The Eastern Cape city of East London was gearing up to become the hub of the automotive industry in South Africa, the area’s Industrial Development Zone Corporation said on Tuesday.
At a media event hosted in Johannesburg, the East London Industrial Development Zone Corporation said the possible expansion of existing industries in the city like DaimlerChrysler would benefit many other industries, especially the automotive component industry.
”If DaimlerChrysler builds more cars, the textile industry, the glass industry .. all industries will benefit,” said business manager Brenda Mabaso-Simelane. She said what made East London unique was that it already had existing infrastructure, like a working port and some large industries.
The port had a vehicle handling wharf which could handle up to 2 500 vehicles a day. This could easily be expanded if the need arose. The city was easily accessible by road, rail and air, and in reach of major international markets. The existing rail link between the city and Gauteng would also soon be upgraded by Spoornet.
The Industrial Development Zone development was part of the government’s strategy to position the country in the global economy.
”The IDZ will operate as a liberalised duty free and multi-sector development area,” said chief executive, Peter Miles.
”A simplified business environment has been designed with streamlined administrative systems to attract investment and maximise private sector participation in all aspects of zone operations and development.”
The IDZ is located on East London’s West Bank, adjacent to the existing harbour and airport. It has more than 1 500 hectares available for new industry. The first phase of the development is 400 hectares in size, which includes a 250 hectare duty free area.
Two major German investors have already joined the IDZ and construction on their 20 hectare factory site was underway.
The Department of Trade and Industry, involved in the development zones in South Africa, has introduced a number of incentives to lure investors.
These include assistance funds, exemption from certain taxes and duty on goods to be exported as well as reduced rates and taxes on properties and services.
Labour legislation would however be enforced rigorously because exploitation of the labour force in the area would not be tolerated. The East London IDZ was granted its operating licence last year and was expected to be open and fully functional by July 2004.
Industries identified as viable in the area include textiles, technology, pharmaceuticals, timber processing, processing agricultural products and minerals like granite and kaolin.
Other IDZs in South Africa include Coega, near Port Elizabeth, Richards Bay in KwaZulu-Natal and Johannesburg International Airport in Gauteng. – Sapa