East London - The Eastern Cape government would have invested R963 million in the province's two industrial development zones (IDZs) by the end of the 2003/04 fiscal year, provincial finance MEC Enoch Godongwana has said.

In an interview with Business Report, Godongwana said the East London IDZ and its far bigger Port Elizabeth counterpart, Coega - which will have received R151 million and R813 million respectively - were an integral part of the province's economic growth and development strategy and would consolidate industrial development in the two cities.

This build-up of critical mass would, he said, enable the Eastern Cape to "slowly develop a world-class economy".

The East London IDZ will focus on crowding investment in the motor industry, textiles and clothing, pharmaceuticals, agroprocessing and high value-add manufacturing, whereas Coega will have a far more heavy industry bent.

Zone chief executive Peter Miles said manufacturing in the first phase of development - a 250ha duty-free area and 130ha of industrial parks - would start in August 2004 and the IDZ had received all the permits, rezoning permissions and environmental impact assessments that it needed. 

There were also plans afoot to expand the harbour, build a new container terminal on reclaimed land, upgrade the power supply and improve the rail link with the industrial heartland of Gauteng.

He said two investors - condom manufacturer Condomi and brewer Weizengold - had already committed to the project, although funding problems had slowed development.

Godongwana said increasing the usage and capacity of the two ports would help the provincial government achieve the other pillars of its economic strategy - raising rural incomes and agricultural and tourism development.

"IDZs are a vehicle for pulling growth in the Eastern Cape and will have forward and backward linkages throughout the economy," he said.

Assistant US trade representative for Africa, Florie Liser, cited the development of a world-class transportation infrastructure at East London, Coega, Durban and Walvis Bay as a key reason behind the US's desire to negotiate a free-trade agreement with the Southern African Customs Union.

The first round of negotiations will kick off on Monday.