United Nations pulls the plug on MMSEZ support

Environmental groups and anti-Musina Makhado Special Economic Zone (MMSEZ) lobbyists rejoiced this week over the United Nations’ announcement of withdrawing its support for this highly controversial industrial park development just north of the Soutpansberg in Limpopo. Since the Department of Trade and Industry (DTI) approved the development of the MMSEZ in July 2017, the project has been marred by controversy.

The main objections include the massive carbon footprint the development will create and the impact this water-intensive industrial park will have on the region's already-scarce water resources. The driving force behind the MMSEZ is the state-owned Limpopo Economic Development Agency (LEDA), in partnership with Chinese investors, with a total value of the development said to be around R165 billion.

The initial MMSEZ plan comprises two sites. The first site, Artonvilla, is located in Musina, while the second site, known as the Southern SEZ, is located some 50 km south of Musina at Bokmakierie. It comprises 8,022 hectares of land. The MMSEZ is said to include the building of a 20-million-tons-per-annum (Mtpa) coal-washing plant, a 3,300 Mw coal-fired power plant, a 3 Mtpa coke plant, and a 390 Mw waste-heat power plant. The other factories planned are a 3 Mtpa high-carbon ferrochrome plant, a 1 Mtpa ferromanganese plant, a 500,000-tons-per-annum (Tpa) silicon manganese plant, a 3 Mtpa stainless steel plant, a 1 Mtpa high-vanadium steel plant, a 1 Mtpa high-manganese steel plant, a 5 Mtpa metallurgical lime plant, a 1.2 Mtpa titanium dioxide plant, and a 150,000 Tpa vanadium pentoxide plant. Following a huge public outcry and pressure from environmental groups, the developers of the MMSEZ have since tried to amend many aspects of the development to lessen its impact on the environment.

Environmentalists and pressure groups suffered a major setback in 2022, when the United Nations Development Programme (UNDP) agency announced its public endorsement of the MMSEZ. On 29 June of that year, several South African civil-society organisations wrote an open letter to the UNDP to record their deep concern about the UNDP’s public endorsement of what they consider the unsustainable coal-dependent MMSEZ. The letter related to a memorandum of understanding (MoU) signed between the UNDP and the developers of the MMSEZ.

The UNDP has now rescinded its support for the MMSEZ. This follows the formal objection launched by, among others, civil-society groups Living Limpopo and Earthlife Africa, and a 29-page final-draft investigation report compiled by the UNDP’s Social and Environmental Compliance Unit (SECU). The report formally recommended that the UNDP pull the plug on supporting such a “high-risk” project as no due diligence was conducted as required by UNDP policy.

The report states that LEDA sought a written agreement with the UNDP “precisely because it believed that engaging with the [UNDP] would help it deal with the challenges that it faced in its relations with outside stakeholders, who were concerned about the potential adverse social and environmental impacts of the project”. The report, however, made clear that the SECU did not investigate the merits of the MMSEZ but only whether its South African office had complied with all the UNDP policies and procedures. Regarding this, the report points out that the UNDP has two distinctly different templates for entering into MoUs – one for the private sector and one for governments/state-owned entities. In the case of the MMSEZ, the UN country office in South Africa erroneously signed a less onerous government template. “The private sector template has provisions dealing with publicity, the use of the UNDP emblem, and reputational risk. Had the country office used the private sector template, it would have been prompted to seek representations from [LEDA] to assure itself of certain facts before entering into the MoU,” the report states.

On Monday, Earthlife Africa Johannesburg and several communities in the Vhembe District celebrated the news of the UNDP’s withdrawal from the MoU. “This is a huge win for the movement toward sustainable and inclusive development and an even bigger win for the people of the Vhembe District who, as a result of the MMSEZ, were living with the threat of possible mass destruction of their natural resources. We welcome the decision, especially because it affirms our concerns about significant procedural shortcomings in the UNDP's handling of the MMSEZ MoU,” said Earthlife Africa’s Director Makoma Lekalakala in a press release.

According to Lekalakala, the UNDP’s South African office’s deviations from prescribed protocols, specifically selecting an inappropriate form for the MoU, bypassed several essential policies. “This oversight resulted in a failure to comply with UNDP's Policy on Due Diligence and Partnership with the private sector, as well as the associated Risk Assessment Tool, particularly in assessing high-risk projects involving coal and other minerals,” said Lekalakala.

“The DA believes the withdrawal poses a risk to the legitimacy of the project, as the UN backing gave credibility to it, despite multiple objections by interested parties, specifically around the EIA. However, the withdrawal will not halt the development,” Mr Jacques Smalle (DA Member of Parliament for Cogta) told the Zoutpansberger on Tuesday. He added that the DA had expressed continuous concern over the lack of water in the area. “Vast quantities of a steady supply of water will be needed for the MMSEZ to operate, and this obstacle has not yet been solved. We objected to LEDA managing this project, and it has become clear that they do not have the capacity to implement a project of such scale. We are also still waiting on the realisation of the 48,000 job opportunities promised by Premier Mathabatha,” said Smalle.

The Freedom Front Plus in Limpopo also welcomed the UNDP’s withdrawal from the MoU. “The planned MMSEZ poses a risk for agriculture, water security, tourism, the environment, and cultural and fossil heritage in the Vhembe District,” said Marcelle Maritz, Member of the Provincial Legislature and Freedom Front Plus provincial leader. According to Maritz, environmental groups and other stakeholders can give themselves a pat on the back “as the pollution and destruction of natural resources and scarce resources are not negotiable”. Maritz concluded by saying that the Freedom Front Plus was not opposed to economic development, but this must happen in balance with nature and the current climate crisis the world is facing.

News - Date: 01 March 2024

Andries van Zyl

Andries joined the Zoutpansberger and Limpopo Mirror in April 1993 as a darkroom assistant. Within a couple of months he moved over to the production side of the newspaper and eventually doubled as a reporter. In 1995 he left the newspaper group and travelled overseas for a couple of months. In 1996, Andries rejoined the Zoutpansberger as a reporter. In August 2002, he was appointed as News Editor of the Zoutpansberger, a position he holds until today.

Email: [email protected]