Agriculture

Agriculture in KwaZulu-Natal is extremely diverse and is reflected in the patterns of its topography. Most of the world's agricultural activities can be practised here. Due to the good reliable rainfall and fertile soils, the region's agricultural sector has become very productive, and is known for its specialist capability in several types of farming.

Business Services

South Africa's financial services sector, backed by a sound regulatory and legal framework, is sophisticated, boasting dozens of domestic and foreign institutions providing a full range of services – commercial, retail and merchant banking, mortgage lending, insurance and investment.

Chemicals and Plastics

KwaZulu-Natal provides nearly a third of the country's plastics requirements. This industry, which uses 150 000 tons of polymer a year, consists of mainly small and medium size companies. The most challenging concern presently experienced by the plastics industry in South Africa is the cost of raw materials linked to the crude-oil price, which has risen dramatically and quickly in the last several years. However, plastics still remain cost-effective products, as the industry has managed to engineer its way around the escalating price. KwaZulu-Natal provides nearly a third of the country's plastics requirements. This industry, which uses 150 000 tons of polymer a year, consists of mainly small and medium size companies. The most challenging concern presently experienced by the plastics industry in South Africa is the cost of raw materials linked to the crude-oil price, which has risen dramatically and quickly in the last several years. However, plastics still remain cost-effective products, as the industry has managed to engineer its way around the escalating price.

Clothing, Textile, Leather and Footwear

The SA clothing and textile industry have suffered massive erosion due to increased importation of these items into the country, KwaZulu-Natal being one of the hardest-hit by this development. Nonetheless, the province has unsurpassed skill in this area/activity and presents massive opportunities for investments in the sector. Some pockets of the domestic activity in this industry are still doing exceptionally well with local designers increasingly invited to design and develop attire for top-end activities/persons. There are a few very large manufacturers, but the majority of clothing manufacturers fall into the medium sized category (50 to 200 employees) and there are approximately 400 SMME concerns, which fulfill the role of sub-contractors to the rest of the industry. This latter group also supplies the informal sector, which is growing rapidly.

Community, Social and Personal Services

Social development and improved economic performance depend on gains in public sector delivery, restructuring of state enterprises and more vigorous capital formation. Apart from shaking effects of the 2008/09 Global Economic slowdown, South Africa has achieved a level of macro-economic stability not seen in the country for many years. Such advances create opportunities for real increases in expenditure on social services, and reduce the costs and risks for all investors, laying the foundation for increased investment and growth. Other sub-sectors that have a potential for development include the education and training services, which has to be strategic in nature. South Africa has to focus and provide resources for training people in those areas of need, side by side with general education. The country requires skilled people - engineers, accountants, actuaries, scientists, teachers, medical staff, as well as farmers, who are all essential for growth.

Energy and Water

Globally, the case for the Green Economy has being made abundantly clear. Renewable energy is the only electricity generation technology whose price has decreased dramatically: solar PV module prices have fallen by 80% over the last five years while wind turbines have become 30% less expensive. South Africa’s wind resource is regarded as amongst the top 5 in the world and could sustain 25% of our grid’s capacity.

Health Services

South Africa’s health care spending is estimated to be around R39 billion dollars. The health care system consists of a large underfunded and understaffed public sector which supports 80% of the population and the small private sector financed by medical aid. The bulk of the health care expenditure emanates from the public sector with a spending of 50% of total spending.

Manufacturing

Logistics refers to the international flows of goods and concomitant payment wherein costs are constantly reduced through the simplification of procedures and documentation. It links demand with supply from different industries and generates a significant proportion of a country’s Gross Domestic Product. The global logistics industry comprises shipping, warehousing, courier, road, rail and air freight and its global market value of logistics $4 trillion equates to 10% of global GDP.

Mining and Beneficiation

Mining contributes around 6.5% of South Africa's GDP and is the country's largest single private employer (500 000 people), with small-scale mining operations making a significant contribution to job creation. Mintek has done a research report on Minerals in KwaZulu-Natal. Click here to download the report from the sector brochures category. Ilmenite, rutile and zircon are mined on a large scale for their titanium and zirconium contents from aeolian beach dunes in the northern areas of KwaZulu-Natal. Large ore reserves are held by Richards Bay Minerals, a leading producer of the heavy minerals, which mines the 17 km stretch of land along a 2 km strip of coastline north of Richards Bay (the City of uMhlathuze). Richards Bay Minerals meets about a quarter of the world's demands for these products, generating billions of rands in foreign currency. The region is rich in other minerals such as aluminium, anthracite and calcitic marbles. Ticor South Africa, launched in 2001, is also situated in the Richards Bay/ Empangeni area and represents an investment of R3 billion in the production of titanium slag.

Tourism and Property Development

For the last few years the Kwa-Zulu Natal (KZN) property market has enjoyed almost unparalleled growth repeatedly outperforming other provinces as an investment destination. The reasons are clear, the Province for some time had lacked a variety of factors necessary to maximize growth. For one there was a lack of national and international marketing focus on the Province, reasons given are varied.

Ship and Building Repairs

The ship repair, ship building and boat building industries have a long and proud history in Durban, having added immeasurably to its value and appeal as Africa's leading port by providing ship owners and operators as well as the recreational and commercial boat fraternity with the knowledge and assurance that skills, expertise and availability are readily to hand. All three industry sectors have made great strides and significant investments in the local economy. They remain in the forefront of technical knowhow and skills development equal to the best available worldwide in their respective fields. . KwaZulu-Natal is already regarded as the second most prolific boat-building centre in South Africa so it’s no surprise that this sector is rapidly emerging as a significant growth industry with 25% of all South African boat-building companies based in this province. Currently the local ship and boat-building industry boasts good basic infrastructure, while tremendous possibilities exist around the Durban shoreline for the construction of ships, boats and maritime parts.

Tourism

The Tourism industry is a key contributor to the KwaZulu-Natal economy. The province's tourism attractions, perhaps less well known internationally, surpass the national norm in many respects and are structured around four components, the coastal holiday areas with their magnificent beaches, sunshine, boating, surfing and fishing; the wildlife game parks in the north; the Drakensberg Mountains and the historical battlefields. Two World heritage sites have been declared recently: the Greater Lucia Wetlands Park, and Ukhahlamba/Drakensberg Mountain Reserve. Both offer interesting opportunities for investors and especially for small businesses. The attractiveness lies in the unique combination of bio-diversity, impressive scenery, all-year climate and its rich mosaic of exciting cultures and history. Its competitive advantage is that it has a monarchy that can be used to support tourism development. Zulu cultural village activity and the African township experience have emerged strongly as new areas of interest that needs to be marketed.

Transport, Storage and Communication

Logistics and supply chain management is growing in importance and it is fast becoming the central function in companies. Boasting Southern Africa's busiest sea port (Durban) and Africa's biggest bulk sea port (Richards Bay), combined with excellent road and rail infrastructure and global logistics service providers, it is easy to see why KwaZulu-Natal lays claim to being southern Africa's Trade Gateway. With the increase in activity at the Durban and Richards Bay harbours it is possible that the industry will continue to experience high growth rates. The number of vessel moves and the gross tonnage of these vessels, at the Durban harbour for example, have increased by 4.2% and 4.6% per month from January 2003 to June 2005, respectively. During the economically challenging 2008, the number of vessels experienced a slight decline of -4.3%, while the GT had an increase of 4.4% respectively. However the port held the fort in handling not less than 21 million TEUs in 2009/2010. The transport, storage and communication industry's contribution to the economy of KwaZulu-Natal has stayed fairly constant at around 12% per annum from 1995 to 2007. The industry has achieved consistently high growth rates of around 5.6% per annum from 1995 to 2007. Even after the 2010 FIFA World Cup™ heydays,the sector is still going strong.

Wholesale, Retail Trade, Household Goods, Hotels and Restaurants

KwaZulu-Natal offers a range of shopping experiences from mega-malls such as Gateway to rural micro markets. The ongoing construction of new shopping malls and the expansion of existing ones across the Province, gives evidence to the fact that the retail trade is booming. The malls are home to major shopping chains such as Woolworths and Edgars, to shops selling a range of goods from household necessities to electronics, clothing, jewellery, and more specialized items. The increasing middle class is also contributing to the surge in consumerism. Even in many of the smaller towns there are taverns, clothing stores, car-repair shops, cafes, stores selling household goods, and many cell phone kiosks from which people can place calls. Brands are growing and access to new markets is occurring on an incremental basis. Branded chains such as Engen, Standard Bank, FNB, KFC, Woolworths, Shoprite are found across the main economic centres of the province, such as Durban, Richards Bay, Newcastle, Pietermaritzburg, Ladysmith. Small towns and communities are benefiting from projects which allow them to produce and sell arts and crafts. This is of particular relevance to the upliftment of women who often have few skills and little opportunity to find employment.

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Emnothweni: issue 29