South Africa to boost industrial growth - CNBC Africa

South Africa to boost industrial growth

Southern Africa

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South Africa to boost industrial growth. PHOTO: Getty Images

Director-general of the Department of Trade and Industry, Lionel October, said that South Africa needs to industrialise in order to meet its National Development Plan goals in the next 15 years.

He believes that the government’s Industrial Policy Action Plan (IPAP) is the route to prosperity.

(READ MORE: Implementing SA's National Development Plan )

To attract foreing direct investment and transform the economy, the Industrial Development Zones (IDZs) and the Special Economic Zone (SEZ) programmes will be implemented by the DTI.

“IDZs are attractive because of their close proximity to an airport or port, good basic infrastructure, and duty-free imports of production-related raw materials and inputs. There are currently six operating IDZs in South Africa which have attracted a great amount of investors into the country, and still aim to attract more,” explained October.

“Some of these zones have advanced socio-economic development through skills development, technology transfer and job creation. Some are tailored for manufacturing and storage of minerals and products to boost beneficiation, investment and development of skills. Others bring together international airports, cargo terminals, warehousing, offices, retail sectors and agricultural areas.”

(WATCH VIDEO: S.Africa's National Development strategy)

There have however been several challenges that have caused the IDZs to not reach their optimal performance.

“To this end, the DTI has devised regulations that will see the country’s IDZs transformed into new SEZs. The SEZs will include IDZs, free ports, free trade zones and sector development zones,” he added.

The DTI said the SEZs are intended to bring mainstream economic activity to poor and isolated parts of the country by leveraging the commercial potential of particular regions.

It will also offer a more investor-friendly business environment and are regarded as vehicles to attract FDI, create employment opportunities and introduce advanced technology.