More investors flock to Coega

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Independent Newspapers

Twenty-three investors have signed to establish industrial operations in the Coega IDZ. Photo: Supplied

Johannesburg - The Coega industrial development zone (IDZ) has secured at least 23 investors that have signed to establish industrial operations and on Sunday two major investments, totalling R700 million, were commissioned by Trade and Industry Minister Rob Davies.

According to Davies, public investment in the Coega IDZ and port of Ngqura in the Eastern Cape has totalled R6.19 billion and the 23 investors in the IDZ have signed up for investments worth R11.3bn. The zone has realised a return on investment of R2.2bn.

The investments commissioned on Sunday, a DCD Wind Towers manufacturing facility and Agni Steels South Africa’s steel mill, are expected to create 500 jobs in their initial production phases.

DCD began with its initial process qualifications earlier this month. The company has a 23 000m2 manufacturing facility that will produce between 110 and 120 steel towers for wind turbines annually, but the company said the wind tower facility was only the first part of its business in Coega.

The DCD Group had initially invested R85m in exploring the feasibility of the renewable energy market and, after finding proof that South Africa could play a role in manufacturing towers for wind turbines, it had poured R300m in to the Coega plant.

“Blade manufacturing will be the next step but we need a consistent market to support such an investment. Other opportunities will be the manufacture of the hubs and assembly of the nacelle,” which houses all of the generating components, DCD marketing manager for energy Henk Schoeman said.

DCD is looking at the concentrated solar power market, where it sees an opportunity to support the manufacturing of the power plant vessels.

In this first phase of the business, Schoeman said 65 percent of wind turbine parts could be manufactured or assembled in South Africa.

Agni Steels SA has built a R400m foundry to produce semi-finished casting steel products, which will start production later this month.

The mild steel billets produced using scrap metal will be exported to other African countries and India in the first phase of the project.

The hi-tech smelting facility will run 24 hours a day, seven days a week so uninterrupted electricity supply will be vital to produce the 300 jobs envisaged.

Agni Steels SA has plans for a second and third phase of the project, with the second phase set to double production. After incorporating a fully automated rolling mill that will produce steel end-products, the plant will increase its headcount to up to 800 people.

The commissioning of the two projects on Sunday came ahead of the promulgation of new legislation on special economic zones (SEZ).

Yesterday, Davies said the amendments to the SEZ Bill were awaiting President Jacob Zuma’s signature after being passed by the National Council of Provinces.

“[The bill] has a provision for a set of incentives. The tax incentives which have already been announced but not implemented allow for tax rates of 15 percent, which is lower than the current 28 percent for companies,” Davies said.


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