Republic of South Africa
South Africa stands as an economic leader in the region. Services play the biggest role in this developed economy, though it is also the world’s largest producer of platinum, gold, and chromium. China is its main trading partner, followed by United States and Germany.
South Africa’s economic strength is thanks in large part to its improvement in competitiveness and business environment in recent years. According to the World Economic Forum’s Global Competitiveness Report, South Africa climbed seven places to reach the 49th place in 2016 mainly due to the increased uptake of information and communications technology and improvements in innovation. Foreign direct investment reached $164 billion by the end of 2015. Almost all industries are open to foreign investment without the need for special approval from the government.
South Africa launched an Industrial Development Zone (IDZ) Program in 1993. There are currently five IDZs in operation: Coega, Richards Bay, East London, Saldanha Bay, and Dube Trade Port. Major industries operating in those IDZs are agro-processing, automotive, aquaculture, energy, metals, logistics, business process services, as well as international airports, cargo terminals, warehousing, offices, retail, hotels, and others.
From 2011-2013 Locus Economica advised South Africa on the replacement of the IDZ program with a new special economic zones (SEZ) program. The SEZ Act was passed in 2014, offering a 15% corporate tax, a building allowance, an employment incentive, a customs controlled area, and a 12% tax allowance.