NEW EDITION OF INDUSTRIAL POLICY ACTION PLAN TO HELP SOUTH AFRICA DOUBLE EXPORTS

CAPE TOWN— South African Trade and Industry Minister Dr Rob Davies says the department will use the lessons learned over the past few years as a game changer for the latest iteration of the Industrial Policy Action Plan (IPAP) to help the government in its bid to re-industrialise the economy and double exports.

Briefing the media on the launch of the 10th iteration of IPAP at the Imbizo Centre in Parliament here Monday, he highlighted the challenges and successes of IPAP 2018/19, the 10th edition of a rolling annual action plan.

Under the promising conditions that we see lying ahead, we expect to continue to draw on these lessons, build on the platform of this first decade of IPAP and raise the game. This is the basis of the new IPAP. The new IPAP focuses on transversal and also specific sectorial programmes, he said.

Davies said IPAP was first launched just after the global economic meltdown, when South Africa’s economy lost about one million jobs amidst continuous threats of de-industrialisation globally.

He said what IPAP did was to re-industrialise the economy and also helped the country to survive the headwinds which came with the global meltdown, effects of which can still be felt today.

The Minister said the latest iteration of IPAP puts emphasis on stronger interventions to support transformation, led by the flagship Black Industrialists Programme, which is inclusive of a bouquet of new and creative incentive measures set out in the incentive section.

The plan also outlines a stronger emphasis on a stronger export effort, focusing on existing lead and dynamic national export champions and new, especially black owned entrants.

IPAP 2018 also includes new, significant interventions to gear up and respond to the challenges and opportunities posed by the Digital Industrial Revolution.

Minister Davies said procurement reform and rolling-out incentive offerings that can help attract more investment will be among some of the cross-cutting focus areas going forward.

Davies spent some time unpacking a Legacy Review, which provides a high level summary of the achievements of industrial policy over past nine years. Under the sectorial support, the automotive sector, which contributes 33 per cent to manufacturing GDP and about 6.0 per cent to the overall GDP produces approximately 600,000 vehicles and supports 113,000 jobs annually.

Exports have doubled over the review period, which has also seen 45 billion Rand (about 3.65 billion US dollars) worth of investment by the majority of the world’s leading global vehicle manufacturers.

The clothing, textiles, leather and footwear sector, which currently contributes 8.0 per cent to the manufacturing GDP and 2.9 per cent to the overall GDP, is one of the sectors that suffered the most during the economic meltdown. With the conditional support measures offered under the Clothing and Textile Competitiveness Programme, the sector now employs 95,000 workers.

Davies said similar successes were recorded in other sectors, including metal fabrication, capital and rail transport equipment sector; mining capital equipment sector; agro-processing; plastics and cosmetics sector and the plastics and cosmetics sector, among others.

However, these successes were recorded during challenging times, both locally and globally. South Africa was not immune to the effects of the global crisis. Domestically, policy uncertainty, weakened intergovernmental coordination and sub-optimal performance of certain State-owned entities, among others, has meant that the successes are but an appetizer of what could be better achieved under more favourable conditions, he said.

Source: NAM NEWS NETWORK