After fierce legal challenges, Amazon set to open new head office in South Africa

Global retail giant Amazon has concluded plans to open its new African base of operations in South Africa with a real estate investment of nearly $300 million. The office will be located at a new development in River Club, a prime section of Cape Town.

“US retail giant, Amazon, will be the anchor tenant, opening a base of operations on the African continent,” the city’s mayor, Dan Plato, said in a statement. “The development is envisaged to take place in phases, with construction set to take place over three to five years.”

He also revealed that the development design intends to create a 150,000 square meter mixed-use space across two precincts. He added that the developer intends 31,900 square meters to be used for residential purposes.

“The development will include both market-driven and affordable housing opportunities – the latter of which will be physically integrated with the other residential units in the apartment complexes.

The entire development is envisaged to create some 19,000 direct and indirect jobs. “With Amazon’s headquarters, with can expect many more thousands of jobs for Capetonians,” James Vos, who is the Mayoral Committee Member for Economic Opportunities and Asset Management at the City of Cape Town, told Cape Talk.

“Amazon already services North America, the UK, and Germany from Cape Town… We expect lots of additional jobs,” he added. “It positions Cape Town as a destination of choice for IT advancement.”

“It will attract other tech companies to Cape Town, the tech capital of Africa. We employ more than 40 000 people in the IT sector.”

Amazon first came to South Africa in 2004 when it opened its first development center in Cape Town for Amazon Web Services (AWS) but its eCommerce services had, until now, not been available in Africa. AWS has increased its presence in South Africa by opening multiple offices.

Amazon’s new sprawling head office to be built in Cape Town follows years of legal challenges. Environmental activists and heritage protection organizations objected to the project, saying that it “ransacks the local ecosystem and dishonors a sacred heritage site of the indigenous Khoi people, who settled on the land when they were driven from another area by Dutch settlers,” African Business reported. Activists further argued that the project will block the valley, worsen flooding, climate change and drought.

Cape Town mayor Plato on Tuesday said these cultural and environmental issues have now been addressed, Business Insider reported. “The City has carefully and thoroughly considered all of the submissions and concerns during the appeal process,” said Plato.

“We are acutely aware of the need to balance investment and job creation, along with heritage and planning considerations.”

South Africa is one of the countries in the world badly hit by the coronavirus pandemic and it is expected that Amazon’s move will help in the country’s economic recovery plan.