Minister of Trade and Industry Budget speech

Minister of Trade and Industry, Mr Rob Davies, gave his Budget Vote Speech on 21 May 2015.

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Madam Speaker,
Honourable Members
Director-General and officials of the Department of Trade and Industry and the Council of Trade and Industry Institutions
Leaders of organised Business and Labour
Distinguished guests

The fundamental goal of this Administration is to radically transform the  South African economy in such a way that it promotes a higher level of more inclusive growth. This is the only sustainable way we will be able to achieve reductions in poverty; unemployment and inequality that we all agree are urgently required.

In identifying the path towards higher levels of sustainable growth, it is important to reflect on past experience. In the 84 quarters between 1993 and 2014, the South African economy grew at 5% or more in only 16 of these quarters. The growth in those periods was overwhelmingly driven by import intensive consumption and the now ended commodity super-cycle.

Neither of these factors will drive growth into the future. More importantly higher levels of inclusive and sustainable growth and radical economic transformation require that we bring about structural change that will do two main things: first, place our productive sectors firmly at the heart of a new growth path that will move us further up the value chain - and second, significantly broaden the base of economic participation. These two components together are what we understand as radical economic transformation.

Honourable Members, The 7th iteration of the Industrial Policy Action Plan (IPAP) which we launched earlier this month seeks progressively to raise the impact of our interventions to support industrial development and the re-industrialisation of our country.

This is an exciting but challenging task. Since its inception, IPAP has had to contend with a global great recession and its lingering aftermath as well as with a number of strong domestic constraints. In these tough circumstances, its impact has been on a scale that has been less than optimal in relation to the demands of re- industrialisation in South Africa. That‟s why it‟s up scaling – as signalled in the President‟s State of the Nation Address and nine point plans - has been identified as a key priority. For now though, it is important to note that in the challenges we have faced, in the global and domestic headwinds, some very significant successes have been achieved.

The overall diversity of the economy and many of its critical industrial capabilities have been retained; and a range of strong and viable policy platforms and programmes have either been built or strengthened.

The fact that South Africa continues to be seen internationally as an environment conducive to investment is reflected in the fact that the stock of foreign direct investment in South Africa is equivalent to around 45% of our GDP. Inward flows have continued to grow, and over the last five years South Africa has accounted for the bulk of new investment projects in Africa, with major investments arriving from the USA, the Eurozone and – increasingly significantly - from China, India and other Asian countries. In 2013 alone, over 130 foreign firms either entered South Africa or expanded their investments here – that is to say, about 3 firms per week.

In October 2014, The United Nations Conference on Trade and Development recognised TISA, one of the divisions of the dti, as the Global Winner for attracting investment in sustainable development.

The current pipeline of potential investment projects that we are monitoring and facilitating includes R 25.3 bn from foreign and R18.5 bn from domestic sources. Aggregating funding from both sources, it is expected that upcoming investments will likely be distributed as follows: R28.8 bn for the green economy; R7.96 bn for advanced manufacturing and R5.74 bn for mainstream manufacturing. Madam Speaker, our report on successes is evidence based. In the automotive sector, 2014 saw a rise in the volume of vehicles. Total vehicle production for 2014 amounted to 545 666 vehicles of which 276 404 were exported. In February this year, BMW South Africa celebrated the production of its one-millionth 3 Series sedan at the Rosslyn plant in Pretoria.

To use but one specific example of further investments; Mercedes-Benz South Africa expanded its production capacity in its East London plant by investing R5.4 billion in plant and equipment creating 550 direct and 400 indirect jobs. In support of this expansion, component manufacturers in East London invested approximately R1, 3 billion in plant, equipment; and building infrastructure to support the production of the new C Class, and in the process creating 800 new jobs. Let me emphasise again: These investments would not have happened without focused government support, its commitment to partner with the private sector and the increasing impact of its industrial policy.

To reinforce these points, allow me to dwell for a moment on a particularly illustrative case study – that of the Clothing, Textiles, Leather and Footwear sector.

Not so long ago, the demise of this sector was regarded as a foregone conclusion. In this House, we heard some members imploring us not to support what was seen as a lost cause. So-called „soft touch industrial policy‟ was cited as the way to go – in other words, abandon support for sectors which were for one reason or another experiencing difficulties.

I am glad government chose to ignore those views; and I am equally happy to say that during the past few years we have been able to report on both the steady competitiveness improvements that have taken place across the sector and the many jobs that have been saved and created, particularly in KwaZulu-Natal and here in the Western Cape.

The dti’s Clothing & Textiles Competitiveness Programme has, since its inception, been aimed at supporting change in the CTLF manufacturing sector to enable it to stabilise and grow.

Let me give you a sense of the most important numbers in a review of the CTCP recently conducted by the IDC.

• As at 31 March 2015, a total of R 3.7 billion had been approved under the programme, of which R 2.6 billion had been disbursed since inception in 2010.
• The share of employment in the sector by companies drawing on the CTCP has increased from 28.8% in the base year of 2009 to 38.7% in 2014. The Manufacturing Value Addition (MVA) increase attributable to the CTCP between the base of 2009 and 2014 is R 3.9 billion (exceeding the disbursements by 50% or R 1.3 billion). By contrast, the overall non-CTCP sector experienced declines in output and value added over this same period.

I can also confirm that we have made good on my promise to this House last year that we would be launching a significant programme to increase value addition in the exotic leather and animal hide industries through the National Leather Cluster. This cluster has now been established at the Vaal University of Technology and is up and running. Its work will be directly responsible for the creation of 2,000 sustainable jobs and a reduction of R1.4 billion in the trade deficit through import replacement by local retailers.

Madam Speaker

The full benefits of all the CTCP interventions will only be realised in the medium to long term. But even in the short term, the data is conclusive:

CTCP interventions have already demonstrably contributed to improved overall competitiveness, sustainability and employment growth for its recipients.

And here‟s the clincher:

At a cost to date of R2.6 billion disbursed, the CTCP has facilitated the creation of R3.9 billion of additional MVA as well as saving over 68,000 jobs and achieving a total net gain of 6, 900 new jobs.

Honourable Members

CTLF is just one of the major areas of dti intervention. As you know, we spread the net much wider. And in this regard I‟m pleased to report that one of our continuing flagship incentives offerings, the Manufacturing Competitiveness Enhancement programme or MCEP, has continued to perform very robustly. Since its inception, just three years ago this month, it has provided support for a total of 236 projects across a wide range of sectors - with an investment value to date of R3.8 billion and the maintenance of an estimated 28, 000 jobs.

At the same time, it is worth noting that our central emphasis on manufacturing does not by any means exclude interventions in key employment-creating service sectors: most notably Business Process Services and the local film industry.

The dti’s contribution to the Business Process Service sector has to date produced some outstanding results. To use but one example, In the first 3 months after being revised and re-launched, Business Process Service incentives were the critical catalyst for recent new investments by MTN Group Management Services and Full Circle Contact Services totalling R16.3 billion and creating an estimated 6, 300 jobs over a five-year period.

Our film and video sector, to borrow a phrase from social media, “is trending”. In the past financial year alone, the industry contributed R3.5 bn to the economy, whilst supporting 25, 000 jobs. The Film and Television Production Incentive underwrote 137 film productions.

There is a clear correlation between the growth in the number of local films that have been released at local cinemas and the introduction of the dti Film Incentive. In the ten-year period between 1990 and 1999, only 34 local films were screened at local cinemas countrywide. In the decade following, this number grew by 129%, to 78 films screened across South African cinemas. (An average of 7.8 new films a year).

However, in the much shorter four-year period between 2010 and 2013, the number of South African-produced films screened at local cinemas rose to 91 – or  an average of 23 new films a year. This spectacular growth curve is the clearest possible evidence of the positive impact that the adjusted Incentive Programme has had on the local film industry.

We are now truly on the global film production map, with an impressive recent record of international films, TV series, documentaries and commercials.

Building on this momentum to support local film makers, the dti recently launched a R1 million-threshold South African Emerging Black Film-Makers Incentive Programme. This will tap into an exciting pool of young talent that up to now has encountered many obstacles to realising its full creativity. In ten years‟ time, we may be looking at a whole new wave or genre of home-grown films that express authentic South African imaginative realities in ways that we have not yet dreamed of.

Honourable Members

Time constraints do not allow for a fuller report on the comprehensive range of dti activities. However I wish to report in summary that besides what has already been mentioned, this department was involved in a R3 billion new investment by Unilever South Africa and a new Atlantis-based manufacturing facility for components for the wind and solar industries by the Spanish company Gestamp. Other green energy production facilities established were Jinko Solar, SMA Solar Technology and Agni Steel in Coega. In September we launched a R100 million gold loan scheme to support jewellery manufacturers.

In the same month a R1.2 billion glass furnace bottling facility was unveiled by Nampak, supported by governments 12i Tax Allowance Incentive Programme.

On the agro-processing front, just to take one example: in December 2014 Abagold Limited,  a  local  Hermanus-based  company  that  farms  abalone  announced a significant expansion with support from the dti Aquaculture Development and Enhancement Programme As the company CEO reported at the time:

“The investment in the project is budgeted to a total sum of R112 million and we have already received R5.6 million on our first claim from the dti. Our maximum production per annum used to be 275 tons of abalone, and with the new project, it will grow to more than 500 tons per annum.”

Twenty (20) Year old Kwanele Tom, who is employed on Abagold‟s Sulamanzi farm, adds “Since I joined the company I have learned how to work with abalone and would like to attend the aquaculture training course and other skills training courses. I want to grow with the company.”

Madam Speaker

I have provided examples of some, though far from all the successes that can be attributed to the work of the dti, with the invaluable support of the IDC and our partner departments in the Economic Cluster.

I have done so to make the point that the current iteration of IPAP not only seeks to build on and enhance these successes, but to provide clear evidence in support of our confidence that these successes can and will continue and deepen. On the contrary, on the basis of what I have already outlined today, it is clear that the substantive issues for inclusive growth in South Africa are, in reality, the following:

• Firstly: the need for a higher impact, scaled-up industrial policy across other sectors - including stronger incentive packages and tighter conditions for recipients of funding – and with a particular focus on support for key „champion‟ or winning firms in sectors where SA already enjoys competitive advantages or where potential competitive advantages could be leveraged or new production capabilities gained.
• Secondly: the need for government, SOCs and the private sector to build a stronger set of working relationships to jointly unlock the opportunities and overcome the constraints that have continued to inhibit the growth of the manufacturing sector.
• Thirdly: the need for increasingly „joined-up‟ government, where both policy coherence and programme alignment support a „laser-focused‟ national industrial effort; including intensive work with global and local OEMs, export promotion programmes and enhanced support for Export Councils.

Finally, Madam Speaker, as we look ahead, we commit ourselves to moving forward on the basis of the five key pillars of industrial development that we have identified in IPAP 2015:

These are:

• Firstly, Infrastructure-driven industrialisation ensuring that the very substantial infrastructure build programme supports local industrial development
• Secondly Resource-driven industrialisation aimed at leveraging the mineral resources endowment to support higher levels of downstream beneficiation and value addition, whilst systematically building up both the demand and competitive advantages South Africa enjoys in the upstream mining, transport and capital goods sectors. Allow me to provide you with one example of this work. Significant industrial development opportunities are emerging in the form of clean energy and mineral beneficiation linked solutions utilizing key SA mineral resources. Fuel cells are one of these representing an exciting window of opportunity for SA to enter and potentially lead in this new high tech resource dependent industries leveraging our PGM endowment, existing fabricators and R&D initiatives. Major platinum mining companies see fuel cells as a possibility to offer growth opportunities for the industry where the continued development of the platinum market is required to ensure long-term sustainability.

In 2015/16, the dti will focus intervention on a multi-faceted and structured approach covering demonstration and market development to increase demand and catalyse the development of the value chain in SA. Investment promotion initiatives to secure potential financing with key technology partners and in collaboration with local R&D initiatives will be key.

In the second quarter of 2015, Impala Platinum in collaboration with the dti and IDC will start the development of a 1.8MW hydrogen-fed fuel cell power solution at their Springs refineries marking the largest single site installation of hydrogen fuel cells in the Southern Hemisphere. These cells will be fuelled from hydrogen off the pipeline supplied by Sasol and Air Products. Impala envisages this to be followed with the execution of a larger installation with the ultimate goal of moving the refineries off- grid. Implats is working closely with local companies as well as a Japanese fuel cell manufacturer and believes there is an opportunity for fuel cells to be locally manufactured.

These exciting fuel cell developments and opportunities is evidence of the need to fast track this potential industry requiring coordinated government effort and strong partnerships between the private and public sector to develop and grow the market and supply chains in SA and the region.

The third pillar is Advanced manufacturing-driven industrialisation

This means, as I have already indicated, a continued focus on key sectors of the manufacturing economy which upgrade the capabilities of the economy as a whole. We need to engage particularly intensively with global OEM”s in these sectors and develop robust conditionalities for public sector support so that growth of the sector achieves our developmental objectives.

It also includes on-going work, not yet completed, to build an integrated system of industrial financing, incentives and export support with a special focus on lead and dynamic companies that can compete effectively in export markets; and, finally, it encompasses a strong commitment to support emerging black industrial entrepreneurs.

Fourth pillar: Procurement

This focuses on strengthening the localisation of public procurement, building on the lessons learnt through the implementation of various policy instruments over the past few years. It includes securing compliance with procurement prescripts in the public sector, training and capacitating public sector institutions for strategic sourcing and supplier development and leveraging other policy instruments such as incentives to support the development of domestic manufacturing capabilities. The dti has designated 16 sectors, subsectors and products for local procurement. When I launched IPAP 2015 I announced further designations for local procurement in the following product areas: transformers, power-line hardware and structures, steel conveyance pipes, mining and construction vehicles and building and construction. In the case of the last sector, the first round of construction material designations include cement, fabricated structural steel, pipes and fittings, sanitary ware, glass, frames and roofing materials. This means that in the 645 infrastructure projects across the country valued at R3.6 trillion the state must procure the types of products listed above (and other products previously designated) from local manufacturers.

This is the strongest signal to date that government intends deploying industrial policy instruments where it believes it can achieve maximum leverage to support industrial development and job creation.

Fifth and final pillar: Regional economic integration

This centres on maximising the opportunities presented to the domestic economy by a growing market on the African continent, driven by high growth in the region, strong consumer demand, infrastructure development and resource exploitation.

The opportunities are significant, and must be energetically leveraged by unblocking obstacles to expanded regional economic trade and crafting clearly-defined programmes of complementary regional industrial development and value chain integration.

Honourable Members

As we have in the past, we will continue to work actively to position South Africa as a competitive and attractive destination for FDI, particularly in value added activities.

In line with these positive outcomes and, my previous reports to this House that we will continuously and consistently seek to improve service delivery even where we are doing well, I am glad to announce today that we will soon be opening  a dedicated Investment Promotion Unit and Inter-departmental Clearing House as announced in the President‟s State of the Nation Address. Specific details of this enhanced investor support facility will be provided in the near future but we intend to provide greater resources to establish a one-stop shop for investor support, regulatory matters, investment financing and immigration matters. In future investors can expect more and better with regard to aftercare, expansion and retention. The unit will have a specialist focus and skills set for unblocking bureaucratic obstacles, red tape reduction, and administrative barriers and will improve Governments service and response to investors.

The establishment of this Unit will also assist in marketing our SEZs, about which I spoke at length in my input to the NCOP budget vote debate yesterday.

Madam Speaker South Africa has been playing a prominent role in championing developmental integration in the regional economic communities we are members of and in the AU. The Tripartite Free Trade Area (T-FTA) that will be launched at a Summit in Sharm el Shaik next month will signal that we are on track to create a market of over 600 million people with a combined GDP of over $1trillion. Later in the same month, in South Africa negotiations will be launched for the establishment of a Continental FTA that will embrace the entire continent –a market of 1, 3 billion people with a combined GDP of over $2trillion.

These developments follow the extra-ordinary SADC Summit held last month which approved a SADC Regional Industrialisation Strategy and Roadmap. South Africa strongly supports regional and continental efforts to build more industrialised and diversified economies and reduce Member States' over-dependence on primary products.

Members may be aware that the US Senate has now passed a Bill that provides for AGOA to be extended for a period of 10 years and for South Africa to be included. New provisions in the Bill however strengthen the conditionalities that will apply and clearly seek to chart a course “to transform the relationship between the US and Africa from non-reciprocal concessions to reciprocal agreements. In addition, the Bill provides for regular reviews of African countries‟ trade and investment policies with an emphasis on the openness to US products, and in the case of South Africa, such a review is scheduled to be held within 30 days of the enactment of the Bill.

Notably absent, although indicated at an earlier stage as a possibility, is any improvement in the level of access of AGOA eligible countries‟ products to the US market.

Agoa commitments remain important to sectors such as autos, chemicals and some agriculture, and agro processing and Government is working hard to remain a beneficiary of Agoa mindful of the 30 day out of cycle review to which we will be subjected. However, the reality is that with the many new conditions and changing dynamics of US trade policy, the value of AGOA is diminishing while its costs are rising. I will raise the matter for discussion in Cabinet in the near future.

Honourable Members, the limited time I have today precludes any substantive reporting on our very important legislative programme. In the coming year we will however depend on your wisdom to assist us in the passage of key pieces of legislation such as the Promotion and Protection of Investment Bill, the Copyright Amendment Bill, the National Gambling Amendment Bill and the Liquor Amendment Bill

Madam Speaker, Honourable Members

All the work I have been discussing is underpinned by the efforts of related development finance and regulatory bodies - namely, the Industrial Development Corporation, the National Empowerment Fund, the Council for Scientific and Industrial Research and the dti’s technical infrastructure institutions - as well as the cooperation of those SOCs that occupy a central place in our industrialisation effort. To the staff of all these institutions and to our own dedicated dti people – on whom all this work rests - I offer on behalf of government as a whole our sincerest appreciation.

The work of the dti is also supported by the oversight of the Parliamentary Portfolio Committee and the Select Committee of the National Assembly and the National Council of Provinces. To the Chairpersons, the Hon Joan Fubbs and the Hon Eddie Makue, as well as honourable members of the Committee, I express my sincere appreciation for your support.

All the work of the dti is also supported by the Ministers and Departments of the Economic Sectors and Employment and Industrial Development Cluster. Allow me to also express my sincere appreciation to these Ministers and their respective departments.

We re-affirm our common goal of taking the inclusive industrialisation of South Africa to a new and higher level.

I thank you.

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Deputy Minister Mzwandile Masina: Trade and Industry Dept Budget Vote 2015/16

Honourable Chairperson,
Members of the National Assembly;
Minister Davies
DG October and officials of the Department of Trade and Industry, and the Council of Trade and Industry Institutions (COTII);
Leaders of government business and Labour
Black Industrialists
Distinguished guests
Ladies and gentlemen

On the occasion of delivering the budget vote in July 2014, I had mentioned that our central task in the coming year would be to give life to the injunction made by the President that we need to foster a radical socio-economic transformation agenda for the benefit of the people as a whole.

Chairperson, In April this year we launched an integrated system at CIPC for company Registration for R125 per registration, free BEE Certificate for Exempted Micro Enterprises (EME R10m turnover) and the second phase will be for the Qualifying Small Enterprise (QSE R10-R50M turnover), which will be accessed through Self Service Terminals throughout the Country.

In partnership with the department of Home Affairs and Commissioner SARS we are using combined information systems in the registration process. Using Biometrics, we can now verify and register a company on the spot and issue you with a verified BEE certificate issued including tax clearance certificate in the shortest possible time if the books are in order.

Through this initiative we stepped up efforts to root-out fraud and corruption within the BEE verification sector. During our budget last year we announced reforms in the film sector to ensure inclusion of emerging black film makers. I’m happy to report that in September last year we launched the South African Emerging Black Film Makers Incentive, which now benefit many black film makers.

The scheme provides financial assistance to qualifying applicants in a form of a rebate from R1 million and above production budget and 50% for the first 6 million of the qualifying SA production.

Subsequently the dti has supported 105 companies to participate in over 19 International Markets at the cost of R30 million with the return on investment of R1billion into SA economy (Kalarahi Pictures as a local beneficiary).

Last year we undertook to reform the practice of constituting delegations to international trade relations trips. We decided to open up space for new players into the Investment and Trade delegation and to date over 200 new companies have been exposed to different foreign markets.

I led delegations to various parts of the world including amongst others China, India, Iran, France, Algeria, Zimbabwe, and Botswana. Many companies who had an opportunity for the first time valued this new approach as they got to interface directly with the dynamics of international trade.

Honorable Chairperson, we revealed last year that the dti would embark on a systematic and deliberate effort to increase the presence of Black Industrialists in our economy. We said these efforts would be consolidated under the umbrella of the Black Industrialist Programme.

In this regard, we said the concept of black industrialists refers to black people directly involved in the origination, creation, a minimum 51% ownership, management and operation of industrial enterprises that derive value from the production of goods and services at a large scale; acting to unlock the productive potential of our country’s productive assets for massive employment locally.

This is premised from the observation that black entrepreneurs and industrialists cannot emerge and play a more meaningful role in the economy without special support measures dedicated exclusively to them. Feedback from some of our DFIs suggests that black owned manufacturing entities have substantially less equity investment. They also have fewer loans at start up and for their growth than others.

They have limited capacity to finance their industrial ambitions and have difficulty accessing private credit without productive assets to use as collateral.

They are likely to pay higher interest rates on loans than their peers. This is added to the likelihood of being denied loans by funding institutions. It is in this context that we intend on using this Black Industrialists scheme to provide various support mechanisms to transcend these barriers to entry and growth

In response to this industrial limitation, we appointed a Black industrialists Advisory Panel; comprising of experts from different sectors, to help us conceive a policy and implementation framework.

This work has led to the development of a policy framework for the Black Industrialists. Amongst other things this draft policy proposes a combination of financial and non-financial support mechanisms intended to boost the industrial asset share of Black industrialists.

These broadly include:

• working capital support in the form of concessional loans
• investment grants that may cover up to 80%, capped annually, on capital equipment for entities with about 51% to 100% black ownership
• joint venture support with investment packages and grants where black industrialists have equity and management control in strategic sectors
• export support through export insurance concessional funding and market support

Deriving from the definition of black industrialists I gave earlier, we have generated criteria for qualifying enterprises. The central properties to this criteria is 51% black ownership, majority black management and control of the enterprise, production of products with wide use in specified sectors of the economy.

We have prepared and will present a consolidated policy implementation plan before Cabinet. This will assist us to release, for public engagement, a final policy action plan from government to the people.

As a prime ethical principle, we will actively apply a transparency in the application and admissions process for benefitting in the Black Industrialists programme. Our considerations include the publication in newspapers and our website of all applying companies as well as the successful applicants.

We have 40 applicants who volunteered as soon as we announced the idea of the BI programme. They have not undergone any adjudication process but will be processed alongside all other applicants when the implementation starts.

As part of our implementation plan, we want to have processed and accredited fifty beneficiaries under the scheme by end of the 2015.

This will increase to hundred at the end of the second year. This is in view of our three year medium term objective of assisting 100 Black industrialists. The third year will be used for preliminary assessment of the implementation and what reinforcement mechanisms are required as we leap into the future

As the dti we have set-aside R1,5 billion in investment into NEF to enable it to secure cheaper loans, SEFA R100 million followed by IDC R23 billion, DBSA R2 Billion and the rest will still come after the policy has been formally adopted by Cabinet.

Various private financial institutions have also expressed willingness to partner with us as government on this programme. These include Standard Bank, FNB and to a certain extent BIDVEST. We invite other private financial institutions to join us in this transformative initiative.

Government has committed its public procurement as one of the instruments to be utilised in advancing this inclusive objective of transformation. This is implemented through the set-asides for targeted procurement from SMMEs and black owned companies.

Current government threshold on set-asides is 30%. The objective is to institutionalise a 70% procurement target from emerging business.

In this regard, we signed a MoU with SAA on the 18 May 2015 to set-aside R10 billion from their public procurement for Black Entrepreneurs and Industrialists within the Airline. We have been engaging Eskom, Transnet, Prasa and Denel in pursuit of a similar arrangement. We are satisfied with the progress so far and the rest of the SOE will be engaged.

The Prasa/Gibela Consortium (R51billion) provides an opportunity to create Industrial Supplier Parks to support this huge investment activity in Nigel.

We are engaging the department of Water and Sanitation on the possible development of alternative sources of sanitation to create new industries. We intend on rolling out through the Black Industrialist Programme manufacturing of pipes in Richards Bay in KZN and Kagiso in Gauteng. International investors from are being engaged to partner with our local firms to pursue a wide range of opportunities.

A stable growth path requires a capable labor force with sufficient skills to drive a competitive and diverse economy. This is the reality that informs our close cooperation with the Department of Higher Education and Training in the pursuit of critical skills through the Sector Education and Training Authorities. We have engaged in an artisan programme that has a 15000 enrolment figure with Deputy Minister Manana.

We have invested R20 million in a pilot in Saldanha Bay. An equal amount has been invested in a skills academy in the Northern Cape that deals with the energy sector. Similarly, the social composition of our skills base broadly and leadership of institutions as well as sectors of the economy needs to rewrite the script of gender relations in society.

Our programme of “Taking the dti to the factories” has taken us to all provinces in the country and this will continue. The objective of this programme is to engage with our people in their spaces both to study their conditions and to avail information about existing government initiatives.

Conclusion

Honorable members, we have an abiding responsibility to actively make this economy work for all our people.

The dti takes very seriously the role of government in fostering transformed economic relations. We view this in line with the national objectives of building an inclusive society. It is in this context that the dti progressively evolves a policy regime that is a midwife to transformed relations of assets ownership and high economic growth.

Our policy objectives are designed to help the economy overcome the vitality of the market in resolving structural and social inequalities historically embedded in Apartheid state policy. This includes overcoming spatial inequalities amongst provinces in terms of industrialisation.

In this context, the aim is not to substitute the dti for private capital. The objective of the DTI is to induce the emergence of new entrepreneurial groups in critical sectors, consistent with the national transformation objectives.

I also want to take this opportunity to congratulate and salute SA Premier Business Award 2015 Lifetime Achiever, Dr Anna Mogokong. She remains a symbol of inspiration to many. We are inspired by her achievement and her continued activism as an agent of transformation in the business sector.

I thank you.