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News Article - Automotive
Background to South African Industrial Development Zones
Posted on: Friday, 14 December 2001. Article source: Eastern Cape Business News
The Industrial Development Zone (IDZ) programme is one of many incentives offered by the South African Department of Trade and Industry to encourage international competitiveness of the South African based manufacturing sector. IDZs will be purpose-built industrial estates linked to an international port or airport in which quality infrastructure and expedited customs procedures are coupled with unique duty-free operating environments suited to export-oriented production. Government will license operators to develop and run the IDZs, provide enterprise support measures, minimise red tape and provide efficient services to enterprises within an IDZ. Linked to international port or airport; Support from Enterprise South Africa; World-class infrastructure; Suited to export-oriented production; Human Resource development; Approved environmental standards; Dedicated customs office to expedite excise inspection and clearing; EDI based clearance procedures. They will include a unique customs regime offering: Duty-free import of production- related raw materials and inputs; Zero rate on VAT for supplies procured from SA; Finished goods deemed imports when selling into SA; IDZs will consist of two zones of operation - Customs Secured Area (CSA): A delimited area with entrance and exit points controlled by Customs personnel. Each CSA will have a dedicated customs office providing rapid inspection and clearance services and one-stop administrative centre to facilitate approval and permitting processes. CSA based enterprises will be eligible for: Duty-free import of production-related raw materials and inputs; Zero rate on VAT for supplies procured from South Africa Right to sell into SA by paying normal imported duties on finished goods. The second zone is an Industries and Services Corridor (ISC); Leading edge industrial and office park environments adjacent to CSAs, occupied by service providers to CSA enterprises. The following services from the Department of Labour and/or accredited agents will be offered to IDZ operators and enterprises to stimulate local human resource development: Learnership programmes tailored to the need for skills at each stage in the establishment of IDZs and the construction and operation stages of IDZ enterprises; and Various HRD programmes including skills audits, recruitment selection and training. For tenants to achieve rapid resolution to labour disputes within the framework of the Labour Relations Act, parties will be encouraged to reach agreement through a privately agreed dispute resolution mechanism or the CCMA. To comply with international investment trends, operators will be required to provide leading-edge transport, communications and utilities infrastructure to ensure global competitiveness of IDZ enterprises. Environmental standards maintained throughout the establishment phase of design and utilities provision will provide IDZ enterprises with a competitive advantage as green accreditation becomes increasingly critical to access developed markets. For more details on the two IDZs in the Eastern Cape, contact the ECDC.
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