The province builds on its industrial base from a variety of angles

Renamed KwaZulu-Natal (KZN) in 1994 following the merging of Natal province with KwaZulu, KZN is South Africa’s second largest provincial economy, serving as a strategically important base for manufacturing and exports. Also known by its nickname “the garden province”, KZN is a popular domestic tourism destination throughout the year, offering subtropical coastline in the south, mountainous landscapes in the interior and a stretch of savannah hosting wildlife in the north. Its heft in the service and industrial sectors, however, is far greater.

Occupying an area of 94,000 sq km, or about 8% of South Africa’s total land, KZN is the third smallest of the country’s nine provinces. Yet what it lacks in size, it makes up in variety, connectivity and economic contribution. According to research conducted by Standard Bank, the province is responsible for 26.9% of South Africa’s agricultural output, 21.6% of its manufacturing and 22.3% of its transport, storage and communications facilities.

It is also something of a nexus. As home to Africa’s largest and busiest container port and bulk terminals, and sharing borders with Mozambique, Swaziland and Lesotho, the province plays a lead role in facilitating the country’s flow of trade. Developments now under way to convert greenfield sites near Durban’s King Shaka International Airport (KSIA) into a designated free zone and air freight hub are set to deepen the province’s integration and further unlock its potential for multi-modal logistics.

Geographic Distribution

Along the coastal belt, with its dependable rainfall and fertile soil, the economy is primarily agrarian (though there is also a strong beach tourism industry), with vast sugar cane plantations and commercial farms growing sub-tropical fruits such as bananas, oranges and mangos. The Midlands, an inland area lying between the capital of Pietermaritzburg and the Drakensberg mountain range, is home to large forestry plantations that provide feedstock to the province’s pulp and paper mills. Rural farmers in the hinterland focus on mixed farming, both growing crops and raising livestock.

Besides its farms, the province has a significant industrial base – though, as with its tourism attractions, the activity is diverse and spread widely across a number of major urban centres. The city of Pietermaritzburg, with a population of around half a million, serves as the provincial capital, while Durban, the country’s largest city after Johannesburg, plays the larger role commercially, especially in tertiary sectors like finance, retail and real estate. Anchored by its port – which at 31.4m tonnes a year handles some 44% of the country’s break-bulk cargo and 61% of its container flow, according to the Port Authority – Durban is host to a variety of manufacturing sub-sectors, including vehicle assembly, food processing, chemicals, textiles and paper milling.

Located 170 km north-east of Durban, the town of Richard’s Bay serves as a transit node for commodities. Australia’s BHP Billiton and India’s Tata Steel both operate smelters in the area, and Londonbased Rio Tinto, through its 74% stake in Richard’s Bay Minerals, owns one of the world’s largest sites for extracting and processing heavy mineral sands. The Richard’s Bay Coal Terminal is also the single largest coal export terminal in the world, with capacity to export 90m tonnes a year, besides handling significant volumes of aluminium, titanium, heavy minerals, granite, ferrochrome, paper pulp, wood chips and phosphoric acid.

Newcastle, the third urban centre after Durban and Pietermaritzburg, hosts a fair number of its own industrial operations. These include a small coal mining sector, a range of textile manufacturers and one of the four national plants of ArcelorMittal, the world’s largest producer of steel, as well as minor works in synthetic rubber, chrome chemicals, diamond-cutting, cement and heavy engineering.

Economic Performance

KZN currently contributes around 16% of national GDP, second only to Gauteng (35%) and slightly ahead of the Western Cape (14%). The province’s contribution could well rise even further: in May 2014, First National Bank forecast its growth to come in at 3% for 2014 and 4% for 2015 – above the national average.

This comparatively favourable performance is partly of the province’s own doing. It has pursued a number of programmes aimed at boosting productivity and fixed capital investments, such as the Dube Trade Port and various infrastructure upgrades led by Transnet. External factors, however, also play an important role: some key sectors, such as transport, tourism, agriculture and transport, are also benefiting from the effects of a depreciating rand. “The national economy is underperforming, and we should not get overly complacent from the fact that KZN’s growth is marginally better,” Andrew Layman, CEO of Durban’s Chamber Commerce Industry (DCCI), told OBG. “There is still room for improvement.”

Trade Flows

Since KZN is the main destination for finished goods and commodities entering and leaving the country, its trade flows are reflective of the country as a whole. China, which imported R12bn ($1.14bn) in 2013, has in the past few years overtaken the US figure of R6.8bn ($644m) to become the province’s top export market. Exports to other countries of the Southern African Development Community (SADC) have also been on the rise. Among the top 10 export destinations in 2013 were Botswana with R4.6bn ($436m), Namibia with R4.2bn ($398m) and Mozambique with R2.8bn ($265m), alongside non-SADC countries like Japan with R5.6bn ($530m), Germany with R4.3bn ($407m), the UK with R3.3bn ($313m), the Netherlands with R3.1bn ($294m) and India with R3bn ($284m). Measured by value, the main exports are aluminium; vehicles and automotive components; iron and steel; ore slag and ash; chemicals; machinery and electrical equipment; paper; base metals; fuels; and oils.

Maritime Gateway

Geographically, KZN occupies a strategic position on the country’s eastern seaboard. With access to both the Indian Ocean and Pacific rims, it is optimally suited to handling trans-shipments serving “south-south” trade, as well as for containers heading further inland to markets in neighbouring African countries.

At 2.6m twenty-foot equivalent units (TEUs) a year, Durban Port is the largest and busiest container terminal in Africa, handling some 60% of South Africa’s container exports each year. Richard’s Bay, meanwhile, hosts the country’s main bulk port and is responsible for around 80% of South Africa’s break-bulk by volume. As for particular goods, Durban Port houses the country’s largest dedicated automotive terminal, while Richard’s Bay Coal Terminal is the world’s largest export transit centre for coal.

According to figures from Transnet, the state-owned enterprise for freight logistics, ships can make it between China and Brazil in 22 days if they travel via Durban, compared to the 27 days it takes if routed through the Suez canal. “Most of our output these days goes to the Far East, and in this sense our local forestry industry has an advantage over our main competitors,” Alex Thiel, CEO of Sappi Southern Africa, told OBG.

Both ports, however, are seeing bottlenecks. Underinvestment over the past two decades has meant that capacity has not kept pace with container traffic, which has been growing by 8-10% a year for the past five years, according to a 2007 study by the University of KwaZulu-Natal. There are also calls to improve the access roads and rail lines that serve the province’s ports (see Transport chapter). “Exporting out of the Durban port has become a concern,” said Thiel. “We have started using Maputo port for exports from our Ngodwana mill and as an alternative, as road and border conditions through Mozambique are improving.”

To address this, Transnet, as part of a R300bn ($28.4bn) capital spending programme to upgrade national rail, port and pipeline infrastructure, is expected to allocate R2bn ($189m) towards expanding Durban Port’s vessel capacity from 3.2m to 4.6m TEU by 2018. Transnet has also taken over a plot of land 11 km from the port that was previously occupied by the old Durban International Airport, which it will use to build a new dig-out port expected to cost R100bn ($9.47bn) and have a capacity of 9.5m TEUs a year when completed in 2016.

Over Land

As part of the country’s umbrella National Development Plan, and in order to address the inefficiencies and lack of coordination that have contributed to delays for infrastructure projects in the past, the authorities have identified 18 Strategic Infrastructure Projects (SIPs) under the auspices of the Presidential Infrastructure Coordinating Commission. In the second phase of this scheme, known as SIP II, one core project is the new dig-out port: the Durban-Free State-Gauteng Logistics and Industrial Corridor. Critical, in turn, to SIP II is that upgrades to both the roads and railways keep pace with port expansion, which is necessary to ensuring that access bottlenecks are avoided.

“The integration of rail and port infrastructure is essential for exporting commodities,” Alan Olivier, the CEO of Grindrod, a KZN-headquartered transport and logistics company, told OBG.

At the moment, around 80% of the port cargo headed from Durban Port to Johannesburg is transported via road, contributing to wear and tear and pollution. This highlights the urgent need to expand rail capacity and rolling stock to absorb more container traffic and ease the burden on the roadways.

Just as crucial is ensuring that the expansion of the Richard’s Bay bulk terminal is matched by adequate rail connectivity. In March 2014, the privately-run Richard’s Bay Coal Terminal announced that the facility would be refurbished to boost its capacity from 82.6m to 110m tonnes.

For this new space to be usable, it is likewise essential that Transnet deliver on its current plans to expand the carrying capacity of the MpumulangaRichard’s Bay coal line from 90m to 120m tonnes.

Trade Logistics

A crucial part of the government’s strategy to improve connectivity and boost trade efficiency is the Dube Trade Port. Located next to the province’s Kink Shaka International Airport in Durban, this development is made up of a number of zones focusing on specific sectors, and provides turnkey infrastructure and transport facilities as well as office and industrial space. The largest component of this is TradeZone, which consists of 77 ha of industrial land adjacent to the airport and cargo terminal. Trade and logistics warehousing is also made available to manufacturing and service-based enterprises that require expedited access to air cargo and passenger services. Phase one of TradeZone, comprising 26 ha, has been sold out, while phase two is slated to launch in 2015. A third phase, to be undertaken as a joint venture with Tongaat Hulet, will take place on a further plot of 135 ha.

Among the site’s tenants is the Korean electronics giant Samsung, which is set to open a television manufacturing plant there by the end of 2014, for a total planned investment of $20m through 2018. Goods made there will have an 80/20 split between those set for domestic sale and those for international markets. At first, plastic components, circuit boards, metal fabrication and packaging will be sourced from established off-site suppliers, but in time, KZN hopes other electronics makers will set up facilities in the trade zone, enticed by the offer of distribution networks and an integrated supply chain.

Room To grow

In addition to the cargo terminal and two trade zones, the Dube Trade Port has three other anchor developments: Dube City, which is earmarked for office, retail, hospitality and leisure space; Dube iConnect, an advanced ethernet network offering infrastructure for a data centre and cloud solutions; and Dube Agrizone, focusing on agricultural technology and agro-industrial production.

In all, an estimated 840 ha will be allocated to the development, most of which is presently vacant, greenfield land. “To me, this is the major comparative advantage Dube has as an aerotropolis,” the DCCI’s Layman told OBG. “Most of the land is owned by either the municipality or Tongaat Hulet, whereas in the case of Ekurleheni, Gauteng’s airport city next to OR Tambo International Airport, the surrounding land will have to be acquired from multiple landowners and converted from its previous use.”

Manufacturing

With infrastructure in place to receive imported raw materials and export finished products, KZN’s manufacturing contribution to GDP is the largest of any province. At a national level, the province is the leading producer of paper products and ferro alloys such as aluminium, and among the leaders for production of food and beverages, chemicals, automotives, furniture and textiles.

Manufacturing accounts for around 16.5% of provincial gross domestic product (PGDP) and 14% of employment. This means the province has a large concentration of labour-intensive and value-added activity, but also makes it particularly susceptible to the challenges plaguing industrial competitiveness at a national level, such as power constraints, labour unrest and the influx of cheap imports. Alongside East London in the Eastern Cape and the town of Roslyn, situated just outside Pretoria in Gauteng, KZN is home to one of the country’s three automotive hubs. There are some 80 component companies set up within the province to serve Toyota – KZN’s main passenger vehicle manufacturer – as well as MAN Trucks and Bus, Hino, and Bell Equipment, all of which assemble commercial vehicles locally.

Key Players

Of all the international automotive companies with a manufacturing presence in South Africa, Toyota is arguably the most significant in terms of both output and sales. According to figures from the National Association of Automobile Manufacturers of South Africa, Toyota’s production facilities just south of Durban have a capacity of 220,000 vehicles a year – nearly twice as much as second-place Volkswagen. In 2013, the Japanese carmaker achieved a 19.5% market share for domestic sales.

In fast-moving consumer goods segments, another multinational with a strong manufacturing presence in the province is Unilever, which established its country office in Durban in 2011 having invested R670m ($63.4m) in a savoury foods plant.

The South Korean conglomerate Samsung will soon be included among the global consumer brands in whose African portfolios KZN plays an important role. In October 2014, the electronics giant announced it is to open a factory in Dube Trade Port, initially to produce televisions and flat screen monitors, but with plans to expand into the manufacture of consumer white goods at a later stage.

Mining resources are limited to the major ore reserves held by Richard’s Bay Minerals and some minor coal deposits (measured at only 4% of the national total) in the Newcastle area. In all, the upstream mining sector makes up only 2% of PGDP. Yet KZN – due to its strategic position in the mineral export chain and its being home to two major aluminium refineries and a number of steel and cement plants – is a substantial player when it comes to downstream processing and metals beneficiation. In addition to the operations of Rio Tinto (through Richard’s Bay Minerals), BHP Billiton, Arcellor Mittal, and Tata Steel, national petroleum retailer Engen also runs a large oil refinery near the Durban airport.

South African energy and chemical company Sasol has been granted a three-year permit by Petroleum Agency South Africa to explore an offshore basin off of KZN’s eastern coast. The basin is located at the southern end of the Mozambican channel, an area where Sasol has uncovered substantial gas deposits in recent years, and exploration there is ongoing.

Industrial Policy

The Department of Trade and Industry (DTI), through the Industrial Policy Action Plan, seeks to further promote industries, such as automotives, in which the country has carved out an international reputation. It also looks to identify new manufacturing sectors, such as green industry, where the country has the potential to achieve a competitive advantage as well as to revive the fortunes of historical sectors, such as textiles, which are under stress and could be susceptible to collapse without government intervention.

At a more granular level, the province is undertaking its own industrial support programmes in line with the DTI’s priorities. For example, along with the eThekwini (Durban) Municipality, it has partnered with Toyota to create a development plan for automotive suppliers. “The idea has been tabled for a long time, and would revolve around Toyota’s focus on just-in-time inventory,” Cosmas Hamadziripi, senior manager at the province’s Department of Economic Development, Tourism and Environmental Affairs, told OBG. “At the moment, component suppliers and service providers are scattered around the province. If they were all clustered together, transport times and efficiencies would improve.”

Nearly a third of South Africa’s manufactured textile exports originate from KZN. The textile industry, though not the most lucrative in terms of earnings, does provide many jobs and has low barriers to entry. These attributes are favourable for small and medium-sized enterprises, but also warrant strong levels of government support in the face of low-cost imports arriving from Asia.

One government scheme to address this is the DTI’s Manufacturing Competitiveness and Enhancement Programme, which aims to enhance supply chain efficiencies and promote skills development. Thus far, it has provided assistance to 469 textile manufacturers and contributed 12,200 new jobs at a national level. Supplementing this is a province-specific revival programme based around clustering. “Clothing need not be a sunset industry,” said the DCCI’s Layman. “It is not doomed to failure so long as we find progressive ways to operate.”

Downstream Integration

The province’s investment promotion agency, Trade and Investment KwaZulu-Natal (TIKZN), is also looking to encourage the development of inputs that are sourced locally. For example, in the province’s northern Amajuba district, where agro-processing is being promoted, TIKZN is inviting investors interested in cultivating and processing soya beans for human and animal consumption. Soya beans are currently grown in the districts of Newcastle and UM zinyathi, yet according to a TIKZN feasibility study, feed manufacturers rely on imports for 75-80% of their soya oilcake, costing R55m-60m ($5.2m-5.7m) and pointing to a ready market. A separate TIKZN feasibility study has been completed on a plant to convert cassava roots into starch. Both projects await investors.

In the Hibiscus municipality, on the province’s limestone-rich south coast, a feasibility study is under way on a $80m plant to make synthetic soda ash, a key material in liquid crystal display glass, detergents, baking soda and other chemicals. Also, in the segment of mineral beneficiation (the process of extracting useful minerals from raw ore) plans are in the conceptual stage for a plant to convert mined titanium into titanium-bearing ore in the Kranskop area of the Maphumulo municipality, where titanium deposits are found. A third project being considered is a plant to make polysilicon, a key component in the assembly of solar panels.

Industrial Zone

The Richard’s Bay Industrial Development Zone is one of five in South Africa. In May 2014 the Special Economic Zones (SEZ) Act was signed into law, overhauling the regulatory framework for these. “SEZs will be far more commercially driven and premised on clustering and more focused foreign direct investment,” Garth Strachan, deputy director-general at the DTI’s industrial development division, told OBG. “Incentives will be contingent on value addition and export intentions.”

With both clustering and export potential in mind, TIKZN is proposing three projects that can work as offshoots of the area’s already-existing aluminium output. The first involves producing aluminium slugs that could be sold to global manufacturers of various products such as aerosol cans, medicinal tubes, bottle caps and automotive filter casings. A letter of intent on this from Nampak, a local packaging group, has already been received. The other two projects, both in the feasibility stage, would be geared towards automotive manufacturers: one would focus on the production of aluminium alloy wheels and aluminium pistons, and the other, to be located in Richard’s Bay, involves mixing aluminium as well as ferrosilicon and limestone (or dolomite) for the production of magnesium metal.

Agriculture

While the province’s climate and soil are able to grow a wide variety of crops and livestock, the challenge for the authorities is to ensure that farming is productive and that agricultural products are provided with sufficient market access. Agriculture’s contribution to PGDP is 3.6% and output is declining. Nevertheless, it remains an important vehicle for rural employment and is critical to alleviating the socio-economic pressures associated with urban migration. Plans are afoot to integrate agriculture better with downstream industries, and agro-processing clusters are being promoted across the province. KZN’s large agricultural sector includes most of the domestic holdings of Tongaat Hulett and Illovo, South Africa’s largest sugar producers, both of which are headquartered in KZN. The province is also the country’s leading pulp and paper producer and is the domestic base for South Africa-headquartered Mondi and Sappi, two of the world’s largest paper and packaging companies.

According to provincial sources, KZN has about 6.5m ha of land available for farming purposes, of which 82% is suitable for livestock production. The province serves as the epicentre of the country’s sugar industry, which contributes between 0.5% and 0.7% of national GDP and employs some 11% of the agricultural workforce.

Bio-Fuels

In the face of a global sugar glut and declining demand from international markets, the government – together with the country’s major sugar producers – is looking to emulate Brazil’s example by distilling sugar cane into bio-ethanol. With state support and the right incentives, they hope to create a domestic market. The main way of achieving this is for local sugar producers to expand their economies of scope and add capacity to produce fuels. An ancillary benefit of ethanol production is that it can contribute towards energy security: South Africa currently imports products for most of its petrol needs. Besides this, it is a more environmentally friendly source of fuel, and excess cane waste can be burned to generate electricity. Diversification into ethanol markets would help mitigate the effects of increasing global competition while providing alternative sources of energy to a country that is already facing a power deficit.

With these benefits in mind, the federal government is in the midst of drafting a subsidy scheme to support the production of bio-ethanol. By October 2015, it is set to introduce mandatory blending of bio-fuels with regular fuel at petrol pumps.

Timber production accounts for 6.5% of KZN’s agricultural output, and biomass, a by-product of wood that is used to make pulp and paper, also contributes towards the country’s mix of renewable energies. “To date, when drafting policy to promote renewable energy, the government has focused its attention on wind and solar,” Thiel of Sappi Southern Africa told OBG. “Tenders for biomass co-generation have been launched and will be awarded soon. The opportunities lie in the efficiency and green nature of biomass generation and on how much can be sold into the grid at fair market prices.”

Keeping It Fresh

According to Cosmas Hamadziripi, senior manager at the province’s Department of Economic Development and Tourism, one distinct agricultural advantage that KZN has over other agriculturally-rich provinces is that it is able to grow crops that can be harvested in comparatively shorter periods. “The citrus and grapes grown in the Western Cape take multiple years to grow,” he said, “and are therefore less equipped to respond to changes in market prices.”

Because the province stands a long way from its main overseas destinations for perishable fruit, its farmers and traders are constrained logistically. Transporting fresh produce by sea is not ideal, as product can go bad over the course of the journey. As a result, air freight logistics will be crucial going forward: produce from KZN must be able find its way quickly from local farms to supermarket shelves in Europe, the US and the Middle East.

Agri-Zone

As part of the Dube Trade Port project, the province is also in the midst of rolling out an agricultural development zone. Only a short distance from KSIA’s international terminal and with easy access to the Durban and Richard’s Bay harbours, the agri-zone is well situated for short-life products destined for domestic and export markets. At the moment, the development is in its first phase, comprising 16 ha of greenhouses, post-harvest packhouses, a central packaging and distribution centre, a nursery, and a plant tissue cultural laboratory. Phase two will expand the site by another 90 ha, providing additional space for greenhouses, packaging and distribution, and including a facility for converting waste into energy. Prospective investors hoping to set up operations in phase two must demonstrate an export focus and a contribution to the development of surrounding small-scale farmers and local employment. As of October 2014, tenants include Shree Property Group, one of South Africa’s largest handlers of citrus fruit, which has booked over 20 sites for R560m ($53m) and Qutom farms, a supplier to grocer Woolworth’s that grows cucumbers, peppers, and tomatoes on 12 ha of land. Dutch flower breeder KP Holland has also set up a local joint venture for growing Thai tulips on a four-ha plot.

Tourism

KZN is the country’s top destination for domestic holidays, with around 30% market share. Its popularity is driven largely by visitors from nearby Gauteng – the country’s most populous province – who arrive by car in pursuit of mountain and hiking activities in the summer months and coastal activities in the winter. In terms of foreign arrivals, however, KZN lags the Western Cape and Gauteng, which together made up 58% of total bednights spent in the country in 2013, according to the government’s annual report on tourism for that year. “While it might seem less attractive to some, we are perfectly content receiving domestic visitors, and this is the segment we will continue to focus on,” Ndabo Khoza, CEO of KZN Tourism, told OBG. “Domestic tourists are less responsive to currency swings and safety concerns, and more prone to repeat visits.” South Africa, he notes, has the largest domestic tourism market on the continent. “In the US, domestic tourism is the lifeblood of the industry,” he adds.

All the same, both KZN Tourism and the provincial government believe that the province is underrepresented in the tourism industry. KZN could fare better when it comes to international arrivals, they say, and both bodies are looking to further develop new packages and attractions so as to expand and diversify the area’s visitor base.

Sourcing Markets

To this end, the province has drafted a 20-year tourism master plan that runs through to 2030, in which core attractions are identified and matched with the source markets they might appeal to. “Before we sell the province, we have to figure out what it is exactly we are selling,” Khoza told OBG. The three main leisure activities being promoted, he said, are beach holidays, culture and heritage, and nature and adventure.

As a natural extension of domestic tourist arrivals, the SADC region constitutes the second main visitor source being targeted. “It is a mistake to overly focus on long-haul visitors, especially as SADC countries are growing in spending power,” said Khoza. “France and Spain get 80% of their visitors from within a four-hour flight radius, and 90% of China’s outbound market holidays are within a four-hour distance.” As most SADC countries already have nature and cultural attractions similar to South Africa’s in their home markets, KZN’s beach offerings are the primary focus of marketing campaigns directed at landlocked SADC member states.

Still, in spite of the local focus, there is a need to expand long-haul visitor figures. Currently, the UK, the US and the EU are the province’s largest source markets for long-haul visitors – India and Russia, meanwhile, are the fastest-growing long-haul markets. To boost these figures, the government is looking to promote regional destinations in neighbouring Mozambique and Swaziland as part of a trilateral “East 3 Route” initiative to help increase the visibility of the broader region to potential visitors. “International travel agents, when putting together a southern African itinerary, typically fly their clients into Johannesburg, then on to Kruger National Park, and finish up with Cape Town and the garden route,” said Khoza. “In some instances, they might include a flight directly to Victoria Falls in Zambia. But many long-haul visitors to Africa love to have more stamps on their passports, and for these Mozambique is exciting as it remains unexplored and its tourism infrastructure is improving.”

Links

Located 35 km north of Durban’s city centre, KSIA is South Africa’s newest international airport, having opened in May 2010 to coincide with the hosting of that year’s football World Cup. The airport, which cost around $900m to construct, has since then seen average traffic of about 4.8m passengers a year, well below its capacity of 7.5m, with major links to Johannesburg and Cape Town, as well as minor ones such as to Port Elizabeth, East London and Lanseria. KSIA forms a core component of the Dube Trade Port, which has a long-term master plan extending to the year 2060 and will be granted status as an SEZ in 2014.

To Khoza, the task of attracting more international visitors and meeting the province’s ambitions for an “aerotropolis” presents a chicken and egg scenario. “To justify more flights, we need to create more demand, and to accommodate more demand, we need more flights.” By way of comparison, Johannesburg’s airport, OR Tambo, serves over 30 international destinations to KSIA’s five.

In 2015, Durban’s International Convention Centre (ICC) will host the World’s Route Conference for the first time in Africa. The event focuses on the development of the global air travel services and will be leveraged by the local authorities to showcase KZN’s aviation credentials.

Conferences & Exhibitions

The aviation conference is partly the result of the provincial government’s push to boost activity in the meetings, incentives, conferences and exhibitions segment. At 33,000 sq metres, the Durban ICC is the largest of South Africa’s three international convention centres, the other two being in Cape Town and Johannesburg. Since opening in 1997, it has hosted some of South Africa’s largest international conferences, including the UN Climate Change Conference in 2011 and the fifth BRICS Summit in 2013.

Outlook

Arguably the largest provincial player in manufacturing, logistics, agriculture, and domestic tourism, KZN is ramping up its efforts to strengthen these sectors while diversifying into new ones. With two federally designated SEZs, a proactive provincial investment body and expanding distribution infrastructure (both upgraded and greenfield), the province’s industrial output should grow in coming years and its prospects should improve for adding more downstream value to its resource base.

While Gauteng remains the country’s financial centre, and Western Cape is still first choice for foreign tourists, KZN should continue to benefit from its diversification efforts across various areas. The focus on multiple sectors that lend themselves well to job creation and boost foreign exchange earnings, should help keep the province’s economy growing.

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The Report: South Africa 2014

KwaZulu-Natal chapter from The Report: South Africa 2014

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