Tempo de leitura: 2 minutos
Covid-19 has become a pandemic that has reverberated across the globe. Its associated detrimental impact on economies has been felt far and wide, with serious disruptions in global value-chains and international trade being evidenced on a daily basis. In the South African context, Covid-19 is threatening to exacerbate the already entrenched socio-economic challenges of poverty, unemployment and inequality that epitomised the country before the virus affected the world.
The Covid-19 pandemic will adversely affect the manufacturing industry in South Africa. No one knows when this pandemic will end, and the extent of the impact it would leave on the economy. But, certainly, whenever it ends, the impact would be significant in many industries, with jobs being affected in some of the sectors.
There are measures that government has taken to avoid massive job losses in the country. These include the notable R500 billion stimulus package that was announced by President Cyril Ramaphosa. The Department of Trade, Industry and Competition (the dtic) has also decided to channel some of its programmes towards responding to the Covid-19 crisis. Key among these is the use of Special Economic Zones (SEZ) to stimulate industrialisation in the country.
The SEZ Programme has been prioritised as one of the instruments used by the government to attract foreign direct and domestic investments, integrate local firms into global value chains, increase exports, develop local industrial capabilities, accelerate the beneficiation of natural resource endowments, accelerate the development of the country’s lagging regions and create decent jobs.
SEZs are defined as a geographic area of a country or region allocated for specific activities that are supported through special measures that are not available to the country’s wider economy. These special measures may include discounted tax rates, infrastructure support and reduction of administrative red tapes.
According to the UN Conference on Trade and Development (Unctad) report published in 2019, almost 5400 SEZs have been established in 146 countries around the world and more than 500 new SEZs are in the pipeline. This increase is an integral part of the global new shift in industrial policies and stiff competition for foreign direct investments.
In countries such as China, SEZs have been the main driver for growth and development. The World Bank has reported that 22 percent of China’s gross domestic product, 45 percent of total national foreign direct investment, and 60 percent of exports are generated by Special Economic Zones.