Speaker, special economic zones may be defined as geographically designated areas of a country, set aside for specific targeted economic activities and generally supported by special arrangements and systems that are often different from those operating in the rest of the country.
Up to now, in South Africa, we have only one form of special economic zones, SEZs, the IDZs, operating in terms of the Manufacturing Development Act of 2000. This programme has focused on export-oriented industries often located in and around ports or airports benefiting, in the main, from the duty-free entry of imports used in the production of export products through customs controlled areas. To date, four of these industrial development zones, have been designated in Coega, East London, Richards Bay and OR Tambo Airport, with three of them being operational.
Whilst these have achieved some important success with 42 operational investments worth R4 billion creating over 5 000 direct jobs and 43 000 construction jobs, some weaknesses in the implementation of the programme have been identified during the IDZ policy review. This includes a number of weaknesses in governance models, particularly in relation to the following: responsibilities of the national government, provinces, municipalities and operators of industrial development zones, lack of focus on IDZ incentives, insufficient stakeholder co-ordination and lack of integrated planning. More importantly, the existing legislation provides, as I have said already, for only one type of special economic zone.
Confronted with these challenges, and also being mindful of the potential special economic zones to achieve industrial demonstration, the current Bill seeks to bring into being the possibility of a broader range of special economic zones. The Bill provides for the following: a determination of the special economic zones policy and strategy; the establishment of an advisory board; a fund for the designation, promotion, development, operation and management of SEZs; regulatory measures and incentives for SEZs; and the establishment of a single point of contact or a one-stop shop to deliver government services. The Bill allows for a variety of special economic zones, including free ports, free trade zones, industrial development zones and sector developments or specialised economic zones.
We have also been developing the following support measures to support special economic zones: a broader SEZ incentives strategy which will allow for a 15% corporate tax in SEZs; building tax allowance and employment tax incentives; customs-controlled area incentive with a VAT exemption and duty- free entrance of imports; and a 12i tax incentive. There has been an enhanced funding strategy, infrastructure strategy, skills and supply development strategy and the one-stop shop strategy.
The DTI, in addition to developing the Bill, has been working on the development of the SEZ tax incentive strategy which has already been announced by the Minister of Finance. We have also been working with the provinces within Minmec to identify potential SEZs; at least one in every province. This potential project has now gone from prefeasibility to feasibility studies which will allow us, once the Bill is passed, to begin the process of designated new special economic zones. It is therefore important that the current Bill, which is an enabling Bill, is passed expeditiously so that we can take advantage of the eminent interest and opportunity which the special economic zones programme will provide. The House's support for the Bill will therefore be greatly welcomed. I thank you very much.