Committee for the Abolition of Illegitimate Debt

South Africa’s own 2020-25 Master Plan for Special Economic Zones set forth broad objectives for SEZs as “economic development tools to promote national economic growth and export through the use of support measures, in order to attract targeted foreign and domestic investments and technologies.” The $18.4 billion (R344 bn) MMSEZ, according to that plan,

“forms part of the Trans-Limpopo Spatial Development Initiative and is a component of greater regional plans… its close proximity to the main land-based route into Southern African Development Community (SADC) and the African continent, together with supporting incentives and a good logistics backbone, will make it the location of choice for investment in the mineral beneficiation, agro-processing and petrochemical industries.” (MMSEZ SOC 2020)

The state-owned Limpopo Economic Development Agency, founded in 2016, set up a company, MMSEZ SOC, as a “profit Profit The positive gain yielded from a company’s activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders. driven subsidiary” with “a limited degree of autonomy, as well as the fiduciary and other responsibilities reflected in Section 9 of the Companies Act” under a controversial chief executive, Lehlogonolo Masoga, who was appointed in mid-2019 after a decade’s service in the provincial parliament. While one smaller part of the SEZ, 50 km from the Zimbabwean border at Beit Bridge, began to be developed in subsequent years, the larger rural Makhado section, a half hour’s drive south of Musina, was embroiled in endless controversies.

 Capital’s deepest contradiction – overcapacity – bedevils the Belt and Road to South Africa

Before reviewing these, consider the context of Beijing’s Belt and Road Initiative from two angles: the history of slave-era, colonial-era and apartheid-era mercantilist and capitalist extractivism in South Africa which, according to critics, Chinese firms are now simply reproducing; and first, the contemporary overproduction crisis that is, by many accounts, the driving force behind Chinese capital’s recent wave of Foreign Direct Investment elsewhere in search of new production sites and markets.

The process of Belt and Road Initiative expansion as a means of displacing Chinese industrial overcapacity is well understood, and is termed ‘going out.’ Given the historical ‘long waves’ of capital accumulation that became evident since the late 1800s, Rosa Luxemburg observed, in 1913, the difficulty of smooth capitalist reproduction “manifest in the fluctuations of prices from day to day; in the continual fluctuations of profits; in the ceaseless flow of capital from one branch of production to another, and finally in the periodical and cyclical swings of reproduction between overproduction and crisis.”

Capital has a tendency to overproduce, and then fall into a crisis, because of the most profound contradiction Karl Marx identified in the mode of production: internecine competition between firms, in which each attempts to get the upper hand by introducing more machinery, to enhance their own productivity (causing what is termed ‘rising organic composition of capital’).

The more capital investment there is, the faster the rate of profit suffers, since replacing workers with machines undermines the basis for ‘surplus value extraction’ – because capitalists can exploit workers, but do not derive surplus value in transactions with each other, in sales of capital goods. With a smaller relative workforce, ‘underconsumption’ of the output also results.

There are several routes chosen when capital overaccumulates in this manner, and Marx wrote of countervailing tendencies in a given corporation, such as making the workers toil more intensively (‘absolute surplus value extraction’) and making them more competitive by introducing with yet more machines (‘relative surplus value extraction’) which in both cases makes the underlying problem worse. Another strategy he wrote about in Das Kapital was utilization of credit systems to mop up overproduction in the short-term, leaving debt as a longer-term displacement of the crisis that would have to be addressed later.

But by the late 1800s, it also became clear that capital and allied states had imperialist capacities to displace the overaccumulated capital. That meant not only new markets for trading Market activities
trading Buying and selling of financial instruments such as shares, futures, derivatives, options, and warrants conducted in the hope of making a short-term profit. , to absorb the overproduction. It also entailed Foreign Direct Investment: moving physical capital around in search of cheaper inputs – raw materials, repressed labour in sites without independent trade unions, and weak environmental and worker safety and health regulation (such as the east coast of China). In that process of imperialist expansion, capital could accumulate by dispossession, as exemplified by South African racist settler-colonialism.

Without these strategies, capital would have to admit defeat and shut down some of the overcapacity, leaving plant and equipment to rust and workers idle, and unpaid loans might face default. That process is termed the devalorisation of capital, or simply, capitalist crisis.

The overproduction that Luxemburg noticed drove imperialism more than a century ago, as a geographical displacement of capital responding to crisis, is vital to confront at the outset, to better understand the MMSEZ: overcapacity affecting global metals markets continued to be profound through the late 2010s and early 2020s, driven from the east coast of China.

Total global steel production in 2023 was 1900 megatonnes, of which 54% was produced in China, with South Africa contributing just under 5 megatonnes (Preuss 2024), mostly from foundries that were once part of a giant parastatal corporation but that in the late 1980s was privatised to local Afrikaner managers and in 2004 sold to the Indian-owned Luxemburg-based corporation ArcelorMittal.

As its local subsidiary ArecelorMittal South Africa (Amsa) explained the dilemma in early 2024, “Elevated imports from China, where the majority of the steel industry is loss-making, is impacting not only South Africa significantly, with its low trade protection measures, but also the Africa overland and sub-Saharan Africa markets, in general” (Karombo 2024).

This most profound contradiction of capitalism – overproduction that is geographically displaced along the Belt and Road – would appear to call into question the deep economic logic of the MMSEZ (Liebenberg 2022a), especially if neighbouring Zimbabwe’s own steel production resumes in earnest. In the centre of that country, the Chinese-owned Manhize plant under construction in the early 2020s aims to produce an annual 5 megatonnes by the late 2020s.

Although by year-end 2023 Chinese monthly steel output had dropped to 2018 levels, an Organisation for Economic Cooperation and Development report (Nakamizu 2023, 3) argued that overproduction remained an acute problem:

“Despite declining steel demand, and a weak outlook, capacity expansions continue at a robust pace, often in pursuit of export markets. The gap between global capacity and crude steel production surged to 627.7 million metric tonnes (mmt) in 2022 from 512.6 mmt in 2021. The recent rise in excess capacity poses risks for the long-term health and viability of the steel industry, and its ability to enable economic growth and prosperity. Tackling excess capacity therefore remains a prerequisite for enabling stable steel market conditions, where steel companies operate on a fair and level playing field. Capacity continues to increase unrelentingly. In 2022 alone, global steelmaking capacity increased by 32.1 million metric tonnes (mmt) to 2459.1 mmt, the highest global capacity figure in history.”

In 2024, the implications of so much overcapacity in steel and other metals and minerals and a lack of competitive exporting meant rapidly falling prices and allegations of Chinese dumping, which by December had wrecked the long steel business of South Africa’s main manufacturer, AMSA. On the verge of shutting down its two largest foundries (in Newcastle and Veereniging), Amsa appealed against Chinese overproduction to the state’s International Trade Administration Commission (ITAC), begging for new protective tariffs. As Business Day reporter Kabelo Khumalo (2025) summed up,

“AMSA, battling a flood of cheap steel imports from China, has persuaded SA’S international trade authority to investigate the tariff regime. AMSA argues that the Southern African Customs Union did not foresee several events when it signed up to the General Agreement on Tariffs and Trade in 1994, which are now putting China at an advantage... ‘The surge in the volume of imports is recent, sharp, significant and sudden enough, the industry is experiencing serious injury and this is causally linked to the surge in imports,’ ITAC said… Furthermore, an analysis for the period of investigation from May 1 2021 to April 30 2024, indicates that the applicant has experienced serious injury in the form of a decline in sales, output, net profit, market share Share A unit of ownership interest in a corporation or financial asset, representing one part of the total capital stock. Its owner (a shareholder) is entitled to receive an equal distribution of any profits distributed (a dividend) and to attend shareholder meetings. , capacity utilisation, productivity and employment… AMSA CEO Kobus Verster in August called for a 25% tariff on imports, saying it was the most appropriate measure to protect the embattled domestic industry. Verster at the time said as China’s exports were forecast to accelerate 24% during the year, many countries that produced steel had acted quickly to enact trade remedies. SA in June 2024 announced it would impose an additional 9% safeguard duty on imports of hot-rolled steel from all countries for 200 days, starting on June 28.”

But regardless of whether it wins a temporary reprieve through tariffs, AMSA is not alone in suffering from Chinese overproduction. The overaccumulation of industrial capital crashed raw material prices in 2024. One victim was South Africa’s main export, platinum group metals (PGMs), of which the country can boast having 85% of the world’s reserves. The price of platinum fell nearly 10% in 2024, to 42% of its 2008 peak, with palladium – used in battery cells for green hydrogen – down 17%.

Indeed on what was an otherwise exuberant, bubbly Johannesburg Stock Exchange in 2024 (rising 13.5%), the ten hardest-hit corporations (with annual share price decline in parentheses) included seven from the extractive industries, according to News24 reporter (Wilson 2025):

- “Petrochemicals group Sasol (-55%) had a difficult 2024, emerging as last year’s worst-performing share. Its business was hit by oil price volatility, lower refining margins, and the global chemical markets remaining oversupplied. In August, Sasol reported a 66% year-on-year drop in full-year profit, mainly due to weaker chemical prices, and skipped paying a final dividend.

- “Kumba Iron Ore (-46.9%) has remained under pressure as iron ore prices continued to decline in 2024 due to the ongoing slump in steel demand from property and construction sectors, especially its biggest consumer, China, and its troubled property sector.

- “Anglo American Platinum (-41%) dropped out of the JSE Top 40 Index, reflecting (at that stage) a 35.6% fall in its share price since the start of 2024 as platinum group metals (PGM) prices continued to fall.

- “Sibanye Stillwater (-39.8%) was another company impacted by the decline in PGM prices.

- “Northam Platinum (-30.6%) plunged in September after it reported financial year 2024 results, with headline earnings per share dropping 81.6% year-on-year. This was mainly due to lower prices despite higher sales volumes and increased revenue from chrome sales. Northam also noted that the local platinum mining industry has entered a phase of irreversible decline as producers struggle with low prices and demand suffers from a rise in battery-operated electric vehicles (platinum is used primarily in autocatalysts).

- “BHP Group (-27.3%) had a forgettable 2024… weaker commodity prices, concerns over China’s economic growth, and mining sector cost inflation Inflation The cumulated rise of prices as a whole (e.g. a rise in the price of petroleum, eventually leading to a rise in salaries, then to the rise of other prices, etc.). Inflation implies a fall in the value of money since, as time goes by, larger sums are required to purchase particular items. This is the reason why corporate-driven policies seek to keep inflation down. have weighed on the share price.

- “Glencore (-25.2%) decline can, for the most part, also be attributed to China, whose massive demand for metals and minerals means it consumes about 60% of global production. However, this has changed over recent years, despite repeated announcements of stimulus packages (which seem to have underwhelmed investors).”

Whether through trade or investment, China is searching for a geographical displacement option to displace massive raw-material overcapacity elsewhere, including to the MMSEZ where a metallurgical complex could thrive, its planners believe, no matter the state of local competitors. According to local conservationist Lauren Liebenberg (2022c),

“China shares the motive, has the means and has agreed to back the MMSEZ under the Framework Agreement between the DTIC and China’s National Development and Reform Commission on Production Capacity Cooperation… China is the world’s biggest steel exporter, frequently accused of dumping tons of its unwanted steel output on global markets, including South Africa, and that capacity cooperation is a policy to absorb over-capacity in China’s domestic manufacturing and construction industries.”

Moreover, the form of expansion is important, because instead of taxing at 27% – the prevailing South African corporate rate by the mid-2020s, there is a successful Chinese precedent for reducing the tax in specific industrial parks, SEZs, which in South Africa lowers the tax rate to 15%. The entire continent was pushed to adopt this approach, and to link up production sites as integral to the Belt and Road Initiative’s coherence.

According to the dynamic Chinese ambassador to South Africa during the 2010s, Lin Songtian (cited by Fabricius, 2019):

“China had built and financed the railway line from landlocked Ethiopia’s capital Addis Ababa to the Red Sea port of Djibouti and another track from Mombasa to Nairobi, with a further stretch from Nairobi on to Uganda and Rwanda being planned, Lin said. His ‘dream’ was that the third major African corridor would be in South Africa linking Limpopo to Johannesburg and thence to the coast at the ports of Durban and Richards Bay. This would be the perfect inaugural Belt & Road Initiative project for South Africa.”

In turn, such a link would support further Chinese mining interests, e.g. not only the MMSEZ project but also copper from the Phalaborwa Mining Company near Limpopo’s Mozambique border. According to Lin, however,

“The manager and the CEO have cried to me that they have the mine production but the transportation is a big challenge. The railway you have, I am sorry to say, is too old and too slow… Everyone understands that State-Owned Enterprises (SOEs) are key to support economic development in any country, especially in China and South Africa. If they can stand strong… it’s key, it’s very beneficial and conducive to sustainable development…” (quoted in Fabricius 2019)

It was long evident that in order for the South African state to help displace overaccumulated Chinese capital into SEZs like Musina-Makhado and a few others, would in turn require Chinese rail equipment funded with Chinese loans. Perhaps the most pressing problem for the transport SOE Lin complained of, Transnet, was haulage capacity.

By the early 2010s, there were insufficient numbers of working locomotives to pull long (up to 3km) mineral- or metal-bearing carriages from Limpopo to the Richards Bay and Durban ports. That problem soon worsened, however, due to a fatal breakdown in relations between Transnet leadership and the Chinese companies that won tainted contracts for nearly 700 locomotives starting in 2013, China South Rail and China North Rail.

Financing had been arranged through a $5 billion line of credit granted to Transnet by the China Development Bank at that year’s Durban BRICS BRICS The term BRICS (an acronym for Brazil, Russia, India, China and South Africa) was first used in 2001 by Jim O’Neill, then an economist at Goldman Sachs. The strong economic growth of these countries, combined with their important geopolitical position (these 5 countries bring together almost half the world’s population on 4 continents and almost a quarter of the world’s GDP) make the BRICS major players in international economic and financial activities. summit. The result was overpayment (by $1.3 billion) for the Chinese-made locomotives, used for both coal and general freight, thanks to an apparently brazen backhander (of $400 million) to the Gupta network (Open Secrets 2021). The two firms merged in 2015 – as the Chinese Railway Rolling Stock (CRRS) company – and soon received a large tax bill by the SA Revenue Service.

But CRRS refused both to pay the bill and to supply vitally-needed spare parts for hundreds of the by-now disabled locomotives, compelling a leading politician Pravin Gordhan – who as State Enterprises Minister had authority for Transnet – to visit Beijing to negotiate a deal in 2023. But he returned having failed, leaving Transnet still without sufficient capacity to help displace China’s overcapacity in the manner Lin had hoped (Khumalo 2023).

As a further reflection of how Transnet’s relationships with suppliers degenerated under Gupta influence, the Chinese firm Shanghai Zhenhua Heavy Industries’ sale of seven container cranes to Transnet for the Durban port in 2011 had cost Transnet $92 million (making them the ‘world’s most expensive cranes’), of which $12 million was a kickback (amaBhungane and Scorpio 2017).

At the same time, Transnet was meant to benefit from what one SOE study suggested was R800 ($50) billion in Limpopo-Richards Bay public-private investment through the 2012 National Development Plan’s Strategic Integrated Project 1, within the Presidential Infrastructure Coordinating Commission (Govender 2012). The expansion of that line was aimed at “unlocking the northern mineral belt,” especially for coal exports (the plan estimated 18 billion tonnes of coal could be railed out). The MMSEZ could have been a major beneficiary of a much more expansive rail system.

However, due to the degeneration of Transnet’s rail line capacity to the Richards Bay coal export terminal (in part due to cable theft), the available capacity of 90 million tonnes of coal per year was never reached. From peak exports of 77 million tonnes in 2017, by 2023 the amount was just 47 million tonnes (Steyn 2023). So overcapacity in production of minerals and potentially metals, as well, ran into the bottleneck of undercapacity in transport.

And that, in turn, left the South African state, society and natural environment with the responsibility for various forms of subsidisation of Chinese capital at the MMSEZ, reflected in a new wave of coal investment and more concessions by the time of the 2024 Forum on China-Africa Cooperation, as discussed below.

For hundreds of years, since the first Portuguese slavers rounded the Cape of Good Hope in 1488, this kind of subsidisation had transpired, i.e., when capital meets the non-capitalist realms of life, as Luxemburg (1913) insisted was the most durable characteristic of imperialism.

 Foreign investor-driven regional under development

Hence the MMSEZ project should also be put in an even longer-range context. The regional Southern African and national South African economies have suffered a long history of resource extraction of various kinds, leaving them highly vulnerable to net wealth depletion, other forms of ecological destruction and economic vulnerability. Even the strategies that appear on the surface to represent solutions, i.e. mineral beneficiation and linkages within the continent’s currently-fractured trading system, have obvious downsides both in theory and practice, including in their current manifestation as SEZs.

Foreign Direct Investment (FDI) was aimed at exploitation of resources from the Southern African region dating to the late 15^th century, overlapping with class, racial and gender oppression and ecological degradation. The systematic extraction of resources for first European, then ‘Global North’ and finally broader international consumption, commenced with the mercantile vessels of Bartolomeu Dias and Vasco da Gama. Their exploratory voyages around the Cape of Good Hope during the 1480s-90s were soon followed by slavers, traders and settlers from Portugal and the Netherlands. The first South African FDI and colonial settlement of note was by the Dutch East India Company’s Jan van Riebeeck in 1652, at what is now Cape Town. Like other such firms, its immediate objective was extermination of local indigenous people, the Khoi San, so as to set up monopolistic agricultural provisioning arrangements for passing ships (Magubane 2001).

Many overseas firms followed the same pattern of FDI through coastal port development and then financial market Financial market The market for long-term capital. It comprises a primary market, where new issues are sold, and a secondary market, where existing securities are traded. Aside from the regulated markets, there are over-the-counter markets which are not required to meet minimum conditions. deepening so as to facilitate global trade (e.g., London-based Standard Chartered Bank which was founded in 1857 in what is now Gqeberha) (Bond Bond A bond is a stake in a debt issued by a company or governmental body. The holder of the bond, the creditor, is entitled to interest and reimbursement of the principal. If the company is listed, the holder can also sell the bond on a stock-exchange. 2003). From the late 19^th century, FDI-driven regional economics subsequently relied mainly upon the uncompensated extraction of minerals.

This process began with the emergence of a diamond mining monopoly, De Beers, whose leader Cecil John Rhodes consolidated power by merging with other mines, and combining natural resource extraction and recruitment of poorly-paid black workers at Kimberley, and later in other mining cites, most spectacularly Johannesburg. Migrancy entailed economic coercion of black men to work at wage levels below the cost of their social reproduction, thanks to durable patriarchal power.

That system remained intact, including migrant labour’s super-exploitative character, through the 20^th century and into the 21^st. Democratic transition occurred in part because of a major crisis of South African capitalism (Bond and Malikane 2019). Then, in conjunction with a rise in capital accumulation in China, a commodity super-cycle from 2002-14 reflected a new opportunity for reinvestment and new FDI, with a focus on the extractive industries but also those that benefited from the dramatic rise in black middle-class (often civil service-based) borrowing and consumption.

However, the underlying disarticulation between the mass base whose incomes were under constant threat – with merely tokenistic welfare support (Bond 2014) – and the tiny group of over-consumers, generated insurmountable contradictions. Investment recovered for the commodity super-cycle until two crashes – 2008 and 2014-15 – led to the crash of share valuations for the world’s main mining houses, most of which were active in South Africa.

Then came a recovery in prices starting in 2020 as a Quantitative Easing monetary stimulus boosted economies out of the Covid-19 lockdown. Again, in part due to unjustified speculation in financial markets, and then with Russia’s February 2022 invasion of Ukraine, the global price index soared again – though from late 2022 subsided.

Rarely recognised in economic histories of South and Southern Africa, is that as commodity prices rise, so does the intrinsic value of natural wealth being extracted from supplier economies, especially a South Africa facing permanent depletion of minerals that are not properly compensated for. The GDP GDP
Gross Domestic Product Gross Domestic Product is an aggregate measure of total production within a given territory equal to the sum of the gross values added. The measure is notoriously incomplete; for example it does not take into account any activity that does not enter into a commercial exchange. The GDP takes into account both the production of goods and the production of services. Economic growth is defined as the variation of the GDP from one period to another. calculus certainly measures income from sales of platinum, coal, iron ore and gold, South Africa’s four major mineral exports.

But there is no formal debit for depleted resources, which in Marxian terms is considered a ‘free gift of nature’ to capital, i.e., as Luxemburg (1913) and Samir Amin (2018) reflected upon, a form of capitalism’s appropriation of the non-capitalist realms (Bond 2021). In short, multinational corporations engage in a form of uncompensated plunder.

 Measuring extraction-based, undercompensated natural-wealth depletion

From the 1970s, environmental economists began addressing the depletion problem, including Nobel laureate Robert Solow (1993) and his student John Hartwick (1977). They began to calculate ecological destruction partly through an asset Asset Something belonging to an individual or a business that has value or the power to earn money (FT). The opposite of assets are liabilities, that is the part of the balance sheet reflecting a company’s resources (the capital contributed by the partners, provisions for contingencies and charges, as well as the outstanding debts). -measurement lens, asking whether shrinkage of ‘natural capital’ due to exploitation of natural resources can be offset by new, resulting investment in productive capital and ‘human capital’ (education expenditures).

Solow and Hartwick insisted that if pollution or the depletion of resource wealth (e.g. minerals extraction) were to occur, it should only be permitted if benefits (profits, taxes and wages that can be counted up and down the value chain) flow into the expansion of productive or human capital. The point, here, is to protect the interests of future generations which have a ‘right’ to also draw down a society’s natural resource base, the way ‘family silver’ is considered the basis for responsible stewardship and sometimes even formal trusteeship (Bond and Basu 2021).

Sustainability as a concept emerged with this debate in mind. The 1987 World Commission on Environment and Development (1987) defined the concept as meeting ‘the needs of the present without compromising the ability of future generations to meet their own needs.’ Soon afterwards, Robert Costanza and Herman Daly (1992, p. 38) compared resource depletion to liquidation of a firm’s inventories, with Daly (1996) therefore suggesting that economists ‘stop counting natural capital as income’ without a corresponding debit to account for depletion.

In 1993, summing up the evolution of the environmental-economics subdiscipline, Solow (1993, p. 170) asked, ‘What should each generation give back in exchange for depleted resources if it wishes to abide by the ethic of sustainability? ... we owe to the future a volume of investment that will compensate for this year’s withdrawal from the inherited stock.’

As a result of such insights – and Daly’s employment – the World Bank World Bank
WB The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

(2011, 2018, 2021) began a ‘Wealth Accounting and the Valuation of Ecosystem Services’ and helped a Committee for Mineral Reserves International Reporting Standards (2020) ‘to standardise market-related reporting definitions for mineral resources and mineral reserves.’

This they took on the road alongside Conservation International, e.g. to Botswana in 2012 where the Gaborone ‘Declaration for Sustainability in Africa’ acknowledged ‘limitations that GDP has as a measure of well-being and sustainable growth,’ in turn leading African signatories (including South Africa) to begin ‘integrating the value of natural capital into national accounting and corporate planning’ (World Bank 2018).

One debate, at the time and ever since, was whether a net positive outcome of such wealth accounting could rely upon the substitutability of these various capitals: i.e., the lost forms of nature are offset by reinvestments of profits into machinery, infrastructure or schooling that makes capitalism more productive and future generations wealthier. Costanza and Daly (1992) insisted that the global environment had become so degraded that it would be inappropriate to substitute lost natural capital with rising productive capital.

Regardless, such calculations led to what the World Bank (2021) terms the ‘changing wealth of nations’ – i.e., the natural capital dynamics within a broader ‘Adjusted Net Savings’ for each country – occur using national states as the unit of analysis (
World Bank 2018). To be sure, this unit is inappropriate due to the transnational scope of both unequal ecological exchange and ecocide, given that localised pollution and greenhouse emissions do not respect borders.

But Bank data is otherwise the most comprehensive available, even if many of South Africa’s own minerals are missing (Bond and Basu 2021). The Bank’s natural capital accounts include not only fossil fuels – oil, gas, and hard and soft coal – but the following minerals and metals: bauxite, cobalt, copper, gold, iron ore, lead, lithium, molybdenum, nickel, phosphate rock, silver, tin, and zinc (with cobalt, lithium and molybdenum only added in 2024).

The World Bank (2021) underestimates South Africa’s mineral wealth substantially, because its methodology does not include platinum group metals, manganese and chrome, where in all three cases, South Africa has led the world for most of the period under discussion; nor zirconium, vanadium and titanium, where South Africa is the world’s second highest producer; nor diamonds. That means a vast amount of underground minerals exists as unrealised natural capital, measured conservatively at $2.5 trillion by Citibank in 2012 (INet Bridge 2012).

What has become clear, even in Washington DC, is that most extraction of non-renewable resources has been done with no regard to wealth effects, especially the sustainability of mining and the needs of future generations to retain natural wealth, since current conditions leave the society much poorer (given that mining revenues are not reinvested in productive capital or education but instead externalised to foreign-headquartered mining houses – whether based in the West or, increasingly, in emerging economies).

In parts of South Africa, such as the second-most important gold-mining province, attention to depletion is occasionally recognised, e.g., in a 2023 report by PwC: “Based on reserves declared, the gold industry is expected to exist in SA for about another 27 years, the report shows, with many of the mines coming to an end in fewer than 20 years. In the Free State, where there are five gold operations and one project in development, current depletion rates suggest there are only six years of gold mining left in the province” (Erasmus 2023).

Not only is inadequately-compensated depletion a major source of multinational corporate plunder, but vast amounts of pollution and greenhouse gases also result from the extractive industries, in what represents uncompensated income drawn from local victims who suffer emissions, but also future generations who will inherit a degraded environment. The problems are evident in a series of four World Bank charts and a map, drawing on (partial) natural capital accounts (as noted, these are exceptionally conservative when it comes to South Africa because depletion would be recorded at far higher levels if missing minerals are included).

- The first shows ‘Natural resource rents’ as a share of GDP, indicating the ebb and flow of income from mainly depleting sources of non-renewable mineral wealth (Figure 1).

- Second, in the rest of the world, countries’ natural resources – containing a much larger share of renewable components (e.g. agriculture, marine and timber) than in South Africa – recover at a much faster rate, while South Africa’s current devaluation Devaluation A lowering of the exchange rate of one currency as regards others. (in $) of mineral depletion is substantial (albeit noting volatile commodity prices, especially during the 2002-14 super-cycle and likewise in 2020-22) (Figure 2).

- Third, specific coal-sourced resource rents – measured as a share of GDP – reveal the South African economy’s comparative addiction to fossil fuels, both for burning (in Eskom coal-fired power plants and in metallurgical operations) and for export, while profits drawn from such rents do not reflect pollution and emissions (Figure 3).

- Fourth, if natural capital depletion, pollution and emissions are combined with (positive) educational funding (human capital investment) and the (net negative) depreciation of physical capital, the Bank’s full Adjusted Net Savings measure reveals that the South African economy has been dis-saving, especially over the past decade, a time the rest of the world recorded relatively high rates of positive saving (9-11% of GDP, but again bearing in mind the methodological flaws that make this highly conservative) (Figure 4).

Figure 1. Natural resource rents (% of GDP), 1970-2021: SA (top) and the world (bottom)

Figure 2. Adjusted Net Savings: SA mineral depletion (current $ billions), 1970-2020

Figure 3. Coal resource rents (% of GDP), 1970-2021: SA (top) and the world (bottom)

Figure 4. Adjusted Net Savings (% of GNI), 1970-2021: world (top) and SA (bottom)

It is vital to address all such natural wealth when assessing economic policy. Even without counting several valuable minerals, South Africa is revealed as a major net loser of non-renewable resource wealth (World Bank 2021, 204). According to the Bank (2021), only three African countries suffered a higher level of depleted metals and minerals wealth from 1995-2018 (Botswana, Zimbabwe, the Central African Republic) (Map 2).

Map 2: Change in metals and minerals wealth, 1995-2018

Matters had degenerated across the continent so much, that of African countries that export natural resources, by the mid-2010s, 88% were net losers in the process, according to a Bank (2018) study relying upon natural capital accounts. The methodology to record depleted wealth is, as noted, conservative. But it is so clear an illustration of GDP’s failure to reflect prosperity, that even the South African government joined a global coalition to measure natural capital. On 25 May 2012, Pretoria became a signatory to the Gaborone Declaration, which as noted was facilitated by the World Bank and Conservation International. That document makes very clear the responsibility that the South African government and private sector actors – including Environmental Impact Assessment (EIA) consultants – have to engage in full-cost accounting that includes the depletion of natural capital in projects such as the MMSEZ. The language mandates the integration of natural capital accounting into state and corporate planning.

 Natural capital outflows from the MMSEZ along the Belt and Road

At the MMSEZ site, various EIA consultants struggled with this responsibility, ultimately evading the challenge. Before considering the details, recall that the omission of natural capital accounting affects not only overall MMSEZ analysis but also the EIA related to a solar-powered energy source known as Mutsho. The idea of ‘Scope 3’ in emissions analysis is that even if a particular process does not immediately cause greenhouse gas emissions, climate planners must be conscious of the downstream utilisation of that resource (e.g. burning fossil fuels outside the jurisdiction from where they are extracted).

In Limpopo Province’s case, the MMSEZ could become a crucial source of unsustainability, especially if a disproportionate share of natural capital is channelled offshore to China via Hoi Mor. The project’s leading entrepreneur, Ning Yat Hoi, was accused in Zimbabwe of corporate fraud and Illicit Financial Flows in 2017. Ning is still wanted for asset stripping Bindura Nickel Corp and Freda Rebecca gold mine, within ASA Resources (then Mwana Africa).

In 2023, Ning not only again visited the MMSEZ (2023) but the nearby platinum-oriented proposed Fetakgoma Special Economic Zone. Savannah and the other EIA practitioners failed to account for the MMSEZ’s net depletion of natural capital (Savannah Environmental, Geyer, and Thomas 2023a), while still claiming downstream economic benefits.

In 2021, the World Bank updated its natural capital analysis. Due to commodity price volatility and non-renewable resource depletion, the Bank (2021, 203-04) observed, ‘
mineral wealth in South Africa went from $60 billion in 1995 to $100 billion in 2010 but dropped to $45 billion in 2018, driven in part by a decline in the country’s gold production’ (Figure 5).

Even without counting many of its most valuable minerals and metals, South Africa is a major net loser of non-renewable resource wealth: only Zimbabwe, Botswana and the Republic of Congo have worse records over the past 25 years, with the Central African Republic in the same category, as shown in Figure 5. Indeed, South Africa also scores very poorly in relation to peers when it comes to managing commodity price booms and busts, as revealed in Figures 6 and 7; over time, as the commodity bubble burst in the 2015-18 period, net wealth shrunk markedly.

The World Bank (2021) stresses the need for an economy’s resilience – especially through better state budgetary management – when the downside of a commodity price cycle emerges:

“The cyclicality of commodity prices has affected the overall balance Balance End of year statement of a company’s assets (what the company possesses) and liabilities (what it owes). In other words, the assets provide information about how the funds collected by the company have been used; and the liabilities, about the origins of those funds. of countries with higher shares of natural capital in total wealth. The structural balance or cyclically adjusted balance is defined as the general government cyclically adjusted balance for non-structural elements beyond the economic cycle (percentage of potential GDP). After the most recent commodity boom of 2004–14, there was a greater impact on the overall and structural balances of countries with relatively higher shares of natural capital in total capital… [but] when the commodity boom ended and oil prices dropped, countries that depended on these oil rents experienced an impact on their public finances.”

Savannah (Savannah Environmental, Geyer, and Thomas 2023a) failed to follow Gaborone Declaration guidelines and to calculate the trajectory of natural capital depletion associated with the MMSEZ project’s anticipated drawdown of mineral resources, a major shortcoming. The MMSEZ will not only contribute to climate catastrophe, but will also impoverish South Africa by depleting sovereign wealth – and prospects for future generations’ prosperity – without adequate reinvestment.

The EIA’s failure to properly acknowledge, much less calculate, this damage is a profound reflection of the practitioners’ limited environmental skills, ecological consciousness and intergenerational responsibility. For any current residents of South Africa, and future generations dependent upon a stable climate and well-managed resource extraction, the MMSEZ EIA will have to be redone to take these vital factors into account.

It is here that the UNDP UNDP
United Nations Development Programme The UNDP, founded in 1965 and based in New York, is the UN’s main agency of technical assistance. It helps the DC, without any political restrictions, to set up basic administrative and technical services, trains managerial staff, tries to respond to some of the essential needs of populations, takes the initiative in regional co-operation programmes and co-ordinates, theoretically at least, the local activities of all the UN operations. The UNDP generally relies on Western expertise and techniques, but a third of its contingent of experts come from the Third World. The UNDP publishes an annual Human Development Report which, among other things, classifies countries by their Human Development Rating (HDR).

was most disappointing, insofar as its officials provided no indication they would challenge the underlying unsustainability of the MMSEZ (Thompson, Shirunda and Mbangula 2023). Ironically, the agency’s Human Development Reports database on sustainability includes ANS as its first dashboard column: ‘The six indicators on economic sustainability are adjusted net savings, total debt service Debt service The sum of the interests and the amortization of the capital borrowed. , gross capital formation, skilled labour force, export concentration index and research and development expenditure.’

South Africa’s ANS reported by the UNDP was -2.5% of national income in 2021 (and that score is generous given all the fast-depleting minerals the World Bank database has not yet incorporated). But it appeared impossible for the UNDP to incorporate either damage done by greenhouse gas emissions (and local pollution) or natural capital depletion into its approach, and hence there was no reason for the agency not to partner with the MMSEZ, until challenged. (Even then, an internal UNDP investigation had come to no conclusion 18 months later.)

Figure 6: Overall balance versus total wealth; change in non-renewable natural capital rent

Figure 7: Structural balance versus total wealth per capita; change in the overall balance

Figure 8: Change in wealth per capita, by income group and asset class, 1995-2020

The overall impact of this process, unequal ecological exchange, can be measured over a longer period – 1995-2020 – thanks to recent World Bank (2024) Changing Wealth of Nation 2024 data. South Africa is not singled out (and again, the Bank’s data and measurement shortcomings underestimate South Africa’s loss of natural resource wealth). Even so, it is evident that the global value chains allow non-renewable natural capital to be depleted from low-income and lower-middle income countries at extraordinarily high rates of -60% wealth decline in the former and 17% in the latter, in this category (Figure 8). Matters would obviously be far worse if local pollution and greenhouse gas emissions are included.

What all this suggests, is that to account for South Africa’s underdevelopment requires considering a form of capital accumulation in which multinational corporate capital takes advantage of opportunities for uncompensated resource depletion, pollution and emissions. In other jurisdictions, such activity is increasingly considered not only abusive, but criminal. In Goa, India prohibitions have been imposed on mining because resource depletion is not compensated for properly (Bond and Basu 2021).

In sum, the systems of accumulation by dispossession have outlasted slavery, colonialism and apartheid. But even after what the UN judged as a formal crime against humanity ended, both the labour super-exploitation and resource-depletion systems continued and were amplified. Some of the most egregious features of the existing system were deracialised, to be sure, but also further deregulated, even as depletion rates, greenhouse gas emissions and other forms of pollution rose. These features can be observed in most post-apartheid SEZs, including the MMSEZ (Touissaint et al 2019).

 Chinese resemblances to neo-colonial capital

Chinese entrepreneur Ning Yat Hoi and his Shenzhen Hoi Mor Resources Holding Company chose the southern section of the MMSEZ to raise what in 2016 was announced as $3.8 billion in investment support for an 8000-hectare metals-based industrial project, bordering the main highway and a railroad line (Liu 2016). As Ning later told China Reform Daily, “Our goal is to build the world’s most competitive energy metallurgical SEZ,” one consisting of plants for coking, ferrochrome, ferromanganese, manganese-steel, stainless steel and cement, as well as coal-washing and a major coal-fired power plant (Lei 2019).

Yet Ning had spent much of 2017-18 defending himself from fraud charges, and was even on the Interpol “Red List” based on charges of “reckless trading and negligence,” transfer pricing and looting worth $4.3 million from the Bindura Nickel Corporation and Freda Rebecca Mine in Zimbabwe (Moyo 2017, Allix 2018). At a November 2018 London High Court hearing, the judge ruled that there were credible allegations of “stealing money, a corrupt relationship between Ning and the Chinese suppliers and an alleged tortious conspiracy between the Chinese directors. The pleadings are extensive” (Sole 2020).

Apparently without being informed about this record, then South African Minister of Trade and Industry Rob Davies (2017) in September 2017 authorised Shenzhen Hoi Mor to run the MMSEZ’s Makhado section (for 90 years with a 30-year extension option) because, as he told Parliament two months later, Ning “will bring along a number of investment projects to anchor the development of this particular SEZ. These investment projects consist of at least eight catalytic projects, with the total investment value over time of about $3.8 billion and projected to create up to 21 000 direct jobs.”

The investors are, potentially, China Civil Engineering Construction Company; China Communications Construction Company; Power Construction Corporation of China; China Metallurgical Group Corporation; China Huadian Corporation; Taiyuan Iron & Steel company; Nanguo Hodo Holdings; PowerChina International Group; Tengy Group and China Metallurgical Group, with loans apparently available from the 2006 China-Africa Development Fund and the 2015 China-Africa Fund for Industrial Capacity Cooperation (Thompson et al 2021).

The decision was codified by President Cyril Ramaphosa in September 2018 when he co-chaired the Forum on China-Africa Cooperation (Focac) along with Chinese leader Xi Jinping (Mokone 2018). One result was the promise of a $1.1 billion loan from the Bank of China for SEZs and industrial parks in South Africa. In spite of Ning’s background, expectations were high, and Ning continued to visit the site, including with a large delegation in 2020 and again in February 2023.

However, complaints soon emerged, relating partly to China’s role in the global economy – with regional implications both in Limpopo and across the border in Zimbabwe and Botswana – resulting in thousands of objections raised by trade unions, government’s centre-right political opposition, journalists, communities and environmentalists. In the process, the SEZ’s regional economic logic was undermined by an announcement by China’s Ambassador to South Africa that instead of exporting metal products northwards into the rest of the African continent, as made sense in the context of the African Continental Free Trade Agreement, the industrial output would be shipped by rail to Durban and from there to international markets (Fabricius 2019).

And as thousands of Environmental Impact Assessment (EIA) complaints showed, vast amounts of local pollution as well as greenhouse gas emissions caused by the MMSEZ would damage Limpopo’s fragile ecology and would also far exceed limits agreed to in Pretoria in government’s official Nationally Determined Contributions to cutting emissions, as mandated in the 2015 Paris Climate Agreement. Even the initial MMSEZ EIA practitioner, Delta BEC (2021), judged the coal-fired power plant to be indefensible without a working carbon capture system (and there was none in existence).

Xi himself also rejected that strategy during a United Nations General Assembly speech in 2021, promising to cancel all such plants along the Belt & Road Initiative. Finally, the debate about an MMSEZ power source unfolded just as Eskom load-shedding became debilitating. A promised solar replacement (400 MW) would not make a dent, due to the extremely high electricity consumption required for the proposed MMSEZ smelters. All these points compel us to ask, whether is a logic to regional economic development based on mining, beneficiation and intensive energy supply in Limpopo Province and nearby countries, especially given that returns to MMSEZ taxpayer investments of R96 billion infrastructure would be only a cumulative R773 million over 20 years (Liebenberg 2022a).

The September 2024 Forum on China-Africa Cooperation (FOCAC) rebooted interest Interest An amount paid in remuneration of an investment or received by a lender. Interest is calculated on the amount of the capital invested or borrowed, the duration of the operation and the rate that has been set. in the MMSEZ. The main implications for the critical analysis above remain the lack of water in the vicinity for washing coal; the lack of a sustained multi-year electricity supply (given Eskom’s long-term ‘death spiral’ prognosis); massive damage to the local eco-system (e.g. destruction of 658 000 baobab, marula, leadwood and shepherd trees); minimal job creation (fewer than 250 at the proposed ferrochrome smelter); and globally, the ongoing glutting of most metals markets, with next-door Zimbabwe’s own new Chinese metals production due to swamp output from the MMSEZ.

In late 2024, the purchase of MC Mining (formerly Coal of Africa) by Hong Kong-based Kinetic Development Group appeared as a major new factor, with a fast-track Environmental Impact Assessment underway at the time of writing. The latest MMSEZ project was due to include a 10Mt/a coal washery and a 3Mt/a coking coal plant (both arranged by Shenzhen Hoimor) and a 1,000Kt/annum ferrochrome and ferroalloys smelter plant (Kinetic), to be powered by a 1,000MW solar PV plant (also Kinetic).

Perhaps most importantly, notwithstanding the solar input, MMSEZ climate implications are profound, especially once the pricing of carbon emissions advances and climate sanctions are imposed on South African output by European and British importers. The proposed ferrochrome plant alone was anticipated to emit 2.2 megatonnes of CO2equivalents (including other greenhouse gases) annually, at a low level of production, but the new version estimates output up to 1 000 000 tons/year.

The ratio of tonnage of CO2e emissions to tonnes of ferrochrome production is as high as 6.1. So if 6.1 megatonnes of CO2 emissions are emitted from that sole smelter (before others are added), and if the damage of a ton of CO2e emissions is $1056 (Bilal, A. and D. Känzig), this ferrochrome plant’s negative annual externalities would be $6.44 billion (R112 billion), which is 20% of the entire GDP of Limpopo Province. Perhaps predictably, the September 2024 Scoping Report by Gudani Consultants backtracked from earlier EIAs, and completely ignored contain any mention of any of this information.

 SEZs as drivers of regional decline

In this durable context of FDI-driven underdevelopment, the systematic depletion of resource wealth and the damage done by emissions and pollutoin, there is an especially acute danger of government, businesses and society placing inordinate hopes in what are variously termed Export Processing Zones, Industrial Development Zones and Special Economic Zones as sources of economic vitality and job creation. In general, although job creation is potentially important, SEZ benefits mainly go to foreign corporations, in the form of relief from Value Added Taxes, import duties and corporate taxes, with the SEZ rate typically about half that prevailing outside the zone, i.e., 15% instead of 27%.

But abundant promises made by SEZ proponents from the late 1990s (Bond 2002) through the 2010s generally failed to materialise (Touissant et al 2019). In at least two high profile cases there have been notable instances of firms moving to SEZs and establishing operations so as to gain investment support, financing and tax breaks, e.g. the Durban factory owned initially by the Dubai-based Mara smartphone company, located at the Dube Trade Port, which after its 2019 inauguration produced no phones and was declared bankrupt in 2021 (Industrial Development Corporation 2022) and again in 2023 (Timeslive 2023); and the Beijing Auto Industrial Corporation factory at the Coega SEZ where construction began in 2016 but where by 2023 there were still no vehicles produced, in spite of Xi having formally opened the plant in 2018 (Furlonger 2023).

Yet hype about SEZ breakthroughs continues. To illustrate, the United Nations Conference on Trade and Development UNCTAD
United Nations Conference on Trade and Development This was established in 1964, after pressure from the developing countries, to offset the GATT effects.

(Unctad) is a proponent of SEZs, and although the Geneva agency traditionally had a relatively progressive role in advocacy for Southern interests, Unctad’s 2019 World Investment Report is dedicated to promoting SEZs: “(w)e are seeing explosive growth in the use of SEZs as key policy instruments for the attraction of investment for industrial development. More than 1 000 have been developed worldwide in the past five years and, by Unctad’s count, at least another 500 are in the pipeline for the coming years.”

The dangers of shifting manufacturing into such zones were sufficiently obvious, however, that Unctad (2019, 205) concluded its report with this caution: “(t)he key objective should be to make SEZs work for the Sustainable Development Goals: from privileged enclaves to widespread benefits.” Nevertheless, after a cursory assessment of the MMSEZ, Unctad (2019, 160) provided an endorsement:

“In Africa, intercontinental trade and economic cooperation through border SEZs is also high on the agenda. The MMSEZ of South Africa is strategically located along a principal north-south route into the Southern African Development Community and close to the border between South Africa and Zimbabwe. It has been developed as part of greater regional plans to unlock investment and economic growth, and to encourage the development of skills and employment in the region.”

Likewise in 2022, United Nations Development Programme (UNDP) resident representative to South Africa Ayodele Odusola promoted the MMSEZ, in spite of widespread criticism that the agency had allied with agencies and firms that did not have the society’s and environment’s interests at heart. According to Odusola (2022),

“the project offers a significant potential boost in local job creation through the establishment of planned agro-processing facilities, energy and metallurgy industries, as well as general manufacturing and logistics services. Various technical studies have been conducted to gauge the potential success of these sectors within the province. Our involvement is to ensure that people and the planet are foremost as the MMSEZ begins to create sustainable employment where poverty and unemployment are rampant.”

Yet in work relating to the MMSEZ, the UNDP ignored its own sustainability indicators, which include Adjusted Net Savings. For South Africa, the UNDP (2022, Dashboard 5) reported this measure at -2.5% of national income in 2021 (also without many critical minerals’ depletion included due to the partial methodology). But contemplating the implications of non-renewable resource depletion at the MMSEZ was apparently beyond the UNDP’s abilities or desires.

Nevertheless, even without commenting on uncompensated resource depletion harm in early 2024, an internal UNDP oversight panel determined that Odusola had in 2022 failed to incorporate the costs and benefits properly (because he used an incorrect template that underplayed potential harm by the Chinese private sector investors arranged by Shenzhen Hoi Mor): “This in turn exposed UNDP to whatever reputational risks may arise from being associated with a company, whose project (pursuant to the applicable policies) the UNDP considers to be high risk,” leading to the panel’s instruction to cancel the partnership or resubmit it under a more rigorous examination (Carnie 2024).

A final contextual point to consider in any regional development assessment is the extent to which the MMSEZ’s obvious locational advantage supports exports to the rest of the continent. While a few other SEZs exist inland for the sake of sector specific industrialisation, and others are planned, the main effort to locate an industrial zone specifically with the African continental market as consumer is the MMSEZ.

Yet the late 2010s witnessed a potential derailing of its “Gateway to Africa” status due to sustained problems at the Zimbabwe border crossing and on the Beitbridge-Harare-Zambia highway. Notoriously bad road conditions and delays due to traffic, immigration and customs, plus high crime, tolls and corruption at the Musina-Beitbridge interface were partially resolved by major new investments on the Zimbabwe side.

But in 2018, a competing truck route to Botswana and then Zambia was announced, diverting off the N1 at the Limpopo Province capital city of Polokwane. Avoiding both Makhado and Musina, the new route crossed into Botswana in a northwesterly direction, and then over a new $260 million Kazungula Bridge, clearing the Zambezi River directly into Zambia without traversing Zimbabwe. Before mid-2021 (when the bridge opened), trucks would have a long wait for a ferry crossing over the Zambezi River.

With the African Continental Free Trade Agreement coming to fruition by the mid-2020s, much greater regional trade was anticipated to move from South Africa to Botswana, not only through Zimbabwe. The new northwestern route takes a typical truck three hours longer (than via Musina-Makhado) to travel from Durban, Johannesburg and Polokwane to Lusaka and onwards to the Copper Belt if there are no delays.

But for many transporters in 2022-23, it was preferable. Conditions on the Zimbabwe side did improve once the Beitbridge border post and crossing received a 2023 investment of $300 million and improvements were undertaken on the quality of the main Beitbridge-Chirundu highway. But the MMSEZ’s logic as a regional gateway hub for production and logistics was nowhere as near as monopolistic as it was prior to 2021 thanks to the Kazungula Bridge route.

 Local economic-socio-ecological resistance narratives

Progress on the MMSEZ has been slow, especially given the attention given to it – including President Cyril Ramaphosa’s personal interest (given that his home village in Limpopo, Khalava, is just 75 kilometers east of the Makhado section). Still, in 2023, an area of Musina was cleared of indigenous vegetation, with plans to do the same to the much larger southern section of rural Makhado in 2024.

From 2024, an area adjoining Makhado is also due to host a solar-powered 400 MW supply to the MMSEZ: the Mutsho Solar PV2 power plant (‘Mutsho’). This followed a period from the mid-2010s when the potential for more coal-fired power to run MMSEZ facilities was regularly touted, with Ning’s plans progressively lowering from 4600 MW to 3300, 1300 and then 600 MW.

In September 2021, Chinese leader Xi Jinping announced at a United Nations General Assembly session that there would be no further Belt and Road Initiative coal-fired power plants. Hence on March 3, 2022, News24 (2022) reported that MMSEZ CEO Masoga now acknowledged there would be no coal-fired power plant, because “Environmentalists said no. World leaders said no – [saying instead] let’s reduce our carbon footprint and stop producing energy through coal.” For Masoga, “We are now focusing on solar,” but the Mutsho plant proposed in 2023 would provide a mere fraction of the power required for smelters and processing, to the degree required, and load-shedding of the national grid was reaching record levels.

Moreover, massive amounts of CO2 emissions – nearly 34 megatonnes annually – were still anticipated from the metallurgical processes, no matter the source of the energy (Table 1). Meanwhile, the most concrete manifestation of the industrialisation strategy – a thermal and coking coal mine being established by MC Mining on the border of the Makhado section of the SEZ – was moving ahead in fits and starts, once again drawing attention to the project’s acute contradictions.

Battles over the firm’s leadership had led to high-profile black entrepreneurs gaining control, including former Finance Minister Nhlanhla Nene as chairperson, but the volatile terrain of the coal sector led to a 40% decline in MC Mining’s share value in 2023, and further delays getting the Makhado project underway. Another indication of instability in the province was the decision by MMSEZ chair and provincial finance minister Rob Tooley to simply quit in 2021, so as to retire, taking up craft beer production at his family ranch.

Table 1: MMSEZ expected emissions (excluding electricity-based emissions), Megatonnes/year

Source: Prometheum Carbon 2020

In this tumultuous context, four different oppositional forces and narratives arose to contest the MMSEZ. First, just after the September 2018 Focac summit, two major unions – the self-described socialist National Union of Metalworkers of South Africa (NUMSA) and the centrist Solidarity – wrote to Ramaphosa, Davies and other ministers:

“The concern is that South Africa as a recipient of these investments risk piling up dangerous amount of debt which is meant to give China a strategic hold over our country... [and] a means to dump or re-channel problems of overproduction from other countries (including China) on South Africa. China is a very efficient producer with a higher productive efficiency (produces at lower costs) and may end up using SA as a production haven, to re-direct its outputs to partner our countries. This threatens the existence of the Africa Growth and Opportunity Act and our benefits from the African Continental Free Trade Area.” (NUMSA and Solidarity 2018, 1)

This line of argument combines an unconvincing, xenophobic conspiracy theory (Chinese debt equates to Bejing’s desire for sovereign control), with valid concerns over South African manufacturers’ ongoing output and capacity losses within a competitive intra-subimperial rivalry (uncritically stressing the risk to ‘our’ benefits from Africa exports). An obvious underlying feature of this narrative is the Marxist theory of overproduction and its geographical displacement. (Aside from that sole letter, the unions did not make further interventions, but as noted below there is a more expansive argument about dealing with overproduction from the federation within which the metalworkers sit, ultimately calling for metal foundries’ nationalization along with a genuine Just Transition.)

The second critique of the MMSEZ came from the opposition centre-right Democratic Alliance, then led by Mmusi Maimane (2019), and featured some of the same nationalistic concerns about corporate rivalry, augmented by worry over declining sovereignty and rising debt:

“It cannot be the case that while South Africa is on the brink of plunging into complete darkness due to lack of energy, Ramaphosa will allow foreign companies to come to our shores and build their own power plants for their own narrow interests. Cyril Ramaphosa’s new strategy cannot be to sell our country to the highest bidder. The DA will not allow China’s model of ‘debt trap diplomacy’ to take root in South Africa.” (Maimane 2019)

That firm line of opposition to the MMSEZ faded as the coal-fired power plant plans changed. Indeed already by 2021, the Democratic Alliance’s Risham Maharaj (2021) issued a statement welcoming massive spending on the MMSEZ, with the proviso that since the African National Congress couldn’t keep local roads in good repair, his party should be given the chance: “The R647 billion MMSEZ development has now been given the green light by the new and controversial Environmental Impact Assessment (EIA) and will require world class roads infrastructure. Only the DA has a proven track record to measure cost of local road maintenance backlog to enable greater efficiency in allocation of budgets.”

However, Maimane’s concern about the overall foreign indebtedness of South African state, parastatal and private borrowers was indeed valid in 2018, having soared from the very low levels of the early 2000s (less than $30 billion) to $185 billion (more than 50% of GDP), as two credit rating agencies Rating agency
Rating agencies Rating agencies, or credit-rating agencies, evaluate creditworthiness. This includes the creditworthiness of corporations, nonprofit organizations and governments, as well as ‘securitized assets’ – which are assets that are bundled together and sold, to investors, as security. Rating agencies assign a letter grade to each bond, which represents an opinion as to the likelihood that the organization will be able to repay both the principal and interest as they become due. Ratings are made on a descending scale: AAA is the highest, then AA, A, BBB, BB, B, etc. A rating of BB or below is considered a ‘junk bond’ because it is likely to default. Many factors go into the assignment of ratings, including the profitability of the organization and its total indebtedness. The three largest credit rating agencies are Moody’s, Standard & Poor’s and Fitch Ratings (FT).

Moody’s : https://www.fitchratings.com/ imposed ‘junk’ status after Finance Minister Gordhan was fired in 2017.

But Covid-19’s financial restructurings – especially sales of securities to local buyers – lowered external debts to $155 billion in the 2020-23 period (around 40% of GDP). Chinese holdings of the growing foreign debt were fairly substantial during the 2010s, but largely through parastatal-to-parastatal loans (especially to Transnet and Eskom).

Shenzhen Hoi Mor did not formally begin MMSEZ construction so these debts did not involve the Limpopo project. Attention to excessive foreign debt is always appropriate in a South Africa whose (then pro-Western) president, PW Botha, in 1985 defaulted on $13 billion of foreign debt (Bond 2014). Moreover, other African countries – 2010s success stories Ghana, Zambia and Ethiopia – were by the early 2020s forced into formal debt default as global interest rates Interest rates When A lends money to B, B repays the amount lent by A (the capital) as well as a supplementary sum known as interest, so that A has an interest in agreeing to this financial operation. The interest is determined by the interest rate, which may be high or low. To take a very simple example: if A borrows 100 million dollars for 10 years at a fixed interest rate of 5%, the first year he will repay a tenth of the capital initially borrowed (10 million dollars) plus 5% of the capital owed, i.e. 5 million dollars, that is a total of 15 million dollars. In the second year, he will again repay 10% of the capital borrowed, but the 5% now only applies to the remaining 90 million dollars still due, i.e. 4.5 million dollars, or a total of 14.5 million dollars. And so on, until the tenth year when he will repay the last 10 million dollars, plus 5% of that remaining 10 million dollars, i.e. 0.5 million dollars, giving a total of 10.5 million dollars. Over 10 years, the total amount repaid will come to 127.5 million dollars. The repayment of the capital is not usually made in equal instalments. In the initial years, the repayment concerns mainly the interest, and the proportion of capital repaid increases over the years. In this case, if repayments are stopped, the capital still due is higher…

The nominal interest rate is the rate at which the loan is contracted. The real interest rate is the nominal rate reduced by the rate of inflation. soared.

A third critique of the MMSEZ, largely from environmentalists (especially conservationists) and community activists along with talented lawyers, more broadly reflected local pollution fears and other public interest considerations. Delta BEC (2021) acknowledged that “the potential negative impacts of the development on the natural, tourism, and agricultural environment of the site and the region may in all likelihood, outweigh the identified positive impacts associated with the potential social and economic development benefits in the longer term.”

Community-based campaigning against the MMSEZ by the Save our Limpopo Valley Environment (Solve) coalition was responsible for most of the thousands of EIA objections, as well as objections to Delta BEC’s flawed public participation and community consultation process (Figure 9). A Johannesburg NGO with national and international profiles, Earthlife Africa, played a central role fighting the MMSEZ. Led by Makoma Lekalakala, it sustained strong links to Limpopo Province community groups like Dzomo La Mupo, which was regularly represented by community leader Mphatheleni Makaulule.

Figure 9. Community-based members of the Save Our Limpopo Valley Environment network

A film about the MMSEZ produced in mid-2023 by Earthlife Africa, The promise of progress and peril, highlighted how, among other sources of destruction, “tens of thousands of baobab, marula, and mopane trees will be uprooted. These trees are directly linked to the people’s culture and livelihoods” (Zoutnet 2023). Indeed Delta BEC (2021) acknowledged that 109 034 indigenous (and endangered) trees would be felled, and wetlands destroyed, with no real prospect of biodiversity offset investments.

Other NGOs fighting the MMSEZ have included groundWork, Fossil Free South Africa, BirdLife South Africa, The Wildlife and Environment Society of South Africa, 350.org and the Mining and Environmental Justice Community Network of South Africa. Legal allies included the University of the Witwatersrand Centre for Applied Legal Studies, Centre for Environmental Rights, Natural Justice and All Rise Attorneys for Climate and Environmental Justice. Even the environmental consultants to a luxury game park bordering the MMSEZ’s Makhado site – Ekland Safaris, whose arms-length ownership is linked to the Saudi Arabian royal family – offered a critique on ecological grounds.

On the other hand, the MMSEZ mobilised its own community forces, e.g. leaders of the Vhaleya community, which was engaged in a land restitution dispute at the Musina site, one Masoga appears to have settled in late 2023 (Dube 2023), as well as youth organisations and the ruling party. But MMSEZ proponents in the southern area lacked sufficiently powerful grassroots links to derail community and environmental opposition, in spite of job promises and of traditional race imbalances in land ownership that ordinarily give their arguments greater purchase.

The most sustained, effective analysis and advocacy on grounds of community-environmental protection may have been that of the Living Limpopo advocacy group led by Liebenberg (2022a, 2022b, 2022c), which contrasted industrial maldevelopment with potentials for the UNESCO Vhembe Biosphere Reserve and Transfrontier Conservation Area options, linking to the Mapungubwe ancient settlement and Limpopo River (at https://livinglimpopo.org/).

In the same spirit, a team from the University of the Western Cape led by Lisa Thompson documented violations of local communities’ political-ecological interests (Thompson and Mbangula 2021, Thompson et al 2021), supported by Berlin-based funder, the Friedrich Ebert Stiftung (prior to its associated Social Democratic Party’s ascent to coalition rule over Germany in 2021 – at which point, as the Russian invasion of Ukraine led to German energy shortages, party leader Olaf Scholz in May 2022 turned to Ramaphosa for assistance in acquiring more coal exports).

Specialist analyses have been provided on the dangers the MMSEZ poses to local biodiversity and eco-tourism, especially by Victor Munnik (2020) on water. Although vague options for a summer-time flood-overflow dam near Musina were suggested, there was much more likelihood that the MMSEZ would rely upon an international transfer from aquifers in western Zimbabwe and eastern Botswana. Delta BEC (2021) acknowledged that by 2040, water required for the mining, industries and power generation sectors would rise by more than five times (from 45.0 million m³/a to 249.1 million m³/a).

A great deal of the water would be directed to washing both thermal and coking coal for subsequent combustion – consequently resulting in further CO2 emissions, which in turn would contribute to droughts and floods in a province and region set to be amongst Africa’s worst affected by the climate crisis. Meanwhile, water-related protests began to occur in Musina townships due to shortages, first in mid-2022 for a full week, and again in March 2023, again drawing attention to the conflict between industrial and residential customers.

At the MMSEZ south district, one of the major water consumers will be MC Mining’s coal mine, one perpetually delayed given the company’s severe managerial and ownership turmoil. That mine’s viability was questioned by the 2021-23 collapse of Transnet’s coal-export capacity (from Limpopo to Richards Bay), due to a Chinese locomotive controversy that left the parastatal railing coal at only 61% efficiency.

The fourth critique of MMSEZ extends the political-ecology analysis further, into damages anticipated as understood in terms of both the ‘Social Cost of Carbon’ associated with emissions from the industrial facilities, and depleted non-renewable mineral wealth. First, even without a coal-fired power plant providing a direct supply and indeed even if (implausibly) 100 percent of the project’s energy came from solar and wind supplies, the MMSEZ will raise South Africa’s CO2 emissions profile dramatically, and in turn result in climate sanctions (known as the Carbon Border Adjustment Mechanism) on South African heavy industrial exports to Western markets (Bond 2024).

A prior climate specialist statement for the MMSEZ (Promethium Carbon 2020) had identified 33.7 megatons (mt) of CO2 equivalent emissions likely to emanate from the MMSEZ’s various plants, including ferrochrome, carbon steel, silicon-manganese, stainless steel and ferromanganese smelters, not including CO2 emissions from coal-fired power. As pointed out by many MMSEZ critics, this would consume around 10% of the South African government’s annual allocation of CO2 emissions during the 2030s, according to commitments made by Pretoria to the 2015 UN climate summit in Paris (Republic of South Africa 2021).

But what is also of concern is the extent to which the products from the MMSEZ will add to South Africa’s ‘climate debt,’ i.e., a future assessment of liabilities Liabilities The part of the balance-sheet that comprises the resources available to a company (equity provided by the partners, provisions for risks and charges, debts). owed by the sources and beneficiaries of high pollution (to cover other people’s and places’ Loss & Damage as well as compensation for adaptation costs). Paying for climate damage currently carries far too low a cost, e.g. $0.30/tonne of CO2 in South Africa’s tokenistic carbon tax (lasting until 2026 for the main polluters), or $85/tonne in Europe’s chaotic Emissions Trading Scheme (Bond 2024).

The U.S. government’s Environmental Protection Agency suggests $185/tonne, although Joe Biden did not raise it from the Obama Administration’s $51/tonne, and it is likely Trump will revert it to $1/tonne. More realistic studies by environmental economists who incorporate feedback loops into their models conclude that $3000/tonne is more realistic (Kikstra et al 2021), and even the conservative National Bureau of Economic Research published a paper in 2024 estimating the cost at $1056/tonne (Bilal, A. and D. Känzig).

Higher carbon pricing will, once implemented, sharply disadvantage the MMSEZ’s high-carbon emitting projects (Table 1). And the South African government will increasingly be compelled to adopt a more realistic price if it aims to maintain industrial exports, due to European and British imposition of the Carbon Border Adjustment Mechanism starting in 2026.

Within this fourth narrative, the second additional political-ecological feature, beyond climate-damage costing, is the incorporation of depleted minerals as a cost of production (Bond and Basu 2021). Even Limpopo Province’s huge deposits of thermal coal would contain future value in the form of concentrated hydrocarbons that would be extracted for non-combustion uses, such as lubricants, synthetic materials, pharmaceutical products, tarmac and many other options.

As discussed in more detail above, so too should the depletion of non-renewable materials be costed into the project (Hartwick 1977, Solow 1993, Bond and Basu 2021). These additional narratives were put (by this author) to EIA consultancies Delta BEC and Savannah Environmental (2023) but there was no willingness to engage in debate and further enquiry.

There is a progressive labour narrative that emerged in 2023, when AMSA was threatening closure, and deserves consideration in full, because nationalisation of the extractive-industry corporations is the only way of addressing the overaccumulation of capital at the heart of South Africa’s metals and minerals industry crises. This statement, although not referring to the MMSEZ, is of great relevance because it suggests before new capacity is built, a restoration of the terms of the old overcapacity’s devaluation is in order. It was issued by the SA Federation of Trade Unions (2023):

 Arcelormittal Plans To Close Two Plans And Decimate 3500 Jobs: Genuine Green Growth Requires A Just Transition And Nationalised Steel Industry

SA Federation of Trade Unions Press Statement, 1 December 2023

The South African Federation of Trade Unions (SAFTU) is worried by the announcement made by ArcelorMittal to shut foundries in Newcastle and Vereeniging, which will result in the retrenchment of over 3 500 workers, a vast share of its workforce, without having a Just Transition plan in place for the affected people and communities. Losing such a large number of jobs at a time of extreme unemployment and cost of living crises, will sentence these workers, their households and the surrounding economy to poverty, misery, crime and alienation.

ArcelorMittal is blaming high logistical and transportation costs, inadequate demand, the ban on export of scrap metal and load shedding for their poor performance. The chaos at Eskom and Transnet have indeed affected many producers, and understandably, employers have complained about additional operating costs and potential losses. While Eskom prepares to decarbonise by shutting down coal-fired power plants, utter chaos and extreme load-shedding have followed the parastatal’s corporatisation (losing its public-interest mandate and fragmenting its functions), privatisation of generation (to Independent Power Producers), and debilitating corruption that has gone largely unpunished.

Added to Transnet’s incapacity, also facing corporatisation, privatisation and corruption, plus liberalised imports from cheaper producers abroad, our industrial economy has felt the extreme stresses of neoliberalism and corporate-driven globalisation.

However, the Luxembourg-based ArcelorMittal’s tendency to blame the scrap metal ban as a factor behind their proposed cuts is hypocritical and exposes the contradictions of capital. In their public statements, ArcelorMittal wants the ban to be lifted. It argues that the “introduction of a preferential pricing system for scrap, a 20% export duty, and more recently, a ban on scrap exports has allowed steel production through the electric arc furnaces route at an ‘artificial’ competitive advantage when compared with steel manufacturers beneficiating iron ore to produce steel.”

The irony is that as a society and workforce, and for the sake of the environment, we do need to recycle scrap, and to allocate our electricity much more responsibly. Therefore, to melt existing scrap steel for reuse makes much more sense than exporting it. The ban on scrap metal exports is also sensible so as to disincentivise the theft and sabotage of our own public infrastructure, because if the demand for the stolen scrap metal is reduced by stopping scrap metal export, there’s a much better chance that the state can halt metal thievery and trace the syndicates who are wrecking public assets for private profit.

Another reason to use recycled scrap metal in the furnaces is that South Africa faces climate sanctions in coming years, because our industrial economy is still so dependent upon high-electricity consumption by smelters. The European Union’s Carbon Border Adjustment Mechanism will, in any case, raise tariffs on imported steel from these same foundries, because the South African carbon tax is below US$0.40/tonne, compared to the current EU Emissions Trading Scheme price of $80/tonne of CO2. Unless our Treasury increases the South African tax by a factor of 200 and keeps raising it, our exports of steel, iron, aluminium, petrochemicals, cars and other products with embedded CO2 will be subject to the EU climate sanctions. (These will be applied starting in 2026). Whether or not we accept such a process (given Europe’s long history of colonialism and economic imperialism), it is underway and is likely to be adopted in other Western jurisdictions.

And that carbon tax does remind us of ArcelorMittal’s irresponsibility: exporting profits and running local foundries into ground – Newcastle is just the latest – without shifting energy inputs to renewables. ArcelorMittal’s executive chairman Lakshmi Mittal has long been accused of milking local operations, as local steel capacity has collapsed from a high in 2008 of 900 000 tonnes/month to a low in October of only 350 000 tonnes, output that was 16% less than in September, and 17% less than October 2022.

The conditions in South Africa are especially distressing because ArcelorMittal’s failures long predate the ban of scrap exports. During the 2010s, ArcelorMittal SA regularly posted losses until 2019, when it finally reported a profit. The company spent the 2010s destroying excess capacity, by closing foundries and retrenching thousands of workers. Between 2014 and 2020, ArcelorMittal reduced its workforce by more than a half, from 15 000 to 7000. The contemplated retrenchments of 3 500 that will follow the closure of these two plants, will add to this bloodbath.

This is part of the cost-cutting measures that have been implemented to return the company to profitability. Remember, this is the norm. Under capitalism, companies operate mainly to make profits, and any loss-making is solved through restructuring (company reducing input costs, mainly labour costs, to return to profitability).

The Just Transition process in this country is presenting new opportunities for steel manufacturing. It requires greener production by using renewable energy for steel manufacture, and in turn the smelted steel and aluminium will be required for locally-produced wind turbines, solar panel frames and a much more appropriate transmission grid that can draw renewable energy from the entire countryside. Because Lakshmi Mittal has no interest in this sort of energy transition, he is simply shutting down plants which could be major contributors to our post-carbon economy.

The capitalist mantra of restructuring and building efficiency has failed, dealing a great blow to the oft-repeated fallacy that the private sector is more efficient that the public sector. ArcelorMittal is a former government company – Iscor, which began operations in 1928 – that underwent privatisation in 1989. At that point, it was argued that new buyers (then consisting mainly of its local managers) would improve its efficiency and fortunes – although this firesale represented Afrikaner ruling-class looting of a state it was soon to abandon as democracy became inevitable. Today, ArcelorMittal’s persistent problems are created by the contradictions inherent in capitalist overproduction. This shows that privatising Iscor was not a route to greater fortunes, but just a way to give the private sector – first local, then foreign imperial cartel – more space for profiteering.

Under capitalism, the success of an enterprise is determined by two things: being a monopoly and taking the advantages of imperfect competition or beating its competitors in a perfect competition. It is not a matter of whether you are controlled by government or the private sector. Having failed to beat its competitors domestically and internationally, ArcelorMittal is scrambling to blame government policy.

SAFTU has for years been campaigning that the production of steel for a developing economy was of such an importance that Iscor should not have been sold in the first place. Giving foreign capital more space in the economy, which at the beginning used its international tentacles to squeeze small domestic steel manufacturers, was never an option. To this end, we have called for the re-nationalisation of ArcelorMittal SA and included this in our Section 77 demands. We feel vindicated. The neoliberals who argue that state should play no role in the economy must note that the steel industry was not hamstrung by public ownership, but by the internal contradictions of capitalism, including ruinous competition.

In 2022, South Africa produced just 4.4 million tonnes of steel, ranking our economy 34^th largest, while the top 15 – led by China – had at least 20 million tonnes of output. China and India have notoriously lax environmental regulations, so unless South Africa adopts similar protections against climate sanctions and uses nationalised steel for rebuilding our productive base in a sustainable manner, we can expect the world’s overproduction and excess capacity of steel – running between 20 and 30% of output – to swamp the rest of our beleaguered industry in coming months and years.

SAFTU has long been calling for a dramatic increase of state investment into the manufacturing sector, to create real, stable jobs to push back against the tide of unemployment, poverty, and inequality that besets the country. With South Africa’s stock market still exhibiting one of the world’s highest share capitalisations in relationship to GDP (the ‘Buffett Indicator’), with huge state-controlled funds available, and with so much corporate cash lying idle, no one can argue that such investments are prevented by lack of funding. The pre-neoliberal state strategy was to use such funding for parastatal investments via ‘prescribed assets,’ and that in turn was one way South Africa became such a major industrial power.

Today, in contrast, the retrenchment of ArcelorMittal workers indicates that the economy remains mired in a state of deindustrialisation. The loss of these decent jobs in the manufacturing sector will not be replaced by corresponding jobs in other parts of the economy. It will be replaced by non-standard work in the service sector, which pays nothing short of indecent wages that cannot sustain workers.

Deindustrialisation is now at such profound levels that state action is vitally needed. The share of manufacturing to the GDP has radically declined: from 24% of GDP in 1990, to 12% today. All the while, government has essentially been following the neoliberal austerity framework for the economy instead of focusing on real needs and job creation not-for-profit maximisation. The current “South African Steel and Metal Fabrication Master Plan 1.0” – supposedly ensuring carbon neutrality by 2050 – being promoted by Minister Ebrahim Patel is one indication of how neoliberal and pro-corporate the state remains: it fails to even mention nationalisation as an option, or how to apply Just Transition principles to steel.

SAFTU demands that government re-nationalise steel and increase spending on an extensive infrastructure rollout, so as to create a market for state-owned, worker-controlled steel industry revitalisation, not for capitalists. To do so, all steel producers – especially ArcelorMittal – should be assessed for massive liabilities in terms of worker safety and health, as well as environmental damage (extreme local pollution and greenhouse gas emissions, plus depletion of non-renewable iron ore stocks), with the price paid investors so as to nationalise the industry adjusted accordingly.

A genuine Just Transition is overdue, including the need to provide compensation to workers and communities. But we still will urgently need a strong steel industry, one powered with renewable energy and producing output that will rebuild our economy in a sustainable manner. To simply let ArcelorMittal close yet more foundries is another reflection of an utterly irresponsible corporate and state elite, which cares nothing for the future of this economy.

 Conclusion

The various narratives in favour of and against the MMSEZ have been reviewed, along with an assessment of interest groups. The 2018-21 power configuration in government meant several very influential leaders of the state were from Limpopo Province: Ramaphosa, Mboweni and his deputy David Masondo, as well as SA Reserve Bank Governor Lesetja Kganyago. While by 2023, construction of the northern part of the MMSEZ appeared inevitable once a community land claim was resolved, there appeared potentially insurmountable contradictions associated with the much larger southern district, ranging from local to global, and from economic to social to environmental.

Overcoming these was not necessarily feasible given the broader conditions of capitalist socio-environmental relations, especially what with oppositional forces as diverse and capable as appeared to be the case since 2018. The ongoing promises of more than 20 000 jobs for construction, metalwork and associated activities were attractive, but there were certainly many more likely opportunities to arise from agriculture and eco-tourism, which would be precluded by the industrial development, according to critics.

The potentially largest-ever industrial park in Africa, the gateway site for metals exports into a continent unshackled thanks to the African Continental Free Trade Zone as well as into a world economy shepherded by Chinese buyers, a desperately-needed reindustrialization and the urgency of localised minerals beneficiation – all stood exposed as empty promises.

At the point of peak hype in 2020, provincial economic minister Thabo Mokone could pronounce, “Given our strategic location, the MMSEZ will be the epicentre of the SADC” (Sunday World 2020). Yet in reality, too many countervailing realities existed, together with sufficient weight to delay and potentially derail the project. Of all the potholes that have emerged along China’s Belt and Road, this is one of the most glaring.

Once the full implications of the MMSEZ are considered and its potential for underdevelopment better understood, different strategies can be assessed in search of alternative projects that would create less regionally uneven development in Southern Africa, and those may well include re-nationalised steel instead of scrapping an enormous asset: the existing steel industry. The scope to genuinely meet socio-economic and environmental needs with a different approach is enormous, but throwing off the deadweight associated with multinational corporate extractivism via the Belt and Road Initiative, is a prerequisite.

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Note: Older versions of this analysis are published in Cosmopolitan Civil Societies, Vol.15(3), pp.110-130, 2024, https://doi.org/10.5130/ccs.v15.i3.8864 (focusing on the solar controversy) and in M.Mdlalose, I.Khambule and E.Khalema (Eds) Contemporary South Africa and the Political Economy of Regional Development. London: Routledge, 2025, https://www.taylorfrancis.com/books/edit/10.4324/9781003397823/contemporary-south-africa-political-economy-regional-development-methembe-mdlalose-isaac-khambule-nene-ernest