35 minute read
Regional overview
A REGIONAL OVERVIEW OF FREE STATE
Both the Botshabelo Industrial Park and the Maluti-A-Phofung Special Economic Zone (MAP SEZ) are attracting investors to the country’s most centrally-located province. Covid-19 hit the tourism sector hard, but the province’s miners are enjoying good commodity prices and the Virginia Gas Project is steaming ahead.
By John Young
The announcement in 2021 by Renergen, the owners of the Virginia Gas Project, that it had signed an agreement with Consol, one of the country’s leading glass manufacturers, gave new impetus to the country’s only onshore gas project.
Having previously targeted the logistics sector for offtake agreements, and successfully concluded several agreements together with a joint venture to roll out gas supplies to filling stations across the country with TotalEnergies, the Consol pact marked a significant new customer for the gas explorers and potentially opens up a new market.
Renergen said in 2021 that their findings continued to confirm early reports of substantial reserves. One of the key facts to emerge is that the gas contains helium of up to 12%, a good percentage.
Other good news came in the form of news that the Maluti-A-Phofung Special Economic Zone (MAP SEZ), the strategically located area on the N3 highway, is attracting new investment to the Free State Province.
Sectors prioritised at the MAP SEZ include logistics, ICT, automotive, pharmaceuticals, manufacturing and agro-processing. The 1 000ha site has four zones: agro-processing, light industrial, heavy industrial and a container terminal. Control of the project now rests with the provincial Department of Small Business Development, Tourism and Environmental Affairs (DESTEA).
Infrastructure Other areas that are being upgraded to provide infrastructure to encourage manufacturing are the Phuthaditjhaba Industrial Park and the Botshabelo Industrial Park, where a foreign firm has started
Sasol’s complex at Sasolburg. Credit: Sasol
construction of a new steel mill (which is covered in the Manufacturing Overview).
Telecoms company Vodacom is investing heavily in its infrastructure in the Free State. Several new base stations have been established in villages such as Clocolan, Fauresmith and Fouriesburg, greatly improving coverage in rural areas. The Rural Coverage Acceleration Programme allocated R207-million to the region in 2020/21.
Bloemfontein is the site of one of Vodacom’s new solar-powered facilities, helping in the company’s drive to reduce its carbon emissions. Vodacom saved 11 971MW in 2020 through its energy management programme.
The N3 is South Africa’s busiest road and the Highway Junction truckstop at the entrance to Harrismith claims to be Africa’s biggest. More than 1 500 vehicles pass through every day and three forecourts cater to three fuel brands. Refuelling, storage and handling take place here, highlighting the province’s strengths in logistics as the country’s most central province.
The country’s two great highways pass through the province. The N3 links the ports of Richards Bay and Durban with the industrial heartland and the N1 provides north-south connectivity. The provincial capital, Bloemfontein, is another logistics hub. Three other national highways intersect the province which is also well served by rail and air links. The Bram Fischer International Airport serves the provincial capital.
Links to the west (Kimberley and on to Namibia) and east (to Lesotho) underpin the planning behind the N8 Corridor concept which covers Bloemfontein, Botshabelo and Thaba Nchu. A plan for the coordinated development of the N8 Corridor has been approved by a range of bodies and is being funded by the Development Bank of Southern Africa (DBSA) and the Mangaung Metropolitan Municipality.
Provincial assets International fuel, gas and chemicals company Sasol regularly invests in new technologies and in expanding production of its many products. Mining is reduced in importance but remains a significant employer. Harmony Gold has several assets in the province and Sibanye-Stillwater has undertaken a feasibility study on a property adjacent to its existing Beatrix mine.
In agriculture, the Free State is looking forward to the implementation of the African Continental Free Trade Area (AfCFTA), the free trade agreement that was stalled by the Covid-19 pandemic. The Free State’s agricultural export basket is well suited to trading with African states and strategies are being considered to promote apples, asparagus, cherries, cut flowers, sorghum, venison and wine.
The Free State produces significant proportions of South Africa’s wheat (30%), sunflowers (45%) and maize (45%) and is ranked third in contribution to national GDP in agriculture.
The Free State shares borders with six other provinces, in addition to the Mountain Kingdom of Lesotho. A summer-rainfall region with a mean
Commercial agriculture is a key element of the Free State economy, with companies like VKB farming and storing vast quantities of grain. Credit: VKB
annual rainfall of 532mm, the Free State’s climate, soil types and topography vary greatly within the province, with plains in the west and mountains in the east. The western and southern areas are semi-desert, with some Karoo vegetation occurring in the south. The southernmost region of the Free State is a largely dry area with open grasslands predominating, although it is also home to the Gariep Dam, South Africa’s largest dam.
Municipalities in the Free State The Free State has one metropolitan municipality (Mangaung), four district municipalities and 19 local municipalities.
Mangaung Metropolitan Municipality Mangaung Metropolitan Municipality is a Category A municipality which governs Bloemfontein, Botshabelo and Thaba Nchu. The sixth-largest city in the country, the Mangaung municipal area covers more than 6 263km² and has a population of about 850 000 people. Bloemfontein is responsible for about 25% of provincial GDP.
Xhariep District Municipality Towns: Trompsberg, Zastron, Philipollis, Smithfield, Wepener The southernmost region of the Free State is a largely dry area with open grasslands predominating, although it is also home to the Gariep Dam, South Africa’s largest dam. The dam is also the site of small hydro-power and aquaculture projects. The nearby Tussen die Riviere Nature Reserve and the Mynhardt Game Reserve are popular. Crops are produced in the northern parts of the district and sheep farming is the biggest activity in the south. Diamonds, gravel and clay are mined at Koffiefontein. Jagersfontein is one of the first places where diamonds were found.
Lejweleputswa District Municipality Towns: Welkom, Virginia, Boshof, Christiana, Bultfontein, Bothaville Mining is the most important economic activity in this area, also known as the Free State Goldfields, but it is also the most important maize-growing area in South Africa. A large natural gas field has been discovered on what used to be gold turf. Bothaville hosts the annual NAMPO maize festival and the headquarters of Grain SA. Welkom is the major urban centre in the district.
The area has tourist assets such as a holiday resort on the Allemanskraal Dam, the Goldfields Wine Cellar in Theunissen and the Willem Pretorius Game Reserve.
Fezile Dabi District Municipality Towns: Sasolburg, Parys, Kroonstad, Frankfort, Heilbron, Viljoenskroon The chemical complex at Sasolburg is the economic driver in the district, which shares a border with Gauteng province along the Vaal River. Kroonstad is the district’s second-largest town and has a number of engineering works and a railway junction.
A good proportion of South Africa’s grain crop is sourced from this district and when the vast fields of sunflowers and cosmos flowers are in bloom, a marvellous vista is created. The Vaal River presents opportunities for yachting, rafting and resort-based enterprises. Parys is a charming town and Vredefort is home to a World Heritage Site – the Vredefort Dome where a meteor crashed to earth.
Fezile Dabi District Municipality is the biggest contributor towards the provincial GDP, accounting for approximately 35%. The Fezile Dabi area is mostly dominated by the industrial power of Sasol, with the manufacturing of refined petroleum, coke and chemical products adding largely to its GDP.
Thabo Mofutsanyana District Municipality Towns: Phuthaditjhaba, Bethlehem, Ladybrand, Clarens, Harrismith, Ficksburg Tourism and fruit farming are the two principal economic activities of this area which is characterised by beautiful landscapes: the Maluti and the Drakensberg mountain ranges, wetlands in the north, well-watered river valleys and the plains of the north and west. The most famous asset is the Golden Gate National Park.
Industrial activity is undertaken at Harrismith and Phuthaditjhaba, where the Free State Development Corporation is promoting investment. The MalutiA-Phofung Special Economic Zone (MAP SEZ) at Harrismith is a multi-modal transport and logistics hub. The commercial centre of the district is Bethlehem while Clarens and Ficksburg have become famous for their artists and cherries respectively. ■
Free State Gambling, Liquor and Tourism Authority
Free State Province
Center yourself in the heart of South Africa
CEO of Free State Gambling, Liquor and Tourism Authority, Mr Kenny Dichabe
The Free State Gambling, Liquor and Tourism Authority (FSGLTA) is one of the two entities of the Department of Economic, Small Business Development, Tourism and Environmental Affairs (DESTEA). The FSGLTA was established by the FSGLTA Amendment Act 4 of 2017, which was amended to incorporate the former Free State Tourism Authority and Free State Gambling and Liquor to form the new entity which is known as FSGLTA. Vision A transformed economy and a prosperous society with an effective, well-regulated gambling and liquor industry and a vibrant tourism sector.
Mission To be a leading developmental institution that drives economic transformation, regulation and adaptation to the ever-changing industry dynamics to benefit the Free State.
Mandate The mandate of the Free State Gambling, Liquor and Tourism Authority is to regulate the gambling and liquor industries within the province and to market and promote tourism in the province. The Authority’s purpose is to promote legally compliant, responsible, sustainable and transformed gaming and liquor industries through effective licensing, regulating and reporting on the activities of the industries, and to position the Free State Province as a tourist destination of choice.
The gambling industry • Invite applications for licences (gambling) • Consider, grant or refuse applications • Cancel, suspend, vary, renew or revoke a licence or registration approved • Implementation of norms and standards in the gambling industry as determined by the National Gambling Act • Ensure that gambling activities are effectively regulated, licensed and controlled • Ensure compliance to the act, rules and regulations
The liquor industry • Receive applications for registrations (liquor) • Reduce the socio-economic and other costs of alcohol • Promote the development of a responsible and sustainable liquor industry in relation to gambling • Generate revenue for the Free State Province
The mandate of the Free State Gambling, Liquor and Tourism Authority is to regulate the gambling and liquor industries within the province and to market and promote tourism in the province. The Authority’s purpose is to promote legally compliant, responsible, sustainable and transformed gaming and liquor industries through effective licensing, regulating and reporting on the activities of the industries, and to position the Free State Province as a tourist destination of choice.
Image: iStock
The tourism industry It is important that the FSGLTA intensifies its efforts to ensure effective marketing of the province in order to attract domestic tourists as well as international tourists. The province continues to enhance tourism infrastructure, up-skill the sector, inculcate the culture of service excellence and enhance the provision of world-class visitor experiences. The Authority has partnered with event organisers and tour operators to market and promote the Free State as a tourist destination. These are achieved through the following: • Forging strategic partnerships with the public and private sectors to leverage from each the capability and capacity to improve the industry • Streamlining the impact of events through partnerships and sponsorships • Improving on Meetings, Incentives,
Conferencing and Events (MICE) as a focused growth area of the market • Continuous review of the marketing plans to stay on par with the industry trends. ■
GAMBLING AND LIQUOR CONTACT DETAILS • Mangaung Metro Abraham Classen classena@fsglta.gov.za | 051 404 0320 | 079 506 0272 • Thabo Mofutsanyana Peter Moleko molekop@fsglta.gov.za | 078 309 4178 • Lejweleputswa Thabo Tlake tlaket@fsglta.gov.za | 057 492 0001 | 072 533 6681 • Fezile Dabi Bongakele Nzunga nzungab@fsglta.co.za | 056 492 0001 | 082 256 5926 • Gariep Abraham Classen classena@fsglta.gov.za | 051 404 0320 | 079 506 0272
TOURISM ROUTE CONTACT DETAILS • Cheetah Route Nthabiseng Methola cheetah@freestatetourism.org | 073 125 1614 • Eagle Route Bonolo Molefe eagle@freestatetourism.org | 072 056 6090 • Flamingo Route Dineka Lephowane flamingo@freestatetourism.org | 073 796 8577 • Lion Route Keakabetse Ramokonopi lion@freestatetourism.org | 084 951 1564 • Springbok Route Kefiloe Molefe molefek@fsglta.gov.za | 079 496 2999
Environmental sustainability
The Environment and Conservation Branch is working to promote a pristine environment that facilities economic transformation.
Environmental sustainability within the Free State Province is conducted within the prescripts of promoting Section 24 of the South African Constitution, recognising and promoting environmental rights as contained in the Bill of Rights. We also recognise our responsibility to promote a pristine environment that facilitates a transformative economic agenda to create jobs and a just society.
The main focus areas are: • Environmental Quality and Protection: environmental education and awareness; waste and air quality management; environmental impacts and assessments; EPWP. Also promoting the circular economy with a particular focus on waste and recycling. • Biodiversity Conservation and Research: maintenance of resorts and reserves; protected areas maintenance and expansion; biodiversity research; game culling and auctions including the transformation and promotion of Biodiversity Economy; transformative entrepreneurship; development and promotion of the wildlife economy.
Current considerations • Ensuring sustainable environmental management. • Improve national and provincial state of environmental reporting. • Integration of environmental objectives in national, provincial and instruments and tools. • Implementation of Chapter 4 of NEMA provisions in relation to fair decision-making and conflict management (conciliation, arbitration and investigations). Responding to EIA complaints and appeals without compromising on economic transformation, job creation and the promotion of spatial integration. Conservation priorities The Free State is 128 000km² in extent, or 12.8-million hectares. This means that it is the third-largest province in South Africa. Located in the centre of the country, with ideal soils and climate, the province is an extremely important food producer and the environmental health of the province is therefore vital to the food security of the country.
The province boasts a strong conservation mindset, not only from within the DESTEA but also from land owners generally.
Prior to the adoption of the Free State Protected Area Expansion Strategy there were already 240 formally declared Nature Reserves in the province. Since the inception of the Biodiversity Stewardship programme an additional 53 000 hectares of private land have been declared and added to the conservation estate. Priority focus is now on extending these conservation areas into the remaining natural areas of the province thereby conserving wetlands, rivers, terrestrial ecosystems and species for future generations.
In addition to the formal conservation areas, there are over 300 000 hectares of game and mixed-species ranches. The province generates over R600-million per annum from the local hunting industry, which maintains many huntingsupport businesses such as taxidermists, curio producers, etc. ■
Growing the Dr Mbulelo Nokwequ, Head of Department at DESTEA, outlines some of the Free State’s tourism sector unique selling propositions.
The Tourism Unit of DESTEA is providing market access for local operators.
DESTEA’s Tourism Unit’s objective is to grow the tourism sector’s contribution to the Free State economy. In achieving this, various activities and functions are performed, which include: • Creating a conducive environment for tourism to thrive • Formulating and implementing a Provincial
Tourism Sector Strategy to guide tourism activities in the province • Providing market access opportunities both locally and internationally to provincial tourism enterprises • Roll out programmes to enhance visitor services and experience • Facilitate and promote tourism education and capacity-building for the tourism sector • Promote the culture of tourism and service excellence • Promote transformation of the tourism sector for inclusive tourism economy, as well as providing support to youth and women in tourism • Facilitating events tourism to reduce seasonality and enhance geographic spread • Facilitate funding for initiatives that seek to develop and grow tourism in the province
Free State Province is situated in the heart of South Africa and shares borders with Lesotho and six other provinces. It provides easy access to the main ports of Durban, East London and Port Elizabeth.
The Free State is an attractive business and investment destination. The province is at the centre of South Africa and the dominant sectors are agriculture, mining, manufacturing and the tertiary sectors, making it ideal for transport logistics and agro-processing.
Companies locating to Free State not only enjoy the opportunity to source inputs at competitive prices, but also to benefit from domestic, regional and international markets for their products and services. • Promotion of tourism safety through among others, programmes such as the Provincial Joint Operational and Intelligence Structure (Provjoints), Because South Africa has been engaging with our economically large trading partners, access to international markets is facilitated through various trade preferences and free-trade agreements. with law enforcement agencies, and also through As far as long-term investment is concerned, there are industrial implementing the Tourism Monitors Programme.parks and a Special Economic Zone (SEZ) that are supported by the Department of Trade, Industry and Competition. Industrial parks Journey to Service Excellenceare situated in Maluti-A-Phofung, Botshabelo and Thaba Nchu. Maluti-A-Phofung SEZ is situated in Tshiame. The J2SE will focus on nominating a small town in the rural tourism nodes and assisting the The Free State’s strengths for inward investment are boosted by: • openness to business, trade and foreign investment town to develop a service excellence-orientated • abundance of natural resources culture in their organisations and different • low factory rentals structures with strong media attention and focus • Africa’s leading telecommunications network during the activation. A town will be identified • and the principles of Service Excellence will be incentive packages uniquely developed for Special Economic Zones • communicated to all organisations. A criterion has incentives associated with the revitalised industrial parks • been developed for the nomination which Free State Development Corporation (FDC) support services for has been shared and discussed with relevant priority sectors such as agro-processing and manufacturing • a large labour pool stakeholders. A number of activities will be • diverse cultures implemented in anticipation of the big media • competitive land and building cost event to launch J2SE Town. • At its core, the J2SE aims to bring together world-class transport and telecommunications infrastructure the entire town including restaurants, accommodation facilities, tourist attractions, police, banks and petrol attendants, among 7 others, to be informed, trained and exposed to FREE STATE BUSINESS 2020 the four components of the SANS 1197:2012. A secondary objective of this programme is to establish a local Tourism Service Excellence structure or to link with existing structures to build a sustainable service culture. ■
• an idyllic climate • recreational and lifestyle facilities. Select investment opportunities include: • Agriculture and agroprocessing • Tourism and property development • Medical and pharmaceutical production and distribution • Manufacturing • Renewable and clean energy • Medical tourism.
Maluti-A-Phofung SEZ investment opportunities
The SEZ is booming with investment to the tune of R1.1-billon for 2020.
MAP SEZ CEO Mpho Mgemane of the traffic to different locations in South Africa and neighbouring countries such as Lesotho and Swaziland. Through its cross-docking precinct and its logistics and warehousing sectors the MAP SEZ presents itself as a solution to lighten the traffic pressure on the N3.
This Special Economic Zone (SEZ) is part of the Free State leg of the massive Durban-Free State-Gauteng logistics and industrial corridor that is intended to strengthen the logistics and transport corridor between South Africa’s main industrial hubs to: • Ignite the economy of the region through industrialisation. • Attract foreign and direct investment. • Create access to export and import markets. • Integrate Free State industrial strategy activities into the corridor. • Create job opportunities and grow the economy within the region.
Objectives As part of its mandate, the MAP SEZ is intended to establish manufacturing opportunities and create a regional and international trade environment with added value-chain benefits. It has also been established to simulate social and economic benefits and regional development and to create a prosperous trade city and functional trade ecosystem. Finally, to encourage beneficiation activities that promote value-added benefits and help to create a prosperous trade city and functional trade ecosystem.
Maluti-A-Phofung Special Economic Zone (MAP SEZ) has been established in terms of the Special Economic Zones Act No 16 of 2014. The programme is intended to deepen industrial development and improve manufacturing competitiveness in the MalutiA-Phofung region.
Since the Durban port is the busiest in the southern hemisphere, it therefore means that the N3 carries the majority
Priority sectors Some of the many MAP SEZ priority sectors are: • Automotive • Agro-processing • Logistics • General processing • ICT • Pharmaceuticals.
Investor benefits Some of the many investor benefits that can be derived from locating within MAP SEZ include but are not limited to the following: • 15% corporate tax instead of 28% corporate tax. • Building allowance tax. • Employment incentive tax. • 12i tax allowance.
MAP SEZ milestones Maluti-A-Phofung SEZ was granted an operator permit in 2017 by the Minister of Trade, Industry and Competition after cabinet approval. MAP SEZ was gazetted as a Special Economic Zone on 2 June 2017 and its tax incentives were gazetted on 6 July 2018.
SEZ project pipeline Since inception the MAP SEZ has engaged numerous investors and through these engagements has built a pipeline of lucrative local and international investments to the tune of R2.3-billion. From this pipeline MAP SEZ is proud to pronounce that it has secured investments from five investors to the value of R1.1-billion in various sectors. The operations of these investors were established in June, September and November 2020. These investors are a source of great pride for the MAP SEZ as they have created 103 jobs since the start of their operations and are projected to create 466 jobs collectively, once they are fully operational.
The MAP SEZ is now gaining momentum in terms of attracting local and foreign investors and is supported by its healthy investment pipeline of approximately R3.2-billion, which is project-ed to create 12 000 work opportunities. ■ 137 R2.6-billion in the next five years, which will create an estimated 22 130 permanent and temporary jobs. ■
Contact details
Any investor interested in establishing their business within the SEZ can contact: Ms M Setai, Manager in the Office of the Chief Executive Officer A Maluti-a-Phofung Special Economic Zone Tel: +27 51 4000 800 | Cell: +27 73 210 0935 Email: maphoika@mapsez.co.za | Website: www.mapsez.co.za
Establishing a business in South Africa
South Africa has eased the barriers to doing business for locals as well as international companies and individuals.
South Africa has a sophisticated legal, regulatory and banking system. Setting up a business in South Africa is a relatively straightforward process with assistance being offered by organisations such as the Department of Trade, Industry and Competition and provincial investment agencies like the Free State Development Corporation (FDC).
South African law regulates the establishment and conduct of businesses throughout the country. Tax, investment incentives, regulations governing imports, exports and visas are uniform throughout the country.
The particular environment varies from province to province with regard to the availability of human and natural resources, the infrastructure and support services, business opportunities and the quality of life. In this respect, the FDC can offer specific advice about the business environment in the province.
Business is regulated by the Companies Act and the Close Corporation Act, which cover accounting and reporting requirements. Under new legislation, no new Close Corporations can be created but CCs can convert to companies.
Registration of company The company must be registered with the Companies and Intellectual Properties Commission, (CPIC) in Pretoria within 21 days of the company being started. There are a range of administrative procedures that need to be fulfilled.
Bank account A business bank account must be opened in the company’s name with a bank in South Africa.
Registration with the receiver of revenue • As a Provisional Taxpayer • As a VAT vendor • For Pay As You Earn (PAYE) income tax payable on money earned by employees • For Standard Income Tax on Employees
Registration with the Department of Labour Businesses employing staff will have to contact the Department of Labour regarding mandatory contributions to the Unemployment Insurance Fund (UIF). Register with Compensation Commissioner for Compensation Fund: Files with the Compensation Fund (in the Department of Labour) for accident insurance (Workmen’s Compensation).
Registration with the local authority Relevant only to businesses dealing in fresh foodstuffs or health matters.
Other procedures • Checking exchange control procedures (note that non-residents are generally not subject to exchange controls except for certain categories of investment).
• Obtaining approval for building plans • Applying for industry and export incentives • Applying for import permits and verifying import duties payable • Registering as an exporter if relevant and applying for an export permit. Business entities There are a variety of forms which businesses can take, including private and public companies, personal liability companies, non-profit companies, state-owned companies and even branches of foreign companies (or external companies).
Branches of foreign companies fall under Section 23 of the Companies Act of 2008 and are required to register as “external companies” with the CIPC. An external company is not required to appoint a local board of directors but must appoint a person resident in South Africa who is authorised to accept services of process and any notices served on the company. It must also appoint a registered local auditor and establish a registered office in South Africa. Patents, trademarks and copyrights Trademarks (including service marks) are valid for an initial period of 10 years and are renewable indefinitely for further 10-year periods. Patents are granted for 20 years, normally without an option to renew. The holder of a patent or trademark must pay an annual fee in order to preserve its validity. Patents and trademarks may be licensed but where this involves the payment of royalties to non-resident licensors, prior approval of the licensing agreement must be obtained from the dtic. South Africa is a signatory to the Berne Copyright Convention. Permits for foreign nationals Work permits In considering whether or not to grant a work permit, the Department of Home Affairs will first evaluate the validity of the offer of employment by conducting a number of checks to confirm the following: • Has the Department of Labour been contacted? • Has the position been widely advertised? • Is the prospective employer able to prove that he or she has tried to find a suitably qualified local employee prior to hiring a foreigner?
I N D U S • Is the prospective employee appropriately T R I A L P R O P E R T Y T O R E N T I N H A R R I S M I T H qualified and do they have the relevant experience? I N D U S T R I A L P R O P E R T Y T O R E N T I N H A R R I S M I T H FDC is renting out 18 850 sqm standalone factory including Furniture Manufacturing Machinery, Equipment, and Furniture for BusinessThe factory is Situated at Site 2277 in Harrismith and close proximity to all amenities, on FDC is renting out 18 850 sqm standalone factory including Furniture Manufacturing Machinery, Equipment, and Furniture for Business Operation.. Operation.. main arterial routes and Quick access onto N3 Freeway. The factory This fa i c s Sittory uatedoffers at Site the foll 22owi7 n7 g i: n Harrismith and close proximity to all amenities, on main a Business permitsrterial routes and Quick access onto N3 Freewa Sprinkler System. 4 Roller Doors y. This Sp Foreign nationals who wish to establish their own factory offers the following: rinkler System. Security Guard House Well fenced and secured 4 S business or a partnership in South Africa must, Roller Doors ecurity Guard House Ample parking 3 phase power with 100 amps 8 toilets, 6 offices and boardroom, reception, kitchen and separate warehouse ablutions with
Well Amp fenced le parki shower apart from having sufficient funds to support and secured ng 3 8 phase po toilets, 6 Occupa informa themselves and their family, be able to invest at wer with 100 amps offices and boardroom, reception, kitchen and separate warehouse ablutions with tion available immediately. Please contact Mr Tefo Matla for more tion or to view: shower Tel: least R2.5-million in the business.051 4000 800 Email: tefo@fdc.co.za www.fdc.co.za Occupation avaFDC The funds must originate overseas, be ilable immediately. Please contact Mr Tefo Matla for moreIS ZERO TOLERANCE TO FRAUD AND CORRUPTION.PLEASE REPORT FRAUD AND CORRUPTION INCIDENTS TO THE FRAUD HOTLINE 0800 212 154information or to view: Tel: 051 transferable to South Africa and belong to the 4000 800 Email: tefo@fdc.co.za www.fdc.co.za FDC Iapplicant (ie emanate from the applicant’s own S ZERO TOLERANCE TO FRAUD AND CORRUPTION.PLEASE REPORT FRAUD AND CORRUPTION INCIDENTS TO THE FRAUD HOTLINE 0800 212 154 bank account). The business must also create jobs for South African citizens. After six months to a year, proof will have to be submitted that the business is employing South African citizens or permanent residents, excluding family members of the employer. Applications for work permits for selfemployment can only be lodged at the South African Consulate or Embassy in the applicant’s country of origin. The processing fee is US$186. The applicant would also have to lodge a repatriation guarantee with the consulate/embassy equivalent to the price of a one-way flight from South Africa back to his or her country of origin. This guarantee is refundable once the applicant has either left South Africa permanently or obtained permanent residence. Any application for an extension of a business permit may be lodged locally. The processing fee per passport holder is R425. Some countries also need to pay R108 per return visa. A list of countries to which this applies is available from the Department of Home Affairs. The FDC assists investors in applying for the relevant work permits to conduct their business. What can the FDC do for you? The FDC will help new businesses by assisting in project appraisal and packaging, putting investors in touch with relevant agencies and government departments, alerting investors to investment incentives and setting up joint ventures where required. ■
South African investment incentives
The South African government, particularly the Department of Trade, Industry and Competition, has a range of incentives available to investors, existing companies, entrepreneurs and co-operatives across many sectors.
South Africa wishes to diversify its economy and incentives are an important part of the strategy to attract investors to the country.
The Department of Trade, Industry and Competition (the dtic) is the lead agency in the incentives programme, which aims to encourage local and foreign investment into targeted economic sectors, but the Industrial Development Corporation (IDC) is the most influential funder of projects across South Africa.
There are a variety of incentives available and these incentives can broadly be categorised according to the stage of project development: • Conceptualisation of the project – including feasibility studies and research and development (grants for R&D and feasibility studies,
THRIP, Stp, etc) • Capital expenditure – involving the creation or expansion of the productive capacity of businesses (MCEP, EIP, CIP, FIG, etc) • Competitiveness enhancement – involving the introduction of efficiencies and whetting the competitive edge of established companies and commercial or industrial sectors (BBSDP, EMIA,
CTCIP, etc) • Some of the incentives are sector-specific, for example the Aquaculture Development and
Enhancement Programme (ADEP), Clothing and Textile Competitiveness Improvement
Programme (CTCIP) and the Tourism Support
Programme (TSP).
Manufacturing
Key components of the incen- I N D U S T R I A L P R O P E R T Y T O R E N T I N H A R R I S M I T H tive programme are the Manufacturing Incentive Programme I N D U S T R I A L P R O P E R T Y T O R E N T I N H A R R I S M I T H FDC is renting out 18 850 sqm standalone factory including Furniture Manufacturing Machinery, Equipment, and Furniture for BusinessThe factory is Situated at Site 2277 in Harrismith and close proximity to all amenities, on FDC is renting out 18 850 sqm standalone factory including Furniture Manufacturing Machinery, Equipment, and Furniture for Business Operation.. (MIP) and the Manufacturing The factory is Situated Operation.. main arterial routes This factory offers at Site 2277 in and Quick access the following: Harr onto is N m 3 ith Fre and eway c . lose proximity to all amenities, on Competitiveness Enhancement main arterial routes a Sprinkler System. 4 Roller Doors nd Quick access onto N3 Freeway. Programme (MCEP). The initial This Sp factory offers the fo rinkler System. Security Guard House Well fenced and secured llowing: MCEP, launched in 2012, 4 S Roller Doors ecurity Guard Ho Ample parking 3 phase power use with 100 amps 8 toilets, 6 offices and boardroom, reception, kitchen and separate warehouse ablutions with was so successful that it was Well Amp fenced le parki shower an ng d secured oversubscribed with almost 890 3 8 phase po toilets, 6 Occupa informa wer with 100 amps offices and boardroom, tion available immedia tion or to view: t re el ception, kitchen y. Please contac a t nd Mr separ Tefo ate Mat wareh la for ouse more ablutions with businesses receiving funding. shower Tel: 051 4000 800 Email: tefo@fdc.co.za www.fdc.co.za
A second phase of the prog- Occupation avaFDC ilableIS ZERO CO i T R mmediately. PleOLERANCE TO FRAUD A RUPTION INCIDENTS TO ase contact Mr Tefo MND CORRUPTION.PLEASE REPORT THE FRAUD HOTLINE 0800 212 1 atla for mFRAUD AND 54 ore information or to view: Tramme was launched in 2016. The grants are el: 051 4000 800 Email: tefo@fdc.co.za www.fdc.co.za not handouts as the funding covers a maximum FDC IS ZERO TOLERANCE TO FRAUD AND CORRUPTION.PLEASE REPORT FRAUD AND CORRUPTION INCIDENTS TO THE FRAUD HOTLINE 0800 212 154 of 50% of the cost of the investment, with the remainder to be sourced elsewhere.
The Enterprise Investment Programme (EIP) makes targeted grants to stimulate and promote investment, BEE and employment creation in the manufacturing and tourism sectors.
Aimed at smaller companies, the maximum grant is R30-million. Specific tax deductions are permissible for larger companies investing in the manufacturing sector under Section 12i of the Income Tax Act. Incentives for SMMEs A lot of emphasis is placed on the potential role of small, medium and micro enterprises in job creation and a number of incentives are designed to promote the growth of these businesses. These include: • Small Medium Enterprise Development Programme (SMEDP) Programme (SMEDP) • Isivande Women’s Fund • Seda Technology Programme (Stp). • Seda is the Small Enterprise Development Agency, an agency of the Department of Small Business Development that exists to promote SMMEs.
Other incentives
Trade-related incentives
Other incentives that are available to investors as well as existing businesses in more than one sector include the following: • Technology and Human Resources for Industry Programme (THRIP) • Support Programme for Industrial Innovation (SPII) • Black Business Supplier Development Programme (BBSDP), which is a cost-sharing grant offered to black-owned small enterprises • Critical Infrastructure Programme (CIP) that covers between 10% and 30% of the total development costs of qualifying infrastructure • Co-operative Incentive Scheme, which is a 90:10 matching cash grant for registered primary co-operatives • Sector Specific Assistance Scheme, which is a reimbursable 80:20 cost-sharing grant that can be applied for by export councils, joint action groups and industry associations. The Export Marketing and Investment Assistance (EMIA) Scheme includes support for local businesses that wish to market their businesses internationally to potential importers and investors. The scheme offers financial assistance to South Africans travelling or exhibiting abroad as well as for inbound potential buyers of South African goods. ■
Online Resources
Department of Trade, Industry and Competition: www.thedtic.gov.za Free State Development Corporation: www.fdc.co.za Industrial Development Corporation: www.idc.co.za Official South African government incentive schemes: www.investmentincentives.co.za
Lesotho National Development Corporation
Profiling the endowments of Lesotho in the Free State neighbourhood.
Ha Belo Industrial Estate Construction Site.
Lesotho National Development Corporation (LNDC) is a corporate body mandated by the Government of Lesotho to “initiate, promote and facilitate the development of manufacturing and processing industries, mining and commerce in a manner calculated to raise the level of income and employment in Lesotho”. LNDC also promotes Lesotho as an attractive investment location for both foreign and indigenous investors.
The Government of Lesotho is the sole shareholder in the Corporation and the Ministry of
Trade and Industry is responsible for providing overall policy direction on investment and industrialisation.
The Corporation is charged with the implementation of the country’s industrial development policies and investment strategy.
The vision of the Corporation is to be “A catalyst for a diversified, globally competitive economy, underpinned by manufacturing and high-tech agroprocessing industries”. Its mission states that “Our aim is to deliver excellent and speedy services to our clientele as we partner to achieve inclusive and sustainable economic growth”. To fulfil its mandate, LNDC offers four core services: investment and trade promotion, investment and trade facilitation, aftercare and development financing services. These core services are offered to foreign and indigenous investors primarily through serviced industrial and commercial sites and buildings. In addition to serviced sites, LNDC offers an array of financing solutions.
Organisational structure In terms of its establishment Act, the strategic leadership of the Lesotho National Development Corporation is vested in the 11-member Board of Directors appointed by the Minister of Trade and Industry. The Board provides direction and oversight over the affairs of the Corporation.
The operations of LNDC are managed by the Chief Executive Officer, supported by the Executive Management Team.
The CEO’s office comprises the Internal Audit and Risk Management Division, Corporate Governance Division and Public Relations Section.
The Executive Management Team comprises four General Managers who head four strategic business units: • Development finance institution (semi-autonomous) • Property development and management (semi-autonomous) • Investment and trade promotion • Corporate services.
Investment and Trade Promotion (ITP) Strategic Unit ITP is responsible for initiating, promoting and facilitating investments from foreign and indigenous investors, promoting and facilitating trade and
exports, facilitating implementation of new and expansion investments, securing international buyers, providing technical assistance to new and existing investors, business expansion and retention (aftercare services), policy advocacy and investment climate reforms and Lesotho nation branding and marketing. ITP is divided into six sub-functions: investment promotion, trade promotion, investment climate reforms, nation branding and marketing, and aftercare services.
Investment and trade promotion relates primarily to promotional activities and campaigns aimed at either potential investors or generally promoting trade and development for Lesotho, generating leads, and developing prospects until they are ready for commitment and implementation. Aftercare services includes investment facilitation, business expansion and retention. These are meant to elevate and manage Lesotho’s reputation as a strategic investment and trading location and to continuously pursue improvements in efficiencies for service delivery to investors, hence positioning Lesotho as the best in Ease of Doing Business in the region.
Development Finance (DF) Strategic Business Unit The LNDC Strategic Plan of 2018-23 instituted the creation of the Development Finance (DF) Strategic Business Unit with the mandate to “develop a portfolio of financing solutions to support private sector led industrial development and economic diversification”. The unit currently offers four financing instruments: • Partial credit guarantee (PCG) – fully operational • Equity finance • Quasi-equity finance • Project preparation facility.
This unit manages LNDC’s equity portfolio of 10 companies. These companies operate in different sectors ranging from agriculture, construction, wholesale, retail and services.
The role of DF is extracted from the LNDC Act No. 20 of 1967 to raise, lend or borrow money; make advances to any company, form or person; lend and advance money to companies, firms or persons owning or engaging in any business similar to or related to that of the Corporation; guarantee payment of cash or performance of contracts by any such company, firm or person on any terms as maybe agreed upon and to issue debentures, bills of exchange and other negotiable or transferrable instruments.
It also can direct expenditure on or towards the implementation of the project or undertaking or any of the objectives of the project or undertaking; make loans or grants for the purposes of the project or undertaking; invest any moneys belonging to the Corporation in any project, undertaking or enterprise; provide technical, advisory or managerial assistance and services; provide plant or machinery for the purposes of any project, undertaking or enterprise.
Property Development Management (PDM) Strategic Business Unit The PDM unit is one of the main cogs that drive the Corporation, as without property there is no established investment. Investment prospects look for globally competitive locations for investment. The PDM division is responsible for acquiring and developing LNDC properties in an effort to create work space for industrialists and other commercial entities.
PDM is primarily responsible for the management of all LNDC property which include: • Acquiring and developing LNDC properties • Managing leases • Marketing commercial properties • Providing maintenance support to tenants.
Corporate Services (CS) Strategic Business Unit LNDC’s Corporate Services division contains the shared support functions of the organisation. These services include Human Resources and Administration, Legal Services, IT, Planning and Research and Finance. The unit is the membrane that allows the Corporation’s operational processes to run as smoothly as possible. ■
CONTACT DETAILS
Lesotho National Development Corporation Email: info@lndc.org.ls Email: moremoholo@lndc.org.ls Website: www.lndc.org.ls
