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SA: Nomalungelo Gina: Address by Deputy Minister of Trade and Industry and Economic Development, Budget Vote Speech, National Assembly (11/07/2019)

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SA: Nomalungelo Gina: Address by Deputy Minister of Trade and Industry and Economic Development, Budget Vote Speech, National Assembly (11/07/2019)

12th July 2019

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House Chairperson

Minister Patel

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Deputy Minister Majola

Chairperson the Portfolio Committee, Mr Nkosi

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Members of the Portfolio Committee

Honorable Members

DG’s and the excellent DTI Team

Our Guests

Madam Speaker, the people of South Africa have just given us a fresh mandate during the May 2019 national and provincial elections to defeat unemployment, poverty and inequality. They trusted us to transform the economy and grow the township and village economies amongst others as we committed in our manifesto.

We cannot disappoint, we have to make difficult choices and implement our Industrial strategy including the implementation of the Industrial Parks revitalisation programme; the implementation of the Special Economic Zones programme; and the Black Industrialist Programme amongst others.

On Industrial Parks Revitalisation, 27 Industrial Parks have been earmarked for revitalization. The industrial parks revitalisation programme is one of the programmes introduced by government in an effort to revive township and rural economies by attracting investment and creating jobs. Government invests in upgrading security and building infrastructure to make these industrial parks safe and more conducive for business activities to ultimately attract investors.

The first phase of this programme focuses on providing critical security infrastructure upgrades such as fencing, lighting, critical top structures and other electrical requirements. As we are all aware, security is a critical factor that investors consider when making their investment decisions. Therefore, in addition to providing this security infrastructure, we will mobilise our communities around which these industrial parks are located to take active interest in these parks. Communities must take collective ownership of these parks and protect them from criminal elements.

Siyathemba ukuthi imiphakathi Kanye nabasebenzi bazosebenzisana nathi, sibambisane ekuvikeleni lezizakhiwo ezisondezelwa ezindaweni esihlala kuzo. Ngoba kuzo sizohlomula kakhulu ngamathuba emisebenzi, Kanye nezizukulwane zethu ukuze silwisane nokusweleka kamathuba emisebenzi nobumbha.

In subsequent phases we proceed to address issues that include compliance with regulatory requirements; engineering designs and the construction of new and existing roads; bulk water supply and sewage treatment plants; upgrading electricity infrastructure; building new top structures in line with the expansion programme of the Parks; and development of vacant land and sustainable industrial clusters in the Parks. In addition, digital hubs that will support skills development for Youth in the townships and equip them for opportunities including those of the fourth industrial revolution will be established in the industrial parks.

Realising the significance of industrial parks in township and rural economies, we are planning to revitalise 15 Industrial Parks this financial year. These Industrial Parks will provide crucial jobs to people who live in the adjacent townships and opportunities for township entrepreneurs to access services and production space. In addition, because of their location, workers will not have to travel long hours and spend a significant portion of their income on transport just to get to their places of work. Through this intervention, we are undoing the injustices of Apartheid-era spatial planning.

Honourable members, this government took a long-term view on the future prospects of the South African economy and decided to introduce the special economic zones programme. This programme is designed to accelerate industrialisation in the country; attract foreign direct investments; facilitate the creation of decent jobs; facilitate the development and improvement of existing infrastructure; promote exports; and spread economic activity to under-developed parts of our country.

Indeed, the successes of this programme, Honourable Mantashe will elaborate more on, these will be replicated in other provinces as we strive to industrialise our economy. In this regard, we are planning to finalise the designation and implementation of the Bojanala SEZ in the North-West which will focus on Mining Equipment, PGM beneficiation, Renewable Energy Technologies and Agro-processing.

The Special Economic Zone programme remains an integral part of our investment drive.  Some of the investment pledges that were made during the Presidential Investment summit in October 2018 have started putting the actual investments on the ground. These investments include MaraPhone, which is investing R1.3 billion at Dube Trade Port in KwaZulu Natal. The investment is estimated to create 1500 jobs over 5 years. It is expected that MaraPhone will start its cell phone manufacturing (the first of its kind in South Africa) in September 2019.

 In addition, in the next twelve months, we plan to designate more SEZs, namely, the Automotive SEZ in Tshwane; Science and High-Tech SEZ in Ekaindustria; another SEZ in Northern Cape in partnership with Vedanta mine; and the 4IR Innovation Corridor SEZ. We will complete the Bulk Infrastructure and consolidation of investments for Musina-Makhado SEZ. 

We are currently working with the KZN province to explore the establishment of the Clothing and Textile SEZ in that province. We expect that this initiative will complement the Clothing and Textile Master plan being developed by social partners in the sector.

We are planning to increase awareness of the existence of our SEZs and their value proposition to both local and international investors. To this end, we will utilise our investment promotion missions, investment conferences as well as the annual SEZ conference to showcase SEZ investment opportunities to potential investors.

Ladies and gentlemen, the Black Industrialists Programme is making progress in advancing transformation in the economy. We are pleased to report that 50 Black Industrialists projected to invest R29.6 billion and create over 16 000 jobs were supported in 2018/19 financial year.

Despite the success of the programme, we have identified market access as a major challenge for most Black Industrialists. We are lobbying other government departments from all three spheres of government including the State Owned Entities to prioritise black industrialists in their procurement processes. In addition, the department is using trade missions to Africa as means to open business opportunities for Black Industrialists.

We are pleased with the work of the B-BBEE Commission in confronting non-compliance with the B-BBEE Act whether by private or State Owned Entities. The Commission’s findings on Eskom for non-compliance with the Act are a clear indication of our commitment to zero tolerance on this type of behaviour.

All organs of state and public entities are required by Section 10 of the Act to implement the B-BBEE Act, not only when they choose to do so.  We have since referred the findings in this matter to the Minister of Public Enterprises and the Director-General of National Treasury for further consideration in line with the Commission’s recommendations.

In conclusion, despite important achievements, the challenges facing the domestic economy are immense. Low levels of economic growth and investment; high levels of inequality; and high rates of unemployment continue to hold back our vision of an inclusive South Africa.

We acknowledge these structural weaknesses and know that the magnitude of the economic challenges we face requires a new and stronger approach. We need to take extraordinary measures in order to realise the lofty aspirations outlined in the National Development Plan.

It is for these reasons that the new approach and the implementation of the Industrial Strategy Minister Patel spoke about at length, need to be prioritised by all government agencies supported by all social partners.

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