During a high-powered BRICS Business Council delegation visit to Dube TradePort earlier this week investors were told that qualifying companies located within Dube TradePort Special Economic Zone are now eligible to access Special Economic Zone incentives after Finance Minister Mr. Nhlanhla Nene published his approval of 12R and 12S in the Government Gazette on the 6th of July 2018.
However what really added to the investment appetite is the flurry of activity taking place within the zone where work is currently underway with the development of Dube TradeZone 2, which opens up an additional 45 hectares for development within the Special Economic Zone.
Amongst the incentives that companies will be able to claim with this approval by the Finance Minister is the accelerated depreciation allowance on capital structures, which is a tax rebate on the investment a company makes in the buildings it operates from; this tax rebate is valued at 10% of the total investment amount per annum, over 10 years, it serves to encourage businesses to invest in new facilities. Secondly, certain companies undertaking business activities within the Special Economic Zone will be eligible to benefit from a reduced corporate tax rate of 15% instead of the normal 28% corporate tax rate.
" Seeing the implementation of this legislation is a significant milestone for South Africa as it serves as a support measure that will accelerate the growth of manufacturing and exports, in addition to attracting further domestic and foreign direct investment. While improving the adoption of new technologies and skills into the market.
Companies will also be entitled to claim to an Employment Tax Incentive (ETI), which encourages employers to hire the youth and other less experienced job seekers, however, the employee age restriction will not apply within Special Economic Zones which will broaden the benefit of ETI to both workers and SEZ Enterprises.” Says Mr. Jabulani Sithole, SEZ Programme Manager
Since its inception, Dube TradePort Special Economic Zone has created a total of 3088 permanent jobs. In the last year, alone businesses operating within the Dube TradePort Special Economic Zone have created 432 new permanent jobs. While the cumulative employment opportunities created by companies operating within Dube TradePort Special Economic Zones, when counting downstream and upstream value chain linkages now totals 12 997 indirect jobs which have been added to the economy of KwaZulu-Natal.
" To date Dube TradePort has secured R 3.2 billion in private sector investment, building on this success, work is already underway to develop the second phase of our Dube TradeZone light industrial development that will be 45 hectares in extent. This development is going to be purpose-built for businesses in the pharmaceuticals and electronics sectors, offering common utilities to service these industries. The development will allow the organization to further target local and foreign investment.
‘With international forums like the BRICS Business Council highlighting Durban as an a trade and investment destination, our current projections point to the expanded zone attracting in excess of R10bn of private sector investment over the next five years, which will spur further job creation in the region." Concluded Mr. Sithole
Over the last eight years, Dube TradePort Special Economic Zone has expanded its land holdings to over 3 500 hectares around King Shaka International Airport, catering for the expansion of its development zones, which encompasses industrial, agro-processing and other commercial activities.
Wherein it has opened a One Stop Shop facility, which will assist investors with a variety of services that range from helping investors apply for Special Economic Zone incentives, as well as other matters that are related to developing and setting up operations within the precinct, improving the ease of doing business for investors.