South Africa's Deputy President Phumzile Mlambo-Ngcuka argued yesterday that the initial key performance indicator of government's yet-to-be-launched accelerated and shared growth initiative (Asgi) would hinge significantly on the success of the rollout of the R370-billion capital programme, spanning power, transport and water.

Speaking at a consultative forum of women at the Department of Trade and Industry's (DTI's) campus in Thswane, Mlambo-Ngcuka said that the programme provided and unprecedented opportunity to create employment and link the first and second economies. However, she cautioned that much preparation was still needed, particularly in acquiring and fast-tracking the skills required to roll-out the programme as well as in ensuring that some of the benefits flowed towards women and youth.

Another key challenge was the need to build capacity within government, especially local government, to deliver on its portion of the infrastructure programme. Early Asgi documents suggest that half, or R185-billion worth of projects, was to be delivered by the three spheres of government, including municipalities.

Some 40% or R148-billion would be spent by the State-owned enterprises, such as Eskom and Transnet, while the development finance institutions, such as the Industrial Development Corporation, the Development Bank of Southern African and the Land Bank, would account for another three per cent or R11,1-billion. The balance would arise from public-private partnerships.

Asgi is designed to raise average growth rates to 4,5% between 2006 and 2010, and to accelerate that expansion to an average of six per cent for the period 2010 to 2014, the deadline for meeting the Millennium Development Goal of halving poverty and unemployment. It is made up of seven components, including greater fiscal and monetary coordination; the large infrastructure development programme; targeted sector investment strategies; a more target and co-ordinated education and skills development push; several second-economy interventions, including the Expanded Public Works Programme; and projects to improve government's institutional capacity to delivery.

Asgi is about positive risk taking

Also speaking yesterday, the DTI's Ravi Naidoo said Asgi was more about delivering on existing policies than on the creation of an entirely new policy environment, but he stresses that it also emphasised 'positive risk taking' by government and a more assertive role for the State in driving growth and development programmes.

He also highlighted the skills dearth, particularly the shortage of engineers, as a key concern and said that a range of initiatives were being considered to deal with this challenge.

For her part, Mlambo-Ngcuka confirmed the creation of a so-called joint initiative on priority skills, or Jipsa, and said that a permanent secretariat would be established to identify, source and guide the development of scarce skills. Initially, this was likely to entail some importation of engineers and project managers, but the Deputy President also called for creative ways of accelerating the development of local project-management expertise. She hinted to a one-year internship for young graduates getting hands-on experience in both large and small projects during the day, while attending lectures in the evenings.

Manufacturing sector not fully integrated into plan - DP

She also called on business to interrogate the import-substitution opportunities that could arise, in a bid to reduce capital leakage, which is currently estimated at 40% of the total value of the projects. She also indicated that Asgi was deficient in defining the role of the manufacturing sector in the infrastructure programme.

Naidoo indication that government and the SoEs would be hosting supplier communiqu