Deputy President Paul Mashatile: Second International Special Economic Zones (SEZ) Conference

Address by the Deputy President of the Republic of South Africa, His Excellency Mr Shipokosa Paulus Mashatile, on the occasion of the Second International Special Economic Zones (SEZ) Conference, Durban ICC, Kwazulu-Natal Province, 17 July 2026 

Programme Director;
Premier of KwaZulu-Natal, Mr Thamsanqa Ntuli and Premiers here present;
Mayor of eThekwini, Councillor Cyril Xaba;
South Africa's Minister of Trade, Industry and Competition, Mr Parks Tau and Deputy Minister, Mr Zuko Godlimpi;
Ministers and Deputy Ministers present, I have seen Deputy Minister of Public Service and Administration, Ms Pinky Kekana;
Reverend Musa Zondi, MECs and Mayors present;
Chairperson of the Portfolio Committee on Trade, Industry and Competition, Mr Mzwandile Masina and Select Committee Chairperson, Mrs Hildergard Sonja-Boshoff;
SEZ Advisory Board Chairperson, Mr Fish Mahlalela and CEOs of our Special Economic Zones and Industrial Parks;
Members of the Diplomatic corps;
International partners; 
Distinguished Investors and Captains of Industry;
Development Partners, Labour and Community Leaders;
Our Friends from the media;
Ladies and Gentlemen,

Good Morning, Sanibonani!

Thank you, Executive Mayor Xaba, for the warm welcome, and Minister Parks Tau for setting the scene of the conference. It is a privilege to attend the Second International Special Economic Zones Conference in Durban, a city that represents the transformative potential of Special Economic Zones (SEZs) in promoting investment and inclusive economic growth.

Durban is the leading marine gateway in sub-Saharan Africa, with the Port of Durban as its centrepiece. The city is a critical node between the industrialised interior, particularly Gauteng, and the global markets, handling a large proportion of South Africa’s sea-borne goods. Its progress from a colonial trading post to an important international hub is based on centuries of history, strategic industrial policies and continuous infrastructure development.

Today, the legacy of strategic infrastructure and industrial development is exemplified by the Dube TradePort and the Durban SEZ. These initiatives are driving investment, innovation and economic transformation, particularly the linking of the Dube TradePort with King Shaka International Airport and the Port of Durban, which handles more than 60% of South Africa’s container traffic. 

It is therefore fitting that we have gathered here today to advance a national project of spatial and industrial transformation. At its heart, this project is focused on building a more productive, competitive, and inclusive economy. This includes the creation of sustainable jobs, the expansion of opportunities for enterprises, and the restoration of dignity through meaningful economic participation for all people.

As President Nelson Mandela reminded us, “Overcoming poverty is not a gesture of charity. It is an act of justice. It is the protection of a fundamental human right, the right to dignity and a decent life”.

Our SEZs are, in many respects, an expression of that vision of creating the conditions for investment, industrialisation, employment, and shared prosperity, so that economic growth becomes a pathway to economic freedom, dignity and a better life for all South Africans.

This task extends beyond any single province. Across our nation, from KwaZulu-Natal to Limpopo, from the Eastern Cape to the Northern Cape, SEZs are unlocking regional potential, strengthening industrial capacity, and connecting local enterprises to regional and global markets.

They are also strategically positioning South Africa as a gateway to the African continent and supporting the broader vision of an integrated, industrialised and prosperous Africa.

Indeed, this is a vision rooted in a strategic choice South Africa made nearly three decades ago. In 1997, we introduced the Industrial Development Zone programme to create world-class industrial hubs that would attract investment, boost exports, and drive industrial growth.

Recognising the power of strategic infrastructure and supportive policy, the programme laid the foundation for a more competitive and diversified economy. Over time, it has evolved into the Special Economic Zones programme, with a broader focus on accelerating industrialisation, creating jobs, and driving inclusive economic development in South Africa and across the African continent.

Honoured Delegates,

A World Bank study has concluded that South Africa's SEZ programme has proved successful so far, attracting R14.8 billion in revenue and creating more than 30,000 jobs across sectors like automotive manufacturing, agro-processing and renewable energy.

Key benchmark projects, such as the Tshwane Automotive Special Economic Zone (TASEZ) and the Coega Industrial Development Zone in the Eastern Cape, serve as primary drivers for skills development and downstream supply chains.

We have learned valuable lessons since Coega was designated in 2001. By 2010, Government had invested more than R3 billion in Coega alone, attracting 21 investments valued at R9.2 billion and generating 2,837 operational jobs. However, some of these investments were not new, but had relocated from elsewhere due to weakened municipal service delivery and township integration, leading to zones risking becoming enclaves.

In response to this, in 2012 we shifted to Special Economic Zones under the SEZ Act. and today under the leadership of President Cyril Ramaphosa, we are entering a third phase: the Spatial Industrial Development Strategy. 

To ignite manufacturing-led industrialisation, the South African government has identified key economic sectors categorised into three areas:

1. Decarbonisation, aimed at low-carbon technologies and climate resilience; 
2. Diversification, focused on expanding the manufacturing base for value-added goods and export markets; and 
3. Digitalisation, emphasising the integration of productivity-enhancing digital technologies across industries.

The Industrial Development Strategy aims to increase the manufacturing sector's GDP contribution from 12%, as manufacturing has significant multipliers to reduce socio-economic issues like unemployment especially among youth and women. The Special Economic Zones Programme is a key mechanism for this re-industrialisation agenda, and after more than a decade, it's crucial to evaluate its impact.

As former Deputy Minister Majola said at the SEZ CEOs Forum, “SEZs and industrial parks are critical players in South Africa’s industrialisation agenda and economic growth. But they will not succeed unless we improve performance in each of the SEZs.”

This therefore requires fully operational, well-resourced SEZs supported by reliable infrastructure, efficient regulation, and good governance to drive industrialisation, attract investment, and stimulate inclusive economic growth.

Colleagues, we are not starting from a blank slate. We are building on an existing network of SEZs and Industrial Parks that have already established industrial foundations across every province of our country.

From Coega, the largest SEZ on the African continent, spanning more than 9,000 hectares, driving automotive, energy and manufacturing clusters alongside the Port of Ngqura;

To Saldanha Bay, our only designated freeport, strategically positioned to develop South Africa as a leading marine repair and services hub for the Atlantic and Indian Ocean oil and gas industries;

To Musina-Makhado, located along the vital N1 North–South Corridor into the Southern African Development Community (SADC), with a focus on mineral beneficiation, logistics and agro-processing;

And to the East London Industrial Development Zone, a UNIDO-recognised Eco-Industrial Park that is setting the benchmark for green industrialisation, automotive components and sustainable manufacturing.

Together, these strategic industrial platforms demonstrate that the foundations for accelerated industrial growth are already in place. Our task is to strengthen their performance, deepen their integration into regional and global value chains, and ensure that they become powerful engines of investment and inclusive economic development.

But we must go further. The new Spatial Industrial Development Strategy demands that we reference every new zone against six layers:

1. Infrastructure corridors – ports, rail, and energy. No zone can thrive in isolation.
2. Resource endowments – from the Bushveld Platinum Group Metals (PGMs) to our agricultural belts.
3. Existing Industrial Parks – Isithebe, Ezakheni, Babelegi. We must revitalise them and plug them into SEZ value chains.
4. The District Development Model – Every district must identify its competitive advantage.
5. Socio-economic data – Zones must be located where jobs are needed most.
6. Community integration – A zone is not successful if the township next door sees no benefit.

This is spatial referencing not as a technical exercise but as a tool for both spatial and economic justice.

I should also make it clear that as Government, we are not planning for the next election cycle. We are planning for the next generation. In this regard, the Cabinet has endorsed a 20-year SEZ development framework, with formal evaluations every five years.

Years 0-5: Baseline and Discipline. We will map, audit, and set KPIs for every zone. Investment, jobs, exports, and SME linkages. No more vanity projects.

Year 5: First Evaluation. We will ask challenging questions: Did this zone generate new investment, or did it simply relocate existing investments? Did it create jobs? If a zone scores below 60% on our scorecard, we will trigger the five-year intervention framework that Minister Tau has announced. We will restructure, repurpose, or de-designate if necessary.

Years 5-15: Consolidation and Expansion. We will deepen clusters – automotive in Coega and East London, PGMs in Limpopo, and marine in Saldanha. We will sign SEZ Pacts so that National Government, Provincial Government, and District Municipalities deliver incentives in unison.

Years 15-20: Maturity. By 2046, we must fully integrate our SEZs into global value chains and their local communities. A young person in Mthatha should be able to envision a career path that starts at a TVET College, progresses to an SME supplier, moves to a factory floor in the East London IDZ, and ultimately leads to an export market.

Honoured Guests, 

Investors tell us that they want certainty. This certainty is provided through among others the three-sphere incentive package:

Nationally, we offer the 15% corporate tax rate for qualifying SEZ companies, and the Section 12i Manufacturing Allowance of up to R900 million, VAT and customs relief in our Customs Controlled Areas, and the Employment Tax Incentive for youth.

Provincially, our entities, such as the Coega Development Corporation and SBIDZ, provide subsidised land, world-class infrastructure, and bespoke skills programmes.

At the district level, our municipalities commit through Service Level Agreements to fast-track zoning, provide bulk services, and ensure 30% procurement from local SMMEs within a 5km radius.

However, incentives are not entitlements. They are part of a compact. In return, we expect investment, exports, jobs, and transformation.

Ladies and Gentlemen, 

We have 5,400 SEZs globally competing for the same capital. We cannot compete simply by being the cheapest. We compete by being the most strategic, the most reliable, and the most inclusive.

To our SEZ CEOs: Your performance will be measured every five years. Not on glossy brochures, but on actual jobs and exports.

To our Mayors: An SEZ cannot function if there is no water, no electricity, or no road to the factory gate. 

The District Development Model must assist us to actively implement the District Development Model in your Integrated Development Plan (IDP).

To our investors: South Africa is open for business, but we are not open for extraction. We want you to benefit here, to train here, and to partner with our SMMEs here. 

To our communities: These zones are yours. Hold us accountable. The girl in Mdantsane must see the East London IDZ as a promising future for her and generations to come. The artisan in Musina must see the SEZ as a market, and most importantly, a door to global markets.

In closing, let me leave you with the guiding vision of South Africa's Industrial Policy: "Industrialisation to create employment and rising incomes; transformation to build an inclusive economy; and a capable state to drive effective implementation."

That is the mandate before us. As we leave Durban, let us renew our collective commitment to ensure that our Special Economic Zones become engines of investment, innovation and opportunity, not islands of prosperity, but catalysts for inclusive growth that will uplift every province and every community across our country.

I Thank You, Inkomu. 

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