SUBJECT: RESPONSE TO AN OPEN LETTER CONCERNING THE UNDP AND MMSEZ MEMORANDUM OF UNDERSTANDING

Dear Mr. Robert Krause

I acknowledge receipt of the Open Letter dated 04 July 2022. I commend the collective and unwavering commitment of the undersigned organisations toward promoting sustainable development in the context of the inter-dependence between people and nature.

At the outset, it must be emphasized that development is at the heart of UNDP’s work in South Africa and around the world. We view development as a multidimensional undertaking to achieve a higher quality of life for all people. As such, economic development, social development and environmental protection are interdependent and mutually reinforcing components of sustainable development. UNDP's work in the country is aligned with supporting the Government of South Africa to overcome the triple development challenges of poverty, unemployment, and inequality. This is operationalized through UNDP South Africa’s three focus areas; “Enhancing Inclusive growth and decent work”, “Climate Change and Greening South Africa’s Economy”, and “Strengthening Democratic Governance.” The establishment of special economic zones in South Africa, such as the Musina-Makhado Special Economic Zone (MMSEZ), forms part of the South African Government’s strategic economic reforms and growth plans. UNDP aims to guide and support these developments while promoting the Sustainable Development Goals (SDGs) and Agenda 2063.  

Development work is collaborative in nature - partnerships strengthen institutional capabilities and are key to achieving transformational impact.  UNDP applies the United Nations Sustainable Development Group guiding principles when entering into partnerships. These principles form the foundation for our programming, with the "leave no one behind" approach as the overarching and unifying principle. When considering a collaboration with any entity, UNDP considers the entity’s mandate and strategic intent and its alignment to advance the SDGs and the National Development Plan (NDP), and their commitment to doing so in accordance with the principles of protecting people and the planet, and leaving no one behind.  All UNDP partner activities are designed to achieve common objectives in line with UN development goals.

We have precisely applied these principles when determining a cooperation agreement with the MMSEZ. UNDP’s interest in engaging with the MMSEZ is part of its efforts to promote socio-economic development that is environmentally and socially sustainable in order to contribute towards overcoming South Africa’s triple development challenge. In addition to advancing development in Limpopo, the MMSEZ project offers the opportunity to advance the African Continental Free Trade Area Agreement (AfCFTA), an initiative supported by UNDP Africa, by introducing trade corridors and gateways between South Africa and neighbouring countries.

UNDP is not new to the geographical area and has been working in the Vhembe District in Limpopo Province since 2016. Through the Global Environmental Facility (GEF) Small Grants Programme, UNDP has been supporting communities through more than 20 environment and climate change related projects. This support has been made possible through partnerships established with the Vhembe Biosphere Reserve (VBR), the Limpopo Department of Economic Development, Environment and Tourism (LEDET), the University of Venda’s Institute for Rural Development, as well as Civil Society Organisations (CSOs) in Vhembe. Our projects vary in scope from the protection of natural sacred sites, rehabilitation of wetlands and fountains, addressing deforestation and overharvesting of indigenous plant species, and reducing energy costs and indoor pollution through the introduction of biogas digesters and eco-briquettes to aquaponics and climate smart-agriculture projects.

Having broadly outlined our mandate and programming principles, I move to address areas highlighted in your Open Letter.

With reference to the first issue raised in the Open Letter, “contravention of environmental and human rights standards and UNDP principles”, UNDP cannot form partnerships with organizations inconsistent with the UN Charter or beyond UNDP's mandate. As such, UNDP partnerships must comply with the norms and standards expressed in the General Assembly and the Economic and Social Council. Furthermore, UNDP is committed to ensuring that our programming and operations are socially and environmentally sustainable. We recognize that social and environmental sustainability is fundamental to the achievement of sustainable development outcomes. As such, the agency has in place policies, procedures and accountability mechanisms to underpin our support to the UN Member States. The UNDP and MMSEZ Memorandum of Understanding (MoU) further outlines how the two entities will cooperate to promote environmental sustainability, address climate change, and empower the local community to participate in socio-economic activities. It must be emphasised that MMSEZ jettisoned plans to include a coal-fired power plant in favour of a renewable energy project. This move led to the signing of an MoU with investors on the Photovoltaic Solar Plant and Hydrogen Energy Plant. The key areas of focus will include energy generation (renewable/clean energy technologies while ensuring a just transition), improved water resource management, and reducing deforestation.   

The second issue relates to the “signing of the MoU creating momentum and confidence in a fundamentally flawed project”. The MoU signed on 17 March 2022 with MMSEZ formalizes a non-binding partnership which stipulates intent and commitment between our two entities. It articulates the legislative background, general principles and focuses on potential cooperation in pursuit of common goals. The MoU in question has identified a series of activities subject to UNDP’s respective mandates, regulations, rules, policies, and procedures. These activities include:

1. Technical support in areas of project management, financial planning, conceptualization of innovative solutions towards advancing the SDGs, leveraging international expertise/knowledge, etc.;
2. Capacity building through training of local communities, businesses and government towards creating an employment pool for jobs of the future and to support the vision of the development of smart cities;
3. Research and innovation in the field of agro-processing, value-adding/ beneficiation of raw materials, energy, water and mining, etc.;
4. Environmental sustainability and climate change through promoting the identification and adoption of climate-friendly solutions in various sectors, including energy generation and water management (such as renewable energy, clean energy technologies and improved natural resource management, while ensuring a just transition);
5. Forging and facilitating partnerships to grow foreign direct investment in the MMSEZ; and
6. Transforming existing skills and assets within rural villages/towns towards the creation of smart cities and the adoption of the 4^th industrial revolution.

For UNDP to formally influence a developmental project, system, or operation and steer it in a direction of environmental and social sustainability, a formal instrument of engagement is required. This instrument allows UNDP to directly engage with the affected stakeholders and those responsible for driving the developmental trajectory.  The MoU entered into with the MMSEZ serves as such an instrument. It will enable UNDP to influence the areas of cooperation outlined in the MoU and support the MMSEZ to mainstream human and environmental rights.

UNDP has also noted additional areas of concern, particularly environmental sustainability, water insecurity, pollution, and lack of community consultation. UNDP has been given assurances, including in the form of a public statement, that all coal-fired power generation plants have been replaced by solar and hydrogen energy facilities which reduce greenhouse gas emissions. This is aligned with the outcomes of COP26 and the country’s commitment to a low-carbon economy. 

Regarding water insecurity, our discussions with MMSEZ management indicate that there are bilaterals to collaborate on water provision and investment promotion.  Further, MMSEZ plans to invest in upgrading the water infrastructure in the Musina municipality to optimize the supply of water. Water from Zimbabwe will be sourced in the short to medium term. The long-term solution is the establishment of the Musina Dam at the confluence of Sands River and Limpopo River for domestic use and irrigation. This dam will also assist in containing the floods that have proven to cause devasting destructions of lives and livelihoods along the Limpopo River right through to Mozambique. Preliminary studies already indicate that the Musina Dam project is viable.

On the issue of community consultations, the MMSEZ have indicated they met the required standard. Nonetheless, we are ready to work with you and other stakeholders to ensure communities’ views and needs are fully integrated into the project implementation.

A review of the MMSEZ shows the project offers a significant potential boost in local job creation through the establishment of planned agro-processing facilities, energy and metallurgy industries, as well as general manufacturing and logistics services. Various technical studies have been conducted to gauge the potential success of these sectors within the province. Our involvement is to ensure that people and the planet are foremost as the MMSEZ begins to create sustainable employment where poverty and unemployment are rampant. Throughout this partnership and process, UNDP will ensure monitoring and evaluation is a continuous management function which will assess the progress made to achieve the expected results while adhering to and upholding national and international laws. We welcome CSOs in working with us to ensure this is achieved.

 While South Africa’s development challenges are vast, the government’s NDP is both ambitious and achievable with strong commitment from stakeholders. A bold and innovative approach is required to ensure that projects like the MMSEZ are given adequate support to overcome poverty and unemployment in the province, and ultimately open an array of new growth opportunities for her people.

There will be continued multi-stakeholder consultations and I invite the undersigned CSOs to join UNDP on this journey. As a matter of priority, we remain ready to work with the collective to address any emerging concerns on the project. We all have a collective responsibility to support the people of Limpopo, protect the environment and jointly shape the MMSEZ development.

I would like to take this opportunity to reiterate the assurances of promoting human rights and protecting environmental sustainability in the country.

Yours Sincerely

Ayodele Odusola, PhD

Resident Representative

UNDP South Africa

TO

Mr. Robert Krause,

Representative of the undersigned CSOs

cc.

MMSEZ SOC

Living Limpopo

Centre for Applied Legal Studies

Centre for Environmental Rights

Natural Justice

The Vhembe Biosphere Reserve, a UNESCO Biosphere Reserve

All Rise Attorneys for Climate and Environmental Justice

EarthLife Africa

groundWork

Fossil Free South Africa

BirdLife South Africa

The Wildlife and Environment Society of South Africa - WESSA NAR & NACSSA

The Mining and Environmental Justice Community Network of South Africa (MEJCON)

350Africa.org

Dr. Victor Munnik

Prof. Lisa Thompson

Prof. Patrick Bond