As the world transitions into renewable energy, South Africa needs to adopt and gradually move away from its fossil fuel highly reliant economy to green energy, which comes with lucrative investment opportunities.
The Minister of the Department of Trade, Industry and Competition (DTIC) Mr Parks Tau, said as much as South Africa and Saudi Arabia are largely dependent on fossil fuels for their energy generation, both countries and their businesses can benefit from sharing ideas, technologies and market knowledge in fields as diverse as green hydrogen, petrochemicals and pharmaceutical products.
As South Africa is in a transitional period from fossil fuel to renewable energy, a number of international investors have shown interest in the country and the energy sector. Extending his invitation to Saudi Arabia business during the South Africa-Saudi Arabia Business Forum held in Sandton on 14 October 2024, Minister Parks Tau pointed out investment opportunities in the Special Economic Zones (SEZ) in the country.
According to Tau, SEZs (Oil and gas, oil storage, oil refinery); aligned to the department’s investment drive, a number of special economic zones have been designated in different parts of the country, each with their own particular advantages and focus.
He said some of the SEZs are in Saldanha Bay, Richards Bay, Dube Trade Port, Coega, Maluti-a-Phofung, Musina and OR Tambo.
“Companies that invest in SEZs can benefit from tax incentives. The support measures that South Africa offers in these SEZs are comparable to our global competitors, if not better. We have also focused on the revitalisation of Industrial Parks to which we invite investment into,” said Parks Tau.
The minister told the business community that there are investment opportunities in the country across different sectors including: Renewable energy (Solar Power – manufacturing and assembly), Tourism and hospitality (accommodation, hotels, resorts, lodges, tourism transport, aviation, rail, cruise liners), Ocean Economy (aquaculture, boat building and coastal marine tourism), Agro-processing (food processing, fisheries, aquaculture, fruit juices, local beneficiation, packaging and export of indigenous teas).
“An area of potential synergies I want to particularly refer to is the green hydrogen economy. We are the world’s largest producer of platinum, a key input in hydrogen fuel cell technology.
Our ambitious plans to unlock the potential of the green hydrogen economy include developing a Hydrogen Valley that stretches from the platinum belt through the country’s industrial heartland. A number of multinational investors like Anglo-American Platinum have already begun leveraging these opportunities,” said Tau.
“Saudi investment across the value chain of the green hydrogen economy will not just support South Africa’s economic goals, but those of Saudi Arabia as well in its on-going drive towards sustainability. I call on the two business communities to seize this opportunity with both hands, and to build on the strong relationship that is being built between our two governments.
I invite you all to engage with officials from Invest SA present here today, who are available to address any queries you may have and to assist in taking these discussions forward,” he continued.