Government is seeking to industrialise the SA economy

Government is seeking to industrialise the South African economy through the Black Industrialists Programme. This was said by the Minister of Trade and Industry, Dr Rob Davies during a round-table discussion with the Black Business Council (BBC) that was held in Johannesburg last night.

On addressing the Black Industrialists Programme in the context of the broader support that it is providing for black business in general, Minister Davies said that economic transformation depended on two inter-connected themes. These are the radical change of the productive base of the South African economy, and the challenge of changing the patterns of participation in the economy, drawing from the skills capacity and entrepreneurial spirit of the whole of the population of the country.

“This means that we have to move from being an economy that only produces and exports primary mineral commodities and an importer of finished goods. That is the least valuable place we can be in the global division of labour. The greatest part of value-chain is located in those parts of the value-chain where value is added,” said Davies. 

In addition Davies said that government was seeking to try to industrialise the South African economy. 

“We have been trying to change the character of Black Economic Empowerment (BEE) so that it relates to developments in the economy and we have discovered that programmes that are sector-specific work better. It is important that we develop black industrialists as an integral part of the industries. To mitigate this we have established a one-stop-shop and I can report today that the Black Industrialists Funding Forum has met on 17 March 2016, and we have received fifty applications to date with the majority coming from agro-processing, Information Communication Technology, capital equipment and construction, automotive and oil and gas sectors,” added Davies. 

On addressing the issue of fronting, Davies mentioned that it was found that the majority of transactions which were passing off as BEE involved share deals in which groups of black people were given a stake in an established company.

“Very often we found that those people probably thought that they were on track to taking over leadership and management of that company but in practice they found that they were confined to some subordinate role in the company. This is a form of fraud but it was extremely difficult to prosecute. That is why we have fronting. We have reviewed this and have developed the Broad-Based Black Economic Empowerment Commission to counter this practice,” said Davies.

The President of the BBC, Mr Ndaba Ntsele expressed that there was a need for a specific voice of black business in South Africa and that the country has not yet reached a point where having this voice does not matter. 

“It is therefore important for a significant organisation like ours to engage with government in order to outline our plans and express our challenges going forward. We are hoping that the Black Industrialists Programme will produce entrepreneurs that will think globally but act locally and drive our enterprises to be globally competitive,” said Ntsele.


Local manufacturers get R54bn of tenders

According to “Tenders worth R54bn have been awarded to local manufacturers and suppliers in the past year,” says Trade and Industry Minister Rob Davies.

Speaking at the Buy Local Summit hosted by Proudly South African earlier this week, Minister Davies said more than 160 tenders went to local manufacturers and suppliers in the country.

According to the Minister, the increase in local tenders going to local manufacturers is due to the support of government in the Preferential Procurement Policy Framework Act, which designates specific goods that should be locally manufactured. These tenders, said the Minister, include local components manufactured for locomotives and buses.

“These 2011 designated products also include rail rolling stock, bus bodies, the textile, pharmaceutical, clothing and leather sector, power valves, steel conveyance pipes, electrical and telecommunications cables and set-top boxes. There are more designated products in the pipelines for fruit products and steel,” explained Minister Davies.

The Buy Local Summit serves as a platform for government and business to provide feedback on local procurement efforts and the influence it has on job creation.

The summit also provides an opportunity for government and corporate businesses to access the Proudly SA member companies, with some 200 exhibitors showcasing their products and services at the Expo.

The Minister praised the Passenger Rail Agency of South Africa for awarding a tender to Alstom to manufacture more than 7,200 coaches locally at a cost of R123bn that will see the company creating more than 8,000 direct jobs.

“Transnet also awarded a total of R50bn in contracts to a number of local companies to build 1,064 electric and diesel locomotives in South Africa that were mainly imported during the 2010 World Cup. This has also led to all the buses that are being procured by municipalities for rapid transport being made and procured in the country,” added the Minister.

The Minister urged local consumers to support, buy and consume local products and goods in order to create jobs and grow the economy. South Africa needs to move away from just government procurement, the private sector also needs to take decision in favour of local goods and products.

Minister Davies also encouraged ordinary consumers to learn a few tricks and pay attention to products that display a country of origin. He said if a product bar code doesn't start with 600, then the consumers must know that the products or goods are imported.




South Africa and Saudi Arabia to strengthen trade relations

The Minister of Trade and Industry, Rob Davies, and his Saudi counterpart, Dr Twafeeq Al Rabeeach will co-chair the seventh session of the South Africa-Saudi Arabia Joint Economic Commission (JEC) in Cape Town. The JEC will start tomorrow with senior government officials and conclude on Tuesday, 15 March 2016 with the signing of the joint communiqué by the two ministers. 


Hollywood “blown away” by SA production crews

South Africa’s international reputation for excellence in the film industry is fast extending beyond its scenic locations to now include the quality of its production crews. This is according to Chris Brancato, Executive Producer of “Of Kings and Prophets,” the first big-budget television series from American Broadcasting Corporation (ABC) Studios to be shot entirely in South Africa.

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