Establishing green industry Special Economic Zones to catalyse renewable energy manufacturing
The Africa Renewable Energy Manufacturing Initiative (REMI) recently hosted a webinar titled “Green Industry Special Economic Zones to Catalyse Renewable Energy Manufacturing: Translating Vision to Investments”. The webinar was the third in the South-South Virtual Policy Dialogue Series bringing together representatives from government, SEZ leadership, industry, and financing institutions. The webinar was hosted in partnership with Project Evergreen – an effort to develop Nigeria’s first green industrial zone.
With the growing recognition of domestic renewable energy manufacturing as a critical priority across the Global South, the webinar addressed the role of Special Economic Zones, as a key strategy to reduce import dependency, build local industries, and create jobs, all while aligning with energy transition and green growth objectives. Achieving this vision requires a comprehensive industrial policy framework, which includes supply- and demand-side incentives, education, skills development, technology transfer, trade facilitation, and infrastructure.
“Green value chains sit at the heart of developing countries’ priorities to advance energy access and security, climate action and industrialization. Governments increasingly recognize that the energy transition must go hand-in-hand with efforts to build domestic renewable energy manufacturing capacity to capitalize on the socio-economic opportunity.”
Damilola Ogunbiyi, CEO and Special Representative of the UN Secretary-General for Sustainable Energy for All, and Co-Chair of UN-Energy
Special Economic Zones (SEZs) have proven to be effective vehicles for supporting industrialization efforts and are increasingly deployed to promote renewable energy manufacturing. By offering a suite of incentives and streamlined regulations, SEZs foster investment and innovation in this crucial sector. Notable SEZ examples highlighted during the webinar included Zambia and the DRC’s transboundary battery and electric vehicle zone, Indonesia’s eco-industrial park programme, and South Africa’s Atlantis Greentech SEZ.
Lessons from SEZs from non-energy sectors were also shared, including agro-processing, textile and pharmaceutical, from Benin, Gabon and Togo. Additionally, Nigeria’s Presidential Committee on Climate Action and Green Economic Solutions is overseeing the development of its first Green Industrial Zone, Evergreen City.
“The idea is to selectively and strategically identify segments of the value chains whether in solar, or geothermal or wind as well as electrification of industry and transport that are not localized yet but represent the largest domestic markets as Nigeria pursues its infrastructure and net-zero ambitions. For Project Evergreen, we are speaking with Global OEMs from China, Europe, the United States and also some African countries where we have leading equipment manufacturing capabilities.”
Lazarus Angbazo, CEO, InfraCorp
During the webinar, panellists stressed the importance of a holistic approach to SEZ development. This includes a focus not only on infrastructure development, but also on investor mobilization and skills development. A key takeaway was the need for local stakeholder involvement and a “human touch” to foster integration across different aspects of the ecosystem, making SEZs more sustainable and effective. Given that the majority of investors are likely to be foreign direct investors, investment promotion agencies must consider local representation for relationship building.
“Based on our experience of developing and operating ten SEZs across Africa, when we are talking about developing [an SEZ], we must take a holistic approach and equally focus on operations and the skills development. Developing infrastructure is not the biggest challenge – the key is to attract investments and optimally allocate costs across the various stages.”
Jasveer Singh, Cluster Director and Head of SEZ Development Function, Arise Integrated Industrial Platforms
The availability of a one-stop shop was highlighted as essential for streamlining services and offering support. Once operational, an ecosystem approach is important – examining the entire value chain, from raw material sourcing to marketing finished goods, to identify and address key challenges. In the specific case of renewable energy technologies, the role of specialized quality infrastructure, such as testing and certification facilities, was also noted and its development must be in tandem with attracting local manufacturing to be set-up. Access to working capital, particularly for foreign investors without adequate local banking history, was underscored as a top priority, requiring dedicated funding facilities such as those created by Afriexim.
“In order to make SEZs bankable, it is in our interest to bring down the intra-regional trade barriers. We need to build strong relationships with business networks and investment promotion agencies to raise awareness and facilitate connections with potential investors.”
Zitto Alfayo, Head of Project Preparation, African Export-Import Bank (Afreximbank)
The webinar addressed common misconceptions that SEZs are a “panacea” and “build it and (investors) will come”. It emphasized the importance of a clear purpose and defined value proposition. Alongside financial incentives, SEZs must offer the basics, including reliable infrastructure (e.g. water, electricity, waste management), skilled labour, and market access (e.g. logistics networks). Supportive policies on land use, labour laws, and taxation are equally critical, along with practical guidance to ensure operational success and efficiency for competitiveness. Community engagement is central to foster inclusivity and long-term success in SEZs.
“SEZs are a tool for industrialisation. It is critical to understand what it is that you’re trying to achieve. We sometimes jump into SEZ when other approaches of industrialisation strategy, such as general incentives, could be better. At Atlantis SEZ, it was very clear from the early days that we were supporting South Africa's roll out of its renewable energy programme and ready to supply the components necessary to grow that particular industry particularly solar, wind and energy storage.”
Matthew Cullinan, CEO, Atlantis Greentech Special Economic Zone, South Africa
Integrating environmental standards and circularity is a key priority for SEZs to reduce operational costs and attract foreign investors. Examples of interventions included introducing SEZ-level green building certifications, net-zero water and carbon strategy as well as integrating symbiosis and circularity into operations. Renewable energy supply and energy efficiency represents a key pillar of an eco-industrial park strategy.
“How to turn an industrial park into an eco-industrial park? UNIDO’s Global Eco-Industrial Park Programme provides a framework centred on park management, environmental, social and economic performance - all based on the principles of green industry”
Prof Purwanto, National Policy Expert, Global Eco-Industrial Parks Programme, Indonesia
The potential for linking SEZs across regions and countries was also discussed as a powerful strategy to drive synergies and address demand-related challenges to justify investments in local manufacturing. Such linkages can lower operational costs, help leverage comparative advantages, and promote intra-regional trade and cooperation. Developing a regional SEZ policy framework was identified as a key enabler for this collaboration requiring trade facilitation and harmonization efforts as part of the wider implementation of the Africa Continental Free Trade Agreement.
“Linking up SEZs with value chains extending across a region can maximize positive outcomes and benefit from a coherent policy environment, economies of scale and lower input costs, in particular energy.”
Dahlia Khalifa, Regional Director for Central and Anglophone West Africa, IFC
The webinar concluded by highlighting the role that SEZs can play in fostering intra-African trade, serving as platforms for regional trade facilitation. SEZs can strengthen economic integration and build stronger trade networks, unlocking the continent’s broader economic potential. The role of governments was also noted as having equity and ‘skin-in-the-game’ in SEZs as part of a Public-Private-Partnership approach with strong political will to ensure regular monitoring and smooth roll-out of permitting, licenses and incentives.
Panellists expressed a collective commitment to deepen engagement and push for regional policies that enable greater collaboration towards advancing renewable energy manufacturing and industrialization on the continent.
The recording of the webinar is available here.
Speakers:
- Damilola Ogunbiyi, CEO and Special Representative of the UN Secretary-General for Sustainable Energy for All, and Co-Chair of UN-Energy
- Dahlia Khalifa, Regional Director for Central and Anglophone West Africa at IFC
- Jasveer Singh, Cluster Director and Head of SEZ Development, Arise Integrated Industrial Platforms
- Lazarus Angbazo, CEO of InfraCorp
- Matthew Cullinan, CEO of Atlantis Greentech Special Economic Zone, South Africa
- Prof. Purwanto, National Policy Expert with Indonesia’s Global Eco-Industrial Parks Programme
- Zitto Alfayo, Head of Project Preparation at the African Export-Import Bank (Afreximbank)
- Lolade Abiola, Programme Manager of the Energy Transition Office at SEforALL and Secretary of the Presidential Steering Committee on Project Evergreen in Nigeria
