also one of the incredible opportunities to<br />

showcase the importance of investment in space science, engineering<br />

and technology and for <strong>South</strong> Africa to take its place in the global<br />

space arena.<br />

@SANSA7<br />

<strong>South</strong> <strong>African</strong> National Space Agency<br />

<strong>South</strong> <strong>African</strong> National Space Agency<br />

Enterprise Building, Mark Shuttleworth Street, Innovtion Hub, Pretoria, 0087<br />

T: 012 844 0500 | F: 012 844 0396 | information@sansa.org.za | www.sansa.org.za


Provinces of <strong>South</strong> Africa<br />

A snapshot of <strong>South</strong> Africa’s nine provinces.<br />

Eastern Cape<br />

Capital: Bhisho<br />

Main towns: Port Elizabeth, East<br />

London, Uitenhage, Graaff-<br />

Reinet, Mthatha, Grahamstown<br />

(Makhanda)<br />

Population: 6 916 200 (2015)<br />

Area: 168 966km² (13.8%<br />

of <strong>South</strong> Africa)<br />

Premier:<br />

Lubabalo Oscar Mabuyane (ANC)<br />

Key sectors: Automotive,<br />

agriculture, agri-processing,<br />

forestry, finance, retail, tourism,<br />

renewable energy.<br />

Infrastructure: Coega Industrial<br />

Development Zone, East London<br />

Industrial Development Zone,<br />

ports of East London, Port<br />

Elizabeth and Ngqura, airports at<br />

Port Elizabeth and East London.<br />

Notable tourism assets: Addo<br />

Elephant National Park, Mountain<br />

Zebra National Park, Wild Coast,<br />

Jeffreys Bay, National Arts Festival.<br />

Provincial government website:<br />

www.ecprov.gov.za<br />

Eastern Cape Development<br />

Corporation: www.ecdc.co.za<br />

Free State<br />

Capital: Bloemfontein<br />

Main towns: Welkom, Sasolburg,<br />

Parys, Kroonstad<br />

Population: 2 817 900 (2015)<br />

Area: 129 825km² (10.6%<br />

of <strong>South</strong> Africa)<br />

Premier:<br />

Sefora Hixsonia Ntombela (ANC)<br />

Key sectors: Agriculture,<br />

agri-processing, chemical<br />

manufacturing, mining, transport<br />

and logistics.<br />

Infrastructure: Maluti-A-Phofung<br />

Special Economic Zone, Bram<br />

Fischer International Airport,<br />

University of the Free State,<br />

Central University of Technology,<br />

N8 Corridor.<br />

Notable tourism assets: Vaal<br />

River, Gariep Dam, Golden Gate<br />

Highlands National Park, Cherry<br />

Festival, Mangaung <strong>African</strong><br />

Cultural Festival (Macufe).<br />

Provincial government website:<br />

www.freestateonline.fs.gov.za<br />

Free State Development<br />

Corporation: www.fdc.co.za<br />

Gauteng<br />

Capital: Johannesburg<br />

Main towns: Tshwane<br />

(including Pretoria), Ekurhuleni,<br />

Vanderbijlpark, Roodepoort<br />

Population: 13 200 300 (2015)<br />

Area: 18 178km² (1.5%<br />

of <strong>South</strong> Africa)<br />

Premier:<br />

David Makhura (ANC)<br />

Key sectors: Financial and<br />

banking, manufacturing, trade,<br />

creative industries, media.<br />

Infrastructure: OR Tambo<br />

International Airport, Gautrain,<br />

major universities and research<br />

institutions, large convention<br />

centres, FNB Stadium (Soccer City).<br />

Notable tourism assets: Cradle of<br />

Humankind, Apartheid Museum,<br />

Constitution Hill, Magaliesberg,<br />

Soweto tours, Dinokeng.<br />

Provincial government website:<br />

www.gauteng.gov.za<br />

Gauteng Growth and<br />

Development Agency:<br />

www.ggda.co.za<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong> 2020 16 20



KwaZulu-Natal<br />

Capital: Pietermaritzburg<br />

Main towns: Durban, Newcastle,<br />

Ballito, Port Shepstone,<br />

Empangeni, Ulundi<br />

Population: 10 919 100 (2015)<br />

Area: 125 755km² (7.7%<br />

of <strong>South</strong> Africa)<br />

Premier:<br />

Sihle Zikalala (ANC)<br />

Key sectors: Chemicals, dissolving<br />

pulp manufacture, sugar, forestry,<br />

automotive, textiles and footwear,<br />

mining, oil and gas, logistics.<br />

Infrastructure: King Shaka<br />

International Airport, Dube TradePort,<br />

Richards Bay Industrial Development<br />

Zone, ports of Richards Bay and<br />

Durban, Albert Luthuli International<br />

Convention Centre Complex.<br />

Notable tourism assets: HluhluweiMfolozi<br />

Park, the Drakensberg<br />

mountains, iSimangilso Wetlands<br />

Park, Durban beaches, <strong>South</strong> Coast,<br />

Zulu cultural heritage, historical<br />

battlefields.<br />

Provincial government website:<br />

www.kznonline.gov.za<br />

Trade and Investment KwaZulu-<br />

Natal: www.tikzn.co.za<br />

Limpopo<br />

Capital: Polokwane<br />

Main towns: Musina,<br />

Ba-Phalabora, Bela-Bela,<br />

Steelpoort, Tzaneen, Thohoyandou<br />

Population: 5 726 800 (2015)<br />

Area: 125 755km² (10.2%<br />

of <strong>South</strong> Africa)<br />

Premier:<br />

Chupu Stanley Mathabatha (ANC)<br />

Key sectors: Mining, agriculture,<br />

tourism, logistics.<br />

Infrastructure: Musina-Makhado<br />

Special Economic Zone, N1<br />

highway and rail network, new<br />

Medupi power station.<br />

Notable tourism assets: Kruger<br />

National Park, Mapungubwe<br />

Heritage Site, Makapans Valley,<br />

Marula Festival, Waterberg<br />

Biosphere.<br />

Provincial government website:<br />

www.limpopo.gov.za<br />

Limpopo Economic<br />

Development Agency:<br />

www.lieda.gov.za<br />

Mpumalanga<br />

Capital: Mbombela<br />

Main towns: Emalahleni,<br />

Middelburg, Sabie, Lydenburg<br />

Population: 4 283 900 (2015)<br />

Area: 76 495km² (6.3%<br />

of <strong>South</strong> Africa)<br />

Premier:<br />

Refilwe Mtshweni-Tsipane (ANC)<br />

Key sectors: Agriculture, forestry,<br />

mining, steel manufacturing,<br />

petrochemicals, pulp and paper,<br />

power generation, tourism.<br />

Infrastructure: Nkomazi Special<br />

Economic Zone, Mbombela<br />

International Fresh Produce<br />

Market, Maputo Development<br />

Corridor, Kruger Mpumalanga<br />

International Airport.<br />

Notable tourism assets: Kruger<br />

National Park, Blyde River Canyon,<br />

Barberton Makhonjwa Mountains<br />

(a UNESCO World Heritage Site).<br />

Provincial government website:<br />

www.mpumalanga.gov.za<br />

Mpumalanga Economic Growth<br />

Agency: www.mega.gov.za<br />

17 SOUTH AFRICAN BUSINESS <strong>2021</strong><br />




Northern Cape<br />

Capital: Kimberley<br />

Main towns: Douglas, Upington,<br />

De Aar, Port Nolloth, Colesberg<br />

Population: 1 185 600 (2015)<br />

Area: 372 889km² (30.5%<br />

of <strong>South</strong> Africa)<br />

Premier:<br />

Dr Zamani Saul (ANC)<br />

Key sectors: Agriculture, mining,<br />

renewable energy, astronomy.<br />

Infrastructure: Upington Special<br />

Economic Zone, Sol Plaatje<br />

University, Vaalharts Irrigation<br />

Scheme.<br />

Notable tourism assets: Six<br />

national parks including the<br />

Kgalagadi Transfrontier Park,<br />

Orange River, spring flower<br />

displays, diamond routes.<br />

Provincial government website:<br />

www.northern-cape.gov.za<br />

Department of Economic<br />

Development and Tourism:<br />

www.northern-cape.gov.za/dedat<br />

North West<br />

Capital: Mahikeng<br />

Main towns: Klerksdorp,<br />

Rustenburg, Brits, Potchefstroom<br />

Population: 3 707 000 (2015)<br />

Area: 104 882km² (8.6%<br />

of <strong>South</strong> Africa)<br />

Premier: Professor Tebogo Job<br />

Mokgoro (ANC)<br />

Key sectors: Mining, agriculture,<br />

agri-processing, automotive<br />

components.<br />

Infrastructure: Hartbeespoort<br />

Dam, Pelindaba nuclear research<br />

unit, North West University,<br />

Bakwena Platinum Highway.<br />

Notable tourism assets: Sun City,<br />

Mmbatho Palms Hotel Casino<br />

Convention Resort, Pilanesberg<br />

National Park, 18 luxury lodges in<br />

Madikwe Game Reserve.<br />

Provincial government website:<br />

www.nwpg.gov.za<br />

North West Development<br />

Corporation: www.nwdc.co.za<br />

Western Cape<br />

Capital: Cape Town<br />

Main towns: Stellenbosch,<br />

George, Plettenberg Bay, Beaufort<br />

West, Oudtshoorn, Worcester,<br />

Malmesbury<br />

Population: 6 200 100 (2015)<br />

Area: 129 462km² (10.6%<br />

of <strong>South</strong> Africa)<br />

Premier:<br />

Alan Winde (DA)<br />

Key sectors: Agriculture, agriprocessing,<br />

wine and grapes,<br />

financial services, manufacturing,<br />

tourism, oil and gas, boatbuilding.<br />

Infrastructure: Ports of Cape<br />

Town, Saldanha and Mossel Bay,<br />

Mossgas oil-to-gas refinery, Cape<br />

Town International Airport, Cape<br />

Town International Convention<br />

Centre, Koeberg nuclear power<br />

station.<br />

Notable tourism assets: Table<br />

Mountain, Garden Route National<br />

Park, Karoo National Park, West<br />

Coast National Park, Kirstenbosch<br />

Botanical Gardens, Cape Point,<br />

V&A Waterfront, Plettenberg<br />

Bay, Route 62, Zeitz Museum of<br />

Contemporary Art.<br />

Provincial government website:<br />

www.westerncape.gov.za<br />

Wesgro: www.wesgro.co.za<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong> 2020 18 22

An ExtrAordinAry<br />

BusinEss EvEnts dEstinAtion<br />

northern Cape, south Africa<br />

An award winning business and incentive destination, this ageless land offers<br />

a seamless fusion of first world technologies and infrastructure with ancient<br />

authentic cultures, dramatic natural beauty and awesome adventure. This is<br />

the Northern Cape. Now come and experience it for yourself…<br />

For more information do visit<br />

www.experiecenortherncape.com<br />

businessevents@experiencenortherncape.com<br />

Northern Cape Tourism @NorthernCapeSA northerncapetourism northerncapesa

FOCUS<br />

Sectoral strengths of<br />

<strong>South</strong> <strong>African</strong> provinces<br />



A wide variety of investments are available.<br />

Gauteng:<br />

• Financial and business services<br />

• Information and communications<br />

technology<br />

• Transport and logistics<br />

• Basic iron and steel, steel products<br />

• Fabricated metal products<br />

• Motor vehicles, parts and accessories<br />

• Appliances<br />

• Machinery and equipment<br />

• Chemical products, pharmaceuticals<br />

North West:<br />

• Agro-processing<br />

• Mining<br />

• Agriculture and agro-processing<br />

• Tourism<br />

• Metal products<br />

• Machinery and equipment<br />

• Renewable energy (solar)<br />

Northern Cape:<br />

• Mining<br />

• Agriculture and agro-processing<br />

• Fisheries and aquaculture<br />

• Renewable energy (solar, wind)<br />

• Jewellery manufacturing<br />

Limpopo:<br />

• Mining<br />

• Fertilisers<br />

• Tourism<br />

• Agriculture<br />

• Agro-processing<br />

• Energy, including<br />

renewables (solar)<br />

Mpumalanga:<br />

• Mining<br />

• Tourism<br />

• Forestry, paper and paper<br />

products, wood and wood<br />

products<br />

• Agriculture and agroprocessing<br />

• Metal products<br />

FOCUS<br />

KwaZulu-Natal:<br />

• Transport and logistics<br />

• Tourism<br />

• Motor vehicles, parts and<br />

accessories<br />

• Petrochemicals<br />

• Aluminium<br />

• Clothing and textiles<br />

• Machinery and equipment<br />

• Agriculture and agroprocessing<br />

• Forestry, pulp and paper,<br />

wood and wood products<br />

Western Cape:<br />

• Tourism<br />

• Financial and business services<br />

• Transport and logistics<br />

• ICT<br />

• Agriculture and agro-processing<br />

• Fisheries and aquaculture<br />

• Petrochemicals<br />

• Basic iron and steel<br />

• Clothing and textiles<br />

• Renewable energy (solar, wind)<br />

Free State:<br />

• Agriculture and agro-processing<br />

• Mining<br />

• Petrochemicals<br />

• Machinery and equipment<br />

• Tourism<br />

Eastern Cape:<br />

• Motor vehicles, parts and<br />

accessories<br />

• Forestry, wood and wood products<br />

• Clothing and textiles<br />

• Pharmaceuticals<br />

• Leather and leather products<br />

• Tourism<br />

• Renewable energy (wind)<br />

Source: Industrial Development Corporation (IDC); The Case for Investing in <strong>South</strong> Africa, Executive Summary<br />

Source: Industrial Development Corporation (IDC)<br />

(<strong>South</strong> <strong>African</strong> Investment Conference, 2018).<br />

Page | 40<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />


Gert Sibande<br />

District Municipality<br />

A national leader in job creation through the EPWP programme.<br />


Executive Mayor Councillor<br />

Muzi Chirwa<br />

Gert Sibande District<br />

Municipality received<br />

an unqualified audit<br />

opinion from the<br />

Auditor-General for the 2018/19<br />

financial year for the second<br />

consecutive year. Running a<br />

clean municipality in terms<br />

of financial management and<br />

governance has been a priority<br />

for the current administration<br />

since coming into office in 2016.<br />

Gert Sibande District<br />

Municipality (GSDM) has a<br />

comprehensive and credible<br />

Integrated Development Plan.<br />

The 2020/21 IDP document is<br />

in line with the Municipal<br />

Systems Act which makes<br />

community participation in<br />

the affairs of the municipality a<br />

legal obligation. The municipality<br />

has been consultative<br />

and transparent in its approach.<br />

GSDM cannot govern alone; the developmental agenda must be<br />

determined by residents.<br />

The impact of Covid-19 has put a huge strain on the economy.<br />

Having been placed as a leading district in <strong>South</strong> Africa in terms<br />

of job creation through the EPWP programme, GSDM commits to<br />

grow this programme and to find more innovative ways to create<br />

sustainable and dignified jobs. Further interventions are planned in<br />

the agricultural and forestry sector, informal traders, construction,<br />

manufacturing, mining and the tourism industry as we rejuvenate<br />

our economy and the realise the economic freedom for our people.<br />

Gert Sibande District Municipality is the largest of the three<br />

districts in Mpumalanga Province at 31 841km², covering 40% of<br />

the province’s land mass. According to Stats SA, Gert Sibande’s<br />

population increased from 1 043 194 in 2011 to 1 135 409 people in<br />

2016. This makes it the smallest district in population.<br />

Name of Local Main Admin Area Population<br />

Municipality Location (km²) Size (2016)<br />

Chief Albert Luthuli Carolina 5 559 187 630<br />

Dipaleseng Balfour 2 616 45 232<br />

Dr Pixley Isaka Ka Seme Volksrust 5 227 85 395<br />

Govan Mbeki Secunda 2 955 340 091<br />

Lekwa Standerton 4 585 123 419<br />

Mkhondo Piet Retief 4 882 189 036<br />

Msukaligwa Ermelo 6 017 164 608<br />

Vision<br />

A community-driven district of excellence and development.<br />

Mission<br />

To support and coordinate our local municipalities to provide<br />

excellent services and development.<br />

Contact details<br />

Tel: +27 17 801 7000<br />

Email: records@gsibande.gov.za | Website: www@gsibande.gov.za<br />

Follow us on Facebook & Twitter @GertSibandeDM<br />

105 21<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong>


Building infrastructure is a<br />

presidential priority<br />

Projects worth R340-billion have been gazetted for implementation.<br />

young people will be employed to digitise<br />

government information, including hospital<br />

files and police dockets.<br />

• Student accommodation.<br />

• SA Connect Phase 1B, broadband expansion.<br />

Richards Bay SEZ.<br />

The two central planks of the <strong>South</strong> <strong>African</strong><br />

government’s post-Covid rebuilding<br />

programme are infrastructure and<br />

industrialisation.<br />

To promote and monitor the first priority, an<br />

Investment and Infrastructure Office has been<br />

created in the Presidency. It is headed by the<br />

former Gauteng MEC for Economic Development,<br />

Dr Kgosientso Ramokgopa. In 2020 national<br />

government gazetted 51 priority infrastructure<br />

projects, with a total investment value of more than<br />

R340-billion.<br />

Sectors targeted for intervention include energy,<br />

housing, transport, water and sanitation, agriculture,<br />

agro-processing and digital infrastructure. Some<br />

of the “special projects” that fall outside sector<br />

categories include:<br />

• Rural pedestrian bridges and rural roads.<br />

• Energy and water savings on government<br />

buildings.<br />

• Digitising of government information: 10 000<br />

A reconstituted Council of the Presidential<br />

Infrastructure Coordinating Commission met<br />

for the first time in July 2020. With President<br />

Cyril Ramaphosa in the chair, the commission<br />

includes national ministers, provincial premiers,<br />

mayors of big cities and representatives of the<br />

<strong>South</strong> <strong>African</strong> Local Government Association.<br />

Where the council intends doing things<br />

differently is by paying close attention to:<br />

• Preventing corruption through transparent<br />

tender processes and strong due diligence.<br />

• Community involvement in planning and<br />

implementation.<br />

• Emphasis on local employment and procurement<br />

and targeted involvement of SMMEs.<br />

• Blended financing through the Infrastructure<br />

Fund to mobilise more resources from the<br />

private sector, multilateral development banks<br />

and development finance institutions.<br />

A World Bank report has shown that a 10%<br />

increase in infrastructure spending results in a<br />

1% growth in GDP. A study carried out by KMPG<br />

for the Gauteng Province found that spending<br />

on infrastructure resulted in additional economic<br />

activity worth R26-billion in the province and<br />

created 92 000 direct jobs.<br />

In the country’s biggest province in<br />

terms of economic activity, the Provincial<br />

Government of Gauteng spent R30-billion on<br />

infrastructure between 2013 and 2016. The<br />

Gauteng Infrastructure Master Plan is expected<br />

to account for expenditure of about R1.8-trillion<br />

over a 15-year period.<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



Special Economic Zones<br />

A key component of the strategy to boost the value<br />

of the country’s products is to develop infrastructure<br />

where manufacturing can take place, namely<br />

Special Economic Zones (SEZs) and industrial parks.<br />

Each province has been allocated SEZs that<br />

play to regional strengths. Described as “major<br />

catalytic projects” for the northern province of<br />

Limpopo, the Musina-Makhado SEZ (MMSEZ), the<br />

proposed Tubatse SEZ and several industrial parks<br />

are central to the strategy of expanding Limpopo’s<br />

manufacturing capacity.<br />

As of February 2020, Shaanxi CEI Investment<br />

Holdings had committed to a $5-billion investment<br />

in a vanadium and titanium smelter project at<br />

the MMSEZ and a further $1.1-billion had been<br />

pledged from other sources. The first-phase focus<br />

is on energy and metallurgical processes but agroprocessing,<br />

logistics and general manufacturing are<br />

expected to follow.<br />

In the Pretoria area, already home to several<br />

Original Equipment Manufacturers (OEMs), the<br />

Tshwane Automotive Special Economic Zone<br />

(TASEZ) has been launched. It is a joint project of<br />

the Gauteng Province, the Department of Trade,<br />

Industry and Competition, and the City of Tshwane.<br />

The implementing agent is the Coega Development<br />

Corporation (CDC), the developer and operator of<br />

the Coega Special Economic Zone (SEZ).<br />

The Coega SEZ is at the Port of Ngqura near Port<br />

Elizabeth and it too has an automotive component,<br />

recently strengthened by the large investment of<br />

the Beijing International Automobile Corporation<br />

(BIAC). East London’s Industrial Development<br />

Zone (ELIDZ) has many companies that sell to and<br />

service the nearby Mercedes-Benz plant while both<br />

coastal SEZs have a strong suite in logistics and are<br />

planning expanded aquaculture parks.<br />

Energy is a key infrastructural requirement for<br />

the growth of any economy, and SEZs are playing<br />

a role. The Coega SEZ has been named as the site<br />

for one of two liquefied natural gas (LNG) plants to<br />

be built (if partners can be found) in terms of the<br />

national gas-to-power plan.<br />

The Richards Bay Industrial Development<br />

Zone (RBIDZ) in KwaZulu-Natal is the other site<br />

Gauteng Premier David Makhura visited the Nissan<br />

plant at Rosslyn in 2020.<br />

designated for an LNG plant, with the capacity<br />

planned for 2 000MW. RBIDZ is also the location<br />

of a new biomass plant.<br />

The OR Tambo SEZ in Gauteng underscores<br />

Ekurhuleni’s strengths in manufacturing and<br />

logistics. The OR Tambo SEZ has launched the<br />

biggest food processing operation in the southern<br />

hemisphere (and the world’s second-largest<br />

refrigeration plant). With a special focus on exportoriented<br />

value-added industry, the OR Tambo SEZ<br />

leverages its connection to the country’s busiest<br />

airport. The focus of this SEZ is on agro-processing,<br />

jewellery manufacturing and mineral beneficiation<br />

as well as the development of hydrogen fuel cell<br />

technology. The SEZ is a subsidiary of the Gauteng<br />

Growth and Development Agency (GGDA).<br />

Two of the largest infrastructure projects in<br />

<strong>South</strong> Africa’s history have unfortunately been<br />

delayed and are running over budget. National utility<br />

Eskom set out to build two huge power stations in<br />

Mpumalanga (Kusile) and Limpopo (Medupi). Both<br />

are near existing power stations and should have a<br />

stable supply of coal.<br />

Eskom committed to completing Medupi in<br />

2020 and intends finishing Kusile by 2023. Medupi<br />

will be able to feed 4 764MW into the <strong>South</strong> <strong>African</strong><br />

power grid when in full commission. Kusile will have<br />

a capacity of 4 800MW and will be the fourth-largest<br />

coal-fired power station in the world. It will also the<br />

first in <strong>South</strong> Africa to use flue-gas desulphurisation<br />

(FGD), a technology that removes oxides of sulphur,<br />

such as sulphur dioxide, from exhaust flue gases. ■<br />

23 SOUTH AFRICAN BUSINESS <strong>2021</strong>

FOCUS<br />

Ready to get behind government’s<br />

ambitious infrastructure programme<br />

Jason Lightfoot, Portfolio Manager at Futuregrowth, explains how private capital<br />

can be mobilised to support infrastructure projects.<br />

In a world in which the government and central<br />

bank have several means available to stimulate<br />

the economy, infrastructure spend is a powerful<br />

anti-recessionary fiscal policy tool.<br />

However, in <strong>South</strong> Africa economic growth has<br />

been constrained by lower levels of investment in<br />

infrastructure than in other developing economies,<br />

which has been exacerbated by specific issues<br />

such as ageing infrastructure and infrastructure<br />

bottlenecks. The Covid-19 crisis and the fiscal<br />

support needed to alleviate the damage done<br />

to businesses and the most vulnerable citizens<br />

as a result of the lockdown could also put the<br />

government’s future infrastructure ambitions at risk.<br />

The extent of infrastructure spending in an<br />

economy is reflected in the level of gross fixed<br />

capital formation (GFCF) as a percentage of<br />

Gross Domestic Product (GDP). The measure<br />

captures how much money as a proportion of<br />

total economic activity is being invested in capital<br />

goods, such as equipment, tools, transportation<br />

assets and electricity and various measurable<br />

outputs of these.<br />

<strong>South</strong> Africa’s reported GFCF has been<br />

historically low, with the exception of the build-up<br />

to the FIFA World Cup in 2010. Latest statistics show<br />

GFCF as a percentage of GDP was 18.19% in 2019,<br />

which is considered far too low for a developing<br />

economy. Several studies consider an acceptable<br />

norm to be in the region of 30% to 35% of GDP.<br />

<strong>South</strong> Africa’s GFCF ratio also has some way<br />

to go before it will achieve the target in the<br />

government’s National Development Plan of<br />

30% by 2030. While assessing this, it is important<br />

to note that a country’s current debt level does<br />

have a bearing on its ability to fund infrastructure<br />

initiatives – and <strong>South</strong> Africa’s government<br />

debt burden doesn’t bode well for the country’s<br />

infrastructure funding capacity.<br />

When you include guarantees to State-Owned<br />

Enterprises (SOEs), the government’s debt-to-<br />

GDP ratio is expected to rise to well above 100%<br />

compared to the average emerging market level<br />

of around 45%. A debt-to-GDP level of more than<br />

twice as large as the average emerging market<br />

means that the <strong>South</strong> <strong>African</strong> government will have<br />

very little scope to fund large-scale infrastructure<br />

and developmental initiatives and thus the burden<br />

will fall elsewhere.<br />

Although there are historical reasons for this high<br />

debt-to-GDP burden, the government’s finances<br />

have also been stretched by the social and<br />

economic measures it has needed to put in place<br />

to alleviate the economic fallout from Covid-19.<br />

A fiscal rescue package of R500-billion will add<br />

to the already high debt burden and economic<br />

lockdowns have already resulted in lower levels of<br />

revenue generation, putting the government in a<br />

difficult position fiscally.<br />

If the environment is right, private investors<br />

are ready<br />

Banks, as well institutional investors, are no<br />

strangers to fulfilling a funding role but have<br />

become more apprehensive about doing so,<br />

given the government’s governance, financial and<br />

operational SOE failures.<br />

While the various developmental finance<br />

institutions need to fulfil a specific role when it<br />

comes to industrial policy, economic development<br />

and providing credit-enhancing capital, capital<br />

market players need to have confidence that<br />

the policy environment will remain stable and<br />

that potential investments will offer sufficiently<br />

attractive risk-related returns.<br />

To a great extent, the Renewable Energy<br />

Independent Power Producer Procurement<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

24 42

FOCUS<br />

Programme (REIPPPP) met these criteria, enabling<br />

the private sector to play an important role,<br />

committing about R200-billion to the programme<br />

to date. REIPPPP is seen as an important success<br />

story, particularly in respect of the impressive<br />

implementation role that the Independent Power<br />

Producers Office played in that programme.<br />

Unfortunately, the success of this programme<br />

has not been emulated in other sectors<br />

and there hasn’t been a coordinated approach<br />

to address the other necessary infrastructure<br />

investments until now. That may change with the<br />

Investment and Infrastructure Office set up by<br />

President Cyril Ramaphosa. The government<br />

gauged private sector investment appetite<br />

recently when it presented various project<br />

pitches for various sectors deemed a priority<br />

to the broader market, as a precursor to<br />

the inaugural Sustainable Infrastructure<br />

Development Symposium of <strong>South</strong><br />

Africa (SIDSSA). Sectors the government<br />

has identified as in need of infrastructure<br />

investment include energy, digital<br />

infrastructure, water and sanitation, human<br />

settlement, agriculture and transport.<br />

The government’s latest engagement<br />

with the private sector is a step in the right<br />

direction. It crowds in potential private sector<br />

investors in a much more coordinated manner<br />

and includes them in assessing how these various<br />

initiatives can be funded.<br />

It is encouraging that the government is<br />

engaging with capital market participants during<br />

the conceptual stage of some of these projects<br />

because it will allow concerns to be addressed<br />

earlier and thereby potentially ensure a much<br />

higher success rate.<br />

Breaking out of SA’s low-growth trap<br />

Although the range of projects is wide, there are<br />

several significant ones that could change the<br />

<strong>South</strong> <strong>African</strong> landscape to the benefit of all. From<br />

a digital perspective, infrastructure investment<br />

in broadband fibre connectivity could provide<br />

peri-urban (townships) and rural communities,<br />

which have been traditionally underserviced, with<br />

affordable access to broadband connectivity.<br />

The infrastructure initiatives under consideration<br />

could be important contributors to<br />

getting <strong>South</strong> Africa out of its current low-growth<br />

trap. Although the estimated R1.5-trillion needed<br />

to fund the projects over the next decade is a tall<br />

ask, the private sector is ready to fund them as<br />

long as they are well structured and managed,<br />

that investors are compensated for the risks that<br />

they are taking and that they ultimately have<br />

policy certainty.<br />

Futuregrowth is an investor in the Khobab Wind Farm.<br />

Futuregrowth<br />

Futuregrowth has been a long-standing<br />

institutional investment partner in infrastructure<br />

and developmental finance, funding projects for<br />

close on 24 years. It manages the largest debt<br />

fund of this nature in Sub-Saharan Africa, the<br />

Futuregrowth Infrastructure and Development<br />

Bond Fund, which has a market value of more<br />

than R15-billion. It has funded various transactions<br />

over the last two decades to the benefit of all<br />

<strong>South</strong> <strong>African</strong>s – and will continue investing in<br />

projects that provide the impetus the domestic<br />

economy needs to lift its economic growth rate to<br />

sustainable levels in the future, while earning riskadjusted<br />

returns. ■<br />


43 SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

25 SOUTH AFRICAN BUSINESS <strong>2021</strong>

FOCUS<br />

The game-changer:<br />

Musina-Makhado<br />

Special Economic Zone<br />

Revitalising the Limpopo economy through industrialisation.<br />

The Economic Reconstruction and Recovery<br />

Plan outlines immediate actions to rebuild<br />

the national economy and to provide<br />

jobs and relief to the <strong>South</strong> <strong>African</strong> people.<br />

These actions include an aggressive infrastructure<br />

programme, far-reaching reforms to increase our<br />

competitiveness and inclusiveness, measures to<br />

catalyse industrialisation, relief for vulnerable<br />

households and individuals, and a public investment<br />

in employment programmes. This plan is a<br />

response to a severe economic contraction unlike<br />

any we have experienced in recent memory. <strong>South</strong><br />

Africa is not alone in experiencing an economic<br />

crisis of this depth and extent. Unemployment has<br />

risen across the world and nearly every economy<br />

has shrunk. As President Cyril Ramaphosa has noted,<br />

“It is true that the measures that were necessary<br />

to delay the spread of the virus and prevent deaths<br />

led to a sharp decline in economic activity.”<br />

The strategic geographic location of the<br />

Musina‐Makhado Special Economic Zone (MMSEZ)<br />

and its close proximity to the main land‐based<br />

route into SADC and the <strong>African</strong> continent,<br />

together with supporting incentives and a good<br />

logistics backbone, will make it the location of<br />

choice for investment in mineral beneficiation,<br />

agro‐processing industries, manufacturing and<br />

logistics. This will provide job opportunities to the<br />

people of Limpopo province currently in need of<br />

jobs and skills development. The establishment of<br />

the metallurgical cluster in close proximity to the<br />

source of raw materials, along with a logistics hub<br />

in the SEZ with access to markets, presents unique<br />

opportunities for mineral beneficiation, which is a<br />

key priority of national government.<br />

Genesis of the MMSEZ<br />

Following the enactment of the Special Economic<br />

Zones Act, the Limpopo provincial government<br />

submitted a comprehensive proposal on strategic<br />

areas for consideration to develop the province’s<br />

economy through industrialisation to the<br />

Department of Trade, Industry and Competition<br />

(dtic). The dtic designated the MMSEZ, which has<br />

become the flagship of the provincial government.<br />

Subsequently, the Musina-Makhado State Owned<br />

Company (SOC), a subsidiary of the Limpopo<br />

Economic Development Agency was established.<br />

This entity is tasked with the responsibility of<br />

facilitating and managing the planning and<br />

development of the MMSEZ.<br />

MMSEZ business case<br />

The essence behind the creation of the MMSEZ<br />

is the establishment of a new industrial hub in<br />

the Vhembe District Municipality, which forms<br />

part of the Trans‐Limpopo Spatial Development<br />

Initiative, situated at two locations, Makhado and<br />

Musina, each with its own unique industrial focus.<br />

The energy and metallurgical cluster (power plant,<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

26<br />


FOCUS<br />

LEDET MEC Thabo Mokone, MMSEZ Executive<br />

Manager: Investment Promotion Richard Zitha and<br />

MMSEZ CEO Lehlogonolo Masoga.<br />

steel plant, stainless steel plant, coking plant, pig<br />

iron plant, ferromanganese plant, ferrochrome<br />

plant, chrome plating, lime plant, ferromanganese,<br />

silicon-manganese and calcium carbide plants and<br />

vanadium-titanium magnetite plant) is located on<br />

the Makhado side and the Northern Site in Musina<br />

is focussing on general manufacturing, agroprocessing<br />

and logistics.<br />

“The MMSEZ has positioned itself as a<br />

platform to revitalise the Limpopo economy<br />

through industrialisation. Our focus is to generate<br />

much-needed base-load electricity, establish a<br />

metallurgical complex, develop a manufacturing<br />

hub, enhance agro-processing and to develop a<br />

regional logistics centre. The close proximity of<br />

chain. The beauty of the MMSEZ lies in the<br />

diversity of opportunities across sectors both at<br />

the downstream and upstream with backward and<br />

forward linkages. The North-<strong>South</strong> Corridor makes<br />

the Musina-Makhado location a strategic passage<br />

for trade between <strong>South</strong> Africa and the rest of the<br />

Artistic Impression of the MMSEZ.<br />

the Beit Bridge border post and the abundance of<br />

mineral and agricultural resources gives the MMSEZ<br />

a competitive advantage,” says Lehlogonolo<br />

Masoga, MMSEZ Chief Executive Officer.<br />

The MMSEZ SOC has another critical<br />

responsibility of attracting and mobilising both<br />

domestic and foreign direct investment in the<br />

identified industrial activities across the value<br />

SADC region and the <strong>African</strong> continent, further<br />

given impetus by the Africa Continental Free Trade<br />

Agreement. Limpopo Province has always enjoyed<br />

a niche of being a gateway to the rest of Africa<br />

as a home to one of the busiest ports of entry,<br />

Beit Bridge Border Post. The development of the<br />

MMSEZ becomes an ideal platform to cement this<br />

strategic socio-economic position of the province.<br />

25 27 SOUTH SOUTH AFRICAN BUSINESS 2020/21 <strong>2021</strong>

FOCUS<br />

Agro-processing potential<br />

Vhembe Region is the food basket of Limpopo<br />

province as it is endowed with various agricultural<br />

resources. some of which are sought after<br />

in lucrative world markets. Exotic fruits and<br />

vegetables are available in abundance, which<br />

creates a viable potential for agro-processing of<br />

value-added products for domestic consumption<br />

and export markets. Food production has over<br />

the years become a multi-billion industry that<br />

requires the creativity of entrepreneurs to exploit.<br />

Complemented by logistics support, the agroprocessing<br />

cluster of the MMSEZ is destined to<br />

become a big success over the next few years.<br />

Various opportunities exist within the agroprocessing<br />

cluster such as food processing,<br />

fresh-produce handling, dry-fruits packaging,<br />

food canning, timber processing, furniture<br />

manufacturing, etc.<br />

Manufacturing within the automotive sector<br />

<strong>South</strong> Africa has established itself as the<br />

powerhouse of the automotive industry in<br />

Sub-Saharan Africa. Over 10% of the vehicles<br />

manufactured in <strong>South</strong> Africa are supplied by<br />

road via the Beit Bridge Border post to markets<br />

to the north of <strong>South</strong> Africa in the SADC region.<br />

This window of opportunity makes the MMSEZ<br />

an ideal location for various opportunities across<br />

the automotive sector value chain such as vehicles<br />

and components manufacturing, storage and<br />

distribution hub, after-care products distribution<br />

hub, tyre manufacturing and distribution hub,<br />

etc. The manufacturing cluster of the MMSEZ will<br />

provide a platform for various Original Equipment<br />

Manufacturers to manufacture products in<br />

the SEZ for both domestic consumption and<br />

export markets in Africa and beyond. A strategic<br />

opportunity exists for manufacturers of products<br />

such as fertilisers, agro-chemicals, industrial<br />

chemicals, steel fabrication, etc.<br />

Sustainable development<br />

The <strong>South</strong> <strong>African</strong> Constitution enjoins us to pursue<br />

economic development in a sustainable manner<br />

and preserve the environment for the benefit of<br />

current and future generations. Section 24 states<br />

that everyone has the right to an environment that<br />

is not harmful to their health or well‐being and to<br />

have the environment protected for the benefit of<br />

present and future generations, through reasonable<br />

legislative and other measures, that prevents<br />

pollution and ecological degradation, promotes<br />

conservation and secures ecologically sustainable<br />

development and the use of natural resources<br />

while promoting justifiable economic and social<br />

development. This constitutional provision is<br />

supported by the National Environmental Act<br />

(NEMA) which provides that negative impacts on<br />

the environment and on people’s environmental<br />

rights must be anticipated and prevented, and<br />

where they cannot be altogether prevented, are<br />

minimised and remedied.<br />

Our country aspires to be a sustainable,<br />

economically prosperous and self‐reliant nation<br />

state that safeguards its democracy by meeting<br />

the fundamental human needs of its people,<br />

managing its limited ecological resources<br />

responsibly for current and future generations, and<br />

by advancing efficient and effective integrated<br />

planning and governance through national,<br />

MEC of Limpopo Economic Development Environment<br />

and Tourism, Thabo Mokone (left) and MMSEZ<br />

CEO Lehlogonolo Masoga at the launch of the MMSEZ<br />

Corporate Identity. Credit: MMSEZ<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

28<br />


FOCUS<br />

Artistic Impression of the MMSEZ.<br />

regional and global collaboration. Our application<br />

for the environmental impact assessment<br />

(EIA) was guided by the above fundamental<br />

values, principles, directives and the entity’s<br />

environmental, social and governance (ESG)<br />

policy provisions. We recognise that sustainable<br />

development and sustainable use and exploitation<br />

of natural resources are at the core of the<br />

protection of the environment.<br />

The months of September and October 2020<br />

were dedicated to a public consultation process<br />

for the EIA application for the <strong>South</strong> site, energy<br />

and metallurgical cluster. The outcome of the EIA<br />

process indicated that the benefits of the MMSEZ<br />

will potentially promote justifiable economic and<br />

social development although a negative impact<br />

upon the environment will become inevitable.<br />

The ultimate goal of the EIA process is to protect<br />

ecologically sensitive areas and support sustainable<br />

development and the use of natural resources,<br />

whilst promoting justifiable socio-economic<br />

development in the location of the project. In our<br />

endeavour to ensure the effective implementation<br />

of the mitigation and management actions,<br />

an environmental management plan has been<br />

developed to provide mitigation measures<br />

necessary to ensure that the project is planned,<br />

constructed, operated, and decommissioned in an<br />

environmentally responsible manner.<br />

The Draft EIA Report identified and assessed<br />

all the potential impacts of the project as well<br />

as the proposed mitigation measures and<br />

management actions. Various specialist studies<br />

have been conducted beyond the approved<br />

EIA scoping report which included the aquatic<br />

impact assessment, ecological impact assessment,<br />

heritage impact assessment, palaeontology /<br />

archaeology impact assessment, soil and land<br />

capability assessment, visual impact assessment,<br />

climate change assessment, air quality assessment,<br />

socio-economic assessment, noise impact<br />

assessment, health impact assessment, traffic<br />

impact assessment, water assessment, high-level<br />

energy study, economic analysis, biodiversity<br />

study, biodiversity offset study, biodiversity offset<br />

strategy, waste impact assessment, town-planning<br />

29 27 SOUTH SOUTH AFRICAN BUSINESS 2020/21 <strong>2021</strong>

FOCUS<br />

Artistic Impression of the MMSEZ.<br />

impact assessment, tourism and food<br />

security study, security of water study,<br />

energy requirement study and energy<br />

generation technology options.<br />

Integrating SMMEs within<br />

the SEZ<br />

Special Economic Zones are<br />

predisposed to attract foreign direct<br />

investment which could translate into<br />

blue-chip international enterprises<br />

locating in the zone. Although it is a<br />

good thing to attract international<br />

companies to locate in the SEZ,<br />

this should not happen at the<br />

expense of local enterprises. Skills<br />

and technology transfer forms an<br />

integral part of the essence of the SEZ<br />

phenomena. In the MMSEZ, SMME<br />

promotion and integration is inherent<br />

to the business model. An instrument<br />

has been developed in the form of<br />

an Enterprise Development Strategy<br />

to mainstream SMMEs development<br />

into the life cycle of the MMSEZ.<br />

The strategy is supported by an<br />

ambitious programme to develop<br />

an SMME Incubation Centre as<br />

a platform for entrepreneurship<br />

excellence, creativity and skills and<br />

technology localisation.<br />

The MMSEZ is partnering with<br />

the Department of Small <strong>Business</strong><br />

Development to roll out this magnificent<br />

initiative. During the month<br />

of October 2020, a Memorandum<br />

of Agreement was concluded with<br />

the Council for Scientific and Industrial<br />

Research (CSIR) to collaborate<br />

on supporting SMMEs in the<br />

MMSEZ and ensuring technology<br />

localisation through various initiatives<br />

across sectors.<br />

Lehlogonolo Masoga<br />

has been a driving force<br />

behind the development<br />

of the MMSEZ.<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

30<br />


FOCUS<br />

Developing small towns into cities<br />

The MEC of Limpopo Economic<br />

Development Environment and Tourism<br />

(LEDET), Thabo Mokone, stated on the<br />

occasion of the launch of the MMSEZ<br />

Corporate Identity, “We are pleased that<br />

finally the province has established a<br />

capable and agile entity seized with a<br />

mandate to implement the MMSEZ.<br />

Our ambition is not just to build an<br />

industrial park but rather to use the SEZ<br />

as a catalyst to unlock a plethora of other<br />

economic opportunities, including the<br />

potential of realising a new Smart City in<br />

our province.” It is our anticipation that<br />

the MMSEZ as a mega-industrial project<br />

will transform the spatial configuration of<br />

the two towns of Musina and Makhado.<br />

According to the external masterplan<br />

report, the two towns requires an<br />

investment of R133-billion in socioeconomic<br />

infrastructure such as roads,<br />

rail, human settlement, schools, health<br />

facilities, ICT infrastructure, airport,<br />

electricity, water and sewerage.<br />

Catalytic projects such as the envisaged<br />

High-Speed Rail Project connecting Johannesburg<br />

and Musina will add the much-desired impetus<br />

of engendering the creation of a new smart city.<br />

The province is currently developing a model<br />

for a new smart city based on the principles of<br />

smart economy, smart mobility, smart housing,<br />

smart environment, smart governance, artificial<br />

intelligence and the internet-of-things. With the<br />

creation of opportunities for local people to earn a<br />

decent income, entrepreneurs to create wealth and<br />

investment in socio-economic infrastructure, such<br />

conditions will lay a solid base for the new smart<br />

city to take shape.<br />

Investment opportunities outside the zone<br />

SEZ projects are by their nature catalytic. They<br />

stimulate growth and development which is felt<br />

outside the delimited geographic space. In Musina<br />

and Makhado towns various stimulus packages<br />

have been identified as investment opportunities<br />

for the private sector outside the confinement of<br />

the SEZ spaces. Among such opportunities are<br />

the new Musina Dam, High Speed Rail Project,<br />

Manaledzi Mega Housing Project in Makhado,<br />

Musina Airport, MMSEZ human settlement, private<br />

hospital, private schools and training centres, retail<br />

property and hotels.<br />

The launch of the MMSEZ Corporate Identity.<br />

It is for this reason, among others, that the<br />

Musina-Makhado Special Economic Zone is “a<br />

world of game-changing opportunities”. ■<br />



29 Market Street,<br />

Polokwane,<br />

Limpopo Province (RSA)<br />

www.mmsez.co.za<br />


Marketing and<br />

Communication Manager<br />

Tel: +27(0) 15 295 5120<br />

Cell: +27 (0)66 173 8957<br />

Shavana.Mushwana@lieda.co.z<br />


Executive Manager:<br />

Investment Promotion<br />

Tel: +27(0) 15 295 5120<br />

Cell: +27 (0)71 391 8188<br />

Richard.Zitha@lieda.co.za<br />

29 31 SOUTH SOUTH AFRICAN AFRICAN BUSINESS 2020/21 <strong>2021</strong>


The Maritime Economy offers<br />

blue water opportunities<br />

Contribution to GDP could rise to R177-billion by 2033.<br />

Richards Bay is the site of <strong>South</strong> Africa’s largest coal export terminal.<br />

Rarely does a country have an opportunity<br />

to start a new sector from scratch, let<br />

alone two. When the Renewable Energy<br />

Independent Power Producer Procurement<br />

Programme (REIPPPP) began in 2011 to find new<br />

sources of electricity, a strong new economic<br />

sector came into being.<br />

In eight years, investment totalling R209.4-billion<br />

was committed to the energy programme by local<br />

and foreign entities. If anything, the potential of the<br />

Maritime Economy, sometimes called the Oceans or<br />

the Blue Economy, is even greater.<br />

The anticipated numbers are impressive. The<br />

share of the Maritime Economy to <strong>South</strong> Africa’s<br />

gross domestic product (GDP) will by 2033 grow by<br />

upwards of 250% (and perhaps as much as 350%)<br />

compared to its current value, to a figure between<br />

R129-billion and R177-billion. A million new jobs are<br />

expected to be created.<br />

In every field <strong>South</strong> Africa either has existing<br />

infrastructure or is in the process of creating or reviving<br />

it: ship-building and repairs, oil rig maintenance, oil<br />

and gas operations, port operations, logistics, marine<br />

engineering and bunkering.<br />

<strong>South</strong> Africa’s eight ports are run by the stateowned<br />

group Transnet, which has a strategic plan for<br />

each port to focus on its strengths. Transnet spent<br />

R2.5-billion on new port equipment in 2019/20.<br />

On the west coast, Saldanha is the main<br />

port for the export of iron ore. Large industrial<br />

operations already exist and the Saldanha Bay<br />

Industrial Development Zone (SBIDZ) is set to<br />

become a hub for maritime repair activities and oil<br />

rig maintenance and repair.<br />

About 1 800km to the east and five degrees<br />

further north, Richards Bay Coal Terminal (RBCT)<br />

is <strong>South</strong> Africa’s primary export portal. Although<br />

volumes dipped somewhat to 72.1-million tons<br />

in 2019, the fact remains that the infrastructure<br />

is in place to support expansion of aspects of the<br />

Maritime Economy through the Richards Bay Special<br />

Economic Zone (RBSEZ).<br />

Sectors under investigation include alternative<br />

energy generation and opportunities in the gas<br />

sector. A feasibility study is being done on a gas-topower<br />

plant and a large liquid petroleum gas import<br />

and storage terminal was recently built for Petredec<br />

by Bidvest Tank Terminals.<br />

Saldanha Bay can offload Very Large Crude<br />

Carriers as can the Port of Durban, which is Africa’s<br />

busiest port. Durban handled more than 81-million<br />

tons of cargo in 2019, which included 2.84-million<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



TEUs (twenty-foot container equivalent). The<br />

Durban Car Terminal handled 521 280 vehicles<br />

(Africa Ports & Ships). Durban is responsible for<br />

about 60% of the total volume of containers<br />

handled by the country’s ports.<br />

The Port of Durban is home to many maritime<br />

companies. EBH SA has been in marine engineering<br />

and ship repair since it began as Elgin Brown and<br />

Hamer in 1878. Three <strong>South</strong> <strong>African</strong> shipbuilders<br />

(SAS, Damen Shipyards Cape Town and Nautic<br />

Africa) have agreed to pool resources on contracts<br />

to become more competitive.<br />

The KwaZulu Cruise Terminal (KCT) consortium<br />

won the contract from TNPA to finance, build and<br />

run the new Durban Cruise Terminal.<br />

The Port of Cape Town has also launched a<br />

dedicated cruise-ship terminal. A renewed focus<br />

on ship repair through facilities such as the Sturrock<br />

and Robinson drydocks is on the cards for the Port<br />

of Cape Town, which has a diverse offering through<br />

its Container Terminal, Multipurpose Terminal,<br />

Liquid Bulk Terminal and Fresh Produce Terminal.<br />

Drilling off the southern coast has revealed vast<br />

resources in the Brulpadda field in the <strong>South</strong>ern<br />

Outeniqua Basin. If some of this gas can be recovered,<br />

the two SEZs on the Eastern Cape coast would<br />

become critical to its utilisation. The Port of East<br />

London is aligned to the East London Industrial<br />

Development Zone while Port Elizabeth has two ports,<br />

the city port being joined by the Port of Ngqura which<br />

anchors the Coega Special Economic Zone.<br />

R700-million have been made. The Coega Special<br />

Economic Zone is planning a 440ha Aquaculture<br />

Development Zone to accommodate new<br />

projects. One possibility is to promote import<br />

substitution, for example, with salmon, of which<br />

<strong>South</strong> Africa currently imports more than 5 000<br />

tons every year.<br />

The allocation of commercial fishing rights in<br />

12 sectors that was due to happen in 2020 has<br />

been postponed to December <strong>2021</strong>. It is likely<br />

that the quotas of larger fishing companies will be<br />

reduced in favour of small-scale fishing companies.<br />

There have been several changes in ownership<br />

in the fishing industry, most likely linked to the<br />

upcoming determination of new fishing rights<br />

in which black shareholding will be a factor. The<br />

acquisition by black-controlled Sea Harvest Group<br />

of Viking Fishing is part of a larger trend.<br />

Tiger Brands has unbundled its 42% stake<br />

in Oceana Group. Oceana holds the popular<br />

pilchards brand Lucky Star, which enjoys 80% of<br />

market share in <strong>South</strong> Africa, and has the highest<br />

market value of fishing companies in <strong>South</strong><br />

Africa. The Oceana Group recently purchased<br />

Foodcorp’s fishing rights and a US fishmeal and<br />

oil company, Daybrook. ■<br />

Fishing<br />

<strong>South</strong> Africa has 3 000km of coastline and the extent<br />

of the country’s territorial waters is greater than its<br />

land size. About half of the fish that <strong>South</strong> <strong>African</strong>s<br />

eat is caught locally, and almost all of that comes<br />

from the waters off the Western Cape. The two most<br />

popular types of fish are hake and sardines, which<br />

are harvested by deep-sea trawlers.<br />

The fishing industry earns R3.4-billion in foreign<br />

earnings annually and employs 26 500 people<br />

across 22 sectors, the main ones being deep-sea<br />

trawling and aquaculture (JSE).<br />

The aquaculture industry is currently small, but<br />

since 2014 investment commitments of about<br />

Work underway at Durban’s drydock facilities.<br />

33 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Now more than ever before the Oceans Economy will be one of the key<br />

pillars on which the <strong>South</strong> <strong>African</strong> economy of the future will be rebuilt.<br />

The Ocean, or Oceans Economy,<br />

is positioned within the <strong>South</strong><br />

<strong>African</strong> Government’s National<br />

Development Plan (NDP) as a<br />

key driver of economic activity and<br />

growth which will help eliminate<br />

widespread poverty and inequality<br />

by 2030.<br />

As Africa’s largest fishing company,<br />

and home to the <strong>South</strong> Africa’s<br />

iconic brand, Lucky Star, Oceana<br />

is focused on protecting the<br />

integrity of the country’s marine<br />

ecosystems, promoting sustainable<br />

employment opportunities, and<br />

contributing to the country’s food<br />

security.<br />

Oceana believes that <strong>South</strong> Africa’s<br />

more than 3 000km of coastline<br />

along a major international<br />

strategic shipping route presents<br />

the perfect platform for sustainable<br />

and long-term usage of our oceans<br />

and coastline for responsible<br />

growth and development and<br />

shared prosperity.<br />

A sustainable oceans economy<br />

incorporating both the traditional<br />

and newer industries such as<br />

fishing and maritime transport,<br />

allied to newer sectors such as<br />

marine tourism, renewable energy,<br />

aquaculture and marine<br />

biotechnology, have the potential<br />

to meet the needs of all peoples,<br />

particularly those who make up<br />

rural coastal communities who<br />

have borne the brunt of poverty.<br />

From humble beginnings in the<br />

tiny West Coast fishing village of<br />

Lamberts Bay when the Lamberts<br />

Bay Canning Company Ltd was<br />

established in 1918, Oceana has<br />

over the course of the last century<br />

grown to be a leading global fish<br />

protein company and Africa’s<br />

largest fishing company. Oceana<br />

is ranked among the top 5 most<br />

empowered companies on the<br />

Johannesburg Stock Exchange and<br />

listed on the Namibian Stock<br />

Exchange as well.<br />

The Group operates in <strong>South</strong><br />

Africa, Namibia and the<br />

USA and markets fish-based<br />

products in 46 countries<br />

across the world.<br />

The fishing industry estimates that<br />

it accounts for 20 000 direct jobs<br />

and a further 60 000 indirect jobs<br />

across the economy in <strong>South</strong><br />

Africa, where the Group continues<br />

to drive economic empowerment,<br />

real transformation and<br />

environmental stewardship for<br />

current as well as future<br />

generations.<br />

Government launched Operation<br />

Phakisa (“hurry up” in Sesotho)<br />

in mid-2014 to spur sustainable<br />

economic growth across key areas<br />

in a bid to address poverty,<br />

inequality and unemployment.<br />

The Oceans Economy was one of<br />

seven targeted sectors, and listed<br />

six priority areas including offshore<br />

Oil & Gas, Aquaculture, the<br />

further development of Small<br />

Harbours, Coastal and Marine<br />

Tourism, Marine Transport and<br />

Manufacturing & Marine<br />

Protection Services & Ocean<br />

Governance.<br />

The fishing sector was not included<br />

as one of the key priority areas<br />

under the Oceans Economy despite<br />

its significant socio-economic<br />

contribution which is estimated<br />

at over R14 billion a year.<br />

The fishing sector is far more<br />

established than some of the newer<br />

maritime industries punted under<br />

Operation Phakisa but this does<br />

not mean that fishing is not a key<br />

contributor and enabler to<br />

national imperatives of economic<br />

growth, job retention and creation,<br />

and sustainable economic<br />

development, particularly in

coastal areas and communities<br />

where unemployment and<br />

underdevelopment are chronic<br />

issues.<br />

The commercial fishing sector,<br />

of which Oceana is an important<br />

stakeholder, makes a socioeconomic<br />

contribution of Rl4.3<br />

billion per annum, employing in<br />

excess of 20 000 people directly<br />

and a further 60 000 indirectly,<br />

and has an annual spend of over<br />

Rl billion in developing and<br />

supporting around 2 000 SMMEs<br />

all across <strong>South</strong> Africa.<br />

The sector is also noted for its<br />

capital intensive nature and, as<br />

such, lists fleet and processing<br />

facilities valued at over R13,5<br />

billion, with further capital<br />

investments of R7,5 billion over<br />

the last 15 years.<br />

The sector furthermore can speak<br />

to demonstrable transformation,<br />

having moved from one of the<br />

most untransformed sectors into<br />

one of the most transformed.<br />

Under Apartheid only 1% of<br />

commercial fishing rights were<br />

held by black <strong>South</strong> <strong>African</strong>s,<br />

but black ownership has grown<br />

and has continued to rise, from<br />

35% in 2004 to over 75% currently.<br />

Oceana operates 11 factories<br />

across the world and also manages<br />

a fleet of 54 vessels and 8 cold<br />

storage facilities.<br />

The Oceana Group works hard<br />

to empower communities and<br />

contribute to environmental<br />

sustainability throughout all the<br />

communities in which the<br />

company operates.<br />

Oceana is also committed to<br />

job security, investing in skills<br />

development, and bringing new<br />

technologies to bear to support<br />

and uplift coastal communities.<br />

The Group is working hard to<br />

drive positive transformation<br />

in fishing to ensure that the small<br />

scale fishing sector participates<br />

in and contributes towards the<br />

broader economic development<br />

of <strong>South</strong> Africa by creating better<br />

job opportunities, shared<br />

prosperity and enabling sustainable<br />

development in coastal<br />

communities.<br />

While the commercial fishing<br />

industry is well transformed in<br />

terms of broad ownership, here<br />

is still a need for greater<br />

transformation at participation<br />

levels.<br />

Continuity through certainty and<br />

long-term stability provides the<br />

platform for significant further<br />

growth and economic<br />

development and it is imperative<br />

that all stakeholders work together<br />

with a unified sense of purpose.<br />

A fully transformed commercial<br />

fishing industry is key to unlocking<br />

economic development in <strong>South</strong><br />

Africa because the fishing value<br />

chain offers enormous<br />

opportunities for inclusive growth<br />

and employment and enterprise<br />

development in coastal<br />

communities.<br />

At Oceana, we believe that<br />

any company that is afforded<br />

the right to fish must prove<br />

their tangible commitment to<br />

converting these rights into<br />

broad-based social and<br />

economic benefits.<br />

This should at all times be done<br />

in a sustainable and inclusive<br />

manner. As such, the company<br />

launched the Oceana<br />

Empowerment Trust (OET) in<br />

2006 to unlock and convert the<br />

value of harvesting fishing rights<br />

into shared, broad-based value<br />

for eligible black <strong>South</strong> <strong>African</strong><br />

employees.<br />

The OET has a 10% shareholding<br />

in Oceana with a market value<br />

of almost Rl-billion, making the<br />

Trust the largest 100% black-owned<br />

fishing entity in <strong>South</strong> Africa in<br />

terms of ownership value.<br />

As of September 2019, 2 447<br />

beneficiaries had received over<br />

R400 million through the Trust,<br />

allowing them to become<br />

financially empowered and active<br />

participants in <strong>South</strong> Africa’s<br />

formal economy.<br />

The Oceana Group will also<br />

continue to play its part in skills<br />

development as it is vital for<br />

<strong>South</strong> Africa and the greater<br />

continent’s growth.<br />

Oceana’s interventions are<br />

premised on the fact that holistic<br />

skills development is central to<br />

enabling young people and women<br />

in particular to be active economic<br />

participants and not mere<br />

bystanders.<br />

Oceana recognises that the<br />

development of the small scale<br />

fishing sector and the enhancing<br />

of skills in this area is paramount<br />

to longer term success, to empower<br />

individuals and communities to<br />

participate to a greater degree in<br />

the formal economy, but crucially,<br />

also creating the opportunities<br />

and platforms to support and<br />

meet these ambitions.<br />

Communities need to move<br />

beyond just survival mode to a state<br />

where they are empowered enough<br />

to become agents of economic<br />

change, where dignity is restored<br />

and long-held dreams fulfilled.<br />

I am confident that we have a<br />

sustainability strategy that enables

us to convert fishing rights into<br />

shared value and continue to<br />

deliver social and environmental<br />

dividends to society.<br />

Areas of potential growth include<br />

marine science, engineering,<br />

vessel crewing, supply chain,<br />

artisans, food safety and supply<br />

of vessels and related equipment.<br />

Oceana invested R28.3 million<br />

in skills development in <strong>South</strong><br />

Africa and Namibia in 2019 and<br />

offered leamerships, internships<br />

and graduate programmes to<br />

empower the youth.<br />

A key part of the Oceana Group’s<br />

strategy in terms of empowerment<br />

and greater participation in the<br />

Oceans Economy is the Oceana<br />

Maritime Academy which will be<br />

launched and fully operational<br />

in the first quarter of <strong>2021</strong>.<br />

Oceana has launched this exciting<br />

initiative with an initial R40<br />

million capital investment and<br />

will spend R35 million a year on<br />

fishing sector skills and training<br />

with a particular focus on small<br />

scale fishers.<br />

The state-of-the-art facility in the<br />

Hout Bay harbour precinct is an<br />

investment in the future of the<br />

<strong>South</strong> <strong>African</strong> and international<br />

fishing industry, being the only<br />

academy in <strong>South</strong> Africa that<br />

focuses exclusively on the needs<br />

of the fishing industry, both small<br />

scale and commercial.<br />

Seeking to address the scarce and<br />

critical skills shortage in the<br />

industry, the Oceana Maritime<br />

Academy will offer world-class,<br />

accredited and industry relevant<br />

maritime skills and training that<br />

will provide the industry with new<br />

talent while enabling small scale<br />

fishers to fish more productively,<br />

profitably and sustainably.<br />

The Academy will draw attendees<br />

from the local Hout Bay<br />

community, the small scale fishing<br />

sector from all over <strong>South</strong> Africa,<br />

Oceana Group employees, as well<br />

as anyone interested in a career<br />

in the fishing industry, and offer<br />

training in a broad range of skills.<br />

This shared value initiative will<br />

not only strengthen the Oceana<br />

business and the talent pipeline<br />

pool for the entire industry, but<br />

will help build a stronger, more<br />

prosperous and equitable country.<br />

While Oceana’s strength lies in<br />

fishing, with its core business<br />

being the catching, procuring,<br />

processing, marketing and<br />

distribution of canned fish,<br />

fishmeal, fish oil, horse mackerel,<br />

hake, lobster & squid, the Group<br />

has a diversified portfolio of<br />

operations which extend to the<br />

provision of refrigerated<br />

warehouse facilities and logistical<br />

support.<br />

Oceana markets and sells close<br />

to 300,000 tons of fish and fish<br />

products in 46 countries in Africa,<br />

North America, Asia, Europe and<br />

Australia and as part of further<br />

diversification in the Blue<br />

Economy, is seeking to move into<br />

longer term sustainable fish supply<br />

in aquaculture.<br />

Oceana views the Oceans Economy<br />

as a key driver of sustainable<br />

economic growth, job creation<br />

and food security, yet the Group<br />

remains fully committed to<br />

protecting the integrity of the<br />

country’s marine ecosystems.<br />

Yet fishing is but one way in which<br />

the Oceana Group is seeking to<br />

empower the communities in<br />

which it operates.<br />

Through the Group’s flagship<br />

brand Lucky Star, the company<br />

has partnered with the West<br />

Coast <strong>Business</strong> Development<br />

Centre (WCBDC) to assist aspirant<br />

and existing business owners<br />

in the small West Coast towns<br />

of Laingville, Steenberg’s Cove,<br />

Stompneusbaai, Velddrif and<br />

Lamberts Bay.<br />

Lucky Star provided the WCBDC<br />

with the building to be able to<br />

provide its services to the St Helena<br />

Bay community, resulting in the<br />

WCBDC in 2019 assisting almost<br />

200 entrepreneurs with a variety<br />

of services.<br />

Oceana recognises that the Small<br />

and Medium-sized Enterprise<br />

(SME) sector will be one of the<br />

key drivers of economic growth<br />

and development and employment<br />

in years to come and therefore is<br />

an active enabler and supporter<br />

through initiatives such as interestfree<br />

loans, training and<br />

infrastructure support, which<br />

seek to unlock the inherent<br />

potential in this sector, particularly<br />

for rural coastal communities.<br />

At Oceana, we believe that<br />

by working together, the<br />

glaring inequalities which so<br />

blight <strong>South</strong> Africa’s beautiful<br />

landscape, can be overcome<br />

and we can create a country<br />

where opportunity, inclusivity<br />

and prosperity for all can find<br />

a home.


Main ports, controlled<br />

and managed by<br />

Transnet National Ports<br />

Authority<br />

Facilities Key cargo/function Plans<br />

Saldanha<br />

Slipways, quayside<br />

facilities (Mossgas<br />

Jetty). Fabrication<br />

facility (FerroMarine<br />

Africa).<br />

Iron ore.<br />

Industrial Development<br />

Zone. Oil and gas supply<br />

base and rig repair.<br />

Cape Town<br />

SWL floating crane,<br />

two graving docks,<br />

syncrolift. Cruiseship<br />

terminal.<br />

General cargo,<br />

General cargo.<br />

containers, drydocking.<br />

Enhance Promote drydock, marine invest engineering<br />

marine capability fleet, improve for<br />

oil loading and gas times. sector.<br />

Mossel Bay<br />

Two offshore mooring<br />

points. Slipway.<br />

PetroSA logistics<br />

base.<br />

Fishing.<br />

Slipway upgrade.<br />

Ngqura<br />

Rig repair.<br />

Containers, dry and<br />

liquid bulk.<br />

Expand rig repair. Serve<br />

Coega IDZ.<br />

Port<br />

Elizabeth<br />

Container terminals,<br />

bunkering, slipway.<br />

Vehicles, manganese,<br />

general cargo.<br />

Removal of manganese<br />

to Ngqura, creation of<br />

leisure waterfront.<br />

East London<br />

Dry dock and repair<br />

quay.<br />

Vehicles and grain.<br />

Serves East London IDZ.<br />

Recent upgrades have<br />

been done.<br />

Durban<br />

Ship repair. One<br />

graving dock, several<br />

floating docks. Three<br />

repair quays. Private<br />

quayside facilities<br />

(EBH and Dormac).<br />

Cruise-ship terminal.<br />

Vehicles and multicargo.<br />

Improve access for<br />

trucks, back-of-port.<br />

New storage areas.<br />

Richards Bay<br />

Richards Bay Coal<br />

Terminal. Repair<br />

berth in small craft<br />

harbour. Serves IDZ.<br />

Coal.<br />

Possible gas and<br />

renewable energy hub.<br />

Service offshore oil and<br />

gas sector.<br />

437 SOUTH WESTERN AFRICAN CAPE BUSINESS <strong>2021</strong> 2019


Overviews of the main economic<br />

sectors of <strong>South</strong> Africa<br />

Agriculture 40<br />

Mining 44<br />

Energy 56<br />

ICT 61<br />

Oil and gas 62<br />

Water 66<br />

Engineering 70<br />

Construction and property 72<br />

Manufacturing 74<br />

Food and beverages 76<br />

Automotive 78<br />

Transport and logistics 80<br />

Tourism and events 82<br />

Banking and financial services 84<br />

Development finance and SMME support 86


Agriculture<br />

Berry production is up as exports rise.<br />

The number of hectares of blueberries will rise over a fiveyear<br />

period by 136% in Limpopo and 102% in Mpumalanga,<br />

an agricultural economist has told the <strong>South</strong> <strong>African</strong> Berry<br />

Producers’ Association (SABPA).<br />

Nina Viljoen’s findings have big implications for employment and<br />

exports, especially as blueberries are growing in popularity globally<br />

as a so-called “superfood”. Wandile Sihlobo of Agbiz promotes the<br />

idea of <strong>South</strong> Africa focussing on horticulture, partly because it is<br />

so labour intensive. He cites blueberries, which need 2.64 workers<br />

for every hectare planted. Signs are promising; gross value rose from<br />

R15.8-million in 2008 to R1.25-billion in 2018 with the total area<br />

planted expanding four times. More than 70% of the blueberry crop<br />

is exported.<br />

The major production companies are Berryworld <strong>South</strong> Africa,<br />

United Exports and Haygrove SA, an affiliate of UK-based Haygro.<br />

There is plenty of scope for berry exports to grow. Current annual<br />

exports are at about 13 500t compared to over 200 000t for table<br />

grapes and about 300 000t for apples (SABPA). Once <strong>South</strong> <strong>African</strong><br />

producers pass muster with Chinese import authorities, volumes can<br />

be expected to grow quickly.<br />

An application launched by Fedgroup Ventures gives investors a<br />

chance to invest in blueberry bushes without getting soil on their<br />

hands. Fedgroup Impact Farming expects investors to earn 10-15%<br />

over an eight-year timeframe and also offers investments in beehives<br />

and solar panels.<br />


The University of Pretoria has<br />

joined an <strong>African</strong> alliance to<br />

tackle food security.<br />

Another subsector to<br />

experience rapid export<br />

growth is oranges. As a source<br />

of vitamin C, oranges grew<br />

in popularity as the Covid-19<br />

pandemic spread. <strong>South</strong> Africa<br />

is the world’s second-largest<br />

citrus exporter, after Spain, and<br />

the number 11 in the world<br />

in terms of production. Citrus<br />

exports earned <strong>South</strong> Africa<br />

about R20-billion in 2019.<br />

By contrast, flower<br />

growers were badly hit by<br />

the effects of the global<br />

shutdown. Normally, Europe<br />

accounts for 80% of exports<br />

with the Americas and Japan<br />

accounting for the balance.<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



Wool exports suffered too, although this was mostly related to<br />

China stopping imports due to a foot-and-mouth disease scare.<br />

About 70% of <strong>South</strong> Africa’s export of this commodity are to China<br />

in a normal year.<br />

Avocado exports were worth about R4.3-billion in 2019, with<br />

more than 1 000ha of new plantings taking place every year to try<br />

to meet growing demand. <strong>South</strong> Africa is among the top three<br />

countries exporting to Europe and the Chinese market is growing<br />

at a rapid rate.<br />

Beef exports increased from 8 292 tons in 2001 to 31 888 tons in<br />

2018 with the largest areas of growth in Muslim countries.<br />

A record crop of 59 050 tons of in-shell macadamias was<br />

achieved in 2019 and production was up by more than 2 500 tons<br />

over 2018. A less fruitful year is expected in 2020.<br />

Total <strong>South</strong> <strong>African</strong> agricultural exports reached R175-billion in<br />

2019 with about 40% going to other <strong>African</strong> countries and 25% to<br />

Europe. The grain and fruit harvests in 2020 were good with the<br />

maize return of 15.5-million tons the second-largest ever and fully<br />

38% better than the previous year’s figure.<br />

The global shutdown threatened the agricultural products<br />

that <strong>South</strong> Africa imports: rice and palm oil are 100% dependent<br />

and half of the maize that <strong>South</strong> <strong>African</strong>s consume comes from<br />

abroad. <strong>South</strong> Africa imports 80% of its fertiliser and 98% of its<br />

agri-chemicals.<br />

Variety and quality<br />

While agriculture’s contribution to national GDP is variously given<br />

in the range of 2.0-2.5%, the upstream and downstream links to<br />

agriculture through processing and logistics mean that the real<br />

contribution is more like 15%.<br />

AgriSA states that the amount of agricultural land in <strong>South</strong> Africa<br />

in 2016 stood at 93.5-million hectares. This represents 76.3% of <strong>South</strong><br />

Africa’s total land mass of 122.5-million hectares and about 3% less<br />

than in 1994.<br />

A total of 70% of <strong>South</strong> Africa’s grain production is maize, which covers<br />

60% of the cropping area of the country. KwaZulu-Natal and Mpumalanga<br />

produce sugar, but volumes are down. The Free State Province supplies<br />


Agricultural Research Council: www.arc.agric.za<br />

Grain SA: www.grainsa.co.za<br />

National Department of Agriculture, Forestry and Fisheries:<br />

www.daff.gov.za<br />

SA Table Grape Industry: www.satgi.co.za<br />

<strong>South</strong> <strong>African</strong> Berry Producers’ Association: www.berriesza.co.za<br />

significant proportions of the<br />

nation’s sorghum, sunflower,<br />

potatoes, groundnuts, dry beans,<br />

and almost all of its cherries.<br />

<strong>South</strong> Africa is famous for<br />

its fruit, of which 35% is citrus,<br />

23% subtropical and nuts, 26%<br />

pome fruit, 11% stone fruit and<br />

9% table grapes. Most of <strong>South</strong><br />

Africa’s citrus and subtropical<br />

fruit comes from the eastern part<br />

of Limpopo. There are about 3<br />

500 wine producers in <strong>South</strong><br />

Africa, with the majority located<br />

in the Western Cape, where<br />

canola (pictured) is also grown.<br />

The Eastern Cape is the<br />

largest livestock province.<br />

<strong>South</strong> Africa has a beef herd<br />

of 14-million. <strong>South</strong> Africa’s<br />

milk producers normally<br />

produce about 3.3-billion<br />

litres of milk every year (Milk<br />

Producers Association).<br />

The Faculty of Natural<br />

and Agricultural Sciences<br />

at the University of Pretoria<br />

(UP) has joined an <strong>African</strong> Research<br />

Universities Alliance<br />

programme together with<br />

the University of Nairobi and<br />

the University of Ghana. The<br />

Centre of Excellence for Food<br />

Security that has been established<br />

intends to create a<br />

network to find solutions to<br />

food security challenges in<br />

Africa. The UP Department<br />

of Plant and Soil Sciences is<br />

working with Impilo Projects<br />

to research aeroponics for deployment<br />

in urban areas. The<br />

faculty has a R13-million facility<br />

to grow plants in different<br />

conditions which mimic possible<br />

future climate scenarios.<br />

Potatoes are being grown in a<br />

first experimental phase. ■<br />

41<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong>


Crafters and knitters<br />

are returning to their<br />

passion<br />

Michael Brosnahan, CEO of SAMIL, unpacks the effects of<br />

the Covid-19 lockdown on the mohair industry.<br />

Michael Brosnahan, CEO<br />

With people at home during the Covid-19 lockdown, was there<br />

greater demand from creative people?<br />

Happily for SAMIL the crafters and knitters of the world took refuge in<br />

their art, many of them returning to their passion, with time on their<br />

hands. The demand for our hand knitting and crochet yarns increased<br />

dramatically during the hard lockdown periods and this increase in<br />

demand shows no signs of abating.<br />

What were other effects of the pandemic?<br />

Sadly, the effect on farmers and processors was quite devastating<br />

financially, particularly in the months of April to June, when we were<br />

unable to export our mohair tops. This obviously impacted all who are<br />

employed in the industry by way of significantly reduced income. We<br />

are very grateful for the assistance provided by the government via the<br />

UIF TERS system which helped to reduce the impact.<br />


Michael emigrated from the UK to<br />

KwaZulu-Natal in <strong>South</strong> Africa in<br />

1981 in order to take up the position<br />

of Quality Assurance Manager with<br />

the Frame Group. A chartered member<br />

of the Textile Institute in <strong>South</strong><br />

Africa, he has managed several large<br />

textile companies since then. Mooi<br />

River Textiles was awarded Cotton<br />

Spinner of the Year for three consecutive<br />

years under his leadership. He<br />

was appointed CEO of Samil Natural<br />

Fibres in Port Elizabeth in 2016.<br />

How will the “new normal” affect the mohair industry?<br />

Providing that <strong>South</strong> Africa and other countries do not return to a<br />

hard lockdown situation, it should not have a further impact. Demand<br />

for high-fashion goods will always be there and due to the reduction<br />

in availability caused by the ongoing drought conditions in the Karoo<br />

region, where most of the mohair is farmed, demand outstrips supply.<br />

Is there a growing awareness of the importance of sustainability<br />

among customers?<br />

There is no doubt that the consumer of today makes purchase decisions<br />

no longer merely on price alone, but also on their understanding of<br />

the ethicality of the manufacturing process. They want to know that<br />

the goods have not harmed the environment in any way. This concern<br />

extends further to the welfare of the people producing the items and<br />

the treatment of the animals.<br />

The Responsible Mohair Standard is an established set of rules<br />

drawn up by the global non-profit organisation, Textile Exchange.<br />

These rules govern all aspects of the mohair industry, from the care of<br />

the environment to the welfare of the animals and all the individuals<br />

employed in the industry. ■<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

54 42

Sharing Africa’s<br />

beauty with the<br />

Sharing world Africa’s beauty<br />

with the world<br />

SAMIL produces and processes<br />

SAMIL mohair, produces the noble and processes fibre. mohair, the noble fibre.<br />

<strong>South</strong> <strong>African</strong> <strong>African</strong> Mohair Mohair Industries Industries Limited (SAMIL) Limited<br />

is the (SAMIL) link between is the mohair link producers, between processors<br />

producers, and consumers. processors Our vision and consumers. is to be an Our in-<br />

mohair<br />

novative vision <strong>South</strong> is to be <strong>African</strong> innovative company <strong>South</strong> specialising <strong>African</strong><br />

company in the production specialising and in processing the production of natural and processing fibres, as<br />

of well natural as speciality fibres, as spun well yarns. as speciality spun yarns.<br />

Mohair, Mohair, the the fleece fleece of the of the Angora Angora goat, goat, is: is:<br />

• the the noble noble fibre, fibre, known known as the as the diamond diamond fibre fibre<br />

• lustrous, lustrous,<br />

resilient<br />

resilient<br />

and<br />

and<br />

offers<br />

offers<br />

exceptional<br />

exceptional<br />

colour<br />

colour<br />

reflection<br />

reflection<br />

• one one<br />

of<br />

of<br />

the<br />

the<br />

world’s<br />

world’s<br />

most<br />

most<br />

beautiful<br />

beautiful<br />

sustainable<br />

sustainable<br />

natural fibres<br />

natural fibres<br />

• a symbol of luxury and exclusivity.<br />

• a symbol of luxury and exclusivity.<br />

<strong>African</strong> Expressions<br />

<strong>African</strong> Expressions<br />

Our local brand <strong>African</strong> Expressions was born of the<br />

Our local brand <strong>African</strong> Expressions was born of the<br />

desire to share Africa’s natural beauty with the rest<br />

desire<br />

of the<br />

to<br />

world.<br />

share Africa’s<br />

Through<br />

natural<br />

our<br />

beauty<br />

unique<br />

with<br />

range<br />

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of<br />

rest<br />

yarns,<br />

of the<br />

world.<br />

we express<br />

Through<br />

the<br />

our<br />

essence<br />

unique<br />

of<br />

range<br />

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of yarns,<br />

makes<br />

we express<br />

Africa<br />

the magical. essence Our of network that which of local makes farmers, Africa who magical. farm Our in<br />

network optimal Angora of local farmers, goat conditions, who farm breed in optimal stock Angora which<br />

goat bear conditions, excellent breed fibres. stock This which ensures bear that excellent our yarns fibres.<br />

This are ensures naturally that soft our to yarns the are touch, naturally easy soft to to knit the touch, and<br />

easy luxuriously to knit and versatile. luxuriously versatile.<br />

SAMIL divisions<br />

Farming: SAMIL Farming, was established with<br />

the primary objective of stabilising and possibly<br />

increasing mohair supply to the processors.<br />

Combing: SAMIL Natural Fibres Combing is is in in Berlin,<br />

outside East London in the Eastern Cape. As mohair<br />

processing has decreased in other parts of the world,<br />

SAMIL Combing has become one of the world’s<br />

leading processors. Unlike many processing plants<br />

SAMIL Combing focusses on and is committed to to<br />

processing only mohair.<br />

Trading: Through a strong support base of of affiliated<br />

companies, partners partners and agents, and agents, SAMIL has SAMIL established has<br />

strong established connections strong connections throughout the throughout world for the the<br />

purchase world for and the sale purchase of raw materials and sale and of finished raw materials goods.<br />

<strong>South</strong> and finished Africa processes goods. in <strong>South</strong> excess Africa of 80% processes of the world’s in<br />

mohair excess production. of 80% of the The world’s advantage mohair of production. having both The topmaking<br />

advantage<br />

and<br />

of<br />

spinning<br />

having<br />

operations<br />

both top-making<br />

in <strong>South</strong><br />

and<br />

Africa,<br />

spinning<br />

as well<br />

as<br />

operations<br />

access to raw<br />

in <strong>South</strong><br />

material<br />

Africa,<br />

produced<br />

as well<br />

within<br />

as access<br />

the company,<br />

to raw<br />

material produced within the company, is that SAMIL<br />

is that SAMIL is able to offer lots guaranteed from origin,<br />

is able to offer lots guaranteed from origin, a rare<br />

a rare luxury in today’s business environment.<br />

luxury in today’s business environment.<br />

Spinning and dyeing: SAMIL Spinning is a global<br />

Spinning and dyeing: SAMIL Spinning is a global<br />

manufacturer of outstanding quality mohair yarns,<br />

manufacturer of outstanding quality mohair yarns,<br />

producing a wide and exclusive range of mohair and<br />

producing a wide and exclusive range of mohair<br />

mohair<br />

and mohair<br />

blended<br />

blended<br />

fancy<br />

fancy<br />

and fine-spun<br />

and fine-spun<br />

yarns in<br />

yarns<br />

both<br />

fine-count<br />

in both fine-count<br />

and coarser<br />

and<br />

varieties.<br />

coarser<br />

We<br />

varieties.<br />

are internationally<br />

We are<br />

renowned<br />

internationally<br />

for our<br />

renowned<br />

superior<br />

for<br />

product<br />

our superior<br />

range and<br />

product<br />

cater<br />

for range the and hand cater knitting, for the machine hand knitting, knitting, machine weaving,<br />

hosiery knitting, and weaving, decor markets. hosiery Although and decor we markets. specialise<br />

in Although pure mohair, we specialise we also in blend pure mohair, we with also a blend range<br />

of mohair other with natural a range and of man-made other natural fibres. and Yarns man-made can be<br />

custom fibres. Yarns dyed can to any be shade custom at dyed SAMIL’s to state any shade of the art at<br />

dye SAMIL’s house. state of the art dye house.<br />

Genetic research: The latest venture under the SAMIL<br />

umbrella is the research project called ANGELA<br />

which aims to enhance Angora goats and the<br />

mohair industry, from increasing kidding rates to<br />

the improvement of the different hair qualities. The<br />

project will make available its results to all in the<br />

mohair farming community.<br />

Contact details<br />

Tel: +27 41 486 2430<br />

Email: yarns@samil.co.za<br />

Website: Contact www.samil.co.za<br />

details<br />

Tel: +27 41 486 2430<br />

Email: yarns@samil.co.za<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

Website: www.samil.co.za


Mining<br />

Exploration is the next frontier.<br />

<strong>South</strong> Africa is currently attracting just 1% of global<br />

spending on mining exploration, a figure that normally<br />

reaches R160-billion annually. Several industry leaders<br />

have expressed concern about the low level of exploration<br />

activity but in 2020 they were joined by the Economic<br />

Transformation Committee (ETC) of the <strong>African</strong> National Congress<br />

(ANC), the country’s majority political party. The ETC sees<br />

exploration as a way of broadening the scope of ownership within<br />

the mining industry.<br />

Gwede Mantashe, <strong>South</strong> Africa’s Minister of Mineral Resources<br />

and Energy, wants to see <strong>South</strong> Africa attracting at least 5% of<br />

global exploration. For exploration to expand a reliable cadastre<br />

is required. A cadastre is a record of property boundaries and<br />

ownership. The Council for Geoscience is working on this. Drone<br />

technology could take the mapping process forward, allowing for<br />

more exploration at a lower cost.<br />

In his 2019/20 budget vote, Mantashe noted that<br />

about 4 000 permanent jobs would be created by the<br />

recent investment of about R45-billion through projects<br />

such as Exxaro’s Belfast expansion (coal), Sasol’s coal mine<br />

replacement programme and Vedanta Resources’ huge zinc<br />

mine in the Northern Cape.<br />

Many mining companies want to start generating their own<br />

power, particularly in the light of unreliable supply from the<br />

national utility, Eskom.<br />


Good mineral prices kept<br />

mining shares buoyant during<br />

the lockdown.<br />

<strong>African</strong> Rainbow Minerals<br />

is currently operating just<br />

three of its 10 plants in the<br />

ferroalloy sector, with the cost<br />

of electricity the main reason<br />

for reduced activity. ARM is<br />

constructing a demonstration<br />

ferromanganese plant to test<br />

alternative energy systems<br />

with the hope that costs can<br />

be significantly reduced.<br />

The CEO of Minerals<br />

Council SA, Roger Baxter, calls<br />

the hurdles faced by mining<br />

companies trying to put<br />

alternative power projects in<br />

place, a “serious challenge”.<br />

In 2019 Minister Mantashe<br />

wrote to the National Energy<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



Regulator of <strong>South</strong> Africa (NERSA) granting a deviation from the<br />

existing Integrated Resources Plan (IRP) to allow for the quick<br />

licensing of generation facilities up to 10MW.<br />

Coal giant Exxaro has disposed of its stake in Tronox Holdings<br />

(mining and processing of titanium ore, zircon and other minerals)<br />

but in 2019 took full ownership of renewable energy company<br />

Cennergi, which owns two wind farms in the Eastern Cape. Indian<br />

company Tata Power held 50% of the company through a whollyowned<br />

subsidiary before the sale.<br />

Despite the global lockdown Exxaro expected earnings for the<br />

first six months of 2020 to be higher than the R3.2-billion earned in<br />

2019. The weaker rand and record coal exports helped to balance<br />

lower dollar prices achieved.<br />

Coal continues to be an important part of the <strong>South</strong> <strong>African</strong><br />

mining landscape, despite pressure to move to renewable<br />

resources. As Baxter points out, “In 2018 the sector employed almost<br />

90 000 people (representing about 19% of total employment in the<br />

mining sector), with an estimated 180 000 further people employed<br />

as a result of coal mining activities.”<br />

Gold Fields’ earnings for the half-year to June 2020 increased<br />

four-fold because of a buoyant gold price. The August 2020 price<br />

for gold reached nearly $2 000. Analysts warned against reading<br />

too much into some of the more extreme rises in the value of gold<br />

mining stocks (DRD Gold went up some 240% between January<br />

and July) because the underlying conditions for gold mining in<br />

<strong>South</strong> Africa are tough.<br />

Implats (Impala Platinum) was expecting to report annual<br />

headline earnings five times better as a result of improved<br />

commodity prices.<br />

Another company to report improved half-year results was<br />

Sibanye-Stillwater which increased volumes at its platinum group<br />

metals (PGM) operations and its gold mines in the first half of 2020.<br />

Some production was lost due to the steps taken to deal with<br />

Covid-19 but, because of the inclusion of the Marikana operations<br />

(bought from Lonmin), <strong>South</strong> <strong>African</strong> PGM production actually<br />

increased by 5% year-on-year to 657 828 ounces.<br />

Gold production within the group was also up after strikes<br />

affected volumes in 2019. Production of 403 621 ounces was 17%<br />

higher than the previous year’s figure. The group expects all of<br />

its <strong>South</strong> <strong>African</strong> operations to be running at optimal production<br />

levels by the end of 2020.<br />

The sale in 2020 by AngloGold Ashanti of its Mponeng mine<br />

and Mine Waste Solutions to Harmony Gold for $300-million (about<br />

R4.4-billion) marks the end of an era. Although the company’s<br />

headquarters will continue to be in Johannesburg and it will be<br />

listed on the JSE, its mines are in Ghana, the Americas and Australia.<br />

AngloGold Ashanti was the<br />

successor to the mining<br />

company formed by Ernest<br />

Oppenheimer in 1917.<br />

Harmony Gold’s acquisition<br />

strategy, including the<br />

purchase from AngloGold<br />

of Moab Khotsong mine in<br />

2017, will result in it being<br />

the country’s biggest gold<br />

producer. With 350 000 new<br />

ounces coming from Mponeng,<br />

it could produce an annual<br />

total of 1.7-million ounces.<br />

Afrimat continued to<br />

expand its commodities<br />

portfolio in 2020. Previously<br />

focussed on construction<br />

materials, Afrimat bought<br />

a 27.27% stake in a highgrade<br />

anthracite mine in<br />

Mpumalanga, Nkomati, and<br />

followed this with the purchase<br />

of Coza Mining, an iron ore<br />

and manganese company in<br />

the Northern Cape. Afrimat’s<br />

first foray into commodities<br />

was also in that province, the<br />

R322-million acquisition of the<br />

Diro mine. In October 2020<br />

Afrimat applied for Nkomati<br />

to be placed under business<br />

rescue because of the Covid-19<br />

lockdown but stated that it<br />

believed the business could<br />

indeed be resuscitated.<br />

Diamonds<br />

An ongoing project by De<br />

Beers to convert its Musina<br />

mine from an open-pit mine<br />

to a vertical-shaft mine will<br />

extend the life of mine of this<br />

northern Limpopo project<br />

45 SOUTH AFRICAN BUSINESS <strong>2021</strong>


to 2045. Venetia Mine is by far the most important part of De<br />

Beers’ <strong>South</strong> <strong>African</strong> operation, accounting for 3.1-million of the<br />

5.4-million carats recovered by the company from its six operations.<br />

Petra Diamonds has made it known that it will consider offers for<br />

parts of its business or all of its operations. This follows a strategic<br />

review where the issue of a R11.25-billion debt repayable in 2022<br />

loomed large. The review began when the <strong>South</strong> <strong>African</strong> Covid-19<br />

lockdown began. Most of the company’s major expenditure on<br />

expansion projects is behind it but reduced demand, even before<br />

the lockdown, has affected earnings. Revenue for the six months to<br />

December 2019 was down by 6%. Of the company’s three <strong>South</strong><br />

<strong>African</strong> mines Finsch (Northern Cape) and Cullinan (Gauteng)<br />

generate 90% of output and 75% of revenue.<br />

In the Northern Cape, Ekapa Mining paid R300-million to buy<br />

out Petra Diamonds from a JV.<br />

Zinc<br />

When phase three is reached, the biggest new mining project<br />

in <strong>South</strong> Africa will deliver 600 000 tons of zinc for Vedanta Zinc<br />

International.<br />

Located at Aggeneys in the Northern Cape near the border<br />

with Namibia, the Gamsberg zinc project has so far attracted<br />

$400-million in investment from the company and has started<br />

trucking product to the Port of Saldanha. Phase one of the open-pit<br />

operation will deliver an annual load of 250 000 tons of zinc. If it<br />

proceeds to phase three, it will likely go underground.<br />

The Northern Cape Province is planning for a deep harbour at<br />

Boegoebaai. Part of the strategy involves the creation of a commodities<br />

corridor linking the Upington Industrial Park with the port.<br />

In August 2020 Australian miner Orion announced it had raised<br />

$6.2-million in share capital towards its Prieska Zinc-Copper Project.<br />

Iron ore and manganese<br />

In 2019 Sitatunga Resources purchased the East Manganese<br />

project on the Hotazel-Kalahari ore belt from <strong>South</strong>ern<br />

Ambition. Menar Holdings,<br />

which controls a majority<br />

share in Sitatunga, is mostly<br />

invested in coal.<br />

The overwhelming<br />

majority of the world’s<br />

manganese comes from the<br />

Postmasburg and Kalahari<br />

regions of the Northern Cape.<br />

Assmang has two manganese<br />

mines in the province:<br />

Nchwaning and Gloria.<br />

The Northern Cape<br />

produces more than 84% of<br />

<strong>South</strong> Africa’s iron ore. The<br />

province has two major iron<br />

belts, from Postmasburg to<br />

Hotazel, and running through<br />

Sishen and Kathu. Sishen is the<br />

most important iron-ore mine in<br />

<strong>South</strong> Africa, where operations<br />

include extraction and four<br />

beneficiation plants.<br />

Kumba Iron Ore has the<br />

huge Sishen facility at Kathu<br />

and Kolomela. Assmang, a<br />

joint venture comprising<br />

<strong>African</strong> Rainbow Minerals and<br />

Assore, mines at Khumani.<br />

The company will spend<br />

R2.7-billion on upgrading its<br />

Gloria mine.<br />

<strong>South</strong>32 is active in the<br />

Northern Cape: Hotazel<br />

Manganese Mines is made<br />

up of two mines, Wessels<br />

(underground) and Mamatwan<br />

(open cut), and the Metalloys<br />

manganese smelter. ■<br />


Council for Geoscience: www.geoscience.org.za<br />

Minerals Council <strong>South</strong> Africa: www.mineralscouncil.org.za<br />

Mintek: www.mintek.co.za<br />

National Department of Mineral Resources and Energy: www.dmr.gov.za<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



November 2020<br />

The Council for Geoscience (CGS) is the national custodian responsible for the collection, compilation and<br />

curation of all onshore and offshore geoscience data and information. The CGS aims to use this information<br />

and knowledge to develop geoscience solutions to real-world challenges in <strong>South</strong> Africa.<br />


Geoscience mapping is the core<br />

function of the CGS and aims to<br />

develop fundamental geoscience<br />

knowledge using an integrated<br />

and multidisciplinary approach<br />

as well as innovation that merges<br />

several onshore and offshore<br />

geoscience themes such as<br />

geology, geotechnical studies,<br />

geochemistry, geophysics and<br />

economic geology for mineral<br />

and energy resources and their<br />

mineralising systems information<br />

to boost sustainable exploration<br />

for economic growth.<br />



As the custodian of the national<br />

seismological network, the<br />

CGS monitors and maintains<br />

a geohazard inventory for<br />

<strong>South</strong> Africa. This information<br />

is primarily used in developing<br />

effective and novel geohazard<br />

mitigation solutions for safe<br />

and judicious land use. Modern<br />

artifi cial intelligence techniques<br />

are applied in subsidence<br />

mapping and seismic hazards<br />

characterization.<br />


The geoscience functions are<br />

supported by a multi-faceted<br />

laboratory that performs a wide<br />

range of analytical services<br />

such as petrography, whole<br />

rock geochemistry, petrophysics,<br />

coal science and hydrochemistry.<br />

The CGS also manages a<br />

geoscience museum, library,<br />

bookshop, and national core<br />

repository which are used by<br />

the scientific community and<br />

the general public.<br />


The CGS carries out hydrogeological studies and aquifer<br />

modelling and is also responsible for environmental geoscience<br />

research which aims to provide sustainable solutions to monitor<br />

and mitigate the impact of geology and mining activities on the<br />

health of the environment including its inhabitants.<br />



As the permanent secretariat<br />

of the Organisation of <strong>African</strong><br />

Geological Surveys (OAGS), the<br />

CGS has an impressive footprint<br />

in the <strong>African</strong> continent where<br />

various geoscience services<br />

have been rendered in line with<br />

global standards, international<br />

policy and governance. The CGS<br />

also collaborates with various<br />

academic institutions and science<br />

councils around the world.<br />


• The CGS is undertaking integrated and multidisciplinary geoscience mapping programme across <strong>South</strong> Africa.<br />

• Some of the recent projects include:<br />

- Multidisciplinary geoenvironmental baseline investigations in the <strong>South</strong>ern Karoo for possible shale gas<br />

development, which uncovered previously undefi ned groundwater aquifers.<br />

- Regional soil geochemical sampling and detailed follow-up surveys, particularly within the Northern Cape,<br />

North West and Mpumalanga provinces.<br />

- Geothermal energy and carbon capture and storage research, which aims to expand the current renewable<br />

energy mix of <strong>South</strong> Africa and decrease the carbon footprint.<br />

- Ground stability and geotechnical assessments for infrastructure development in the Northern Cape and Free<br />

State Provinces.<br />


Our head office is located at: 280 Pretoria Street, Pretoria, 0184 I @CGS_RSA I I I<br />

Tel: +27 (0)12 841 1911 I Email: info@geoscience.org.za I Web: www.geoscience.org.za




By: Casper Badenhorst, Chief Operations Officer,<br />

Pilanesberg Platinum Mines<br />

Despite facing a tough economic<br />

period, the mining sector continues to<br />

play an important role in our economy<br />

and still has the potential to make<br />

a significant impact in the socioeconomic<br />

development of our country.<br />

We trust the upswing experienced in<br />

2019 will spill over into 2020 and reclaim<br />

profitability in the industry. Pilanesberg<br />

Platinum Mines is cautiously optimistic;<br />

a productive 2020 will support the<br />

continuation of our plans to expand<br />

mining operations thus increasing our<br />

staff component and benefitting the<br />

communities in which we operate.<br />

As a growing mine, we are proud that we<br />

sustained production in a constrained<br />

environment, ensuring continued<br />

contribution towards the social and<br />

economic development of our wider<br />

community. As we enter a new decade,<br />

I reminisce on our achievements. In<br />

2019, we purposefully held ourselves<br />

accountable to our core values of zero<br />

harm, upliftment and innovation.<br />

Our specific focus on zero harm resulted<br />

in no fatalities. In fact, because of our<br />

commitment to the safety of our people,<br />

we wrapped up this past decade with<br />

over 5 million fatality-free shifts.<br />

In addition, our efforts in uplifting<br />

our female employees, has gained<br />

some traction. Tebogo Metsileng was<br />

nominated in the mining category for<br />

the Women’s Lifestyle Award. Tebogo,<br />

a Lab Technician, has been recognised<br />

for her community service as a PPM<br />

Wellness Team Member and for her<br />

contribution as a Lab Technician.<br />

She has also been recognised for<br />

her motivation of the youth in her<br />

community, making her a worthy<br />

recipient of the 2019 Women Lifestyle<br />

Award. This recognition will pave the<br />

way for many women in this industry.<br />

Furthermore, our commitment to reduce<br />

our impact on the environment remains<br />

a core focus.<br />

We have taken innovative steps towards<br />

decreasing our negative impact on the<br />

environment, including the termination<br />

of polystyrene packaging in our<br />

canteens.<br />

We will continuously strive to improve<br />

the lives of our people, our immediate<br />

communities; and protect the<br />

environment, as we contribute to the<br />

growth and transformation of this<br />

sector. Over and above our operational<br />

accomplishments, I am proud<br />

of what we have achieved in our<br />

respective communities. Our top three<br />

achievements include:<br />

Supporting small businesses<br />

In creating a meaningful impact in<br />

our communities, we realised that<br />

supporting small businesses is critical.<br />

The ‘Community Crusher’ which started<br />

as a non-profit project is now proving its<br />

potential to be a fully-fledged business,<br />

rendering a service to most of our<br />

building projects.

Most importantly, 14 community<br />

members are employed in this project,<br />

of which 64% are women – securing<br />

future female community leaders!<br />

Furthermore, the ongoing support of<br />

the relocated farmers is anchored in our<br />

mission to train, develop skills and build<br />

capacity of the small-scale subsistence<br />

livestock keeper; and grow them to<br />

become sustainable and independent<br />

commercial farmers. To this end, a<br />

professional Extension Officer has been<br />

allocated to service and capacitate<br />

them and all the basic farming support<br />

infrastructure has been set up.<br />

Enabling economic development in<br />

communities<br />

As part of our contribution to socioeconomic<br />

development in the Moses<br />

Kotane Local Municipality and the<br />

Bakgatla Ba Kgafela, our conviction is<br />

that infrastructure interventions can play<br />

a major role in enabling and catalysing<br />

economic development. Consequently,<br />

we have concluded construction of<br />

Legkraal - Bofule paving and phase one<br />

of the Motlhabe - Ngweding roads. This<br />

will enable village to village connectivity<br />

and access, with subsequent boosting<br />

of the economies of the affected areas.<br />

To secure a sustainable and productive<br />

mine is not only about our employees’<br />

jobs, but it is also about the impact that<br />

these jobs and our operations have on<br />

our people. As a mine, we are constantly<br />

reminded that the future is a legacy in<br />

the making and the best tomorrow for<br />

all, relies on the crucial decisions we<br />

make today.<br />

“As a mine,<br />

we are<br />

constantly<br />

reminded<br />

that the<br />

future is a<br />

legacy in<br />

the making<br />

and the best<br />

tomorrow for<br />

all, relies on<br />

the crucial<br />

decisions<br />

we make<br />

today“<br />

Educating the youth<br />

Education is important for our youth,<br />

who are the real bastions of tomorrow.<br />

Maths and Science are key tools to<br />

understand, analyse and impact local<br />

communities. We assisted over 200<br />

students with their studies through<br />

a Saturday school programme. As a<br />

result, the 2019 academic results have<br />

improved significantly from a pass<br />

rate of 40% to 80% providing more<br />

opportunities to these learners.<br />

Tel: 014 555 1800

FOCUS<br />

World-class zinc operation in<br />

the heart of the Northern Cape<br />

R5-billion investment by Vedanta Zinc International is a major catalyst for growth.<br />

Vedanta Zinc International (VZI) is a<br />

grouping of zinc assets located in <strong>South</strong><br />

Africa and Namibia, owned by the sixthlargest<br />

diversified resources company<br />

in the world, Vedanta Limited. Vedanta Limited<br />

recently invested R5-billion into VZI’s flagship,<br />

Gamsberg open-pit and concentrator project in<br />

the Northern Cape province, which is now fully<br />

operational and was inaugurated in February 2019<br />

by President Cyril Ramaphosa.<br />

President Cyril Ramaphosa and Vedanta chairman<br />

Anil Agarwal at the Gamsberg mine opening.<br />

VZI’s operations include Black Mountain Mining<br />

(Pty) Ltd (consisting of underground operations<br />

Deeps and Swartberg as well as the flagship surface<br />

operation, Gamsberg Project) located in <strong>South</strong><br />

Africa’s Northern Cape province and the Skorpion<br />

Zinc Mine and refinery in Namibia’s //Kharas region.<br />

VZI’s vision is to create an integrated, world-class<br />

regional zinc complex with the values of Safety, Trust,<br />

Entrepreneurship, Innovation, Excellence, Integrity,<br />

Respect and Care at the core of their business.<br />

As of March 2020, VZI employed more than<br />

4 200 people (including business partners), of which<br />

99% are <strong>South</strong> <strong>African</strong>s: 80% are from the Northern<br />

Cape and 60% from the Namakwa District.<br />

VZI’s Gamsberg Phase I open-pit mine<br />

represents $400-million worth of investment<br />

into <strong>South</strong> Africa by the Vedanta Group. Life of<br />

mine extension at other mines in the complex<br />

($46-million), Gambserg Phase II ($350-million) and<br />

a further $850-million worth of investment on a<br />

possible Gamsberg Smelter-Refinery Complex are<br />

potential future investments in the <strong>South</strong> <strong>African</strong><br />

mining sector. The smelter-refinery is subject to the<br />

availability of power and support from government<br />

to make the project economically viable.<br />

Leveraging technology<br />

Gamsberg has implemented a unique flotation<br />

system, the Staged Flotation Reactors. They<br />

break the conventional flotation paradigm into<br />

individual, optimised reactors which drastically<br />

reduce energy and air consumption. The footprint<br />

in the plant gets reduced by around 50%,<br />

operations become easier and maintenance costs<br />

are lower. VZI is the first company in Africa to<br />

adopt Staged Floatation Reactors.<br />

Backfilling operations is an integral part of Black<br />

Mountain. Underground mining creates voids<br />

which need to be filled. This provides opportunities<br />

for mining operations like Black Mountain to<br />

dispose of waste material underground and<br />

provide support and stability to the surrounding<br />

rock mass.<br />

>>>>>>>><br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

52<br />


FOCUS<br />

The Gamsberg Nursery houses<br />

379 different species and will<br />

have a capacity of 129 000<br />

plants after the upgrade.<br />

Biodiversity<br />

The Succulent Karoo Biome is unique in its floral<br />

diversity. Among the 36 global biodiversity<br />

hotspots, the biome is home to at least 6 000<br />

species of plants that have evolved over millennia.<br />

VZI’s environmental specialists have worked closely<br />

with a wide range of experts, including those from<br />

the International Union for Conservation of Nature<br />

(IUCN), to ensure the site’s necessary protection,<br />

preservation and ultimate restoration.<br />

The Gamsberg Nursery is derived from the<br />

Environmental Management Plan (EMP) and the<br />

requirements for the Integrated Flora Permit.<br />

Since October 2019, there have been 12 000<br />

plants grown with 379 different species. After<br />

the upgrade, 129 000 plants will be housed in<br />

the nursery.<br />

Community commitment<br />

VZI has joined hands with PinkDrive NPC, a<br />

significant player in the gender-related cancer<br />

sector, to bring critical screening to the Northern<br />

Cape. The outreach programme is for the communities<br />

of Okiep, Nababeep, Bergsig, Pella and<br />

Pofadder. The campaign aims to create awareness,<br />

provide education and render health-related<br />

services to community members. Community<br />

members are also provided with free screening<br />

and testing for Covid-19.<br />

In 2015, 12 new local businesses were created<br />

and commercial opportunities to the value of<br />

R7.1-million were provided.<br />

Childcare and education<br />

support programmes<br />

benefit more than 1 800<br />

children at a cost of R6-<br />

million per annum. Youth<br />

and sports clubs are<br />

supported. The total spend<br />

on corporate social responsibility and community<br />

work is over $14-million to FY2020.<br />

During the Covid-19 lockdown period, many<br />

outreaches were made throughout the region.<br />

Items distributed included masks, hand sanitiser,<br />

gloves, care packages, face shields, food and<br />

clothing to areas within the Khai Ma and Nama<br />

Khoi municipal areas. Visits were made to old-age<br />

homes and disability care centres and schools. ■<br />

The outreach programme delivers groceries to<br />

local communities and organisations.<br />

111 53 SOUTH AFRICAN BUSINESS <strong>2021</strong>

FOCUS<br />

Showcasing Ivanhoe’s<br />

education initiatives<br />

Ensuring inclusive and equitable quality education.<br />

Ivanhoe Mines places great value on the level of<br />

host community acceptance and trust, which underpins<br />

its social licence to operate. We strongly<br />

believe in collaborative problem-solving and<br />

employ a sustainability strategy that includes social<br />

development goals, targets and projects in alignment<br />

with host country regulatory frameworks and<br />

international frameworks such as the UN’s Sustainable<br />

Development Goals (SDGs).<br />

Our sustainability strategy recognises the power<br />

of education and aims to advance the objectives of<br />

ensuring inclusive and equitable quality education<br />

and promoting lifelong learning opportunities for<br />

all (SDG 4). Ivanhoe has, accordingly, developed<br />

and implemented various educational initiatives<br />

across its three principal projects.<br />

A case study at the Platreef Project<br />

To enable access to education, and raise the quality<br />

of education across all stages of the education<br />

value chain (including the vulnerable in society), we<br />

have invested numerous educational infrastructure<br />

and support initiatives at our Platreef Project under<br />

the first Social and Labour Plan (2015-2019):<br />

• Investment into the development of the Lesedi<br />

Centre and its staff capacity to support the Early<br />

Childhood Development Function.<br />

• Under its scholarship programme, Platreef<br />

supported 426 learners from underprivileged<br />

families. Platreef further provided study assistance<br />

to 79 employees, and external bursaries to 37<br />

employees and host community members, also<br />

partnering with universities in Canada and Japan<br />

for post-graduate qualifications.<br />

• Platreef established five E-learning venues with<br />

support from the Department of Education, which<br />

remain crucial during the Covid-19 pandemic to<br />

maintain momentum for learners at beneficiary<br />

schools. Expansion to four more schools is<br />

planned for <strong>2021</strong>.<br />

• Platreef introduced the MiniChess programme at<br />

the Motshitshi Primary School through the Entrust<br />

Foundation. This resulted in a marked improvement<br />

in numeracy and mathematical abilities,<br />

spatial perspective development, critical/strategic<br />

thinking development and mastery of English<br />

mathematical terminology among learners.<br />

• Infrastructure support (food garden, irrigation system)<br />

was provided to the Thobela Disability Centre,<br />

which caters for 30 young people of various ages.<br />

• Free Wi-Fi access to the host communities has<br />

enabled digital inclusion.<br />

The phased development plan<br />

The MiniChess programme at Motshitshi Primary<br />

School has been a huge success for learners.<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

54<br />

Ivanhoe is investigating a phased development<br />

plan for the Platreef Project, targeting significantly<br />

lower initial capital, to accelerate first production<br />

by using Shaft 1 as the mine’s initial production<br />

shaft. This plan will focus on initially targeting the<br />

development of mining zones accessible from<br />

Shaft 1 and maximising the hoisting capacity of this<br />

shaft, followed by expansions to the production rate<br />

as outlined in the 2017 Definitive Feasibility Study.<br />


Platreef-sponsored science laboratories help<br />

bring the subject to life and make it fun.<br />

55 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Energy<br />

Solar and wind projects are regularly coming onstream.<br />

Credit: Abengoa<br />

<strong>South</strong> Africa’s acclaimed Renewable Energy Independent<br />

Power Producer Procurement Programme (REIPPPP)<br />

attracted about R200-billion in committed investments,<br />

mostly in solar and wind power, in just five years.<br />

The early rounds of the independent power producers’<br />

programme continue to produce regular dividends. In October<br />

2020, another wind farm started commercial operations.<br />

Located about 80km north-east of Ceres in the Witzenberg Local<br />

Municipality, the Paardekraal East Wind Farm is in the Western Cape.<br />

The 110MW project was constructed by the Concor and Conco<br />

Consortium, Siemens Gamesa Renewable Energy supplied and<br />

installed the wind turbines, the towers were built by GRI in Atlantis<br />

and Mainstream Asset Management <strong>South</strong> Africa will manage the<br />

operations.<br />

According to the Department of Energy, the REIPPPP by<br />

2016 had created more than 30 000 jobs and benefited local<br />

community development to the tune of R256-million. Figures<br />

released by the <strong>South</strong> <strong>African</strong> Wind Energy Association (SAWEA)<br />

showed shareholding for local communities reached an<br />

estimated net income of R29.2-billion over the lifespan of the<br />

projects. Some 14 000 new jobs are expected to be created,<br />

mostly in rural areas, and more than R30-billion has already<br />

been spent on Black Economic Empowerment (BEE) in the<br />

construction phase.<br />

The majority of wind projects have been allocated to the Eastern<br />


Training for a renewable future<br />

is a new priority.<br />

Cape, but approximately 60% of<br />

the solar projects so far allocated<br />

in the programme have been in<br />

the Northern Cape, the nation’s<br />

sunniest province.<br />

Gas is also in the mix.<br />

The Department of Energy is<br />

targeting the procurement<br />

of 3 126MW and intends<br />

spending R64-billion on port,<br />

pipeline, generation and<br />

transmission infrastructure at<br />

three key ports, Richards Bay,<br />

Coega and Saldanha Bay.<br />

The most popular method<br />

relies on solar panels, namely<br />

solar photovoltaic (PV). The<br />

other form of solar power<br />

(concentrated solar power, CSP)<br />

is effective and some projects<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



Liquefied natural gas can<br />

help <strong>South</strong> Africa reach its<br />

decarbonisation goals<br />


Liquefie<br />

help SoS<br />

decarbo<br />

Aldworth Mbalati, CEO of DNG Energy, reveals how his company will offer a cleaner Aldworth Aldworth Mbalati<br />

fuel stop for ships that travel along the <strong>South</strong> <strong>African</strong> coastline.<br />

fuel fuel stop stop for ships for s<br />

What are the main advantages of liquefied natural gas (LNG)?<br />

Liquefied natural gas is a cleaner and cheaper fuel alternative for the<br />

energy market. The environmental, social and economic benefits will<br />

help the country meet its targets in reducing greenhouse gas emissions,<br />

drive economic growth and improve the lives of its citizens.<br />

Aldworth Mbalati, CEO<br />


Aldworth Mbalati started his entrepreneurial<br />

journey as owner and<br />

CEO of Vutomi Properties in 2002.<br />

In 2005 he was involved at Bayethe<br />

Investment Company, a company<br />

investing in coal and other energy<br />

assets. Five years later, he expanded<br />

into oil and gas exploration, production<br />

and midstream activities<br />

such as gas-to-power as the major<br />

shareholder and CEO of <strong>African</strong><br />

International Energy, Africa. He started<br />

DNG Energy in 2013. He obtained<br />

rights and developed an LNG import<br />

terminal in Mozambique.<br />

Transnet National Ports Authority recently gave permission for<br />

you to begin bunkering operations: how significant is that?<br />

The promulgation of regulations by the International Maritime<br />

Organisation (IMO) in January 2020 requiring all ships to use fuel that<br />

has sulphur content of no more than 0.5% has put LNG to the fore<br />

as a solution for decarbonising the marine industry. Finalisation of a<br />

bunkering licence for DNG Energy at Coega gives us a go-ahead to<br />

begin our integrated gas infrastructure for on-shore and off-shore LNG<br />

logistics. We are building the first floating storage unit (FSU) Aldworth for Africa Aldworth Mbalati, C<br />

and the largest in the southern hemisphere. Our position at Coega<br />

gives us an opportunity to optimise trade for the global marine industry<br />

by offering a cleaner fuel stop for ships that pass through Algoa Bay,<br />

estimated at 57 000 ships every year.<br />


What will be the impact of DNG Energy’s bunkering activities?<br />

We support government’s strategy to develop the Coega Industrial<br />

Development Zone as a gas hub. Our operations will reduce the<br />

Aldworth<br />

energy<br />

Aldworth Mbalati Mbalati start<br />

costs of doing business, expand the marine economy by creating trepreneurial trepreneurial jobs, journey journe as<br />

developing skills and will also move <strong>South</strong> Africa closer to meeting CEO of CEO its Vutomi of Vutomi Properti<br />

climate change objectives.<br />

In 2005 In 2005 he was he involved was Investment Investment Company, a<br />

Who do you see as your customers in the LNG space? investing investing coal in and coal ot a<br />

Our customers are global and local shipping companies, assets. intensive assets. Five years Five years later, la he<br />

energy users, logistics companies, industrial and commercial operations,<br />

into oil into and oil gas and explor gas e<br />

the taxi industry and households.<br />

duction duction and midstream<br />

and such such as gas-to-power as<br />

What are the strengths of your team?<br />

shareholder shareholder and and CEO<br />

DNG Energy’s team has unity in vision, values and shared culture. International International The Energy, Energy Afric<br />

working environment is steeped in a culture of hard workers ed who DNG ed are DNG Energy Energy in 2013. in 20 H<br />

focused on the value proposition needed by the market. To those rights who rights and developed and develope an<br />

say it cannot be done, DNG Energy asks, “Why not?” ■<br />

terminal terminal Mozambique<br />

in SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

57 SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

36<br />



have been commissioned, but it is relatively expensive.<br />

Projects such as Kathu Solar Park (100MW), a<br />

concentrated solar power project, and the Roggeveld<br />

Wind Farm (147MW) are indicative of the large scale of<br />

most of the energy generation that is being rolled out.<br />

At Black Rock Mine solar power is being put to use on<br />

a smaller scale. To light the intersections leading to<br />

the mine, BEKA Schréder has installed solar-powered<br />

streetlights.<br />

All of Abengoa’s three plants in the Northern Cape<br />

use CSP which reflects the sun’s rays during the day into<br />

a molten salt storage system. The energy is then slowly<br />

released during the night. The 205m tower that collects<br />

the rays at the Khi Solar One site is one of the tallest<br />

structures in <strong>South</strong> Africa.<br />

Despite the emphasis on renewables in <strong>South</strong><br />

Africa’s latest integrated resources plan (IRP), <strong>South</strong><br />

Africa’s energy mix is still weighted towards coal.<br />

Two huge new power stations, Kusile and Medupi,<br />

are being built by Eskom and 1 000MW has been<br />

allocated to private producers to build coal-powered<br />

stations known as Thabametsi and Khanyisa. The IRP<br />

has attracted criticism for enabling an expansion of the<br />

coal industry. Koeberg nuclear power station is due to<br />

be decommissioned soon after 2045.<br />

A new centre has been established at Wits <strong>Business</strong> School<br />

to teach the new skills that are needed for new kinds of energy.<br />

The Africa Energy Leadership Centre (AELC) is supported by the<br />

Chemical Industries Education and Training Authority (CHIETA).<br />

Another body active in energy training is the Energy and Water<br />

Sector Education and Training Authority (EWSETA).<br />

Regulations in the energy sector are being keenly watched.<br />

The 2019 decision that power projects generating less than 10MW<br />

do not have to get licences from national departments has given<br />

hope to independent power producers and city governments<br />

across <strong>South</strong> Africa that a new era in energy policy has begun.<br />

These smaller projects can go ahead (up to a total of 500MW)<br />

outside of the country’s IRP but the next step – allowing<br />

companies to sell any excess power they generate to the grid –<br />

will be a real game-changer.<br />

Mining companies such as Sibanye-Stillwater and Gold<br />

Fields have made it clear that they want to marshall renewable<br />

energy resources to power their own operations, to the<br />

tune of 150MW and 40MW respectively, but clearance from<br />

government is still needed.<br />

An example of the potential that lies within companies is Tongaat<br />

Credit: Perdekraal East Wind Farm<br />

Hulett. This company’s sugar<br />

mills are producing between<br />

12MW and 14MW of power.<br />

The company believes that the<br />

national sugar industry could<br />

generate between 700MW<br />

and 900MW. The managing<br />

director of <strong>South</strong> Africa’s other<br />

sugar major, Illovo Sugar SA,<br />

was quoted in the Sunday<br />

Times in March 2020, saying,<br />

“There are opportunities around<br />

how do we sell power into<br />

the grid, opportunities within<br />

the whole biofuel, bio-energy<br />

sphere.” Mamongae Mahlare<br />

also said that the key to the<br />

sugar industry’s future lay in<br />

diversifying into energy.<br />

Many of the same conditions<br />

exist for Sappi’s wood and fibre<br />

mills in Mpumalanga and<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



KwaZulu-Natal and all of the breweries making<br />

beer across <strong>South</strong> Africa.<br />

Discussions about feed-in tariffs will have<br />

to be finalised before the huge potential of the<br />

relevant sectors can be fulfilled with regard to<br />

energy generation. If national utility Eskom is<br />

broken into separate business units then the<br />

likelihood of the tariff discussions taking place<br />

will greatly increase.<br />

Funding<br />

Enel Green Power has adopted a new approach<br />

to funding its renewable energy projects. Law<br />

firm Norton Rose Fulbright has concluded a<br />

R3.5-billion financing arrangement with Absa<br />

and Nedbank which treats five wind farms to be<br />

built by Enel as one project, resulting in better<br />

terms. This is the first time such a method has<br />

been adopted in Africa.<br />

Investec intends listing a renewable energy<br />

fund on the JSE, to be called Revego Africa<br />

Energy. In addition, private banking clients of<br />

Investec may now receive loans to fund the<br />

installation of solar power in their homes, which<br />

payment can be linked to the home loan.<br />

The support of two of <strong>South</strong> Africa’s<br />

biggest institutional investors, the Industrial<br />

Development Corporation (IDC) and the Public<br />

Investment Corporation (PIC), has been crucial<br />

in getting the renewable energy sector off<br />

the ground. They have also played a role in<br />

helping communities fund their participation in<br />

community trusts.<br />

Many partnerships between local and<br />

international companies have been established.<br />


IPP projects: www.ipp-projects.co.za<br />

National Energy Regulator of <strong>South</strong> Africa: www.nersa.org.za<br />

<strong>South</strong> <strong>African</strong> National Energy Development Institute: www.sanedi.org.za<br />

<strong>South</strong> <strong>African</strong> Photovoltaic Industry Association: www.sapvia.co.za<br />

<strong>South</strong> <strong>African</strong> Renewable Energy Council: www.sarec.org.za<br />

<strong>South</strong> <strong>African</strong> Wind Energy Association: www.sawea.org.za<br />

<strong>South</strong> <strong>African</strong> partners are often local energy<br />

companies and representatives of residents.<br />

Typically, a community trust is established to<br />

represent the interests of the local community.<br />

Investment by black people into the<br />

renewable energy programme is not limited to<br />

community trusts. Pele Green Energy is engaged<br />

with a photovoltaic plant at Touwsrivier in the<br />

Western Cape as a shareholder and as a provider<br />

of construction management services. Once the<br />

facility starts generating power, Pele will operate<br />

and maintain the plant.<br />

Among the international investors<br />

active are Enel Green Power (Italy), Scatec<br />

Solar (Norway), Globeleq (UK), Mainstream<br />

Renewable Power (Ireland), Gestamp<br />

Renewable Energies and Abengoa (Spain),<br />

Solar Capital (Phelan Energy Group, Ireland),<br />

SunEdison (USA), ACWA Power (Saudi Arabia),<br />

China Longyuan Power Group (China), Engie<br />

(France), juwi Group (Germany) and Tata<br />

Power of India. The last-named company<br />

recently sold to partner Exxaro Resources its<br />

50% stake in Cennergi, which owns two wind<br />

farms in the Eastern Cape.<br />

Partnerships with foreign utilities or power<br />

companies are becoming more common,<br />

in part because the competition is bringing<br />

down the price which bidders are offering<br />

to sell power. This makes it difficult for <strong>South</strong><br />

<strong>African</strong> firms to compete on their own. Many<br />

foreign investors such as large national utilities<br />

have strong reserves of cash and do not need<br />

to borrow money.<br />

The bank created by the five nations of<br />

BRICS, the New Development Bank (NDB), has<br />

made $180-million available to Eskom to help it<br />

integrate power from renewable energy sources<br />

to the national grid. ■<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />


ICT<br />

Data centres are booming.<br />


As <strong>South</strong> Africa joins the global trend towards online<br />

shopping and with the first networks rolling out 5G in<br />

2020, data centres are going up all over the country.<br />

Teraco stores data in Johannesburg, Durban and Cape<br />

Town. A second 30MW site is under construction in Brackenfell<br />

to complement the existing facility in Rondebosch (pictured).<br />

Microsoft Azure has facilities in Cape Town and Johannesburg<br />

and Amazon has two sites in Cape Town. Huawei Cloud Services<br />

will use a partner company in Johannesburg to store its data.<br />

Africa Data Centre (ADC), part of the Liquid Telecom Group, has<br />

purchased a Tier IV data centre in Johannesburg, previously used<br />

by Standard Bank.<br />

A 2019 study by Microsoft found that the cloud ecosystem<br />

will create around 112 000 new jobs in <strong>South</strong> Africa by 2022<br />

(IT Web). The number of permanent employees of Amazon Web<br />

Services reached 7 000 in October 2020. Acuity Consultants was<br />

quoted in 2019 as saying that software developers’ salaries had<br />

risen by 30% in a year (<strong>Business</strong> Times).<br />

A new entrant to the <strong>South</strong> <strong>African</strong> market relies entirely<br />

on the cloud. Uniconta, an enterprise resource planning (ERP)<br />

system for small and medium-sized businesses, opened its first<br />

offices in Cape Town in 2019, a precursor to plans to expand<br />

elsewhere in Africa.<br />

Cell C became <strong>South</strong> Africa’s third mobile operator in 2001,<br />

following MTN and Vodacom. Cell C was in the news early in<br />

2020 when it defaulted on interest payments on a loan and this<br />

had an effect on the shares of Blue Label Telecoms, which owns<br />

45% of the operator. When Cell C’s results were announced in<br />

October 2020, reference was made to a turnaround strategy.<br />

Telkom, which became the country’s fourth operator in 2010,<br />

intends selling its cellphone towers and masts (estimated to be<br />

worth about R12-billion) in order to invest in 5G.<br />

The Council for Scientific and Industrial Research (CSIR) in<br />

Pretoria will host a new body aimed at preparing <strong>South</strong> Africa<br />

for the Fourth Industrial Revolution (4IR), the <strong>South</strong> <strong>African</strong><br />


<strong>Business</strong> Process Enabling SA: www.bpesa.org.za<br />

Independent Communications Authority: www.icasa.org.za<br />

Technology Innovation Agency: www.tia.org.za<br />


Vodacom is rolling out 5G.<br />

Credit: Data Centre Map<br />

Affiliate Centre of the World<br />

Economic Forum.<br />

The Small Enterprise<br />

Development Agency<br />

(Seda) runs the SoftstartBTI<br />

ICT incubator in Midrand<br />

and Tuksnovation, a hightech<br />

incubator, at Pretoria<br />

University. Several incentives<br />

relevant to companies and<br />

educational bodies in the ICT<br />

sector are available from the<br />

Department of Trade, Industry<br />

and Competition (dtic).<br />

The Information<br />

Technology Association (ITA)<br />

is the trade and employer<br />

body of the Information<br />

Technology industry in <strong>South</strong><br />

Africa. The ITA represents<br />

more than 200 companies<br />

which supply information<br />

technology equipment,<br />

systems, software and<br />

services. Members include<br />

IBM, Microsoft SA, Siemens,<br />

SAP and Axiz. ■<br />

61 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Oil, gas and petrochemicals<br />

Exploration for gas off the south-eastern coast is hotting up.<br />


Sasol is selling assets to<br />

reduce debt.<br />

The Karoo Deep Drilling and Geo-environmental Baseline Project is<br />

investigating the potential impact of shale gas drilling.<br />

(Credit: Council for Geoscience)<br />

There was great excitement in the oil and gas sector when<br />

Total and its joint venture partners announced in the 2019<br />

that they had made a discovery at a site called Brulpadda,<br />

off the coast of Mossel Bay.<br />

The drilling was successful enough to warrant the return of the semisubmersible<br />

rig Deepsea Stavenger from Norway to <strong>South</strong> Africa and in<br />

August 2020 the rig was in place to drill the nearby Luiperd prospect in<br />

Block 11B/12B. The block, in the Outeniqua Basin 175km off the southern<br />

coast, covers an area of about 19 000km² in water depths of 200-1 800m.<br />

In October 2020, Total announced that it made a second significant gas<br />

condensate discovery on the Luiperd prospect.<br />

Total E&P <strong>South</strong> Africa BV is the operator (45%) with partners<br />

Qatar Petroleum International Upstream LLC (25%), CNR<br />

International (<strong>South</strong> Africa) Ltd<br />

(20%) and Main Street 1549<br />

Proprietary Ltd (10%, of which<br />

Africa Energy has a 49% stake).<br />

Petroleum Agency <strong>South</strong><br />

Africa (PASA), which encourages<br />

exploration and regulates the<br />

oil and gas industry, has noted<br />

the significance of international<br />

oil companies committing to<br />

exploration off <strong>South</strong> Africa’s<br />

coast. Increased confidence by<br />

such companies can only lead<br />

to growth in the industry, and<br />

with the massive gas finds in the<br />

Rovuma Basin off Mozambique<br />

in 2020, there are sure to be<br />

more companies interested in<br />

<strong>South</strong> Africa’s potential.<br />

Another drilling project – on<br />

land this time – was launched in<br />

September 2020 in the Karoo.<br />

The Council for Geoscience<br />

(CGS) announced phase two<br />

of the Karoo Deep Drilling and<br />

Geo-environmental Baseline<br />

Project (KDD) in Beaufort West.<br />

The geoscientific research<br />

project in the Karoo Basin is<br />

aimed at developing a geoenvironmental<br />

baseline model<br />

with a focus on assessing<br />

the potential environmental<br />

impacts of shale gas<br />

development in the Karoo.<br />

A Gas Utilisation Master Plan<br />

(GUMP) is being developed as a<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



part of national energy policy. Private companies are responding<br />

to this changed environment. Renergen, which owns rights to a<br />

field of liquified natural gas (LNG) in the Free State, has started<br />

taking orders for its product from logistics companies. Bulk Hauliers<br />

International Transport (BHIT) has signed an agreement to take LNG<br />

to fuel 50 of its trucks, which should lead to lower operating and<br />

maintenance costs. <strong>South</strong> <strong>African</strong> Breweries is another client.<br />

Delta Natural Gas (DNG) Energy announced in 2019 the rollout of<br />

400 natural gas refuelling sites across <strong>South</strong> Africa with a focus on the<br />

taxi and logistics sectors. The major economic sectors using gas are<br />

the metals sector and the chemical, pulp and paper sector. Brick and<br />

glass manufacturers are also big consumers.<br />

Anadarko Petroleum, a US company, is investing $20-billion<br />

to build a liquid natural gas (LNG) plant in Mozambique. The<br />

projected spin-offs for the <strong>South</strong> <strong>African</strong> economy are estimated<br />

to top R7-billion.<br />

A new addition to <strong>South</strong> Africa’s pipeline network is a pipe to<br />

get natural gas from Mozambique to Gauteng. SacOil’s R90-billion<br />

project will deliver gas to Johannesburg and nearby towns.<br />

International chemicals and energy company Sasol has<br />

several large plants in Mpumalanga and the Free State. Sasol Gas<br />

is one of the four Sasol operations at Secunda, supplying natural<br />

gas to Sasol Synfuels and buying Sasol Synfuels’ methane-rich<br />

pipeline gas.<br />

Air Liquide Large Industries SA, a subsidiary of French company<br />

Air Liquide, has purchased Sasol’s oxygen production site in Secunda<br />

for R8.5-billion. The site, which contains 16 air separations units, will<br />

continue to supply gas and oxygen to Sasol’s various plants in terms<br />

of a supply agreement. Sasol is selling a number of its assets in an<br />

effort to reduce debt.<br />

Large quantities of oil are transported around the Cape of Good<br />

Hope every year: 32.2% of West Africa’s oil and 23.7% of oil emanating<br />

from the Middle East. Irrespective of market volatility, the longterm<br />

prospects for shipping and oil and gas are strong enough for<br />

national government to pursue Operation Phakisa (which includes a<br />

strong maritime economy element) and for Transnet National Ports<br />

Authority to spend heavily on upgrading the nation’s ports. The Port<br />

of Saldanha has a new open-access liquefied petroleum gas (LPG)<br />

plant run by Sunrise Energy.<br />

The Department of Trade, Industry and Competition (dtic)<br />

has established a Gas Industrialisation Unit (GIU). The first two<br />


National Energy Regulator of <strong>South</strong> Africa: www.nersa.org.za<br />

Petroleum Agency SA: www.petroleumagencysa.com<br />

<strong>South</strong> <strong>African</strong> National Energy Association: www.sanea.org.za<br />

<strong>South</strong> <strong>African</strong> Petroleum Industry Association: www.sapia.co.za<br />

sites identified by the DoE<br />

for liquefied natural gas<br />

(LNG) plants are Richards Bay<br />

(2 000MW) and the Coega<br />

Industrial Development Zone<br />

(1 000MW) in the Eastern Cape.<br />

This has the potential to turn<br />

the Richards Bay Industrial<br />

Development Zone (RBIDZ) and<br />

its Eastern Cape counterpart<br />

into energy hubs.<br />

The Coega IDZ is also<br />

home to the country first gasfired<br />

plant run by a private<br />

consortium, the Dedisa power<br />

plant. A new gas turbine open<br />

cycle power plant near Durban<br />

has been commissioned by<br />

Avon Peaking Power.<br />

The <strong>South</strong> <strong>African</strong> oil industry<br />

generates annual sales of about<br />

R365-billion and includes global<br />

giants such as Engen, BP, Shell,<br />

Total and Chevron.<br />

Most of the oil that feeds<br />

the country’s four crude-oil<br />

refineries is imported. The<br />

refineries are in Cape Town,<br />

Sasolburg and Durban (two).<br />

In addition to <strong>South</strong> Africa’s<br />

crude-oil refineries, natural-gas<br />

conversion plant, coal-to-fuel<br />

and gas-to-liquid crude-oil<br />

refineries, Sasol produces fuel<br />

from coal at its Secunda facility<br />

and PetroSA has the country’s<br />

only gas-to-liquid (GTL) facility<br />

at Mossel Bay.<br />

Getting fuel to the province<br />

of Gauteng is the key mission of<br />

the new multi-purpose pipeline<br />

(NMPP) which started delivering<br />

fluids in 2012. The NMPP<br />

terminals allow for greater<br />

flexibility in supply. Refined<br />

products such as jet fuel,<br />

sulphur diesel and both kinds of<br />

octane petrol are carried. ■<br />

63 SOUTH AFRICAN BUSINESS <strong>2021</strong>

FOCUS<br />

A game-changer for<br />

<strong>South</strong> <strong>African</strong> oil and gas<br />

Light oil and gas condensate discoveries could be the start<br />

of something big off the <strong>South</strong>ern Cape coast.<br />

If the <strong>South</strong> <strong>African</strong> gas market is to take off and<br />

thrive, significant drilling has to take place. As the<br />

new CEO of Petroleum Agency SA, Dr Phindile<br />

Masangane, describes the situation: “That would<br />

be a game-changer for <strong>South</strong> Africa’s upstream oil<br />

and gas industry.”<br />

As it happens, a major discovery has been made<br />

at a site south-east of Mossel Bay called Brulpadda.<br />

Says Dr Masangane: “The recent discovery by Total<br />

and its JV partners in Block 11B/12B (Brulpadda) is<br />

the first giant step in that direction.”<br />

Odfjell’s Deepsea Stavanger semi-submersible<br />

oil rig relocated from Norway to <strong>South</strong> Africa<br />

in June 2020 to start exploratory drilling. The<br />

Luiperdpadda prospect where the rig is drilling<br />

is the second of five prospects in the group. With<br />

light oil and gas condensate having been found<br />

in the Brulpadda well, it is possible that other<br />

prospects will be found with this further drilling.<br />

Africa Energy holds a 4.9% effective interest<br />

in the Exploration Right for Block 11B/12B.<br />

The Company owns 49% of the shares in Main<br />

Street 1549 Proprietary Limited, which has a 10%<br />

participating interest in the block. Total as operator<br />

holds a 45% participating interest in Block 11B/12B,<br />

while Qatar Petroleum (25%) and CNRI (20%) are<br />

the other participants.<br />

The exploration drilling in Block 11B/12B<br />

is in deep waters similar to where the gigantic<br />

Mozambique Rovuma Basin gas discoveries were<br />

made in 2010. The drilling campaign has long-term<br />

benefits to <strong>South</strong> Africa which include introducing<br />

frontier deepwater (>1400m) exploration drilling,<br />

building confidence and potentially shifting<br />

petroleum exploration activities to private<br />

international oil companies (IOCs), de-risking<br />

deep-water acreage which is believed to be<br />

prospective for large oil and gas resources. This will<br />

encourage other IOCs to take risk in drilling deepwater<br />

prospects, which could result in the country<br />

discovering more oil and gas resources.<br />

In June 2020, the Block 11B/12B joint venture<br />

received the fast-track 3D seismic dataset<br />

from Petroleum Geo-Services ASA for the<br />

2 305km² 3D seismic programme completed<br />

earlier in the year on the block. Initial<br />

interpretive work has identified a number<br />

of additional leads, including a potential<br />

northern extension to the Luiperd Prospect.<br />

When the Block 11B/12B JV receives<br />

the fully-processed 3D dataset it will then<br />

integrate the PGS data with the Polarcus<br />

3D seismic data from 2019 in order to<br />

mature previously identified leads into<br />

prospects. “Further development of the<br />

discovery is highly dependent on the<br />

success of this further drilling,” comments<br />

Dr Masangane. “Possible development<br />

could see condensate being piped to the<br />

PetroSA facility in Mossel Bay,” she adds, “but<br />

these decisions are ultimately up to the<br />

operator, Total and its partners.”<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

64 34

FOCUS<br />

Petroleum Agency SA: promoting<br />

and regulating exploration and production.<br />

Petroleum Agency SA evaluates, promotes and<br />

regulates oil and gas exploration as well as related<br />

production activities in <strong>South</strong> Africa, in addition<br />

to archiving all relevant geotechnical data. The<br />

Agency acts as an advisor to the government and<br />

carries out special projects at the request of the<br />

Minister of Mineral Resources and Energy.<br />

<strong>South</strong> Africa’s energy mix is changing to include<br />

more gas through importing liquefied natural gas<br />

(LNG), using shale gas if reserves prove commercial,<br />

and developing infrastructure for the import of<br />

LNG. Petroleum Agency SA plays an important<br />

role in developing <strong>South</strong> Africa’s gas market by<br />

attracting qualified and competent companies to<br />

explore for gas. Another major focus is increasing<br />

the inclusion of historically disadvantaged <strong>South</strong><br />

<strong>African</strong>-owned entities in the upstream industry.<br />

Currently, natural gas supplies just 3% of <strong>South</strong><br />

Africa’s primary energy. A significant challenge<br />

facing the development of a major gas market<br />

is the dominance of coal. Opportunities for gas<br />

lie in the realisation of <strong>South</strong> Africa’s National<br />

Development Plan (NDP) and the Integrated<br />

Resource Plan (IRP).<br />

As custodian, Petroleum Agency SA ensures<br />

that companies applying for gas rights are<br />

vetted to make sure they are financially qualified<br />

and technically capable, as well having a good<br />

environmental track record. Oil and gas exploration<br />

requires enormous capital outlay and can<br />

represent a risk to workers, communities and the<br />

environment. Applicants are therefore required to<br />

prove their capabilities and safety record and must<br />

carry insurance for environmental rehabilitation. ■<br />

Contact details<br />

Tel: +27 21 938 3500<br />

Email: plu@petroleumagencysa.com<br />

Website: www.petroleumagency.com<br />


Dr Phindile Masangane was appointed as the<br />

CEO of the <strong>South</strong> <strong>African</strong> upstream oil and gas<br />

regulatory authority, Petroleum Agency <strong>South</strong><br />

Africa, in May 2020. Before then, Dr Masangane<br />

was an executive at the <strong>South</strong> <strong>African</strong> state-owned<br />

energy company, CEF (SOC) Ltd, which is the<br />

holding company of PASA.<br />

Dr Masangane was responsible for<br />

clean, renewable and alternative energy<br />

projects. In partnership with private<br />

companies, she led the development<br />

of energy projects including the deal<br />

structuring, project economic modelling<br />

and financing on behalf of the CEF Group<br />

of Companies. Her responsibilities included<br />

supporting the national government<br />

in developing energy policy and<br />

regulations for diversifying the<br />

country’s energy mix. In 2019, Dr Masangane was<br />

Head of Strategy for the CEF Group of Companies<br />

where she led the development of the group’s<br />

long-term strategic plan, Vision 2040+ as well as<br />

the group’s gas strategy. From 2010 to 2013, she<br />

was a partner and director at KPMG, responsible for<br />

the Energy Advisory Division. She successfully<br />

led the capital raising of $2-billion for<br />

hydro and coal power plants expansion<br />

programmes of the Zimbabwean power<br />

utility, ZESA/ZPC.<br />

An alumnus of three universities, Dr<br />

Masangane has a BSc (mathematics<br />

and chemistry) from the University of<br />

Swaziland, a PhD in Chemistry from<br />

Imperial College, London and an<br />

MBA from the University of the<br />

Witwatersrand. ■<br />

65 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Water<br />

Infrastructure spending will have to be consistently high.<br />


The National Cleaner<br />

Production Centre <strong>South</strong><br />

Africa is finding ways to use<br />

less water.<br />

Amatola Water.<br />

The National Department of Water and Sanitation has<br />

released a master plan in response to the severe droughts<br />

that have affected the country in recent years. It calls<br />

for annual investment for a decade of R3.3-billion in<br />

infrastructure to achieve water security. This is a figure that can<br />

only be achieved with the help of the private sector.<br />

In 2030 <strong>South</strong> <strong>African</strong> demand for water will be 17%<br />

greater than supply. That is the verdict of the 2030 Water<br />

Resources Group, an international consortium of private<br />

companies, agencies and development banks that has<br />

established a <strong>South</strong> <strong>African</strong> chapter, the Strategic Water<br />

Partners Network.<br />

The National Cleaner Production Centre <strong>South</strong> Africa (NCPC)<br />

is the technical partner for the water use part of Phase 2 of the<br />

Strategic Water Sector Cooperation between the governments<br />

of Denmark and <strong>South</strong> Africa. NCPC, which runs the Industrial<br />

Water Efficiency project, has found that more efficient use of<br />

energy (a key focus area of its work) has also led to less water<br />

being used in production processes.<br />

A strategic review led Aveng to dispose of Aveng Water and<br />

Aveng Namibia Water in June 2019, together with a range of<br />

other businesses deemed to be non-core. The buyer was Infinity<br />

Partners, a 100% black-owned company jointly held by investor<br />

E-Squared Investments and Suzie Nkambule, who was the MD of<br />

Aveng Water up until the time it was sold.<br />

Another sale in 2019 resulted in Inzalo Capital Holdings taking<br />

a 60% stake in the water group of Sebata Group Holdings. The two<br />

companies affected are USC Metering and Amanzi Meters which,<br />

as a result of the transaction,<br />

qualify as “Black Industrialist”<br />

businesses in terms of the Black<br />

Industrialist Policy (BIP) of the<br />

Department of Trade, Industry<br />

and Competition (dtic).<br />

The Western Cape, which<br />

bore the brunt of a fierce<br />

drought for several years, fares<br />

well in terms of providing water<br />

infrastructure and maintaining<br />

its wastewater treatments<br />

plants. The Western Cape<br />

Department of Agriculture<br />

has launched a climate action<br />

plan called Smart Agri which<br />

includes doing studies on<br />

conservation agriculture.<br />

When the long-term<br />

drought was at its worst,<br />

tourists to Cape Town were<br />

encouraged to “Save like a<br />

Local”. Together with a range<br />

of technical and legislative<br />

measures, the campaign<br />

to use less water worked<br />

remarkably well.<br />

The drought also led<br />

to creative thinking by<br />

corporate <strong>South</strong> Africa. Old<br />

Mutual’s large Pinelands<br />

campus (accommodating<br />

approximately 9 000 staff<br />

members) is producing its own<br />

water by purifying wastewater.<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



Technology and innovation<br />

A plant that makes water from air was launched in 2019. Aqua Air<br />

Africa has established an atmospheric water-generation plant at<br />

Ga-Rankuwa near Pretoria and is producing about 10 000 litres<br />

per day through a process that involves the condensation of<br />

water vapour into liquid.<br />

Simpler technology is giving the pupils at a school<br />

in Limpopo access to drinking water. Students from<br />

the University of Pretoria’s Department of Geography,<br />

Geoinformatics and Meteorology have helped to build a net<br />

in the mountains where Tshiavha Primary School is located.<br />

Fog is captured by a big net and channelled into tanks by<br />

a gutter running along the bottom of the net. About 2 500<br />

litres of water is captured per day which means that there is<br />

enough to share among the villagers.<br />

A new kind of water filtration system has been pioneered by<br />

a water entrepreneur from the same province, a system which<br />

puts macadamia nut shells to use. The brainchild of Murendeni<br />

Mafumo, the idea was first put into action in 2018 and has been<br />

used in schools and rural communities by Kusini Water. Powered<br />

by solar power, the purification system uses a carbon filter that<br />

is made from macadamia nut shells.<br />

The province of KwaZulu-Natal is taking a lead in<br />

desalination technology. Richards Bay has installed a<br />

10-container desalination plant next to the municipal water<br />

treatment plant at Alkanstrand. The first mobile sea water<br />

purification unit in <strong>South</strong> Africa, it comprises 10 containers<br />

and is located adjacent to the water treatment plant at<br />

Alkantstrand. It can deliver 10 megalitres of drinking water. In<br />

2018 JG Afrika and technology partner NuWater delivered a<br />

R72-million desalination plant to <strong>South</strong>32’s Hillside aluminium<br />

smelter in the same town.<br />

In an attempt to reduce the amount of water sucked up by<br />

alien plants, Coca-Cola aims to recover nearly three-billion litres<br />


National Cleaner Production Centre <strong>South</strong> Africa: www.ncpc.co.za<br />

National Department of Water and Sanitation: www.dwa.gov.za<br />

<strong>South</strong> <strong>African</strong> Water Research Commission: www.wrc.org.za<br />

Water Institute of <strong>South</strong> Africa: www.wisa.org.za<br />

of water through the removal<br />

of invasive plants.<br />

Supplying water to<br />

households and businesses<br />

has often been a task<br />

beyond the capabilities<br />

of some of <strong>South</strong> Africa’s<br />

municipalities. The Municipal<br />

Infrastructure Support<br />

Agency (MISA) falls under<br />

the National Department<br />

for Cooperative Governance<br />

and Traditional Affairs and<br />

will assist municipalities<br />

to plan for, provide and<br />

maintain infrastructure. The<br />

first action of MISA was to<br />

commission 81 engineers<br />

and town planners to get to<br />

work in areas that need the<br />

most help.<br />

Another response to<br />

the municipal problem is a<br />

new national strategy which<br />

gives a bigger role to wellresourced<br />

water boards<br />

such as Umgeni Water and<br />

Sedibeng Water.<br />

In terms of the National<br />

Water Resource Strategy,<br />

catchment area management<br />

agencies have been established<br />

to oversee water resource<br />

management on a regional<br />

basis. The Imkomati-Usuthu<br />

Catchment Management<br />

Agency covers Mpumalanga,<br />

parts of Limpopo and part of<br />

the Kingdom of Swaziland.<br />

Another example of a CMA is<br />

the Breede-Gouritz Catchment<br />

Management Agency in the<br />

Western Cape. ■<br />

67 SOUTH AFRICAN BUSINESS <strong>2021</strong>

FOCUS<br />

Gert Sibande Water<br />

Quality Testing Laboratory<br />

Improving water quality for citizens of the district.<br />

The Gert Sibande Water Quality Testing<br />

Laboratory is the only SANASaccredited,<br />

government-owned<br />

facility in the Mpumalanga Province.<br />

It is situated on the N17 corridor in<br />

Ermelo, bounded by Ekurhuleni Metro of the<br />

Gauteng Province to the west, Sedibeng District<br />

Municipality of the Northern Free State to<br />

the south-west, Ehlanzeni District Municipality<br />

of Mpumalanga Province to the northeast,<br />

Nkangala District Municipality to<br />

the north (Mpumalanga Province), Amajuba<br />

District Municipality to the south-east of<br />

KZN and Swaziland to the east and, therefore,<br />

easily accessible.<br />

The facility is evidence of Gert Sibande District<br />

Municipality’s vision to be “A community-driven<br />

district of excellence and development” and is in<br />

line with the National Development Plan (NDP)’s<br />

vision 2030 which is:<br />

“To ensure that all <strong>South</strong> <strong>African</strong>s have access to<br />

clean running water in their homes.”<br />

The centrality and the strategic location of<br />

this facility ensures easy accessibility by all stakeholders.<br />

Informed by the need to improve water<br />

quality in the district, the laboratory was established<br />

in 2011 to guarantee safe drinking water<br />

provided to millions of citizens within the district<br />

according to section 9 (1) of the Water Services Act<br />

No. 108 of 1997.<br />

GSDM laboratory staff at the GSDM Water Quality Testing Laboratory led by Ms Victoria Tshabalala (centre).<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />

68<br />


FOCUS<br />

Mr Siyabonga Makhathini, the Senior Technician (Chemistry) at the ICP room in the GSDM laboratory.<br />

The focus of the facility is on the following:<br />

• Chemical analysis.<br />

• Microbiological analysis.<br />

• Physical analysis.<br />

These services are available to all stakeholders<br />

and customers including local municipalities<br />

and industries. A pricelist is available on request.<br />

Gert Sibande District Municipality prides itself<br />

about this facility which meets the requirements of<br />

the ISO/IEC 17025:2017. In addition, the Gert Sibande<br />

Water Quality Testing Laboratory promotes water<br />

quality and care for water in communities through<br />

active involvement in awareness programmes<br />

offered by local municipalities. It also promotes<br />

careers in science by providing opportunities to<br />

students in the form of in-service training.<br />

The laboratory boasts of the provision and<br />

delivery of superior laboratory services and aims to<br />

promote and support the development of a culture<br />

of scientific learning. The Gert Sibande Laboratory<br />

regards its clients as valuable stakeholders whose<br />

interests are a priority for the laboratory.<br />


Monday to Thursday: 07h30-13h00; 13h30-16h30<br />

Friday: 07h30 to 14h00.<br />

Contact details<br />

Address: Cnr N17 Bethal and Nelspan Roads,<br />

Cassim Park. PO Box 1748, Ermelo, 2350.<br />

Tel: +27 17 801 7143.<br />

Email: laboratoryservices@gsibande.gov.za<br />

Website: www.gsibande.gov.za<br />

Facebook: @gertsibandedm<br />

Twitter: @GertSibandeDM<br />

GPS coordinates: S26 31’ 25.73” E29 58’ 19.25<br />

107 69 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Engineering<br />

Many engineering groups are selling off assets.<br />


A presidential infrastructure<br />

office may breathe new life<br />

into the sector.<br />

A semi-portable crane from RGM Cranes. Credit: Betterect.<br />

Aveng’s disposal of non-core assets is typical of<br />

the activity of larger companies in the sector. The<br />

company’s website lists Aveng Trident Steel and<br />

Aveng ACS (Automotive Control Solution) as solid<br />

businesses which will realise good value once a new owner<br />

is found and lists another eight businesses (in roads, rail,<br />

civils and electrical) which the group sold in 2019.<br />

With a renewed focus on infrastructure, resources and<br />

mining solutions, Aveng’s main operating companies are<br />

now Moolmans in <strong>South</strong> Africa (contract mining and mining<br />

services) and McConnell Dowell (engineering, construction<br />

and maintenance) in Australasia, <strong>South</strong>east Asia and the<br />

Middle East.<br />

Some of the big names such as Group Five, Basil Read<br />

and Esor are in business rescue. Others such as Murray &<br />

Roberts and WBHO rely heavily on offshore contracts for<br />

revenue. Murray & Roberts has completed its transition from<br />

being a <strong>South</strong> <strong>African</strong> company focussing on contracting to a<br />

multinational engineering and construction group with a focus<br />

on natural resources markets.<br />

An Investment and Infrastructure Office has been created<br />

in the Presidency. It is headed by the former Gauteng MEC for<br />

Economic Development, Dr<br />

Kgosientso Ramokgopa. In<br />

2020, 51 infrastructure projects<br />

with a total investment value<br />

of more than R340-billion were<br />

gazetted and hopes are high<br />

that this initiative will provide<br />

a boost for engineering firms.<br />

A study carried out by<br />

KMPG found that spending<br />

on infrastructure resulted in<br />

additional economic activity<br />

worth R26-billion and created<br />

92 000 direct jobs.<br />

Marine repair and<br />

engineering form a significant<br />

sector in the Western Cape and<br />

KwaZulu-Natal, with established<br />

companies such as EBH <strong>South</strong><br />

Africa offering comprehensive<br />

services. Both KwaZulu-Natal<br />

ports are expanding (Durban has<br />

built a cruise-liner terminal and<br />

Richards Bay is undertaking no<br />

fewer than 45 projects) and will<br />

continue to attract engineers.<br />

Dormac, which is<br />

headquartered in the Bayhead<br />

area of the Port of Durban,<br />

is best known for its marine<br />

engineering but it offers<br />

specialised services to the<br />

sugar industry and provides<br />

machinery for industrial giants<br />

like Toyota and Defy.<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



Sector news<br />

Expansion at Betterect’s manufacturing plant in Krugersdorp has<br />

helped to push production to a monthly level of 650 tons of steel<br />

plate work. This has necessitated the installation of strong and<br />

reliable cranes which have been provided by RGM Cranes for<br />

more than 30 years. Betterect specialises in mild and stainless<br />

steel fabrication, steel erection and corrosion protection.<br />

Betterect recently commissioned RGM Cranes to supply a<br />

30-ton semi-portable crane and two 10-ton single-girder cranes.<br />

The smaller cranes lift items for the erection of semi-assembled<br />

or fully assembled tanks and skids in the workshop area. Most of<br />

the RGM cranes are on site at the Chamdor site but when a fuel<br />

gantry was constructed at the airport on the island of St Helena,<br />

the two companies worked together there.<br />

RGM is the <strong>South</strong> <strong>African</strong> agent and supplier for Turkish<br />

company Güralp. The Güralp hoist is sent to <strong>South</strong> Africa in kit<br />

form (the hoist, cabling and electrics) and RGM manufactures the<br />

girders and assembles the crane.<br />

A good sign for the engineering sector came in the news that<br />

the Boksburg site where DCD Rolling Stock used to make rail<br />

wagons and fix locomotives is up and running again, courtesy of<br />

TMH Africa, a part of the TMH Group, which has head offices in<br />

Switzerland.<br />

ELB Group’s Engineering Services division employs more than<br />

1 000 people and the company is currently working full-time on<br />

the vast Gamsberg zinc project in the Northern Cape. Manganese,<br />

iron ore and coal are other mining sectors where ELB is active and<br />

it does work for Eskom (the national utility) and companies such<br />

Nestlé and Unilever.<br />

The Renewable Energy Independent Power Producer<br />

Procurement Programme (REIPPPP) has created an entirely<br />

new industry in less than seven years, with investment of about<br />

R200-billion in solar parks and wind farms. This has created<br />

many opportunities for engineers.<br />


Consulting Engineers <strong>South</strong> Africa: www.cesa.co.za<br />

Engineering Council of <strong>South</strong> Africa: www.ecsa.co.za<br />

National Department of Public Works: www.publicworks.gov.za<br />

<strong>South</strong> <strong>African</strong> Consulting Engineering Firms: www.consultsa.co.za<br />

<strong>South</strong>ern <strong>African</strong> Institution of Civil Engineering: www.civils.org.za<br />

Training<br />

A study jointly commissioned<br />

by the Water Research<br />

Commission and the <strong>South</strong><br />

<strong>African</strong> Local Government<br />

Association (SALGA) found<br />

that the country’s four-in-amillion<br />

ratio of engineers is a<br />

long way from the required<br />

50-per-million. In 2015 there<br />

were are 16 423 registered<br />

professional engineers in<br />

<strong>South</strong> Africa.<br />

One response at national<br />

level was the importation<br />

of Cuban engineers. Several<br />

partnerships between the<br />

public and private sectors are<br />

trying to address the skills<br />

deficit. One example is the<br />

partnership that Wits’ National<br />

Aerospace Centre has with<br />

Boeing and Airbus.<br />

The Skills Development<br />

Amendment Act is intended<br />

to improve the situation.<br />

Universities, universities of<br />

technology and companies<br />

are increasing their focus on<br />

the training of engineers.<br />

The Engineering Council<br />

of <strong>South</strong> Africa (ECSA) has a<br />

programme where trainees<br />

can earn certificates in specific<br />

disciplines from a range of<br />

institutions. The qualifications<br />

are in line with the council’s<br />

Exit Level outcomes. Six<br />

of <strong>South</strong> Africa’s biggest<br />

construction companies have<br />

established a R1.25-billion<br />

skills fund. ■<br />

71 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Construction and property<br />

Logistics property is strongly placed for growth.<br />


Cement and brick<br />

manufacturers are hoping for<br />

a quick recovery.<br />

Credit: Equites<br />

The trend which saw logistics property growing as a<br />

sector because of the Amazons of the world needing<br />

more space to store their products will speed up in<br />

the post-Covid world as more people work and order<br />

from home.<br />

The Economist focused in its 30 May 2020 issue on<br />

Prologis, Amazon’s biggest landlord. The American company<br />

has assets of $125-billion and 90km² of floor space, and spent<br />

$25-billion in 2019 in America and Europe. E-commerce now<br />

accounts for about 40% of its construction activity, whereas<br />

it was a fifth before the pandemic.<br />

A similar trend playing out in <strong>South</strong> Africa was noted by<br />

Nick Wilson in the <strong>Business</strong> Times (Sunday Times 5 July 2020).<br />

The logistics property sector had “boomed in recent years due<br />

to the growth of e-commerce” but was likely to do even better<br />

because of Covid-19. About a third of Fortress’s R30-billion<br />

portfolio is in the logistics sector and it signed contracts in<br />

2020 with Takealot and a Netflix production company.<br />

The clients of Equites, a company which focusses on<br />

logistics property, include Amazon, Super Group, HDL and<br />

DSV, a Danish transport and logistics company. Equites is the<br />

only specialist logistics property company listed on the JSE. In<br />

six years, its portfolio has grown from R1-billion to R15-billion.<br />

There are more than 30 real estate investment trusts (REITs)<br />

on the JSE and they generally deliver good value.<br />

FNB, which publishes a regular property barometer,<br />

has done an in-depth analysis of previous crises to help<br />

understand what may occur in the post-Covid property<br />

market. According to John Loos, a property strategist at FNB<br />

Commercial Property Finance, the most vulnerable sector is<br />

likely to be Retail Property. Smaller neighbourhood centres,<br />

with more essential items<br />

and greater convenience,<br />

will be less vulnerable.<br />

This is borne out by<br />

the results announced by<br />

Resilient in 2020. Of the<br />

company’s 28 retail centres<br />

across <strong>South</strong> Africa, the<br />

ones that did best were the<br />

smaller, rural malls.<br />

The <strong>South</strong> <strong>African</strong> Council<br />

of Shopping Centres calculates<br />

that the country has the sixthhighest<br />

number of shopping<br />

malls in the world. R2-billion<br />

was recently spent on Menlyn<br />

Park in Pretoria to expand it to<br />

177 000m² of gross lettable<br />

space while the Gateway<br />

Theatre of Shopping in<br />

Durban, <strong>South</strong> Africa’s secondbiggest<br />

mall, recently spent<br />

R750-million.<br />

The lockdown accelerated<br />

the trend for people to work<br />

from home, and so the<br />

Office Property sector will<br />

come under pressure. Many<br />

companies will be reducing<br />

office space but, as Loos<br />

writes, “Improved technology<br />

has gradually been driving a<br />

greater remote working trend<br />

for some years. Covid-19 has<br />

merely sped this trend up.”<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



Industrial Property will take a hit but is expected to<br />

recover strongly while Residential Property is expected to be<br />

the least at risk. Prices will likely go down, but people need<br />

a place to live and the work-from-home trend will increase<br />

the importance of residential property. Loos concludes that,<br />

“In a few decades time, the composition of the property<br />

stock may look noticeably different to what it is today, the<br />

key features being a smaller portion of the total being retail<br />

and office property, and an even larger portion of the stock<br />

being residential property than is currently the case.”<br />

Statistics SA has found that the percentage of <strong>South</strong><br />

<strong>African</strong>s living in flats has risen markedly. Whereas 26 out<br />

of 100 approved plans in 2013 were for flats, this figure<br />

reached 59 in 2016. Although the total number of people<br />

living in flats is still relatively small (5.4%), this figure will rise<br />

as urbanisation increases.<br />

Construction rebuilding<br />

Job losses and business rescues have been recurring themes<br />

in the <strong>South</strong> <strong>African</strong> construction sector for some time.<br />

The fact that some kind of recovery must happen after the<br />

lockdown will give hope to all construction and construction<br />

material companies, and they will hope that increased order<br />

books will allow them to restart some of their facilities.<br />

Corobrick is a manufacturer of masonry, pavers and<br />

concrete earth retaining systems. The company, which has its<br />

headquarters in Durban and employs 1 400 people, announced<br />

in 2020 that four of its 13 factories would be closing.<br />

PPC Cement suffered losses for the year ending 30 March<br />

2020 with cement demand significantly down from the<br />

previous year. The Covid-19 lockdown will have made the<br />

situation worse and a rights issue is likely to follow.<br />

Road-building, renewable energy and affordable housing<br />

have proved good sectors for Raubex, which returned<br />

good results in 2020, despite the lockdown occasioned by<br />


Construction Industry Development Board: www.cidb.org.za<br />

SA Institute of Architects: www.saia.org.za<br />

SA Reit Association: www.sareit.prowly.com<br />

<strong>South</strong> <strong>African</strong> Property Owners Association: www.sapoa.org.za<br />

Credit: Fortress Reit Ltd<br />

Covid-19. The company’s<br />

Earthworks and Materials<br />

division delivers two-thirds<br />

of its operating profit but<br />

it is upbeat about its Roads<br />

division winning contracts<br />

in <strong>South</strong> Africa in the short<br />

term. Tenders were entered<br />

for R22-billion worth of<br />

road construction in the six<br />

months to March 2020.<br />

The Inner City Local Area<br />

Plan (LAP) for Durban has<br />

been developed for the<br />

Strategic Planning unit of the<br />

eThekwini Municipality by a<br />

Joint Venture called IPPU. A<br />

major milestone was reached<br />

in 2019 when the beachfront<br />

promenade extension<br />

reached the harbour. The<br />

project began in early 2018<br />

and cost R400-million.<br />

According to the organisers<br />

of the 2019 KZN Construction<br />

Expo, infrastructure will attract<br />

more than R200-billion in<br />

investment over seven years<br />

and R35-billion will be spent<br />

over 15 years at the Port<br />

Waterfront development. ■<br />

73 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Manufacturing<br />

TFG plans to double manufacturing capacity.<br />

TFG, whose <strong>South</strong> <strong>African</strong> brands include TotalSports,<br />

Markhams and Foschini, has a five-year plan to double its<br />

manufacturing capacity.<br />

Having purchased Prestige Clothing Maitland and<br />

Prestige Clothing Caledon in 2012 and spent R75-million on<br />

expanding the factory in Caledon in 2017, TFG now plans to<br />

significantly increase the percentage of locally-made clothing<br />

items from the current level of 35% to 55%. This expansion should<br />

lead to more jobs within the group, which expanded in 2020 with<br />

the purchase of Jet from Edcon.<br />

The Manufacturing and Competitiveness Enhancement<br />

Programme (MCEP) of the Department of Trade, Industry and<br />

Competition (the dtic) has disbursed grants which have resulted in<br />

230 000 jobs being “sustained”. Because of the Clothing and Textile<br />

Competitiveness Programme, that sector currently now employs<br />

around 95 000 workers, contributing 8% to manufacturing GDP and<br />

2.9% to overall GDP. In the leather sector 22 new factories have<br />

been opened, supporting 2 200 jobs.<br />

In the Western Cape, this revival is reflected in member<br />

companies of the Cape Clothing and Textile Cluster hiring 35% more<br />

staff in four years. About 23 600 people are employed in the province<br />

and exports from the Cape amounted in 2017 to R4.4-billion with<br />

sales up by 34% above inflation.<br />


The furniture sector is finding<br />

ways to grow.<br />

The furniture manufacturing<br />

sector earned R3.9-billion in<br />

exports in 2018 and contributed<br />

1% to the country’s gross<br />

domestic product (GDP).<br />

Employment across the sector<br />

amounts to more than 26 000,<br />

but that figure is markedly<br />

down from a high of 80 000 in<br />

the 1990s. Exposure to foreign<br />

imports and distance from<br />

lucrative markets continue to<br />

pose threats to the sector, but a<br />

group of manufacturers, buyers,<br />

government and traders has set<br />

out to do something about it.<br />

A first Furniture Sector<br />

Forum (pictured) was held<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



Johannesburg in 2019 where government incentives and ideas<br />

about how to reduce the cost of expensive machinery through<br />

co-ownership and partnerships were shared. The forum was cohosted<br />

by the <strong>South</strong> <strong>African</strong> Furniture Initiative (SAFI), Proudly<br />

<strong>South</strong> <strong>African</strong>, PG Bison and the Department of Trade, Industry and<br />

Competition. The second Forum took place in October 2020, with<br />

the support of Interior Design Professions (IID) and Trend-Forward.<br />

The dtic’s Agro Processing Support Scheme (APSS) includes<br />

furniture manufacturing as a core sector for future growth and<br />

support. Other efforts to get government departments to buy locally<br />

were explained. Average employment per manufacturer is 13 people<br />

per facility which makes the sector well suited to expansion and to<br />

measures requiring flexibility, but it can lead to manufacturers feeling<br />

isolated. The idea-sharing forum is one way of overcoming that.<br />

Contribution to GDP<br />

Manufacturing’s contribution to <strong>South</strong> <strong>African</strong> GDP is 13%, less<br />

than half its contribution in the 1980s and a drop of about 11%<br />

from the 1990s. In 2018, the real-term contribution to GDP was<br />

R386.8-billion (Stats SA).<br />

The manufacturing sector employs the third most people of <strong>South</strong><br />

Africa’s economic sectors, about 1.7-million, after financial services and retail.<br />

Two of the manufacturing sectors that have achieved the best<br />

results in recent years, automotive and food and beverages, are<br />

featured separately. Food and beverages is the most significant,<br />

contributing 25% to total manufacturing activity.<br />

The global surf ski market is worth about R220-million.<br />

According to Dale Granger of biznews, some 30-40% of that niche<br />

market belongs to <strong>South</strong> <strong>African</strong> manufacturers such as East<br />

London’s Fenn and Durban-based Revo and Carbonology. The<br />

<strong>South</strong> <strong>African</strong> after whom the world’s first surf ski was named, Oscar<br />

Chalupsky, is now CEO of Nelo Surf Skis in Portugal. A new surf ski<br />

sells for between $3 000 and $6 000.<br />

<strong>South</strong> Africa’s pharmaceutical sector is worth approximately<br />

R20-billion annually. Although there are more than 200<br />

pharmaceutical firms in the country, large companies<br />

dominate, with Aspen (34%) and Adcock Ingram (25%) the key<br />

players, followed by Sanofi, Pharmaplan and Cipla Medpro. The<br />

National Association of Pharmaceutical Manufacturers (NAPM)<br />


Chemical and Allied Industries’ Association: www.caia.co.za<br />

Manufacturing Circle: www.manufacturingcircle.co.za<br />

<strong>South</strong> <strong>African</strong> Furniture Initiative: www.furnituresa.org.za<br />

<strong>South</strong> <strong>African</strong> Textile Federation: www.texfed.co.za<br />

has re-branded as Generic<br />

and Biosimilar Medicines of<br />

<strong>South</strong>ern Africa.<br />

The opening in May 2018<br />

of a R1-billion specialised<br />

product facility at the Port<br />

Elizabeth plant of Aspen<br />

Pharmacare will add 500 jobs<br />

to the existing complement of<br />

2 000 staff members.<br />

<strong>South</strong> Africa’s chemical<br />

industry contributes 5%<br />

to national gross domestic<br />

product and about 60% of<br />

earnings are derived from<br />

exports. The complexes<br />

run by Sasol at Secunda<br />

(Mpumalanga) and Sasolburg<br />

(Free State) underpin the<br />

national manufacturing<br />

capacity. Sasol Chemical<br />

Industries makes about 60% of<br />

<strong>South</strong> Africa’s polypropylene.<br />

AECI is one of <strong>South</strong><br />

Africa’s biggest groups. The<br />

two principal divisions are AEL<br />

Mining Services (with a large<br />

factory site at Modderfontein<br />

near Johannesburg) and<br />

Chemical Services, which<br />

has 20 separate companies.<br />

Foskor is the country’s<br />

only vertically integrated<br />

phosphates producer.<br />

The by-products of the<br />

sugar and forestry processing<br />

plants of KwaZulu-Natal<br />

benefit the chemicals sector.<br />

Illovo Sugar manufactures<br />

downstream products such<br />

furfural, furfuryl, alcohol,<br />

diacetyl and ethyl alcohol.<br />

Sappi makes 17% of the world’s<br />

dissolving wood pulp. Two of<br />

the companies three mills are<br />

in <strong>South</strong> Africa, Ngodwana<br />

(Mpumalanga) and Saiccor<br />

(KwaZulu-Natal). ■<br />

75 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Food and beverages<br />

Starch mills are changing hands.<br />


<strong>South</strong> <strong>African</strong>s love chicken<br />

and hamburgers.<br />

Tongaat Hulett, best known as a sugar producer, is selling<br />

its starch business (with three milling plants in Gauteng<br />

and one in the Western Cape) to the KLL Group, a whollyowned<br />

subsidiary of Barloworld Logistics Africa. The<br />

Germiston plant is pictured.<br />

The R5.3-billion transaction was in doubt because of concerns<br />

about the value of the business expressed by the buyer in the<br />

context of Covid-19 but the Competition Tribunal in July 2020<br />

approved the deal.<br />

The top five fast-food companies in terms of outlets in 2019 were<br />

KFC (900), Steers (600), Debonairs (569), Wimpy (467) and Nando’s<br />

(340). McDonald’s, FishAways and King Pie were close together in the<br />

next three positions in a survey done by <strong>Business</strong> Tech. The survey<br />

found a total of 5 287 stores, which includes the somewhat vague<br />

“over 200 stores” claimed by Chicken Licken.<br />

Famous Brands owns Steers, Debonairs, Wimpy and FishAways,<br />

a typical scenario in the <strong>South</strong> <strong>African</strong> fast-food sector. The Spur<br />

Corporation has outlets in several segments including family<br />

diners, pizzerias, hamburger outlets and steak houses, including<br />

the Hussar Grill.<br />

Taste Holdings announced in 2020 that it was placing its<br />

food business into voluntary liquidation after a failed attempt<br />

to sell the Domino’s Pizza business. The Starbucks franchise<br />

was sold for R7-million.<br />

More than half of the companies operating in the food<br />

and beverage sector in <strong>South</strong> Africa are in Gauteng, including<br />

Nestlé, Tiger Brands, Pioneer Foods, RCL, AVI and Astral. There are<br />

approximately 4 000 food processing companies in the province,<br />

employing more than 100 000 people.<br />


Agricultural Research Council: www.arc.agric.za<br />

FoodBev SETA: www.foodbev.co.za<br />

National Agricultural Marketing Council: www.namc.co.za<br />

Two of the best-known large<br />

companies in <strong>South</strong> Africa’s<br />

food and beverages sector were<br />

purchased by international<br />

companies in 2019. PepsiCo<br />

bought Pioneer Foods and<br />

Central Bottling Co of Israel made<br />

on offer on dairy company Clover.<br />

Clover’s action in 2019<br />

in closing three small-town<br />

plants in rural areas illustrated<br />

a less positive aspect of <strong>South</strong><br />

<strong>African</strong> manufacturing: the<br />

inability of small municipalities<br />

to adequately supply services<br />

to companies. Clover moved<br />

production to Port Elizabeth,<br />

Durban and Johannesburg.<br />

Food and beverages makes<br />

up 26% of the <strong>South</strong> <strong>African</strong><br />

consumer products sector,<br />

just ahead of agro-business<br />

(25%), diversified companies<br />

(23%) and sugar producers.<br />

Recent capital expenditure<br />

in the industry has targeted<br />

improving efficiency rather<br />

than expansion of production.<br />

The food and beverages<br />

sector employs about 230 000<br />

people. Beverages accounts for<br />

just over 4% of all manufacturing<br />

sales while food is responsible<br />

for 13.5%. Within the sector,<br />

beverages accounts for 24% of<br />

sales. One quarter of the 37% of<br />

national GDP that is generated<br />

by agro-industries derives from<br />

agro-processing. ■<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />


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Automotive<br />

The automotive sector makes up a third of <strong>South</strong> Africa’s manufacturing capacity.<br />


Supplier parks and Special<br />

Economic Zones are playing<br />

to <strong>South</strong> Africa’s automotive<br />

strength.<br />

The East London IDZ hosts a number of automotive companies.<br />

Vehicle sales declined sharply in the Covid-19 lockdown<br />

period. For the year to September 2020, sales of passenger<br />

vehicles went down by 34.4% and by a similar amount in<br />

light commercial vehicles.<br />

Analysts will be closely watching consumer behaviour as<br />

economies open again to monitor the effects of working from home<br />

and the further growth of the ride-hailing trend.<br />

The manufacturing part of the automotive and components<br />

sector is a vital part of <strong>South</strong> Africa’s manufacturing landscape. It is<br />

responsible for more than 112 000 jobs which translates to more than<br />

450 000 jobs once the multiplier effect is taken into account.<br />

The <strong>South</strong> <strong>African</strong> automotive industry also accounts for:<br />

• 30.1% of the country’s manufacturing output.<br />

• 6.9% of GDP (4.4% manufacturing, 2.5% retail).<br />

• 27.6% of value addition within domestic manufacturing.<br />

• exports to 151 countries, 74% to EU.<br />

• exports in 2018 of vehicles and components of R201.7-billion, a<br />

record (and 15.5% of country total).<br />

• exports in 2019 of 387 125 vehicles achieved a new record<br />

amount of R148-billion and components also set a new record<br />

of R53.7-billion.<br />

(National Association of Automobile Manufacturers of <strong>South</strong> Africa,<br />

NAAMSA)<br />

Foreign direct investment<br />

(FDI) into <strong>South</strong> Africa from<br />

seven of the eight Original<br />

Equipment Manufacturers<br />

(OEMs) totalled R7.3-billion<br />

in 2019 and a further<br />

commitment was made<br />

of another R40-billion<br />

investment over the next<br />

five years. The component<br />

sector invested R3.5-billion<br />

in 2019 (Automotive Industry<br />

Development Centre, AIDC).<br />

Long-term state support<br />

of the industry through the<br />

Automotive Production and<br />

Development Programme<br />

(APDP) is a major reason for<br />

the continuing health of this<br />

vital sector. The industry itself<br />

is looking to Africa for new<br />

markets. By increasing total<br />

production numbers to onemillion<br />

vehicles, the sector will<br />

become more viable.<br />

The National Department of<br />

Trade, Industry and Competition<br />

(the dtic), working together<br />

with the National Association<br />

of Automobile Manufacturers<br />

of <strong>South</strong> Africa (NAAMSA) has<br />

set targets for 2035 to increase<br />

production to 1% of world<br />

volumes (which would mean<br />

1.4-million more vehicles made<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



in SA), increasing local content and doubling employment and blackowned<br />

businesses in the sector.<br />

<strong>South</strong> Africa has three centres of automotive production: the<br />

Eastern Cape, Gauteng and KwaZulu-Natal. In the Eastern Cape, the<br />

OEMs are Volkswagen, Mercedes-Benz, Isuzu and Beijing Automobile<br />

Investment Corporation (BAIC). Ford has an engine plant in Port<br />

Elizabeth.<br />

In KwaZulu-Natal Toyota has a large plant just south of Durban.<br />

Although the manufacturers of loaders, dump trucks and haulers are<br />

not counted in the tally of <strong>South</strong> <strong>African</strong> OEMs, Bell Equipment, a<br />

global leader in its field, runs a large manufacturing site in Richards<br />

Bay. Dezzi Equipment is based in Port Shepstone. In 2018 AIH<br />

Logistics started assembling Mahindra and Bolero bakkies from kits<br />

imported from India on a site at the Dube TradePort. Pretoria is home<br />

to BMW, Nissan and Ford.<br />

All three centres are making use of targeted land allocation to<br />

try to boost the sector through industrial parks or Special Economic<br />

Zones. The idea is to get economies of scale through grouping<br />

companies which serve one another. Training becomes easier and<br />

costs can be reduced.<br />

Chinese OEM BAIC is the first new entrant into the market to set<br />

up within an SEZ. The planned investment in the Coega SEZ by BAIC<br />

and its partners is R11-billion. BAIC expects to be building 50 000<br />

vehicles per year at its site at the Coega SEZ by 2022.<br />

Automotive component suppliers and downstream<br />

manufacturers such as electronics components, metal fabrication,<br />

plastic moulding, precision machining and trim are expected to<br />

take up opportunities in the Automotive Zone within the Coega<br />

SEZ, as they do at the East London Industrial Development Zone<br />

(ELIDZ). Companies in the ELIDZ which manufacture in support of<br />

the Mercedes-Benz operation include Feltex Automotive Trim, TI<br />

Automotive (brake and fuel pipes), Yanfeng Automotive Interiors,<br />

Linde+Wiemann (seat frames, recliners, metal surface treatment)<br />

and Onelogix VDS, which is a logistics company that delivers<br />

motor vehicles.<br />

In line with the policy of developing industrial economic<br />

hubs, the Durban Automotive Supplier Park is being built at Illovo,<br />

south of Durban and near to the Toyota plant. The Dube TradePort<br />

Corporation will manage the project, which covers 1 013ha. The<br />

Durban Automotive Cluster, which has 39 member companies,<br />


Automotive Industry Development Centre: www.aidc.co.za<br />

Manufacturers: www.naacam.co.za<br />

National Association of Automotive Component and Allied<br />

National Association of Automobile Manufacturers of <strong>South</strong> Africa:<br />

www.naamsa.co.za<br />

is funded by the municipality.<br />

Together, these firms have<br />

about 17 000 employees.<br />

Trade and Investment<br />

KwaZulu-Natal (TIKZN) estimates<br />

that the province’s component<br />

automotive manufacturers<br />

enjoy a combined turnover<br />

approaching R10-billion.<br />

The Tshwane Automotive<br />

Special Economic Zone (TASEZ)<br />

is a project of the Gauteng<br />

Province, the Department of<br />

Trade, Industry and Competition<br />

(dtic) and the City of Tshwane.<br />

The implementing agent<br />

is the Coega Development<br />

Corporation (CDC), the<br />

developer and operator of the<br />

Coega SEZ.<br />

The TASEZ, branded as<br />

“Africa’s First Automotive City”,<br />

has a mandate to promote<br />

economic participation for<br />

SMMEs and create employment<br />

in the region. Sectors<br />

targeted include security,<br />

ICT maintenance, facility<br />

maintenance, construction,<br />

automotive supply chain,<br />

marketing and advertising,<br />

catering and events.<br />

Both the Nissan and<br />

BMW plants are expanding<br />

and Ford is investing in<br />

Silverton. An Incubation<br />

Centre for SMMEs has been<br />

launched at Nissan’s assembly<br />

plant in Rosslyn. The facility<br />

supports small enterprises<br />

through subsidised rental<br />

and mentorship and training.<br />

Management of the centre<br />

is done by the Automotive<br />

Industry Development Centre,<br />

a subsidiary of the Gauteng<br />

Growth and Development<br />

Agency (GGDA). ■<br />

79 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Transport and logistics<br />

Decongestion of ports is a priority.<br />


Airlink has signed partnerships<br />

with two world-leaders.<br />

Credit: <strong>South</strong> <strong>African</strong> Heavy Haul Association<br />

Getting freight through <strong>South</strong> Africa’s ports in a more<br />

efficient manner has become an urgent priority. A Port of<br />

Durban Decongestion Task Team includes a broad range<br />

of private and public sector organisations involved in the<br />

port. Through nine targeted workstreams the team is tackling the<br />

root causes of Bayhead congestion and is working on improving<br />

coordination, planning, operations and cargo flows.<br />

A mandatory automated truck booking system has been<br />

introduced at Durban Container Terminal Pier 1 and Pier 2, while the<br />

Grindrod, FPT and Bulk Terminal depots have also piloted their own<br />

booking systems.<br />

Although Transnet Port Terminals and Transnet Freight Rail are<br />

vital to the smooth running of the loading systems, private operators<br />

of storage facilities and trucking companies also need to synchronise<br />

their operations. In Cape Town, efforts to work on decongestion<br />

include the City of Cape Town, the Cape Chamber of Commerce and<br />

Industry and the provincial government.<br />

The 2020 Technical Conference of the <strong>South</strong> <strong>African</strong> Heavy Haul<br />

Association tackled the issue of bringing smart technology to the<br />

railway system under the theme, “Smart, Resilient Railway Operations<br />

& Infrastructure”. Smart systems can self-monitor and self-diagnose<br />

railway conditions and then predict failures or problems before<br />

they occur. One of the biggest<br />

problems facing the <strong>South</strong><br />

<strong>African</strong> rail system is cable theft,<br />

which leads to frequent delays<br />

along the network.<br />

Transnet Freight Rail (TFR)<br />

has had a new CEO since<br />

April 2020. Siza Mzimela, with<br />

a background in airlines and<br />

logistics, wants to divert road<br />

freight to rail, which currently<br />

attracts just 20% of <strong>South</strong><br />

Africa’s general freight. One<br />

of her goals is to find a <strong>South</strong><br />

<strong>African</strong> manufacturer who can<br />

produce railway lines.<br />

Transnet Freight Rail’s<br />

operations represent about<br />

80% of Africa’s rail infrastructure.<br />

With 25 000 employees TFR has<br />

specialist divisions for hauling<br />

coal and iron ore together with<br />

a general freight division which<br />

transports everything from<br />

grain to chemicals.<br />

It is on these specialised<br />

lines that TFR excels. A new<br />

record was set in 2019 when<br />

375 wagons were hitched<br />

to the Sishen-Saldanha train<br />

that hauls iron ore from the<br />

Northern Cape to a dedicated<br />

terminal at Saldanha in the<br />

Western Cape. The total<br />

volume transported in 2019<br />

amounted to 58.4-million tons.<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



Coal tonnage reached 72mt in the same year and general freight<br />

accounted for a further 85mt.<br />

Increasing the amount of general freight transported by rail<br />

would not only bring down costs but it would also take the burden<br />

of thousands of heavy trucks off <strong>South</strong> Africa’s roads.<br />

<strong>South</strong> Africa has 22 000km of railway lines and 747 000km of<br />

roads, 325 019 heavy-load vehicles and the road freight industry<br />

employs 65 000 drivers. The logistics and courier market is worth<br />

R10-billion. There are 135 licensed airports in the country, 10 of<br />

which have international status.<br />

Air<br />

Four airlines were still flying after the Covid-19 lockdown: Airlink,<br />

Mango, Cemair and FlySafair. The business rescue process was<br />

applied to SAA, SA Express and Comair.<br />

A R1.5-billion business rescue offer was made to Comair that<br />

would enable it to restart in time for Christmas 2020. The offer entails<br />

delisting from the JSE. Comair operates as a British Airways franchisee<br />

on domestic routes and launched its own low-cost airline, kulula.<br />

com, in 2001.<br />

In October 2020, Airlink signed two deals in quick succession with<br />

Qatar Airways and Emirates, giving customers single-ticket travel and<br />

one-stop baggage check-in.<br />

Airports Company <strong>South</strong> Africa (ACSA) owns and operates the<br />

country’s 10 biggest airports. The company also manages airports in<br />

India and Brazil.<br />

Ekurhuleni wants to leverage the location of <strong>South</strong> Africa’s<br />

biggest airport, OR Tambo International, into a major economic<br />

asset. OR Tambo International in Johannesburg caters for more than<br />

21-million passengers annually. Cape Town International Airport<br />

recorded 10-million passengers in 2016, a figure that rose in 2019 to<br />

a shade under 11-million. King Shaka International Airport (KSIA) is<br />

north of Durban.<br />

The <strong>South</strong> <strong>African</strong> Ministry of Transport has several agencies<br />

and businesses reporting to it: Air Traffic and Navigation Services<br />

Company, ACSA, National Transport Information System, Road<br />

Accident Fund, <strong>South</strong> <strong>African</strong> Civil Aviation Authority, <strong>South</strong><br />


Airlines Association of <strong>South</strong>ern Africa: www.aasa.za.net<br />

Airports Company <strong>South</strong> Africa: www.acsa.co.za<br />

Road Freight Association of <strong>South</strong> Africa: www.rfa.co.za<br />

<strong>South</strong> <strong>African</strong> Association of Freight Forwarders: www.saaff.org.za<br />

<strong>South</strong> <strong>African</strong> Heavy Haul Association: www.saheavyhaul.co.za<br />

<strong>African</strong> Maritime Safety<br />

Authority (SAMSA), the<br />

<strong>South</strong> <strong>African</strong> National Roads<br />

Agency Limited (Sanral) and<br />

the Passenger Rail Agency of<br />

SA (PRASA).<br />

Logistics<br />

<strong>South</strong> Africa’s largest agricultural<br />

company has signed an<br />

agreement with Transnet to<br />

partner in upgrading grain<br />

facilities at two ports. East<br />

London and Durban will receive<br />

R100-million revamps as part of<br />

a 15-year tender won by Afgri.<br />

Transnet is hoping that the<br />

partnership will help it towards<br />

reaching its goals in its road-torail<br />

strategy.<br />

The building of the Musina-<br />

Makhado Special Economic<br />

Zone (SEZ) will boost Limpopo’s<br />

role as a transport and logistics<br />

hub. The Musina Intermodal<br />

Terminal is 15km from the busy<br />

Beit Bridge border crossing. It<br />

will boost efforts to move cargo<br />

from road to rail.<br />

The Maputo Development<br />

Corridor is Africa’s most<br />

advanced spatial development<br />

initiative. Run by the Maputo<br />

Development Corridor<br />

Logistics Initiative (MCLI),<br />

the corridor runs from near<br />

Pretoria in Gauteng, to Maputo<br />

in Mozambique.<br />

The Harrismith Logistics<br />

Hub at the Maluti-A-Phofung<br />

SEZ on the N3 is an inland<br />

port that can handle cargo<br />

containers and shift cargo<br />

from road to rail, reducing<br />

congestion and costs. ■<br />

81 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Tourism and events<br />

The MICE sector faces special challenges.<br />


Tsogo Sun Hotels has<br />

increased its stake in three<br />

hotels post-lockdown.<br />

Credit: AfriCamps at Ingwe<br />

Although all projections about the tourism sector and<br />

its potential for growth and for job creation were shortcircuited<br />

by the Covid-19 pandemic, the fact remains that<br />

the sector can grow quickly and it is a good job creator. In<br />

the short term, domestic tourism will be the focus but the potential<br />

of the sector, and <strong>South</strong> Africa’s riches in terms of what it can offer,<br />

remain significant.<br />

According to John Loos, a property strategist at FNB Commercial<br />

Property Finance, an overlooked factor in many analyses of the<br />

Covid-19 lockdown has been how technology has shown that some<br />

business travel can be avoided altogether. Corporate travel budgets<br />

will be cut, and fewer physical conferences will be held, he predicts,<br />

which will put the meetings, incentives, conferences and events<br />

(MICE) sector under even more pressure.<br />

A relatively small market currently, but one with massive<br />

potential, is Muslim tourism. The Western Cape has already started<br />

doing research in its agricultural and tourism sectors and there is no<br />

doubt that with good marketing, <strong>South</strong> Africa could start gearing<br />

up for a growing number of Muslim tourists. The fact that most of<br />

the country’s major cities have a proportion of Muslim residents and<br />

mosques are widely spread across the country means that travelling<br />

around the country is easy.<br />

The 16 units that comprise<br />

the Buckler’s Africa Lodge by<br />

BON Hotels on the banks of the<br />

Crocodile River overlooking<br />

the Kruger National Park has<br />

halal certification. A coastal<br />

option that allows for selfcatering<br />

is AfriCamps Boutique<br />

Glamping site at Ingwe near<br />

Plettenberg Bay. Situated on a<br />

hilltop with great views of the<br />

ocean and the Tsitsikamma<br />

Mountains, the luxury tents<br />

have fully-fitted kitchens.<br />

Virtual tours have been<br />

taken up by heritage operators<br />

such as Constitution Hill and<br />

Liliesleaf Farm and this option<br />

is likely to grow as people in<br />

other countries seek out a<br />

<strong>South</strong> <strong>African</strong> experience free<br />

from any worries.<br />

When the Marriott<br />

International hotel group<br />

closed three of its <strong>South</strong> <strong>African</strong><br />

hotels during the Covid-19<br />

lockdown, Tsogo Sun Hotels,<br />

which owns a controlling stake<br />

in all three hotels, stepped up<br />

its commitment by agreeing<br />

to bring them into its portfolio,<br />

keep them open and run them.<br />

Two of the affected<br />

hotels were the Protea Hotel<br />

by Marriott Hazyview in<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />



Mpumalanga and Durban’s Protea Hotel by Marriott Durban<br />

Edward. The third hotel, the Mount Grace in the Magaliesberg, was<br />

originally developed by the Brand family and was the sister hotel<br />

to The Grace in Rosebank. Tsogo bought and restored The Grace<br />

in 2015 and it currently operates as 54 on Bath. The Tsogo group<br />

believes that demand for conferencing, weddings and shorter<br />

family getaways will grow and that the Mount Grace, with its close<br />

proximity to Johannesburg, is in a good position to respond to<br />

those markets.<br />

Tsogo Sun Holdings split its casino and hotel operations in 2019<br />

in order to unlock value in the two sectors. With a market cap of<br />

R25-billion, Tsogo is the country’s biggest hotel group. It has 36<br />

hotels and three casinos in Gauteng. The hotel brands cover four<br />

market segments, and they include a handful of stand-alone hotels<br />

such as the Palazzo (at Montecasino) and the boutique hotel in<br />

Rosebank. SunSquare, <strong>South</strong>ern Sun Hotels, <strong>South</strong>ern Sun Resorts,<br />

Garden Court and StayEasy are among the group’s brands.<br />

The move by Marriott International into the <strong>South</strong> <strong>African</strong><br />

market was seen as significant, and it retains most of its<br />

properties. In partnership with the Amdec Group, Marriott<br />

spent about R1-billion on the Marriott Hotel Melrose Arch and<br />

Marriott Executive Apartments Johannesburg Melrose Arch.<br />

Buying into Protea Hotels has also given Marriott access to<br />

other <strong>African</strong> countries.<br />

A three-billion-year-old micro-fossil found in the Makhonjwa<br />

Mountains in Mpumalanga is thought to be the oldest sign of life<br />

on the planet. The Makhonjwa Mountains were declared a World<br />

Heritage Site by UNESCO in 2018. Culture and heritage accounts for<br />

40% of world tourism and is one of the fastest-growing subsectors.<br />

In Durban, a joint venture between MSA Cruises SA and Africa<br />

Armada Consortium is spending R175-million on the financing‚<br />

construction‚ maintenance and operation of a cruise terminal for a<br />

25-year concession period.<br />

The Port of Cape Town has launched its dedicated cruise-ship<br />

terminal, and the area between the terminal and the Cape Town<br />

International Convention Centre is being developed as a multi-use<br />

precinct called the Yacht Club.<br />

On the western edge of Cape Town’s Foreshore, an ambitious<br />

plan envisages two new hotels, flats, retail space and offices rising out<br />


<strong>African</strong> <strong>Business</strong> Travel Association: www.abta.co.za<br />

<strong>South</strong> <strong>African</strong> Golf Tourism Association: www.sagta.co.za<br />

<strong>South</strong> <strong>African</strong> National Parks: www.sanparks.co.za<br />

<strong>South</strong> <strong>African</strong> Tourism: www.southafrica.net<br />

<strong>South</strong> <strong>African</strong> Tourism Services: www.satsa.com<br />

Credit: Buckler’s Africa Lodge<br />

of ground currently occupied<br />

by three car dealerships and<br />

a roadworthy station on<br />

Christiaan Barnard Street. The<br />

Harbour Arch concept is based<br />

on Johannesburg’s Melrose<br />

Arch, with seven tower blocks to<br />

be constructed on 200 000m²,<br />

roughly half the footprint of the<br />

V&A Waterfront.<br />

Peermont Hotels, Casinos<br />

and Resorts has added the<br />

Emerald Resort & Casino to<br />

its portfolio of properties.<br />

Peermont purchased the<br />

Vanderbijlpark property from US<br />

company Caesars Entertainment<br />

Corporation, which brings to 11<br />

the number of casino resorts it<br />

runs on the subcontinent.<br />

There are 711 745 people<br />

employed in the tourism<br />

industry nationally, with<br />

road transport (29%), food<br />

and beverages (20%) and<br />

accommodation (19%)<br />

absorbing the largest numbers.<br />

The sector contributes 9% to<br />

<strong>South</strong> Africa’s gross domestic<br />

product (GDP). ■<br />

83 SOUTH AFRICAN BUSINESS <strong>2021</strong>


Banking and<br />

financial services<br />

Investors are getting behind fintech.<br />

Naspers Foundry is one of several investment funds<br />

looking for opportunities in the financial sector.<br />

Insurance technology is of particular interest, together<br />

with credit services and payment systems.<br />

The appointment by mobile operator Vodacom of a new<br />

Chief Financial Officer (CFO) in 2020 gave further insight into<br />

the growing link between the digital world and the world of<br />

finance. The new executive, Raisibe Morathi, was for 10 years<br />

CFO of Nedbank.<br />

Morathi also served on the board of Sanlam, a giant in<br />

the <strong>South</strong> <strong>African</strong> financial sector. In 2019, Sanlam, which<br />

has 20 319 <strong>South</strong> <strong>African</strong> employees, distributed R190-billion<br />

between employees, shareholders, government and clients.<br />

Capital Appreciation, which is part-owned by the Public<br />

Investment Corporation, is already invested in a software<br />

developer, a credit card payment terminal provider and has<br />

R500-million available for further investments.<br />

<strong>African</strong> Rainbow Capital, with about 5%, has a stake in the<br />

investment company and is the owner of TymeBank, which<br />

received a banking licence in 2017.<br />

Tyme stands for Take Your Money Everywhere and refers to<br />

the bank not having a branch network. Perhaps the lockdown<br />

encouraged customers to think in digital terms because Tyme<br />

reported in October 2020 that it had 2.4-million customers, up<br />

from 1.4-million at the end of March. A 400% increase in the<br />

use of services such as airtime and electricity purchases was<br />

also noted.<br />

Discovery Bank officially launched in March 2019 and is<br />

experiencing rapid growth with deposits of R3.7-billion. Discovery<br />

Bank is applying the behavioural model it uses in its health<br />

business to reward good financial behaviour.<br />

Another relatively new bank is Capitec, which is steadily increasing<br />

its customer base by providing banking for business and<br />

individual customers in what it describes as a simple manner. In<br />


PSG is selling a big stake<br />

in Capitec Bank.<br />

May 2020, investment holding<br />

company PSG announced that<br />

it would reduce its holding in<br />

Capitec Bank from 32% to 4%,<br />

earning about R4-billion by<br />

selling those shares.<br />

<strong>South</strong> Africa’s financial<br />

services sector has expanded<br />

by the opening of several<br />

new stock exchanges.<br />

Pharmaceutical company<br />

Aspen Pharmacare has taken a<br />

second listing on A2X.<br />

Of the four new exchanges,<br />

Equity Express Securities<br />

Exchange (EESE) trades in Black<br />

Economic Empowerment<br />

(BEE) while ZARX and 4AX<br />

are targeting companies<br />

that are not listed elsewhere.<br />

ZARX has agricultural holding<br />

companies like TWK and<br />

Senwes among its clients.<br />

The JSE is the world’s 19th<br />

biggest exchange and nearly<br />

400 companies are listed<br />

on the JSE or AltX, the JSEowned<br />

exchange for smaller<br />

companies. ■<br />


Financial Sector Conduct Authority: www.fsca.co.za<br />

Insurance Institute of <strong>South</strong> Africa: www.iisa.co.za<br />

<strong>South</strong> <strong>African</strong> Institute for Chartered Accountants: www.saica.co.za<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />


CPD<br />


“ Attending CIGFARO Training<br />

and webinars has allowed me to<br />

earn CPD points while<br />

participating in Technical<br />

discussions to help improve my<br />

professional capacity. This is a<br />

great time to be associated with<br />

a SAQA recognised Professional<br />

Body. ”<br />

Ms Zanele Malaza<br />

(PGFO), CFO City of<br />

Mbombela<br />



Development finance and<br />

SMME support<br />

A new fund aims to make R5-billion available at a fair price.<br />

Anew fund for SMMEs was launched in 2020 with the<br />

aim of providing capital at a fair price. Former SA Post<br />

Office CEO Mark Barnes, who previously worked in<br />

investment banking and private equity, is heading the<br />

Kisby Investment Fund. Partners in the fund are Arena Holdings<br />

(media), 4AX Africa Exchange, 4AX Debt Services and Rainfin<br />

(online credit). Barnes told <strong>Business</strong> Day that the fund would be<br />

compensated for the risk in supporting companies that have to<br />

“hunt around in the overpriced debt market” by taking equity in<br />

the firm. Kisby is aiming for a R5-billion fund to support companies<br />

in the R10-million to R1-billion revenue bracket.<br />

Funding is available for technology start-ups in many<br />

forms but getting funding early in the process can be difficult<br />

because the concept is not proven. For asset management<br />

company Futuregrowth, ring-fencing some funding for<br />

allocation to early-stage development is a way of ensuring<br />

that potential is not overlooked. The company has put 10% of<br />

its development equity fund (or R280-million) into businesses<br />

such as payment devices (Yoco), infrastructure platform<br />

(Rubicon), fintech (LifeCheq) and an app for domestic workers<br />

(Sweep<strong>South</strong>).<br />

Data company 5M2T (5Minutes2Town) has started offering<br />

sophisticated information about the township market. From how<br />

many spazas in Soweto have refrigeration units (4 700) to brand<br />

loyalty, 5M2T covers 60 000 spazas, salons, barbers and other<br />

informal trade outlets an “in-market audit”. This allows for better<br />

ordering and planning for suppliers and logistics operators.<br />

The Covid-19 lockdown had a severe impact on many small<br />

businesses. A survey conducted by risk finance company <strong>Business</strong><br />

Partners Limited found that 95% of SMME respondents thought they<br />

would not survive without help. The company’s packages in response<br />

included a Repayment Relief Programme and a Financial Assistance<br />

Programme capitalised at R100-million.<br />

Most big companies in <strong>South</strong> Africa have two main<br />

programmes to support SMMES: enterprise development (ED) and<br />


Futuregrowth has a focus<br />

on early stage start-ups.<br />

local supplier development (or<br />

procurement). Venetia Mine in<br />

northern Limpopo, a De Beers<br />

Group mine, has more than 50<br />

SMMEs enrolled in incubation<br />

programmes and 34 locallyowned<br />

companies are doing<br />

business with the mine.<br />

The National Department<br />

of Small <strong>Business</strong> Development<br />

(DSBD) has several programmes<br />

to assist SMMEs and cooperatives.<br />

The Small Enterprise<br />

Development Agency (Seda),<br />

a subsidiary of the DSDB,<br />

has 42 incubation centres in<br />

<strong>South</strong> Africa under its Seda<br />

Technology Programme (STP).<br />

The National Department of<br />

Trade, Industry and Competition<br />

(the dtic) is trying to stimulate<br />

township and rural economies.<br />

Programmes include the<br />

Enterprise Investment<br />

Programme (EIP).<br />

The <strong>South</strong> <strong>African</strong> SME<br />

Finance Association (SASFA) is a<br />

national, self-regulating body for<br />

alternative finance companies. ■<br />


National Department of Small <strong>Business</strong> Development: www.dsbd.gov.za<br />

National Small <strong>Business</strong> Chamber: www.nsbc.org.za<br />

Small Enterprise Development Agency: www.seda.co.za<br />

<strong>South</strong> <strong>African</strong> SME Finance Association: www.sasfa.net<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />


FOCUS<br />

Coega Development<br />

Corporation<br />

a.co.zaPromoting small business as a way of sparking economic growth, creating jobs<br />

and tackling inequality.<br />

, Arcadia,<br />

In championing socio-economic development,<br />

the Coega Development Corporation (CDC)<br />

places the interests of small businesses at the<br />

centre of economic growth. Small business development<br />

and support is crucial as a catalyst for<br />

addressing poverty, unemployment and inequalities<br />

in the society.<br />

The National Development Plan 2030 encourages<br />

Small, Medium and Micro Enterprise (SMME)<br />

support through procurement and developing<br />


ISO 9001:2015 ISO 14001:2015 ISO 45001:2018<br />

The CDC has a ISO dedicated 20000-1:2011 SMME ISO <strong>Business</strong> 27001:2013<br />

Unit that prioritises empowerment to unlock<br />

opportunities particularly www.coega.co.za<br />

in the built environment<br />

such as infrastructure development and facilities<br />

maintenance. “The billions of rands to be spent<br />

on infrastructure development in the country to<br />

revive our economy should also benefit SMMEs,”<br />

says Dr Ayanda Vilakazi, CDC’s Head of Marketing,<br />

Brand and Communications.<br />

SMME participation on large contracts is<br />

black and female managers and professionals.<br />

Between 2015 and 2020, SMME-procurement<br />

spend achieved by the CDC was 29%. In 2019,<br />

R461.77-million benefited small businesses in all<br />

areas where the organisation has operations.<br />

Contact details<br />

Head Office: Coega SEZ <strong>Business</strong> Centre,<br />

Corner Alcyon Road and Zibuko Street, Zone 1,<br />

Coega SEZ, Port Elizabeth 6100<br />

Tel: (RSA only): 08610 COEGA | 08610 26342<br />

Tel: +27 41 403 0400 | Fax: +27 41 403 0401<br />

Email: info@coega.co.za<br />

Website: www.coega.co.za<br />

Coega has offices in Pretoria, East London,<br />

Cape Town and Durban.<br />

increasing, a sign of the success of the CDC’s SMME<br />

development programme. Some highlights:<br />

• SMME involvement in the construction of the fourstar<br />

Bluewater Bay Sunrise Hotel, Port Elizabeth.<br />

• As of March 2020, 383 SMMEs benefited from<br />

training, 178 CETA accredited.<br />

• In 2019/20 CDC, SARS and CIDB held compliance<br />

workshops for 652 SMMEs.<br />

• 72 SMMEs successfully upgraded on CIDB<br />

through CDC intervention and support.<br />

A key organisational objective of the CDC is<br />

to facilitate, promote and drive the inclusion of<br />

SMMEs in procurement opportunities. The CDC is<br />

also working at improving its B-BBEE status. The<br />

organisation improved its B-BBEE status from level<br />

4 in 2019 to level 2 in 2020. ■<br />

87 SOUTH AFRICAN BUSINESS <strong>2021</strong>

INDEX<br />

INDEX<br />

Airlink............................................................................................................................................................................................IBC<br />

Air Products............................................................................................................................................................................... 59<br />

Chartered Institute of Government Finance Audit and Risk Officers (CIGFARO)...................... 85<br />

Coega Development Corporation (CDC)....................................................................................................2-3, 87<br />

Council for Geoscience (CGS)................................................................................................................................47-49<br />

DNG Energy.............................................................................................................................................................................. 57<br />

Futuregrowth Asset Management...............................................................................................................9, 24-25<br />

Gert Sibande District Municipality.............................................................................................................21, 68-69<br />

Musina-Makhado Special Economic Zone (MMSEZ)............................................................................26-31<br />

Northern Cape Tourism Authority (NCTA)........................................................................................................... 19<br />

Invest Durban ........................................................................................................................................................................IFC<br />

Ivanhoe Mines..................................................................................................................................................................54-55<br />

Kemtek.............................................................................................................................................................................77, OBC<br />

National Metrology Institute of <strong>South</strong> Africa (NMISA)................................................................................... 7<br />

Oceana..................................................................................................................................................................................34-36<br />

Petroleum Agency SA.................................................................................................................................................64-65<br />

Pilanesberg Platinum Mines...................................................................................................................................50-51<br />

<strong>South</strong> <strong>African</strong> Bureau of Standards (SABS)............................................................................................................. 5<br />

<strong>South</strong> <strong>African</strong> Mohair Industries Limited (SAMIL)....................................................................................42-43<br />

<strong>South</strong> <strong>African</strong> National Space Agency (SANSA).......................................................................................14-15<br />

Vedanta Zinc International......................................................................................................................................52-53<br />

SOUTH AFRICAN BUSINESS <strong>2021</strong><br />


48669<br />

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At Kemtek Imaging Systems, we’re hard-wired to source the highest quality products and advanced<br />

technologies from the world’s leading manufacturing brands. We then distribute these to our valued<br />

customers and resellers in the commercial print, industrial print, AM/3D print, auto ID, barcoding and<br />

labelling industries. But far beyond this, we provide professional advice, insight and technical support from<br />

our very own, and very human, industry specialists. To view our vast product line-up, visit our website and<br />

contact us directly for more information.<br />

ABG I Akhani 3D I Argox I BarTender I Brother I Cipherlab I Datalogic I Epson I Herzog+Heymann<br />

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National 0861 KEMTEK Johannesburg +27 (0)11 624 8000 Pretoria +27 (0)12 804 1410 Durban +27 (0)31 700 9363 Cape Town +27 (0)21 521 9600 Port Elizabeth +27 (0)41 364 3690<br />

www.kemtek.co.za<br />


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