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OR Tambo SEZ flags its location benefits

Gauteng MEC for Economic Development Parks Tau. File photo

Gauteng MEC for Economic Development Parks Tau. File photo

Published Jul 27, 2022

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Investors in the freight industry located in the OR Tambo SEZ had a good opportunity for locating there since there were additional opportunities coming onboard, said Gauteng MEC for Economic Development Parks Tau.

He said yesterday that currently they were working on the Gauteng-Eastern Cape high-speed rail corridor that would give additional opportunities for people to be able to export and import directly between Gauteng and the Gqeberha Port.

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“The high-speed corridor has been declared a Strategic Infrastructure Programme in the Presidency, therefore, giving us the opportunity to focus on increasing logistics that support both rail-based and air-based logistics in the SEZ,” Tau said.

He was speaking in a virtual broadcast session moderated by CNBC Africa’s Fifi Peters and a panel of experts as they discussed the OR Tambo SEZ

He said it was important to note that those who were invested in the site were entitled to a particular set of investments. There were also additional incentives that came with being located in the SEZ.

Steven Kilfoil, the chief financial officer of the IN2FOODS Group, said the locality around the airport had logistical benefits for them.

“On top of that the incentives for being in the SEZ range from tax incentives where you have a lower tax rate, ETI (Employment Tax Incentive) benefits, previously known as the Youth Wage Incentive. Within the SEZ the requirements are relaxed in terms of age. There are also some accelerated allowances that allow for capital investment. All of those things put together as well as the fact that we were there from the beginning means the infrastructure was built to meet our needs.”

Kilfoil said going forward the extension of the facility was under consideration. “From our side it is about maturing as a business and to enhance the benefits that they were getting.”

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Airports Company of South Africa (Acsa) chief executive Nompumelelo Mpofu said they had seen air cargo perform better than passenger traffic over the pandemic period.

“We have also seen the recovery that has been faster. Whilst air cargo was muted, a little bit down by 25 percent from 2019 levels, in 2021 we closed the year at 386 000 tonnes compared to the 419 000 tonnes. That basically means we are very close to the 2019 performance levels in the cargo environment compared to the passengers.

“Passenger traffic tends to be around 70 percent while cargo shows close proximity to 2019 levels. Cargo has outperformed tourism in the Covid recovery environment,” she said.

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Mpofu said Acsa had also seen cargo increase its performance for total revenue for airports or airlines from basically around 11 percent in 2016 to contributing 40.3 percent of total revenue of operations in airports. “That is quite an important jump.”

She said there were a number of things that had to be done for South Africa to promote air cargo.

“The transport sector is developing an Air Freight Strategy that will help to lift trade with respect to dedicated freighters that carry cargo on dedicated businesses. Increasing that capacity can only augur well for this very exciting growth prospects that we see in the air cargo environment,” Mpofu said.

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South African Association of Freight Forwarders chief executive Dr Juanita Maree said South Africa needed to know that trade and logistics infrastructure was a shared responsibility.

“For that we need to encourage private sector participation. We need to mature on those different modules because currently we do not have a perfect one. The different sides of the equation may have lack of trust which we need to overcome because we in the private sector are willing to participate but we just have to help each other mature in this journey,” Maree said.

BUSINESS REPORT

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