Upington Special Economic Zone (SEZ)
Upington, the second-biggest town in the Northern Cape Province of South Africa, is located along the banks of the Orange River and is a popular tourist destination with warm weather and long sunny days.
Similarly to Special Economic Zones countrywide in South Africa, the Upington SEZ has a geographically designated area set aside for specifically targeted economic activities.
Upington SEZ is ideally situated and has a special focus on serving the renewable energy industry (especially solar energy) and the aviation industry in South Africa and internationally.
In the heart of the Green Kalahari, right next to Upington International Airport, there is more than 500 ha of prime land available to be utilised by investors (440 ha for the Industrial Park and 90 ha for the Aviation Park).
Upington is situated 130 km from the Namibian border post and about 350 km from the border post with Botswana. Upington also has good access roads such as the N10 and the N14, effectively linking up Namibia and Botswana.
Upington is 500 km from Boegoe Bay’s Port Nolloth, which is one of the ports that has been earmarked for the integrated planning of South Africa’s Oceans Economy under Operation Phakisa (read more about the Boegoe Bay project here).
The Dawid Kruiper Local Municipality (DKLM) has made the land available for the development of the Upington SEZ. The ZF Mgcawu District, in which Upington is situated, has a well-developed economy and active business community supported by government and government parastatals.
The development will be divided into seven phases (see below). The Environmental Authorisation has been received from the National Department of Environmental Affairs (DEA) for the approval of the development of the Upington SEZ and the Masterplan for the infrastructure is in place.
Industrial hub to service the SADC
The main objective for the proposed Upington SEZ in the Northern Cape Province is to establish a world-class industrial hub to service the Southern African Development Community (SADC) in the following sectors:
- Renewable energy with a focus on solar component manufacturing.
- Aeronautics through the development of an Aviation Park for aircraft maintenance, repair and overhaul (MRO).
The following key economic drivers underscore the viability of a solar farm and solar component manufacturing facility at the Upington SEZ:
- the increasing and sustained demand for photovoltaic (PV) and concentrated solar power (CSP) systems within the South Africa and sub-Saharan context;
- the above demand will in turn produce a number of assembly opportunities for PV panels and inverters as well as CSP in-field mirrors, structures and backward integration of manufacturing facilities, e.g. float glass and silicon wafers;
- the recent announcement by the Department of Energy of Renewable Energy Independent Power Producers (REIPP) with the majority in the Northern Cape, Upington vicinity;
- European and Chinese companies continue to express interest in establishing PV and CSP component manufacturing and assembly plant(s) in South Africa.
Upington International Airport
The Upington International Airport has a number of characteristics that make it a particularly favourable location for the possible establishment of an Aviation Park.
- An arid climate that is not conducive to accelerated corrosion and deterioration of aircraft when stored in Upington;
- the availability of relatively low cost open surface area (land) for the storage of aircraft, as well as for the possible development of supporting industries in and surrounding the airport;
- Upington Airport has an unusually long runway (5 km) that serves as a National Aeronautics and Space Administration (NASA) designated African landing site for its shuttles. The runway therefore can accommodate a large variety of aircraft;
- Upington is close to the northern border of South Africa and there its position is considered convenient and strategic from an African continental perspective;
- the remoteness of Upington renders it a fairly safe location in terms of security;
- there is a strong market for the establishment of an Aviation Park in South Africa to serve both the European and African regional markets;
- the absence of any meaningful competition in this market on the African continent is another plus;
- and there are 90 hectares for the development of an aviation-theme park with complete EIA for industrial development. The development of the Aviation Park is spearheaded by Airports Company South African (ACSA) which will become the anchor tenant of the Upington SEZ.
Incentives for investing in the Upington Special Economic Zone
The Upington SEZ is exempted on rates and taxes for 5 years by Dawid Kruiper Local Municipality.
Investors will also potentially benefit from the following incentives offered by the dti:
- 15% corporate tax
- Building tax allowance
- Employment tax incentive
- Customs-controlled area (VAT-exempt and duty-free)
- 12I tax allowance designed to support greenfield investments
Depending on the nature of the investor proposal, additional incentives may be negotiated with the Northern Cape provincial government and local municipalities, while the South African government has also introduced a number of support mechanisms and incentives to encourage businesses to become more energy efficient.
More reasons to invest in the Upington SEZ
Besides benefiting from several government incentives for investing in an SEZ, investors will contribute towards the social and economic growth of the Upington area, the Northern Cape and South Africa. By investing in the Upington SEZ, you’ll help create jobs and drive economic development while getting the necessary support to run and grow your business.
The Upington SEZ will provide an investor-friendly business environment and a one-stop shop service to investors to reduce the bureaucracy of government approvals and application processing. The service will be geared towards fast-tracking projects within the SEZ.
Together with our partners, the Northern Cape Economic Development Trade and Investment Agency (NCEDA), the Northern Cape Department of Economic Development and Tourism, the National Department of Trade and Industry (dti) and Airports Company South Africa (ACSA), we invite all interested investors to contact us for more information.