Harnessing the potential of special economic zones for private sector development and inclusive industrialization in Southern Africa

Abstract

The term “special economic zones” (SEZs) is a generic term encompassing various forms of specially designated clusters of industrial and high-value-added activities whose operators receive incentives not received by other economic operators. SEZs can also be defined as geographically demarcated areas where economic laws are more liberal than in the rest of the country. As a result, they include a variety of forms and types. The key message of the present study for the Southern African subregion is that countries around the world are replacing old-fashioned, export-focused, rigid schemes with a broader, more flexible form of SEZ as an appropriate policy tool to support two key objectives: private-sector development (including that of micro-, small and medium-sized enterprises) and industrialization. The Subregional Office for Southern Africa of the Economic Commission for Africa commissioned the present study to identify measures, policies, partnerships and institutional frameworks that will enable Southern African countries to harness SEZs to drive private-sector development (including that of micro-, small and medium-sized enterprises) and achieve sustainable industrialization. The study aims to improve our knowledge and understanding of how relevant and effective SEZs are as tools for private-sector development to inform policymaking.