Investing in the Free State
The Free State is South Africa's third-largest province, a land-locked region in the centre of the country, north of Lesotho. The capital Bloemfontein is conveniently situated for access to the harbours of Durban, East London and is only 400 kilometres from Gauteng, the industrial and commercial heartland of the country.The province is the world's fifth-largest gold producer, with mining the major employer. Its other major economic activity is agriculture. It is also a leader in the chemicals industry, being home to the giant synthetic-fuels company Sasol, which has its base in the town of Sasolburg.
Free State Development Corporation
The Free
State Development Corporation (FSDC) is the official implementing agency of the policies of the provincial Department of Economic Affairs, Environment and Tourism. It reports to a board of directors representing government, business and labour.
The organisation works closely with ministries, chambers, municipalities and government departments to develop and support entrepreneurs and investors in the provincial economy.
Targeted sectors for foreign direct investment are farm machinery and equipment, leather tanning and finishing, gold jewellery and beneficiation, floriculture, petrochemicals, and pharmaceutical research and development.
- Free State Development Corporation
- Free State Provincial Government
- Bloemfontein Chamber of Commerce
Mining is the province's major employer. A gold reef over 400 kilometres long, known as the goldfields region, stretches across Gauteng and the Free State. South Africa is the world's largest gold producer, and the country's largest gold-mining complex is Free State Consolidated Goldfields, with an area of 330 square kilometres.
The province has 12 gold mines, producing 30% of South Africa's output and making it the fifth-largest producer of gold in the world. The Harmony Gold Refinery and Rand Refinery are the only two gold refineries in South Africa.
Gold mines in the Free State also supply a substantial portion of the total silver produced in the country, while considerable concentrations of uranium occurring in the gold-bearing conglomerates of the goldfields are extracted as a byproduct.
Bituminous coal is also mined, and converted to petrochemicals at Sasolburg. The Free State also produces high-quality diamonds from its kimberlite pipes and fissures, and the country's largest deposit of bentonite is found in the Koppies district.
Jewellery and beneficiation
Lucrative opportunities for the export of jewellery exist in markets such as the US, Canada, Norway and Switzerland, which have provided preferential access to South African jewellery manufacturers.
The Free State Goldfields region is seen as a cluster area for gold jewellery. Harmony Gold, through direct supplies of gold to mass producers, creates a large opportunity and favourable disposition for the prospective investor.
The challenge facing this industry is to promote and develop an internationally known indigenous jewellery industry and brand, to move away from unmounted diamond exports towards higher value-added jewellery products.
Scope exists for the manufacturing of upmarket rings, earrings, necklaces, bracelets, anklets and brooches made from gold, silver and precious and semi-precious stones The focus should be on high quality products with unique designs.
Industry
Since 1989, the Free State economy has moved from dependence on primary sectors such as mining and agriculture to an economy increasingly oriented towards manufacturing and export.
Some 14% of the province's manufacturing is classified as being in high-technology industries - the highest of all provincial economies. The northern Free State's chemicals sector is one of the most important in the southern hemisphere.
Petrochemicals company Sasol, based in the town of Sasolburg, is a world leader in the production of fuels, waxes, chemicals and low-cost feedstock from coal. Sasol is the world leader in Fischer-Tropsch technology, a catalyzed chemical reaction in which carbon monoxide and hydrogen are converted into liquid hydrocarbons, producing a synthetic petroleum substitute for use as synthetic lubrication oil or as synthetic fuel.
AgricultureAgriculture dominates the Free State landscape, with cultivated land covering 32 000 square kilometres, and natural veld and grazing a further 87 000 square kilometres of the province.
It is also South Africa's leader in the production of biofuels, or fuel from agricultural crops, with a number of ethanol plants under construction in the grain-producing western region.
Field crops yield almost two-thirds of the gross agricultural income of the province. Animal products contribute a further 30%, with the balance generated by horticulture.
Ninety percent of the country's cherry crop is produced in the Ficksburg district, which is also home to the country's two largest asparagus canning factories. Soya, sorghum, sunflowers and wheat are cultivated in the eastern Free State, where farmers specialise in seed production. About 40% of the country's potato yield comes from the province's high-lying areas.
The main vegetable crop is asparagus, both white and green varieties. Although horticulture is expanding and becoming increasingly export-orientated, most produce leaves the province unprocessed.
The Free State's advantage in floriculture is the opposing seasons of the southern and northern hemispheres. The province exports about 1.2 million tons of cut flowers a year.
Soil conditions in several areas of the Free State are ideal for floriculture. South Africa also has advantages in production technology, quality control and transport infrastructure.
Floriculture is highly knowledge-intensive, depending heavily on close phytosanitary monitoring and control for efficient production and to comply with the stringent entry requirements in principle export markets.
Property
The province contains a vast spread of industrial and commercial properties, ranging from unused mining facilities to
massive industrial parks. These buildings are available at highly competitive rates. These include standard and custom built factories, industrial incubators, shopping centres, small industrial parks, office blocks and so on.
- Download the Department of Trade and Industry's Provincial Economic Overview (1.8 MB) here.
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