Tatenda Zingoni_MPhil Thesis- Evaluation of Industrial Development Zones in South Africa
Abstract Industrial Development Zones (IDZs) are Special Economic Zones which are set aside to facilitate the establishment of export oriented industries which are subjected to custom made policies and incentives. South Africa currently has three functional IDZs which have realised varying levels of success, namely Richards Bay IDZ (RBIDZ), Coega IDZ (CIDZ) and the East London IDZ (ELIDZ). The South African government’s New Growth Path aims at ensuring economic growth and promoting job creation. Investment into the manufacturing sector is expected to contribute to the country’s growth and employment imperatives. Industrial Development Zones have been noted as having significant potential of contributing to growth. Key success factors noted for the operation of development zones include well defined financial and policy incentives, close location to ports or main transport nodes, along with focused marketing of the zones. South Africa’s Industrial Development Zones policy framework has some shortcomings which were identified in the research process. Examples of the shortcomings include lack of adequate financial incentives for investors in Industrial Development Zones and absence of a coordinated marketing strategy for the country’s zones. The shifting global economic landscape is seeing an increase in the economic power of developing countries such as the Brazil, Russia, India, China and South Africa (BRICS) bloc. As investors increasingly make steps to establish operations in new regions, development zones are expected to attract growing investment. Revision of the South African IDZ framework is anticipated to make the zones more attractive and competitive.