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Boosting economic growth
SPECIAL FEATURE Boosting economic growth
Sector-specific industrial zones are set to transform Limpopo’s economy.
Mineral beneficiation is a vital part of Limpopo’s economy. Photo: Impala Platinum.
In July 2016 the national cabinet approved the Musina-Makhado Special Economic Zone (SEZ). Located in the far north of Limpopo in the Vhembe region, Musina-Makhado is strategically located near the border of Zimbabwe and on the Great North Road which links South Africa to the broader Southern African region.
The location of the Musina-Makhado SEZ, with links to Zimbabwe, Botswana and Mozambique, promotes the Trans-Limpopo Spatial Development Initiative. Logistics will be one of the key focus areas of the SEZ. Soon after the announcement of the designation of the SEZ, the National Department of Trade and Industry (dti) said that a consortium of Chinese investors, Sino, has agreed to put R40- billion into the Musina-Makhado SEZ where they will operate the mineral beneficiation operations.
The initiative has already attracted investors in the form of the Eco-Industrial Solutions (EIS), the private sector investor behind the Limpopo EcoIndustrial Park (LEIP). LEIP aims to be an integrated industrial development comprising five major industrial components that sets new standards in sustainability. Set on 6 400ha of land, the LEIP will include a nature reserve, two residential estates and schools. The Limpopo Economic Development Agency (LEDA) is working with EIS to establish a petrochemical cluster within the Musina-Makhado SEZ.
LEDA is the key driver of the provincial government’s drive to boost the economy through investment. LEDA is an agency of the Limpopo Department of Economic Development, Environment and Tourism (LEDET). LEDA’s brief
is to contribute to accelerated industrialisation sector infrastructure, an integrated public transport in Limpopo by stimulating and diversifying the policy and policies on land development. industrial base of the regional economy. The focus Key elements of the Limpopo Development is on high-impact projects that will spark growth Plan are: industrialisation (beneficiation of mining in a variety of sectors and create employment and agricultural products and produce); mining opportunities. (local suppliers, improved training and access to
Two key areas of focus relate to Special sector value chains for entrepreneurs); infrastructure Economic Zones and Corridor Development and development; agri-processing; SMME promotion to land, property and infrastructure development and ICT and the knowledge economy (establish a (including business parks and industrial parks). WAN footprint). As these targeted areas grow, the infrastructure Mining is currently the most important part of and associated industries will act as a magnet for the provincial economy. Recent platinum mining other businesses and industries in the same sector, developments on the eastern limb of the Bushveld together with service industries. Complex have increased this effect but global
A Musina-Makhado Skills Development Plan has commodity prices have been uncertain in recent been approved by the provincial government. years. One of the goals of the LDP is to see more
A second application for an SEZ at Tubatse is beneficiation from the mining sector, which will pending. Tubatse is in the Sekhukhune District support the goal of further industrialising the Municipality and hosts a number of mining province’s economy. Related to this is an emphasis operations. on the manufacturing that needs to grow, and this
The SEZ in Tubatse will focus on the beneficiation is where the SEZs’ role becomes critical. of platinum group metals (PGM) and mining-related While the Limpopo Development Plan is aligned manufacturing. The province of Bashkortostan in with the broader National Development Plan, there Russia has also expressed an interest in the SEZs are also several national Strategic Infrastructure of Limpopo. Projects (SIPs) which affect Limpopo.
Phase one of the SEZ project would see a 280ha Three in particular are expected to make a big site developed to accommodate a mining suppliers impact, namely SIP 1 (Unlocking the Northern park, light manufacturing, heavy manufacturing, Mineral Belt with Waterberg as the Catalyst), SIP 6 logistics, a solar energy cluster and a PGM (Integrated Municipal Infrastructure Project) and beneficiation cluster. SIP 7 (Integrated Urban Space and Public Transport SPECIAL FEATURE Other national SIPs of relevance relate to green Limpopo Development Plan energy, agri-logistics and rural infrastructure, The Great North Road regional integration and water and sanitation The SEZ and industrial parks being promoted in passes through Limpopo infrastructure. the province fall within a broader framework. The Limpopo Development Plan (LDP) targets three from the south to the bor der town of Musina and on to Zimbabwe and its neighbroad areas for improvement and development: bours in the Southern African socio-economic, infrastructural and institutional. Development Community. Every department of the Limpopo Provincial The busy N11 highway links Programme). Government has targets within the LDP which the province to Botswana to are translated into actionable programmes to be the west and Mpumalanga implemented within time-frames. Province to the east. The plan is supported by strategies relating to a spatial investment framework in public and private Most of South Africa's lo gistics operators have a presence in the provincial capital city of Polokwane and freight logistics hubs have been established at that city and 15 LIMPOPO BUSINESS 2019/20 at Musina. Limpopo covers about 10% of South Africa's The province also has a sophisticated rail netland mass and is home to about 10% of the coun work which Transnet Freight Rail aims to further
BIOGRAPHY
Webster Mfebe, Chair of the Limpopo Eco-Industrial Park, has won several awards in construction and leadership. He is the CEO of the South African Forum of Civil Engineering Contractors (SAFCEC) and has accumulated a wealth of senior leadership and management expertise during nearly 40 years in the mining, construction and engineering industries, broadcasting and politics. Webster has addressed international conferences on political and economic issues and has contributed to business intelligence articles in some publications. Board Chair Webster Mfebe outlines the steps to be taken by Eco-Industrial Solutions to create the ground-breaking Limpopo Eco-Industrial Park.
What does your company do? Eco-Industrial Solutions (Pty) Ltd (EIS) is committed to integrated and sustainable industrial property development. Its slogan is “Industry Nurturing Nature”. EIS is developing the Limpopo Eco-Industrial Park (LEIP) project, powered by renewable energy and municipal waste syngas, to be the world’s first zero solid-waste, carbon neutral heavy and light-industrial park integrated with a 2 200-hectare nature park. This development recognises and promotes a symbiotic relationship between people, planet and profit.
The LEIP is a multi-billion-rand project that will significantly contribute to growing an inclusive economy and creating new jobs, particularly in the Limpopo Province. The LEIP project provides a fully serviced and secure platform for heavy and light industrial tenants as well as incubating and supporting Small, Medium and Micro Enterprises (SMMEs). The LEIP Master Plan is based on principles derived from the field of industrial ecology to create a closed loop or circular economy, which benefits local communities whilst integrating and preserving the environment. No flaring of emissions will be necessary, as all waste gases and solid waste will be gasified at extremely high temperatures without interrupting or requiring process changes to tenants’ business models.
How was the company formed? EIS was formed by founding members who share the vision and passion to create job opportunities through environmentally friendly industrialisation and shared benefits to local communities.
In response to some of the major challenges facing humanity today such as ecological collapse followed by social uprising,
due to rapidly increasing climate change and environmental degradation of the life support systems, EIS was specifically formed in 2011 to address these problems by implementing technoeconomically viable and sustainable industrial development projects.
What is the ownership structure of the company? The project development company, EIS, is 89% black-owned and 57% black women-owned, while the LEIP project is 65% black-owned with 90% board control. Local Limpopo Vhembe District citizens have been allocated 10% of the ownership of the LEIP with Musina Local Municipality as the proxy shareholder. Funds and dividends are to be used for developmental activities identified by the communities themselves, including bursaries and other communal co-operative activities such as farming and agro-processing.
Why have you chosen northern Limpopo as the location for the park? EIS recognised the future growth potential of the Musina Municipality, considering its location adjacent to the Beitbridge border post as a gateway for doing business in Southern Africa. After a rigorous site-selection process, the site in Musina was deemed ideal based on its accessibility as well as its strategic location. The national N1 highway and Transnet’s north-south rail line traverses the site, providing major links to the rest of South Africa and superior access to neighbouring countries to the north.
Please explain what is unique about the LEIP. Why is it a game-changer? The LEIP demonstrates that ongoing industrial pollution can be stopped through the application of existing, technically proven and commercially available technologies, for example, plasma waste gasification and the combination of viable renewable energy options. The LEIP’s design incorporates these essential technologies through creative application and funding. Worldwide, people are panicking about the state of the environment and the fate of future generations. With increased awareness and more developed consciousness coupled with technological advancements, the LEIP pioneers the transition required in terms of altering humanity’s development pathway to a sustainable one.
As a mega-industrial and residential growth point and an infrastructure CAPEX in excess of R10.7 billion, the LEIP will be a catalyst for transforming Musina into a mega-city. Musina will become South Africa’s most sustainable and desirable fully integrated industrial-residential growth point, facilitating socio-economic transformation and inter-regional trade, to the lasting benefit and well-being of all South Africans and SADC.
Musina’s growth into a mega-city will be underpinned by beneficiation of local and regional resources, manufacturing of industrial chemicals and information technology components, as well as agro-processing and superior logistics services that enable improved inter-regional trade.
The layout of the park was dictated by consulting ecologists and heritage specialists who used sensitivity maps to indicate areas suitable for development and areas that should be preserved as part of a nature reserve. Typically, ecologists and heritage specialists are involved during the environmental authorisation process, which is too far down the line in terms of the broader project development process, at which point impacts are mitigated rather than avoided by protecting the environment from the outset.
The LEIP is committed to transformation and to replicating its transformation blueprint, where applicable, in all its future eco-industrial developmental initiatives. All contractors and services providers will be made aware to comply with the contractually obligated transformation requirements.
How many people will be employed at the park? Total LEIP: Direct jobs: 58 967. Total including indirect and induced jobs: 289 251.
Eco-Industrial Solutions
The Limpopo Eco-Industrial Park will set new standards in ecologically sound industrial development.
Eco-Industrial Solutions (Pty) Ltd (EIS) was established to create an innovative industrial park combined with a nature park in the northern area of Limpopo. The Limpopo Eco-Industrial Park (LEIP) will be Africa’s first zero solid-waste eco-industrial park. Municipal waste and renewable energy will be utilised to provide syngas and power for industrial enterprises within the park. Waste from the park will be contained and disposed of within the park through the application of plasma gasification technology and a closed-loop water management system.
Background
In South Africa air pollution kills an estimated 20 000 people per year, 780 000 people in Africa and worldwide nine-million people per year. Coupled with the plight of unemployment in Africa and more specifically in South Africa, the expertise of the founding members covers heavy industrial development in various countries globally, experience in implementing environmental protection as well as the realisation of institutional mega-projects.The Musina, Vhembe, region is blessed with an abundance of natural resources, accessible labour and existing major infrastructure. The LEIP concept has been successfully integrated into the Integrated Development Plan (IDP) and Spatial Development Framework (SDF) of the Musina Local Municipality.
Furthermore, the LEIP concept is in tune with the spirit encapsulated in South African President Cyril Ramaphosa’s vision of a “New Dawn”, predicated on the twin pillars of “Renewal and Rebuilding”. Vision
To find techno-economically viable solutions to the challenges facing humanity. To promote industrialisation in a way that is beneficial to local communities as well as the environment.
Motto
Industry nurturing nature.
The concept
The world’s first zero solid-waste eco-industrial and integrated nature park. The Limpopo Eco-Industrial Park will illustrate the symbiotic relationship between people, planet and profit by demonstrating their mutually beneficial co-existence, thereby preserving Mother Earth for future generations.
Location
Musina, northern Limpopo. Near Beitbridge border post and part of the Musina-Makhado Special Economic Zone.
LEIP components
1.
2.
450MW PV Solar Power for agro-processing, buildings and water heating and supply excess to the Eskom grid. Two approved off-channel dams with 20 million cubic metres water storage capacity.
STRATEGIES TO MITIGATE RISK AND PROMOTE THE CIRCULAR ECONOMY
3.
4.
5. 6.
7.
Ensure that all toxic materials, other waste and gases are disposed of within the LEIP. Reduce food waste and recycle key nutrients (N, P) through their recovery from food waste and waste water. Generate power through solar PV and municipal waste syngas and export excess power to the grid. Use Eskom power for construction only. Capture heat and gas emissions to supplement electricity supply. Protect and integrate sensitive areas throughout the LEIP. Responsibly manage the value chain of waste materials such as metals, plastics and wood. Waste concrete and bricks will be crushed and mixed with local hard rock into a uniform and usable construction material.
Blue Drop status drinking water and environmentally friendly waste-water treatment facilities. A Nature Reserve comprising 2 286 hectares of environmentally sensitive tourism area. 80 chalets in the integrated nature reserve. Two residential eco-estates: Musina EcoHousing Estate (3 797 units) and Singelele Equestrian Estate (903 units). Waste gasification plants for residential and industrial waste.
Game-changer
Plasma waste gasifiers will be used extensively. This technology has been used elsewhere to transform waste to energy, but the LEIP aims to take this a step further by ensuring that no waste leaves the site. The target is for the industrial park to be a self-contained unit with a zero-waste impact on the surrounding countryside and communities.
Timeline
2019/20: Bankable project studies to be finalised. Infrastructure construction proceeds (including LEIP East basic infrastructure, Transnet Intermodal Terminal Facility and bulk water and sewage treatment facilities). Musina Eco-Housing Estate construction begins. 2021: Construct truck stop and warehousing, agroprocessing facility, PV solar farm 1 000ha, plasma gasification facilities, ITC development centre. 2022: Establish a balanced renewable energy system that is integrated with waste gasification and syngas generated power. Construct copper processing plant. Establish nature park, including 80 chalets. Establish Industrial Ecology Research Centre. 2023: LEIP East Operations commence with commissioning of utilities, infrastructure and financial management systems. Commission SEZ operations. Construct LEIP West basic infrastructure, to accommodate a chemical plant complex including ammonia-urea, methanol and resin, by utilising carbon engineering technology to generate the required feedstock hydrogen (H2) and carbon monoxide (CO), the basic building blocks for these plants.
Impact
GDP impact 2019: R744 million GDP impact 2025: R17.2 billion GDP impact (direct and induced) from 2019 to 2025: R61.3 billion.
CONTACT DETAILS
Head Office
Eco-Industrial Solutions (Pty) Ltd, Modimolle 0510, Limpopo, South Africa Phone: +27 87 702 6065 Email: ceo@eco-industrialsolutions.org Website: www.limpopoecoindustrialpark.com
Building skills and creating jobs through partnerships
The Limpopo Eco-Industrial Park is set to make a huge economic impact.
The Limpopo Eco-Industrial Park (LEIP) is an integrated and sustainable industrial development that is aligned with and in support of South African government goals articulated in the National Development Plan and the Industrial Policy Action Plans.
The LEIP is a private-sector initiative driven by Eco-Industrial Solutions (EIS), but the development incorporates significant partnerships at local, provincial and national level illustrating the inclusive philosophy of the developers.
The park, through its various industrial components, will create tens of thousands of direct and indirect jobs over the first five years, provide about 4 900 permanent housing opportunities in the town of Musina and add more than R15-billion to the revenue of the provincial government. It will also provide a boost to the national tax base.
Among the projects to which the LEIP initiative will contribute via partnerships are the National Development Plan, the Green Economy Plan, and the achievement of South Africa’s Transformation and Sustainable Development Goals.
In January 2019, South African President Cyril Ramaphosa attended a Business Economic Indaba organised by Business Unity South Africa (BUSA), on the sidelines of which the Public Private Growth Initiative (PPGI) made a presentation on 18 projects from 19 economic sectors, representative of opportunities for South Africa’s private and public sectors to work together to combat unemployment and stimulate the economy. The LEIP is project number 17 on the list of 18 PPGI projects which were promised full government support, while engagements within the PPGI platform will take place with the
Presidency over the next five to 10 years, with a view to implementing sectoral plans.
Partnerships
Several key partnerships with EIS involve NECSA, SAFCEC, Lepelle Northern Water, Transnet Freight Rail, Musina Local Municipality and LEDA.
SAFCEC will be responsible for quality monitoring of their construction members.
The Nuclear Energy Corporation of South Africa has signed an agreement with EIS and LEIP to jointly develop and implement plasma gasification of municipal and gaseous waste on a localised scale, thereby minimising the adverse impacts of longerdistance logistics.
The Lepelle water utility has signed up to be the LEIP’s water service provider. Plans for a Special Economic Zone (SEZ) in the Musina area have been aligned with Transnet’s requirements.
Transnet Freight Rail intends to operate its new intermodal terminal facility within the LEIP as a dry port extension of a seaport. It is expected to have an initial storage capacity of 50 000 units. A train ferry is intended that will be able to carry roughly 1 000 vehicles per day across the Beitbridge-Zimbabwe border.
The Musina Local Municipality has approved the land development application for the LEIP and will at financial close become an equity partner in the project, holding a 10% share on behalf of the local communities. LEIP is the first part of a broader initiative, the Musina to Africa Strategic Hub Initiative (MUTASHI), of which the Musina-Makhado SEZ is the other major component.
The Limpopo Economic Development Agency (LEDA) has signed an agreement to work with EIS to establish the LEIP as the Musina SEZ Operator within the Musina-Makhado SEZ.
Economic and social benefits
The LEIP has been designed to ensure that local women, youth and disabled people benefit from the project. The housing developments are designed as integrated communities with the natural environment and with amenities such as five schools, a children’s hospital as well as local churches, shopping and community centres. The following innovations are aimed at benefitting local communities: • Establish a Research and Development Industrial Ecology Faculty within the LEIP in collaboration with local universities (University of Venda and University of Limpopo). The LEIP aims to support innovation, research and development, community engagement and literacy and numeracy. • A Skills Development Centre and Trade Test Centre is to be built and fully equipped in consultation with the Department of Higher Education and Training (DHET), which will invite the participation of the various Sector Education and Training Authorities (SETAs). The goal is for the skills centre to also be available for use by learners from the SADC region.
Transformation
The transformation imperatives of the LEIP project as a private development are mainly aimed at contributing towards the empowerment of the following targeted groups of South African citizens: • Youth (in support of the Youth Empowerment Service YES programme) • Women • People with disabilities • Military veterans • Rural and township communities. • Only construction companies rated no less than Level 2 BEE status will be contracted to do work at the LEIP, and such companies will be vetted to assess their state of competence and readiness to undertake quality construction services. In special cases, for technical reasons, contractors and service providers with less than Level 2 BEE status will be allowed if they form SMME partnerships with locals, who will jointly carry out the work on site.
