Fresh Setbacks Put Amazon’s Splashy Africa Project In Real Jeopardy

The sprawling development intended as Amazon’s headquarters in Africa, which is to be situated in South Africa, has suffered another major setback.

For several months now, an ongoing dispute about the intended location of the USD 280 M facility has kept the project in limbo, sparking a court case that could be expected to drag on. And the latest development in the said case has put the entire project in jeopardy.

The developers of the property that would house the Africa headquarters of the world’s biggest e-commerce company have been denied leave to appeal an interdict stopping construction in Cape Town.

The Liesbeek Leisure Property Trust (LLPT), the developers behind the project, said it will now approach the supreme court of appeal directly.

The decision to deny leave to appeal was handed by Western Cape High Court Judge, Patricia Goliath, handing a surprise victory to the Observatory Civic Association and the Goringhaicona Khoi Khoin Indigenous Traditional Council, which are opposing the development at the site, saying it’s culturally significant indigenous land of the Khoi community, reports TechCentral.

Judge Goliath’s decision means work at the site remains halted for the foreseeable future and could, the developers have warned previously, could lead to 6,000 direct and 19,000 indirect job losses.

The ban could also lead to the loss of significant socioeconomic benefits, which include developer-subsidised housing as well as a park that will be open to the public. 

When word first got out in April 2021 that Amazon had set the ball rolling on a mega plan that would see the company launch a mammoth African headquarters in South Africa, it was embraced as big, generally good news. One of the world’s biggest tech companies was finally set for the Africa challenge, it had seemed.

For years, Amazon’s interaction with the African continent had been limited to Amazon Web Services (AWS; the cloud-computing business), a few thousand virtual customer service jobs, and an undocumented number of African residents (in 17 African countries) ordering stuff online and paying huge delivery fees to have items shipped across oceans (typically from the U.S.) in a matter of several days.

By announcing that the City of Cape Town had okayed a ZAR 4 Bn (USD 280.2 Mn) project, which has the retail giant, Amazon, at the centre of a 150,000 squared-metres space (of which 70,000 squared-metres is dedicated to Amazon), it had seemed all but certain that the U.S. e-commerce giant was looking to expand into Africa’s e-commerce territory, finally. And that speculation sure brought some excitement.

However, it soon became clear that not everyone was as enchanted by the proposed plans and Amazon suddenly found itself embroiled in a dispute.

The problem? Well, it has something to do with the location chosen for the development of the gigantic facility that would house Amazon. That location is a territory that is now under dispute.

It turns out the chosen location, at the confluence of two rivers, is the ancestral home to the earliest Khoi and San inhabitants in Southern Africa. And that area appears to be of historical importance to certain groups because of its cosmological, spiritual, and environmental significance to the indigenous groups.

In August 2021, rights groups filed an interdict at the Western Cape High Court to halt the project. Consequently, a South African court ordered the developers to pause construction of Amazon’s headquarters in South Africa in March this year, over concerns by indigenous people that the U.S. company is defiling sacred land.

A move to appeal the interdict has now been shot down, throwing a spanner in the works further. All roads now lead to the Supreme Court in South Africa where Amazon and its partners would be hoping to catch a break, though nothing is guaranteed.

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