The United Nations Industrial Development Organisation (Unido) is urging South Africa to take proactive steps to begin integrating the concept of carbon neutrality into its revised industrial strategy, warning that a delay in doing so could undermine the future competitiveness of the country’s exports.
The UK and France recently made firm commitments to transition to ‘net zero carbon’ economies by 2050, while several of South Africa’s other key trading partners are expected to make similar commitments in future. Net zero carbon is when the amount of carbon dioxide emissions released by a country on a yearly basis is zero or negative.
Unido energy and climate coordinator in South Africa Conrad Kassier tells Engineering News that the agency is already supporting three projects in South Africa aligned with the carbon-neutrality objective, including the Global Cleantech Innovation Programme, the Industrial Energy Efficiency Project and the Low Carbon Transport Project.
Kassier emphasises the importance, however, of an overarching policy framework for addressing the risks and opportunities associated with moves towards net zero carbon.
Industrial StrategyThe Climate Change Act, a Bill which was released for public comment in 2018, may eventually provide such a framework, but Kassier believes there is also a near-term opportunity to start integrating carbon neutrality into South Africa’s evolving industrial strategy.
President Cyril Ramaphosa has announced that ‘Industrial Strategy Masterplans’ for validated priority sectors are to be finalised ahead of the Medium-Term Budget Policy Statement in October.
He has indicated, too, that this “revitalised industrial strategy” will not only focus on meeting domestic demand but will also include the objective to increase regional and global exports.
“Given that South Africa’s industrial policy has a strong export dimension, government could consider ways to integrate support for carbon-neutral manufacturing, possibly through incentives that are linked to the roll-out of special economic zones and industrial development zones,” Kassier says.
A failure to do so could, in time, reduce the country’s export competitiveness as importers insist on evidence of low-carbon manufacturing.
In addition, a coherent policy framework could also result in South Africa not being overlooked as an investment destination in the future, particularly in a context where competitor countries have aligned their industrial strategies and incentives to low-carbon principles.
“For many manufacturers globally, sustainability has become a core investment driver. Therefore, to meet its $100-billion, five-year investment target, South Africa will increasingly need to ensure that that driver is catered for.”
Kassier believes South Africa can demonstrate policy intent by gradually introducing the concept of low-carbon manufacturing into the Industrial Policy Action Plan (IPAP), while building an overarching national policy framework in parallel.
“I think it is important to sensitise industry, through the IPAP, about the need to start the transition to carbon neutrality, because the cost of delay, to exports and jobs, could be dramatic and damaging.”