THE MUSINA-MAKHADO SPECIAL ECONOMIC ZONE ENVIRONMENTAL IMPACT ASSESSMENT (EIA) PROCESS

OCTOBER 2021

INTRODUCTION TO THE ENVIRONMENTAL IMPACT ASSESSMENT PROCESS

Many communities in both urban and rural areas of South Africa are unaware that Environmental Impact Assessments are a legal requirement for sustainable development, and for any development project that may significantly impact the environment.

The National Environmental Management Act (NEMA), a South African environmental law, regulates Environmental Impact Assessments, both in terms of livelihoods and environmental impacts Inclusive of how the development project may or may not balance the benefits and consequences in terms of sustainable development. South African EIAs ostensibly follow international best practice to include local communities.

NEMA (Section 24) states the involvement of communities, particularly vulnerable and disadvantaged persons, is crucial part of the law binding the EIA public participation process (referred to as PPPs)

“…the participation of all interested and affected parties in environmental governance must be promoted, and all people must have the opportunity to develop the understanding, skills and capacity necessary for achieving equitable and effective participation, and participation by vulnerable and disadvantaged persons must be ensured”.

NEMA is the regulatory framework against which the current EIA process on the Musina Makhado Special Economic Zone (MMSEZ) must be weighed. The EIA process has frequently been tailored to “fit for purpose” blanket EIAs that cover all future industrial development in a particular designated area. Blanket EIAs cover all manufacturing and industries to be established within a designated zone. The blanket EIA approach is how the recent chemical leak catastrophe occurred in eThekwini at the Cornubia Presidential Project (run in similar fashion to the SEZs). During the chaos of the July riots, the United Phosphorus Limited chemical plant (UPL) based at Cornubia spilled literally 6500 kinds of different toxic chemical compounds into Umhloti river and Umhlanga Lagoon, and into the air (the smell of the burning chemicals stretched for kilometres). Fortunately. in the case of the MMSEZ, the blanket EIA approach is not the case, but there are other issues concerning the EIA process that are deeply problematic.

China’s ideological reconstruction of a geostrategic Global South explains the significance of the MMSEZ and why a Special Economic Zone centred around a coal plant and metallurgically extractive industries would even be considered in the current global climate change dialogue towards a less carbon intensive global economy. The MMSEZ is a result of the high-level China – South Africa state to state partnership on development and forms part of China’s economic “going out” strategy linked to the rewiring of aid and trade in Eurasia and Africa via what is known as the Belt and Road Initiative.

THE GLOBAL SIGNIFICANCE OF THE MUSINA-MAKHADO SPECIAL ECONOMIC ZONE

The history of the Musina Makhado SEZ is a surprisingly long one. The idea for the Zone originated from the 2012 meeting of the Forum on China-Africa Cooperation, after the former Minister of Trade and Industry, Dr Rob Davies, endorsed Special Economic Zones as the new driver of economic growth and development in South Africa. In order to effect radical changes to what were previously known as Industrial Development Zones, the Department of Trade and Industry (Dti) drafted the new Special Economic Zones Act of 2014, which came into effect in 2016.

From 2016 onwards, Davies, as Minister of the Dti, made regular reference to what was first called the Energy Metallurgical Special Economic Zone (EMSEZ). The focus on steering South Africa’s development trajectory towards SEZs preceded a large number of Dti and other departmental delegations visiting China through a SEZ exchange programme funded by the Chinese government. The exchange programme was geared towards orientating South African officials involved in restructuring and re-aligning South Africa’s ailing Industrial Development Zones to fit with SEZ model in China as form of what the Chinese government like to call ‘inclusive development’ (a term used by the Chinese government to describe growth and large scale employment). The Zones are seen as pivotal to ensuring sustainable development. Virtually every South African official involved in the management or oversight of the Zones has visited China (including President Cyril Ramaphosa himself).

As a result of this SEZ learning/brainwashing exchange, the change of legislation to South Africa’s SEZ Act, all SEZs now qualify for a plethora of economic and tax incentives including only 15% corporate tax, vat concessions, water and energy discounts, to name a key few, to entice Foreign Direct Investment.

In 2017, the Metallurgical Zone’s the operator’s licence was issued to a Chinese Company Shenzhen Hoi Mor, authorised by Minister Rob Davies. However, it was only in 2020 that the first Environmental Impact Assessment Report for the MMSEZ was released by the Limpopo Economic Development Agency. The long incubation period for the SEZ appears to be as a result of ensuring that sufficient Chinese (and other) Foreign Direct Investment will take place. At the Investor Conference held at the time of the release of the absolutely final EIA on 1 September, it has come to light that Anglo-American are investors, as may be the Australian coal mining company MC Mining (previously Coal of Africa), although MC Mining is currently clawing back from the brink of bankruptcy, despite loans from the Industrial Development Corporation. Nevertheless, government optimism on the ability for the MMSEZ to catalyze growth is abundantly clear.

THE MMSEZ EIA PUBLIC PARTICIPATION PROCESS 2020 to 2021

There have been 4 Rounds of Public Participation on Musina Makhado EIA. These took place in September and again October 2020 complicated by COVID-19 lockdown regulations. The September 2020 meetings were restricted to 50 participants. These were further supplemented by a 2nd round of public participation in October 2020.  Neither of these rounds were translated into the vernacular languages of the Limpopo communities. Furthermore, many communities were excluded from the events run by Limpopo Economic Development Agency and the Environmental Consultancy Delta-BEC, because of poor advertising (In only 2 newspapers) and on the radio.

A further round was to be held in January 2021 which was restricted to a virtual meeting (after which the further community meetings had to be cancelled because of another hard COVID lockdown). The January round of Public Participation was rescheduled to March 2021. The question of lack of broader participation was raised by many Interested and Affected Parties in September and October 2020. The fact that newspapers/radio are ineffective to reach rural communities was raised in public meetings and yet the March public participation rounds followed a similar format to the earlier meetings, leaving communities angry about lack of consultation.

The anger of Limpopo community leaders is justified. By law, in order to ensure public participation, the EIA consultant (known as the Environmental Assessment Practitioner, or EAP, appointed by the consultancy who is awarded the EIA tender) must ensure that all communities affected by the proposed development project are informed and consulted in a way that their inputs provide meaningful changes around any concerns they may have. The process of registering as an Interested and Affected Party simply boils down to sending an email to the Environmental Assessment Practitioner (although naturally this is harder for vulnerable and disadvantaged groups).

Furthermore, all affected communities, and registered Interested and Affected Parties (meaning any member of the public, or any organisation) must be directly informed of the process of the EIA and of how their comments and concerns are to be addressed. 

Mudimele leaders meeting

COMMUNITY CONCERNS ON MMSEZ DEVELOPMENT SUSTAINABILITY

In September 2021, just prior to the public participation process, fieldwork undertaken by the African Centre for Citizenship and Democracy together with activist leaders in Mining Communities Unite in Action (MACUA) established that many local communities and their leaders in the Musina and Makhado areas still have both very little knowledge of the MMSEZ and many groups have systematically been excluded from the PPP meetings held to date. The reasons range from poor communication around where and when events were being held, lack of transport and lack of direct consultation. Fieldwork interviews with key informants who prefer to remain anonymous, confirm poor communication on the impacts of the MMSEZ extended to the traditional leadership of the Vhembe district.

Musina meeting

The ACCEDE September 2021 meetings allowed community leaders to voice concerns on the water, pollution and climate-change impacts of the Zone to the Vhembe biosphere. The final EIAR states that initial supply of water to the southern site of the MMSEZ will rely on two sources, the first will be from an agreement with the Zimbabwean Water Authority to supply 30 million cubic metres of water for use to the coal mines, to increase the supply capacity of the Nzhelele dam (by raising the dam walls) and also by extracting groundwater at a rate of 18 million cubic metres per second to ensure sufficient water supply. The alluvial aquifer, Thuli Karoo, will be used for groundwater supply. Given that the Musina dam will take 10 years to build (with no clear documented strategy in the public domain for funding its expensive construction, estimated at R13.89 billion) the chances that the Vhembe underground water table will be radically affected are very high.

While the EIA recognises chronic water shortages and supply issues to the MMSEZ, the realities of the short and medium water supply issues are not directly addressed. At a Friedrich Ebert Stiftung webinar on water scarcity and the MMSEZ held on 4 October, CEO of the Musina Makhado State Owned Company (MMSOC) Lehlogonolo Masoga defended the water scarcity and livelihoods issues surrounding project, stating that there would be more than sufficient water for the MMSEZ after the building of the Musina dam and that adequate provision has been made for the MMSEZ for the foreseeable future.

The ignominy of Masoga’s confidence the CEO of the Musina Makhado State Owned Company (MMSOC) is that it underlines that government cannot grasp the grim reality of their flimsy water provision plans for the next ten years (this also assuming the mega-Musina dam will ever see the light of day). Nor is there full appraisal of the consequences this will have on the livelihoods of millions of Vhembe rural residents who are already battling with water shortages and ongoing droughts.

Communities such as the Mudimele, who are closest to the proposed southern site, were alarmed to hear that the final Environmental Impact Assessment Report states that the Nzhelele dam, which was used to supply their village with water, is proposed as a future water supply to the southern MMSEZ site. Commercial farmers in the area confirmed that the Nzhelele dam has very limited capacity and it is for this reason that the Mudimele community have to rely on boreholes and are not able to draw water from the dam.

The final EIA refers to the MMSEZ as “… the largest single planned SEZ” and promises 53 800 jobs. For the largest SEZ in South Africa, it has been pointed out that given the scale of the project, this local employment figure is very low.  It seems that the Limpopo Economic Development Agency realised this and decided to up the employment ante radically.

At the Lekkerlag public participation meeting which took place on the 29th of September for the SEZ Property Owners, namely the Mulambwane Community Property Association owners, the job promises rose to a whopping 800 000 for locals. The Mulambwane have leased the land via Lieda to the Chinese operator Shenzhen Hoi more now registered as the South African company known as the South African Energy Metallurgical Base (SAEMB). The lease is valid for 99 plus 30 years. Making unrealistic employment promises to the Mulambwane has, as a result, ensured their full endorsement of the MMSEZ.

At this same meeting, disturbingly, police presence also blocked a disaffected group of the Mulambwane community from entering the meeting until a representative of the Centre for Environmental Rights (CER), called the new EAP and insisted that in terms of NEMA regulations that they be allowed to enter (just in time to hear the incredible jump in job promises to the figure of 800 000).

Two of the community public participation meetings were called off by the leaders of community groups who have requested written replies from Enviroxcellence on what their communities stand to gain and why they have not been sufficiently informed (the Mudimele community meeting and the Musina showgrounds meeting did not take place)  

At meetings held at Tshipise and in Louis Trichardt and at an online public participation session on Monday the 4th of October, neither Enviroxcellence nor Lieda would answer any direct questions. Enviroxcellence simply regurgitated the March PPP presentation of the smaller footprint of the MMSEZ (now trimmed down to 3500 hectares and the smaller coal plant, reduced from 3300MW to 1320MW).

Participants from these meetings will attest that the EAP, the Lieda Facilitator and Enviroxcellence team dodged every question, no matter how hard participants pushed for direct answers to burning issues posed by the MMSEZ, like livelihoods threats, climate change, water scarcity and more.

The tactic of “noting” in order to say nothing, makes it blatantly clear that Lieda and Enviroxcellence did not learn from past mistakes, instead they compounded them into a travesty of the National Environmental Act of 1998, to the great detriment of Vhembe communities.

 

THE COST OF THE MMSEZ TO SOUTH AFRICA’S SUSTAINABLE DEVELOPMENT

The Musina-Makhado SEZ has two sites, a Northern site close to Musina which is for light industry (the EIA is approved) and the southern site based between Musina and Makhado. The Southern site, the high-polluting “metallurgical-energy cluster” will centre on the coal plant, to provide power for mineral extraction, smelting and processing.

Although the justification for SEZs is the produce value chains to boost economic diversification, the MMSEZ Master Operational Plan states that 70% of the processed minerals are to be exported back to China. The mineral beneficiation aspect to the zone is thus questionable in terms of what the South African economy would gain when offset against mineral depletion.

Despite South Africa’s Just Transition commitments, at the  webinar hosted by Friedrich Ebert Stiftung on the 4th of October 2021, CEO Masoga stated that the MMSEZ coal plant would champion the use of ultra-super critical clean coal technology, the kind of technology that Medupi officials say they cannot use because it is too expensive. This flouts clauses that bind Medupi’s construction to this technology in World Bank loans. Considering Medupi’s construction foundered under-sized boilers which has taken over a decade to fix, the slick sound of ultra-super critical clean coal sounds like another South African coal catastrophe waiting to happen.

LIES VERSUS LIVELIHOODS

Even more worrying in the context of South Africa’s corruption riddled governmental landscape is that the MMSEZ will be the first SEZ in South Africa to be run by Chinese operator, even though Shenzhen Hoi Mor is now registered as the South African Energy Metallurgical Base. The Chair, Ning Yat Hoi, had company fraud charges laid against him in 2017 by London-based mining companies with operations based in Zimbabwe, the year that the then Minister of Trade and Industry, Dr Rob Davies, awarded the tender. On the 4th of October 2021, CEO Lehlogonolo Masoga stated that he was aware of the charges against Ning, but continued to say blithely that the allegations appear to be based “… on a business partnership dispute that won’t affect this project”.

When questioned on the bumped-up figure of employment promises of 800 000 jobs for locals made at the Limpopo public meetings, Mr Masoga stated he could not confirm that figure, because the following day he may be quoted in the newspaper. Another fine bit of fancy footwork dodging questions in the vein of the Enviroxcellence public participation presentations.

It is abundantly clear that Mr Masoga and the Limpopo Environmental Development Agency are happy to make big promises they know they can’t keep, the cost of which will be the destruction of the Vhembe biosphere on the buying consensus on the basis of scandalous figures of large-scale employment to local communities.


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