Coega Development Corporation (Pty) Ltd

COEGA DEVELOPMENT CORPORATION (PTY) LTD
PROJECT SUMMARY

1. Mandate
The Coega Development Corporation (Pty) Ltd (CDC) is a private company wholly owned by the South African Government and mandated to develop and manage the Coega Industrial Development Zone (IDZ) to international standards. It has a staff complement of about 200 who have expertise in multidisciplinary areas such a finance, marketing project development, project and program management, human capital development, environmental management, facilities management, customs as well as information and communication technology.

2. Background
The CDC is developing the Coega IDZ on 11 500 ha of land in the Nelson Mandela Bay Municipality adjacent to the new Port of Ngqura in the Eastern Cape, Republic of South Africa. The first phase of the Port of Ngqura, which comprises five berths, and the main infrastructure to service the IDZ west of the Coega River are complete. The Coega Container Terminal at the new port will be operational by mid 2009. The State Electricity Authority, Eskom, has already commenced major reinforcement and upgrading works to the national grid and to the local distribution network. Conservatively, the National Government will have expended nearly US$3 billion by 2010/11 in providing enabling infrastructure. This demonstrates the National Government’s confidence in and commitment to the Coega Project as a key initiative to further industrial growth.

3. Investment Promotion
The CDC has already signed deals worth US$4 billion including with global players such as Rio Tinto/Alcan and Straits Chemicals of Singapore. A number of other projects such as a ferro-manganese smelter, a crude oil refinery, a LNG terminal, a CCGT power station, an animal feed/biofuels plant and BPO and logistics facilities are currently being finalized. The CDC is also willing to establish partnerships with other entities to further develop the enabling infrastructure and investor base of the Coega IDZ.

4. Objectives
In general terms, the objectives of the CDC in developing the IDZ are as follows:-

- To enter into appropriate partnerships to work with the CDC to further develop the Coega IDZ;
- To facilitate FDI and investments locally;
- To leverage international investor networks;
- To draw on skills for operating EPZ’s and IDZ’s;
- To enhance revenue generation and ensure long term sustainability; and
- To appropriately plan for further Cluster developments and for the commencement of new Clusters conducive to the long term strategic plans for Coega and South Africa.

5. Clusters
The current status of the development of the IDZ can be found on the CDC’s website at www.coega.com and is summarised hereunder.
Zone 1 is focused on logistics and light manufacturing being located closest to the new port.
Zone 2 is the site of the automotive cluster.
Zone 3 is the downstream fabrication, capital goods and general industry cluster.
Zone 4 is the training and BPO cluster (services).
Zone 5 is the light metals cluster and the site of the aluminum smelter.

All of the above Zones are well established and well serviced. The Zones referred to below are not yet well established or serviced.
Zone 6 is the ferrous-metals cluster (steel and ferro-alloys).
Zone 7 is the chemicals cluster and the site of the Chlorine Refinery.

Further Zones have been identified but their long term applicability needs to be tested. The general layout of the Coega IDZ can be seen in the latest Development Framework Plan which is available on CDC’s website. The CDC welcomes all initiatives and as much innovation and lateral thinking as possible will be regarded in a positive light.

6. CDC’s Offering
The core business of the CDC has been indicated above but, early on, the CDC recognized that a more complete service was required by investors. A separate business unit called “CDC Services” provides project and program management services and is currently assisting the Eastern Cape Government with the roll out of hospitals, clinics and pathology facilities, recreation facilities and tourism related activities right across the Eastern Cape. CDC Services’ project portfolio currently stands at just under R3 billion. Another separate business unit called “Human Capital Solutions” provides a complete HR/IR service including skills analysis, training, induction and exit management. That unit has also implemented a Zone Labor Agreement such that labor stability figures of less than 0.1% have been achieved compared to the national average of about 2.4%. The Intsimbi Parntership will be entering into an agreement to implement some of the first pilot projects under the US Partnership jointly with Human Capital Solutions.

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