Create an investment-ready platform for infrastructure projects in the emerging aquaculture sector

Aquaculture is one of the fastest growing food sectors in the world and is considered a key sector for future food production (Costello et al., 2020). Aquaculture is defined as the farming and farming of freshwater and marine organisms such as fish, crustaceans and plants (including algae). Production can be onshore or offshore in rivers, dams or the ocean. Land-based aquaculture uses systems constructed with raceways, ponds or tanks.

According to Heller (2017), land-based aquaculture is expected to experience continued growth to meet increased market demand as global demand for seafood continues to grow. It is predicted that by 2050, aquaculture production and volumes, especially around Asia, will double and be the main source of aquatic food protein globally (Stentiford et al., 2020).

In addition to having a smaller spatial footprint compared to both land-based agriculture and capture fisheries, aquaculture offers many positive attributes, including poverty alleviation in socio-economically disadvantaged regions, increased production due to technological advances and comparatively lower environmental impacts (Stentiford et al., 2020). Despite the huge potential it holds for South Africa’s economy, the local aquaculture sector is underperforming and continues to contribute very little to the national fishery products and the country’s Gross Domestic Product (GDP) (FAO, 2022).

According to Little et al. (2016), aquaculture has grown faster than any other livestock sector in recent decades, with annual growth of 7.5% between 1990 and 2009, outpacing the global growth achieved by poultry (

To unlock the aquaculture sector in the Nelson Mandela Bay Municipal Area (NMBM), the Coega Development Corporation (CDC), as the operator of Africa’s leading Special Economic Zone (SEZ), has decided to develop a plot of 440 hectares (ha). Aquaculture Development Zone (ADZ) based in the Coega SEZ to accommodate both freshwater and marine aquaculture. The overall objective of the development is to create an investment-ready platform for commercial aquaculture operations planned to be established in the Coega SEZ, thereby facilitating entry and stimulating the growth of the sector in the region.

Identifying the problem

Through stakeholder engagement and desk research, CDC has identified some of the major constraints that are stifling the growth of the sector in the NMBM region and set out to address some of them through interventions. of the public sector. It should be noted that the identified constraints listed below are by no means exhaustive and merely serve to highlight the constraints from an infrastructural and environmental perspective that the CDC seeks to address through the development of the ZDA of Coega.

Constraints identified include:

Access to land adjacent to the ocean: Land adjacent to the ocean in South Africa is expensive to acquire and largely protected by environmental legislation.

Logistic links with local and international markets: It is crucial to have good road networks to transport products to local markets. Being close to an airport or seaport for exports is of vital importance.

Bulk infrastructure availability: Providing bulk infrastructure services to ocean-adjacent properties is usually very expensive, especially in rural areas. Therefore, financing infrastructure in bulk as part of the project development cost would, more often than not, render the project unviable.

Environmental approvals: Cumbersome and costly environmental approvals have been a major stumbling block, especially for SMEs looking to enter the aquaculture sector.

Coega ADZ

Over the past decade, the CDC has set out to develop one of the largest terrestrial ADZs on a single geographic footprint in South Africa. The 440 ha ADZ is a new development located within the Coega SEZ adjacent to the deep water port of Ngqura (Figure 1). Being located next to the Indian Ocean with approximately 12 km of coastline forming part of the 9003 ha SEZ boundary, it was inevitable that the CDC would pursue aquaculture as one of its targeted sectors for development.

Figure 1: Location of the Coega ZDA within the Coega SEZ.  (Source: Ethical Exchange, 2017)

Figure 1: Location of the Coega ZDA within the Coega SEZ. (Source: Ethical Exchange, 2017)

Figure 2: Coega's ADZ showing the lower coastal section reserved primarily for large seawater users, e.g., abalone farms and the higher inland section for Return Marine Aquaculture (RAS) systems and freshwater aquaculture.  (Source: Ethical Exchange, 2017)

Figure 2: Coega’s ADZ showing the lower coastal section reserved primarily for large seawater users, e.g., abalone farms and the higher inland section for Return Marine Aquaculture (RAS) systems and freshwater aquaculture. (Source: Ethical Exchange, 2017)

Respond to identified constraints

Access to land adjacent to the ocean

After years of planning and evaluation, the CDC identified Area 10 of the Coega SEZ to develop a terrestrial ADZ (Figure 1). To provide context for the ADZ and site selection in the Coastal Development Group in SEZ Zone 10, various project-specific, SEZ-wide, regional, and strategic environmental and planning processes were undertaken. undertaken (Ethical Exchange, 2017).

In 2014, an independent design and feasibility study identified Area 10 as a favorable location for aquaculture development, with marine aquaculture restricted to low-lying areas (i.e. closer to the ocean ) and freshwater aquaculture to higher inland areas. in the area (Figure 2). In addition, CDC conducted market research, interacted extensively with aquaculture specialists and operators, visited various aquaculture operations, and engaged with a number of potential investors. Accordingly, in addition to marine aquaculture and following another feasibility assessment, the CDC decided to include intensive freshwater and brackishwater aquaculture based on feedback received and technology development. to reduce water exchange and water consumption.

Logistics links

Coega’s SEZ is served by two ports, with a combined capacity of over two million twenty-foot equivalent units (TEUs) per year. The Coega ADZ is located next to the port of Ngqura which has 2100 refrigeration outlets crucial for maintaining the cold chain. The ADZ is also located approximately 25 km from the port of Port Elizabeth with approximately 1,000 refrigerated outlets. Both ports are served by the world’s leading shipping companies. The ADZ is directly connected to the N2 highway, which connects the SEZ to the rest of the region. The SEZ is further connected to the rest of South Africa and neighboring countries by a rail link.

Chief Dawid Stuurman International Airport (DSIA) is approximately 30 km from the ADZ and provides connectivity for domestic and international passengers and cargo. This is particularly important for investors looking to transport goods to global markets by air freight, for example exporting live abalone to China. A flight between DSIA and OR Tambo International Airport takes approximately 1 hour and 40 minutes and is served by several airlines.

Enabling infrastructure

In August 2020, the CDC began construction of enabling infrastructure in Zone 10 of the SEZ to unlock approximately 100 ha (Phase 1) of the ADZ (Figure 3). Construction includes the development of road, electrical and stormwater infrastructure release sites for marine and freshwater aquaculture. This means that aquaculture investors can focus on developing their core business rather than raising capital for bulk infrastructure.

Figure 3: Developing the enabling infrastructure to unlock Coega's ADZ Phase 1.

Figure 3: Developing the enabling infrastructure to unlock Coega’s ADZ Phase 1.

Environmental approvals

In March 2015, the NMBM Bioregional Plan (NMBMBP), which designates ecologically significant areas as Critical Biodiversity Areas (CBAs) and existing Protected Areas (PAs), was adopted by the Department of Economic Development, Environmental Affairs and Tourism (DEDEAT) and officially in the Official Gazette. The NMMBBP informs land use planning, environmental assessments and permits, and outlines how the development of the Coega ZDA should be adapted to the environmentally sensitive coastal zone. This paved the way for the CDC to initiate an Environmental Impact Assessment (EIA) for terrestrial aquaculture at the identified site in Area 10.

In February 2018, CDC received Environmental Clearance (EA) to develop and operate Coega’s onshore ADZ. This allows companies to farm nearly 40 marine and freshwater species in the Coega ZDA without undertaking an additional independent EIA. Investors are, however, required to develop an Environmental Management Plan (EMP) that corresponds to the broader Environmental Management Program (EMP) for the ADZ.

The CDC received an EA to take and discharge seawater from and into the marine environment in September 2021. This was the final and most difficult hurdle the CDC had to overcome from an environmental perspective, bearing in mind that the marine environment prior to the SEZ is a Marine Protected Area (MPA).

The CDC is currently engaging potential aquaculture investors looking to expand their business in the Coega ADZ. We hope to launch the first aquaculture investment project in fiscal year 2022/23. This will be an important step in CDC’s journey to create a world-class investment location for aquaculture investors that will contribute significantly to the economy of the NMBM and the wider Eastern Cape. The CDC has laid the foundation for the development of the aquaculture sector in the NMBM and will continue to engage relevant stakeholders to find solutions and ensure that the various barriers that impede the growth of the sector are removed.