Hon members, before I call the Minister, let's apologise to all the guests who are in the gallery and the members of the media. Members of Parliament were engaged in some other important business in the National Assembly. We would like to apologise profusely for this late start. We were supposed to start at 18:10, but we are starting at 18:30.
Chairperson, colleagues, ladies and gentlemen, it's a pleasure to be sharing this Budget Vote debate with our colleagues from the Ministry of Small Business Development. This particular Budget Vote debate is taking this format because a number of the programmes that will be transferred to the Ministry and Department of Small Business Development still fall under Budget Vote No 36.
The new Ministry will give dedicated focus to small business and co- operative development, areas that are fundamental in bringing about economic transformation. As soon as we heard the announcement of the new Ministry, we in the Department of Trade and Industry worked very closely with the newly appointed team and have already transferred parts of the DTI and some of the institutions of the DTI family to the new Ministry. We want to assure that Minister and Deputy Minister that this close co-operation between our sister departments will continue and, undoubtedly, together we can do more.
I will not be able, in the time allocated to me, to cover all the ground I would have liked to, and I therefore circulated a written version of this input which, together with the similar document that will be circulated in the NCOP tomorrow, represents a consolidated statement that we wish to convey in relation to Budget Vote No 36.
The rationale for placing industrial development at the centre of the DTI's work has already been shared in a discussion with the portfolio committee. Achieving the target of 5% sustainable growth by the end of this administration requires bringing about structural changes in the economy, including placing productive sectors at the forefront of the growth process and moving higher up the value chain.
We have also argued that our experience in the past administration, when we tabled and implemented successive iterations of our industrial policy action plans, shows that where we have acted purposefully in pursuit of well-defined industrial policy objectives we have achieved successes and demonstrated that industrial policy does indeed work.
However, hon members know that the President has called on us to implement the central task of this administration, namely to bring about radical economic transformation. This has a number of dimensions, but requires, among other things, that the impact of our industrial policy is increased to the point where industrial policy becomes a key driver of higher levels of growth along a qualitatively different, higher value-added and more job- creating growth path.
We discussed with the portfolio committee some of our thinking on the elements of a higher impact by industrial policy. They include building and expanding the infrastructure development programme; implementing a number of mineral beneficiation projects; pursuing active development integration on the African continent; and repositioning South African manufacturing on a continent that is itself seeking to industrialise and creating a platform for more granular engagements with dynamic and leading companies, based on a higher level of support against greater conditionalities.
Hon members, allow me now to be more specific regarding some of our plans in the current financial year. Firstly, we anticipate an acceleration in the automotive sector, where the Automotive Production and Development Programme, APDP, has already supported significant new investment. Projected capital in expenditure for 2014 is anticipated to reach a record level of R7,9 billion. As the National Association of Automobile Manufacturers of South Africa puts it, and I quote:
The relatively high levels of capital expenditure in recent years may be attributed in large part to investment projects by manufacturers as part of the Automotive Production and Development Programme.
Moreover, adjustments to the APDP and the designation of buses in terms of the Preferential Procurement Policy Framework Act, PPPFA, have resulted in Mercedes-Benz, Volvo and MAN winning tenders to provide locally assembled buses for metros' commuter bus expansions and for the production of the uniquely South African S'esfikile taxi.
In the coming year, the APDP will undergo an early review, which will allow us to take stock of efforts and determine what more can be achieved in growing the industry in South Africa. In addition, the Automotive Supply Chain Competitiveness Initiative, launched in 2013 to enhance localisation, and to raise productivity and supply capabilities, is proving to be successful and we will continue to expand the programme.
Also, the Automotive Export Manual report of 2014 shows that vehicle and component exports increased by 8,2% from R94,9 billion in 2012 to R102,7 billion in 2013. This is the first time that the industry has exceeded the R100 billion export mark. [Applause.] Hon members, this is a sector that employs in excess of 100 000 people. It is an important sector and we will continue to support it.
Secondly, the clothing, textile, leather and footwear sector, an important labour-absorbing sector that many have written off a few years ago, has now been successfully stabilised through the introduction of a number of interrelated measures. These include improved monitoring of imports to ensure compliance with customs and excise regulations and to reduce unfair and illegal imports; the designation of products from this sector under the PPPFA, and collaboration with key retailers to encourage local procurement; the introduction of the Clothing and Textile Competitiveness Improvement Programme, which has succeeded in a number of cases to attract investments to the sector; and the creation of two regional footwear clusters. These clusters have revitalised the previously moribund footwear sector in KwaZulu-Natal and the Southern Cape, leading to a new production of more than 150 000 pairs of shoes per month, with the creation of 700 sustainable jobs.
In the coming year, the department will continue to roll out the Clothing and Textile Competitiveness Improvement Programme, CTCIP, to reach more companies within the sector and I will announce in the near future details of a significant programme to increase value addition in the exotic leather and animal hide industries through the national exotic leather cluster.
Chairperson, the metal fabrication, capital and rail transport equipment sectors are the bedrock of a modern industrial economy. The DTI has been active and instrumental in unlocking these sectors' potential and we can now expect significant expansion to take place.
A combination of the designation of locomotives in terms of the PPPFA, and the work of the National Tooling Initiative and the Gauteng Foundry Training Centre has been pivotal in securing substantial local content commitments in Transnet's and the Passenger Rail Agency of South Africa's rail rolling stock investment plans.
Indeed, the localisation success in renewable energy, buses and rail rolling stock will become the yardstick against which the localisation of government procurement is measured. To unlock the value of localisation for South Africa, further refinement of procurement legislation will be required, including a focus on ensuring compliance across all tiers of government; improving the transversal procurement process; and utilising the multibillion infrastructure build programme to support local manufacturing, especially in the transport, energy, and construction sectors.
The DTI has already designated a number of products for local procurement, including railway rolling stock; power pylons; buses; canned and processed vegetables; the textiles, clothing, leather and footwear sector; solar water heaters; set-top boxes; pharmaceutical products; furniture products; power and telecoms cables; and valve products and articulators.
I want to take this opportunity to say that in the next round of the designation of products government anticipates designating steel products, conveyance pipes, transformers, building and construction material, and rail signalling and components. To add to this momentum, the private sector needs to buy more from local companies and, indeed, made such an undertaking in the Local Procurement Accord, signed a few years ago.
The President assented to the Special Economic Zones Bill earlier this year. Simultaneously with processing the legislation, we embarked on a process, together with the provinces, of conducting feasibility studies on potential special economic zones.
I will speak about this more in the National Council of Provinces tomorrow. But I want to indicate that, in addition to the Saldanha Bay Industrial Development Zone, IDZ, which was designated last year, in the very near future we will be handing over the operator permit to allow the Dube TradePort to become another industrial development zone.
Public consultations are under way for the Harrismith TradePort in the Free State also to become an industrial development zone, IDZ. Work is well advanced on industrial sector special economic zones, including two potential platinum value chain special economic zones, one in the North West and the other in Limpopo.
We will continue in the year ahead, and in the course of this term, to support investments through a number of incentives. In addition to that, as the President noted in the state of the nation address, South Africa's development finance institutions have an asset base of R230 billion. Over the coming year, we will work closely with the Industrial Development Corporation, IDC, and the Department of Economic Development to upscale IDC support for industrialisation and to achieve greater cohesion with the deployment of DTI incentives and IDC programmes.
Our aim is to seek a stronger developmental conditionality and reciprocal obligations from beneficiaries of state support in areas such as competitiveness upgrading, employment retention and creation, investment and so forth.
We have spoken often of beneficiation, and the case for beneficiating our mineral wealth is unassailable. We can no longer afford simply to remain located at the bottom of global value chains as producers and exporters of primary products and importers of finished goods. Now is the time to move into action.
The DTI has been charged with developing a Minerals Beneficiation Action Plan as a component of the Industrial Policy Action Plan. A good deal of preliminary work has been done to identify potential value chains, and also some of the measures that can be deployed to turn our aim and ambition of beneficiation into a reality.
Government is committed to facilitating broad-based black economic empowerment through targeted interventions to achieve more inclusive growth. In order to facilitate broader participation, the department will begin implementing the BBBEE Amendment Act, which was passed in the last Parliament and signed into law in January this year.
The BBBEE Amendment Act and the accompanying Code of Good Practice seek to increase alignment between BBBEE activities and government's objectives of industrialisation, localisation, skills development and job creation.
Chairperson, South Africa recognises the importance of foreign direct investment. We are, and will remain, open to foreign direct investment, FDI. South Africa accounted for the bulk of new investment projects in Africa, with investments arriving from the USA, EU member states and, increasingly, from China, India, and other Asian countries. The reasons are not hard to find. South Africa offers many opportunities, not only for access to a growing domestic market, but also as a platform to the dynamically growing markets of the African continent.
Allow me to state some recent facts on foreign investment in South Africa. Firstly, in August 2013, the global Financial Times magazine of the UK voted South Africa the overall winner for the best investment destination on the African continent. [Applause.] And this was for both 2013 and 2014.
Secondly, the AT Kearney Foreign Direct Investment Confidence Index ranks South Africa in position number 13 amongst 25 leading economies, and we moved up two places from the ranking we had in 2013. [Applause.] South Africa, in fact, ranks better according to this index than countries like Switzerland, Sweden and the Netherlands.
Thirdly, International Investment Initiative director at the University of Bern's World Trade Institute, Dr Stephen Gelb, says if we look at the number of firms investing in South Africa, and not just at the number of dollars flowing in, we see that over 130 foreign firms either entered South Africa or expanded their investments during 2013 - that is about 2,5 foreign firms per week to announce investment in South Africa.
Finally, our investment team, Trade and Investment SA, Tisa, has developed an investment pipeline which is a very good indication of foreign investment coming to South Africa. The total of potential investment projects for 2013-14, which Tisa is monitoring, stands at R60,5 billion. This is a substantial increase on what it was a few years ago.
These factors have been recognised by leading investors and, for example, this year we are welcoming Samsung Electronics, which will establish a manufacturing hub for Africa at the two newly designated IDZs in Dube TradePort.
It's worth repeating that South Africa's economic development is inextricably linked to the African continent.
Hon Minister, you have two minutes remaining.
Two minutes. In that case I am going to miss all the stuff on foreign trade ... [Laughter.] ... and on Brics, simply to say that there is a legislative programme that will be introduced. I am not going to go through the Bills that are here. I just want to say that each proposal made to Parliament will be accompanied by a regulatory impact assessment. This process will include a cost-benefit analysis, which assists us in choosing the appropriate legislative tools to employ.
In addition to the Bills we will be presenting, we will be developing regulations under the Lotteries Amendment Act to introduce full-time distributing agencies to improve the disbursement of funds. The National Credit Amendment Act, which was passed through regulations in terms of that, will see the introduction of compulsory affordability assessments. With regard to the Intellectual Property Laws Amendment Act, we will be publishing regulations in terms of the establishment of the Council on Indigenous Knowledge.
Finally, let me express a word of thanks to the DTI, the staff, the director-general and the deputy directors-general. It has been a great pleasure to work with all of you. Thanks also to all the agencies that are part of the DTI family - many representatives are sitting here today. There is a very good story to tell in the programmes of the agencies, but unfortunately I don't have the time to go into that today. Let me also welcome Deputy Minister Masina to the DTI. He is already providing some very significant support, and I look forward to developing a close working relationship with him. Thank you very much. [Applause.]
I call on the Minister of Small Business Development. I am told that it is the Minister's maiden speech.
HON MEMBERS: Malibongwe! [Praise!]
Hon Chairperson, it is really a pleasure to see you here, in the Chair. We have come a long way to be where we are today.
Minister Davies and other Ministers; Deputy Minister Thabethe, Deputy Minister Masina and other Deputy Ministers; Director-General Lionel October - these are the people we have been working with - Acting Director-General, Pumla Ncapayi, who is my Acting DG; hon members; chairmen and chief executive officers of state-owned enterprises; distinguished guests; captains of industry; ladies and gentlemen, comrades and friends, we have just returned from a flurry of activities, responding to the call by our government to honour the birthday of the late Comrade Nelson Mandela. Thousands responded positively. I for one joined the Premier of the Free State, Comrade Ace Magashule, in cleaning and painting Pelonomi Hospital. We take the opportunity to thank all who positively responded to this noble call. This show of solidarity and responsibility should extend beyond just honouring Comrade Nelson Mandela.
There are critical areas in the life of South Africa that need unity of purpose, one of which would be support for the call by the ANC for radical economic transformation. It is important to note that the ANC is not anti- business. However, it has a responsibility to respond radically to the needs of the people, including strong protection measures against exploitation and unjust measures. The ANC stands for an economy that is inclusive, equitable and fast-growing.
Those still debating the concept of radical economic transformation should realise it is do or die for the majority of the black people of South Africa. [Applause.] Government cannot forever be a buffer between the rich and poor, neither can it be a scapegoat for those who prefer to meander, or sit on the fence. It cannot be a scapegoat for those who do not contribute meaningfully to the socioeconomic challenges facing our country. This country belongs to all of us, including you in the opposition. [Interjections.] Together, we will move South Africa forward.
The world is conscious of the deep wounds inflicted upon our people by the defeated apartheid regime. It is also aware of our efforts to heal, but the focus on us is no longer the same as it was for 20 years. The world that supported us is going through its own challenges, with some now looking at us as competitors. We therefore need to step up and take responsibility for our destiny.
We must focus on ourselves and our needs, while realising our commitment to African development and the better world we envisage. Of course, we are saddened by some of the things that are happening globally. Our ultimate goal is to build a South Africa with decent employment, entrepreneurial opportunities, a vibrant economy and a high quality of life, which everybody would like to see. Our goal is to build a South African economy geared towards addressing the triple challenge of unemployment, poverty and inequality.
It is an honour for me to present my maiden Budget Vote, jointly with the Department of Trade and Industry, DTI, the department that has been the custodian of small, medium and micro enterprises, SMMEs, and co-operatives. I am ably supported by my Deputy Minister, Elizabeth Thabethe, in this regard.
In the past years much has been done by the Departments of Trade and Industry and of Economic Development to address SMMEs and co-operatives. However, due to the ANC's recognition of the importance of this sector, as well as listening to the calls by SMMEs and co-operatives for a stand-alone department, the ANC-led government decided to create a department, with its own budget and structures, to give undivided attention to advance the interests of SMMEs and co-operatives. Something new is here and it is going to work.
It is important for us to note the programmes considered by the DTI during the previous financial year, and we are raising them because those programmes still have to continue. Through the Incubation Support Programme, the DTI has to date approved support for 39 incubations amounting to R590 million, focusing on the agriculture, services and manufacturing sector. In addition, the Small Enterprise Development Agency Technology Programme has created 291 new small and medium enterprise entrants, supported 1 227 existing SMMEs and created 1 258 employment opportunities. We know that this is not enough when we look at the challenges in South Africa.
Centres for Entrepreneurship, such as King Hintsa Further Education and Training College in the Eastern Cape, that focuses on agro-processing, as well as Ekurhuleni West College in Gauteng, that focuses on welding and waste management, have been established. In the current financial year, we envisage the establishment of two additional institutions to upscale our efforts with regard to entrepreneurship.
Twenty-eight projects were approved through the Support Programme for Industrial Innovation, amounting to R76 million, with beneficiaries from Gauteng, the Western Cape and KwaZulu-Natal. Areas of focus include the green economy, information and communications technology, energy and manufacturing.
Through the DTI, the review and amendment of the Co-operatives Act and the National Co-operatives Strategy have been completed. This will allow for the establishment of new institutional arrangements such as the Co- operative Development Agency and the Co-operatives Tribunal.
In addition, 243 projects amounting to R62 million were funded through the Co-operative Incentive Scheme during the previous financial year, with 1 897 beneficiaries, of whom 990 were female, 253 were youth, 25 were people with disabilities and 629 were male.
The new department will continue to collaborate with provincial entities to advance Cabinet's decision of 2007, which calls for 85% procurement of 10 specified products and services set aside. Within this context, I would like to commend KwaZulu-Natal, the Eastern Cape and, most recently, the Free State, on their efforts to advance the initiatives and co-operatives movement in South Africa. [Applause.]
Furthermore, the DTI has approved the establishment of secondary marketing co-operatives as well as an incentive amounting to R10 million per co- operative, focusing on advanced value addition in respect of goods and services, use of technology as well as improved logistics and infrastructure.
In addressing measures for a conducive environment, the DTI recently launched the National Informal Business Upliftment Strategy, which will enhance enterprise development support and co-ordinate intergovernmental and stakeholder relations for broader participation of South Africa's informal sector in the economy. In addition to this, the implementation of the integrated small-medium-micro enterprises and co-operative development will allow for harmonisation and co-location opportunities in the informal sector.
The red tape reduction measures - and I think this is of interest to many - for municipalities were launched and rolled out in all nine provinces. We will watch this with a hawk's eyes. This will allow for a reduction in red tape in local government's small business environment and will serve as a monitoring mechanism.
During the course of the previous financial year, the DTI approved the Youth Enterprise Development Strategy, YEDS, aimed at increasing the contribution of youth-owned enterprises to South Africa's gross domestic product, GDP. The YEDS envisages direct support to young entrepreneurs with the objective of creating and managing sustainable and efficient business capable of providing decent, permanents jobs.
In this regard, my department will take the lead in the implementation of these programmes, in collaboration with other departments, and this will serve as a direct response to South Africa's National Youth Policy.
It became imperative to set up a focused centre to help to create a favourable legal and regulatory environment, including support for infrastructure and mechanisms to assist SMMEs and co-operatives to grow sustainably. This centre will scale up support and expand the number and viability of the sector to achieve development vision.
The Department of Small Business Development aims to provide extensive support to small business and co-operatives, and increase support through consolidated public agencies, enterprises coaching, mentorship, incubation and intensive support mechanisms.
We will build on the commitment in the social accords to bring black-owned small businesses and co-operatives into the supply chain of large companies and the public sector. We will also mobilise the private sector and state- owned enterprises to support SMMEs and co-operatives.
The National Development Plan, NDP, envisages a trebled economy by 2030 with a target of 11 million job opportunities. SMMEs and co-operatives can make a meaningful contribution to this objective. We believe SMMEs and co- operatives are a critical means to empower our people, a mechanism to draw new entrants into the economy, strengthen inclusive growth, build the economy, encourage solidarity and create large numbers of jobs.
We envisage a close collaboration, as already mentioned, with Ministers Davies and Patel and their deputies, and we draw on their experience. This will allow for a successful and complete migration of functions, programmes and projects that have been in their purview. A co-ordinated effort is important, as we believe the work around SMMEs and co-operatives cuts across all government departments. We will be knocking on each and every door of all the departments.
We present the budget midyear and also at a time when we are engaged in the process of configuring the department as well as fulfilling the government's plans to implement the changes that will affect the macro- organisation of the state. This is an organised government.
We are conscious of the need to establish the department at high speed. [Interjections.] SMMEs and co-operatives cannot afford vacuums of any sort. Within this context, we have been mindful of the end user and have considered business continuity as a principle from which recipients will continue to benefit whilst we configure our department.
We cannot afford to disappoint organisations such as the Black Business Council, National African Federated Chamber of Commerce, Nafcoc, the Co- operatives Movement in South Africa and many others, or even individuals, including Mr Sandile Zungu and, of course, our hon chairperson, Ruth Bhengu, whose passion for co-operatives runs deep. [Applause.]
Facts and figures indicate that SMMEs contribute 57% of South Africa's GDP and account for 56% employment, 76% in the informal sector. In an attempt to benchmark South Africa's performance, there are three countries of interest to us, namely Brazil - not because I was ambassador there - Chile and India, whose SMMEs and co-operatives have contributed approximately 20% to their countries' GDP and employ 60 million people. This highlights the significant contribution by SMMES and co-operatives towards economic growth.
The department, guided by this understanding, will have to ensure a concerted effort focusing on enhancing areas such as policy, regulatory environment, advancing localisation as well as leveraging on public procurement, financial and nonfinancial support.
Hon Minister, you have two minutes remaining.
Chairperson, in advancing the initiative of small business development, we will be looking at upscaling the identified interventions, enhancing existing partnerships to enable government departments and state-owned entities to work together. Furthermore, there will be a concerted effort in our engagement with the private sector and labour to sustain the gains and advance the common objective of supporting this sector. Those structures that will be migrating from us will be indicated.
With this in mind, my department will focus on the active participation of SMMEs and the implementation of the entrepreneur programme through centres for entrepreneurship and the Seda Technology Programme and the Incubation Support Programme. I think I have already mentioned many of those, Comrade Chair. Chairperson, sorry.
I wish to thank the portfolio committee, including the opposition, that had made very positive contributions during our meeting; Deputy Minister Thabethe, for her unwavering support and valuable leadership; the staff in my office and the staff in the Broadening Participation Division.
In conclusion, I would also like to thank all those who supported us as we started this new department. I would specifically like to thank my family, who has supported me. My family is represented by my son Boitumelo, who is in the gallery today. I would also like to thank Jessica Longwe, one of the comrades who has assisted us for a very long time through European parliamentarians to support parliamentarians. Many of us were sent to many countries to do study tours through that programme and it is my wish that they would continue that programme because it is still important. Thank you very much. [Applause.]
Chairperson, hon members of this House, guests in the gallery, men and women of South Africa, first of all, let me say thank you, South Africans, for your confidence in the ANC ... [Applause.] ... which has given us another five years to roll back three centuries of socioeconomic and racial discrimination which deprived our country - that is why we are going at a little slower pace - of harnessing the potential of all our peoples.
Trade and Industry's objectives in its Budget Vote No 36 are to roll back monopoly practices, advance black industrialists, and grow an inclusive employment-creating economy through radical economic transformation in our developmental state. The Industrial Policy Action Plan, Ipap, underpinned by a strategic trade policy, is pursuing the New Growth Path. In this way, we are busy recapturing essential policy space, policy space that will enable us to steer our country in the right direction, safely through the global storms that continue to buffet our shores. This is why the ANC is supporting the people's budget.
However, we cannot ignore the effect of protracted strikes on the economy. Short, sharper strikes create more room to manoeuvre and get better results for the workers. Recently a National Union of Mineworkers, NUM, strike successfully negotiated an increase of R1 000 in the first two years for lowest-paid workers, followed by R950. I would be the first to say that is not enough, but I do welcome a strategic result. I want to say to the captains of industry - and I suggest you have tea and wine and tell them as well - that they should not continue to act with impunity in certain industries and continue to ignore the productivity of the workers in favour of their wealth, and ignoring the continued plight of the workers due to their wages.
In the Portfolio Committee on Trade and Industry the ANC said these challenges - the challenges of eliminating poverty and creating decent and sustainable employment - called for radical economic transformation. However, most opposition parties actually believe you can overcome poverty and create sustainable employment while the country pursues business as usual. [Interjections.] In fact, what they want is to maintain the status quo. Well, the ANC is giving this House notice ... [Interjections.]
Just a minute, hon member. Hon members, we have no problem with interjections, because it is your right to interject, but please do not stop the member from speaking. [Interjections.]
The ANC is giving this House notice: Twenty years of sunset clauses and the determination of some to sustain the status quo are over. [Interjections.] You have had your honeymoon! [Applause.] In the fourth term in Parliament, the portfolio committee had already embarked on this path, which is quite clearly spelt out in the Broad-Based Black Economic Empowerment Act, which, I must say, the poor DA got very confused about. [Interjections.] Indeed, 20 years of democratic transition calls for bold and decisive steps to place the economy on a qualitatively different path that substantially, significantly reduces inequality, especially for women.
More than 75% of the Department of Trade and Industry's budget, R9,8 billion, directly and indirectly, is geared to ramp up industrialisation. The Minister's decision to use manufacturing to spearhead this drive makes sound economic sense. Manufacturing has the highest economic and employment multipliers of any sector. Read the KPMG report and learn. Higher levels of value addition, as South Africa shifts up the value chain, are expected to generate higher income levels and greater wealth. [Interjections.] The one thing that will go up is, of course, the ANC's support.
Using the R9,8 billion budget, the Department of Trade and Industry, DTI, is expanding manufacturing to create jobs through the development of the productive sectors. This, the committee believes, is its greatest contribution to capturing policy space. In the state of the nation address, President Jacob Zuma also mentioned three issues. He spoke about increasing private sector investment to support industrial development, with the impending piece of legislation, the Protection and Promotion of Investment Bill, already in the pipeline. [Interjections.] Yes, you may well say "Woo!" As soon as final regulations on broad-based black economic empowerment, BBBEE, become effective, you will be "wooing" your way out! [Laughter.] He also spoke about strengthening the country's economic and investment ties with other regions. Yes, we are going to become Africans, if we are not already thinking of ourselves as Africans. We won't have a choice, we are deepening our entry into African trade.
We are very fortunate that there has been a sixth iteration of Ipap. There is absolutely no doubt ... [Interjections.] No doubt you have never ridden one! Yes, the Ipap, whilst recognising the achievements of the past, has acknowledged that the results have been somewhat uneven. Yes, much more remains to be done. As the Minister keeps on putting it, let's develop greater traction here. [Applause.]
We all unanimously agreed that ... [Interjections.] If you would like to take the floor and dance, do so [Laughter.] ... there should be greater co- ordination between the national departments, between the three spheres of government, regarding the implementation of Ipap. I must say, hon Minister, I know you are not a silo conformer and I am pleading with your colleagues to stop the silo mentality. We have to work together. We do not want any maestros around here. [Interjections.] We don't! [Laughter.]
Furthermore, we want to see the decentralisation of productive activities. I want to congratulate you, Minister, for actually recognising this. Did you know, mealie meal was taken all the way up from the rural areas to Gauteng, where I live - yes, I do eat mealie meal occasionally - it is then refined and taken all the way back? [Interjections.] I guess you are not interested in what poor people eat. [Interjections.] You are not! The cost of the mealie meal included transport there and back and, on top of it, did not create jobs in local areas. Minister Davies, the director-general and his team, Lionel October and the rest, worked together on this, and they are now intent on developing a lot more of these mills around the country. That is a very good idea. [Applause.]
Chairperson, if I may just say one thing, because I see we are on the point of closing: The budget is a political tool. That is why there is so much noise here. [Interjections.] The budget is a socioeconomic tool. The budget, as we will learn very soon, is a legal tool - we have to vote on it. Most of all, beyond all of those technicalities, the budget is about improving people's lives. It absolutely is. [Applause.] Let me say that one of the better moves that we have made as a government was to separate small business, to take it out, to give it its own place in the sun. You have two specialists, two passionate people, in co-operatives, and they are the hon Ruth Bhengu and the hon Mabasa. Their name is "co-operatives". So, you will certainly go far with that.
I do want to say that the Minister of Trade and Industry, the Minister of Small Business Development, and the Minister of Economic Development, as well as the Deputy Ministers, are really an example to their colleagues of how we should be working together collegiately and collectively to actually implement our budget effectively. I thank you. [Applause.]
Chairperson, Minister Davies, Deputy Minister Masina and hon members, South Africa is in the eye of an economic storm. We will stave off another recession - only just - and we all feel relieved by that. However, no-one can deny that it has been a tumultuous year, although one would never say so, listening to Minister Davies' speech. Perhaps the part dealing with reality was in the pages he couldn't get to. [Laughter.]
The fact is we have had our sovereign rating downgraded this year, with the threat of another. We are in the middle of a second crippling strike, with another starting next week. Employment and output are down in key labour- absorptive sectors. Investor confidence is exceedingly low. We had an unsustainably large trade deficit at nearly R7 billion in May despite the weaker currency. Government revenue will not meet its targets, which means the budget deficit cannot realistically be reduced, and we are now in the triple bind of high inflation, low growth and rising interest rates. An economic storm, indeed.
It is, of course, true that there has been a great recession from which the world's economies are only now starting to emerge. We ourselves were not immune to that difficult time. It has, I hope, been a valuable lesson for the ANC. By promising voters 5 million jobs, even while the economic warning lights were flashing bright red in 2009, the party set itself up for failure. In May this year, we saw the consequences, hon Fubbs - the worst ANC election results since 1994. [Interjections.]
However, the recession alone is not a sufficient explanation for our current turmoil. We are in this position because our national government, from the President down, and including this Minister, has proven unable, and even unwilling, to speak with one voice on the economy, and because they have failed to remove the impediments to a higher rate of growth.
The fact is that the storm we now face is also of our own making. Our competitor economies are all growing again, and much faster than us. Chile is growing at 5,9%; Nigeria at 7,2%; Russia, Costa Rica and Poland, all at over 4%; and Turkey at 8,2%. The recovery is well under way among our competitors. We are performing far below potential. So, how do we turn this around?
This government must urgently address the following problems if we are to reverse our current decline and build a solid foundation for creating growth. Firstly, all government departments must speak with one voice on a plan for economic growth. However, it is not enough to just speak with one voice. Government must also act in unison. Policy uncertainty is the surest inhibitor of investor confidence, and it is the reason that private sector investment is presently so low. This government has got to stop contradicting itself on key economic policy questions.
The Minister referred to foreign direct investment numbers. He says that we are now ranked 13th and that this is something to celebrate. What he doesn't tell you is that two years ago we were ranked 11th. [Interjections.] It is a decline, not an improvement, Minister - and we are attracting one-sixth of the foreign direct investment that Brazil is attracting; only one-sixth! [Interjections.]
A member of the public sent me a copy of the China Daily, the biggest English newspaper in China, with a special focus article last week on South African investment. The editorial says:
The downside in South Africa is that labour issues, including strikes, are a big headache, and the power supply can be unreliable.
That is a summary of some of the problems we have. Just one month ago, nearly 30 days ago, the President committed himself to the National Development Plan in his state of the nation address. However, since then, this commitment has been subverted by damaging visa regulations, a disastrous land reform proposal and several other growth- undermining proposals. You, Minister, also contributed to policy uncertainty by releasing a poorly drafted Promotion and Protection of Investment Bill and by bungling the cancellation of investment treaties. [Interjections.] Most recently, you dropped hints about introducing export taxes on minerals.
Of course, the DA supports the drive for local manufacture and beneficiation. We also believe South Africa must move up the value chain. However, the way to do it is not with price controls and trade-distorting taxes. We should be looking to attract manufacturers to locate here, use our local raw materials, and pass on skills and technology. That is how you build an industry.
In the context of our trade deficit, export taxes are simply impossible, and talk of them just adds greater uncertainty. Are we pursuing export-led growth or the import substitution policies of the 1980s? Confusing, contradictory policy messages are the enemy of growth and they have got to stop.
HON MEMBERS: Hear, hear!
Secondly, remove those impediments to and constraints on growth that the government already controls. This department focuses on industrial policy and trade, but it cannot hope to succeed in either until it can get tangible backing from other government departments.
South Africa cannot hope to move up the global value chain with double- digit municipal electricity surcharges on top of already expensive electricity. We cannot export more with ports that are among the most inefficient and expensive in the world. We cannot attract foreign direct investment to our shiny, new special economic zones until we spend our infrastructure budgets. Perhaps most urgently, we must implement policy steps to address our dysfunctional labour relations environment and end the continuous cycle of strike action that destroys productivity and undermines economic stability.
HON MEMBERS: Hear, hear!
Thirdly, we must get serious and driven about promoting South African products and companies abroad. The Minister didn't mention trade once in his speech. This department invests precious little in trade promotion - only 3,7%, or R360 million, of its total budget. This is wholly inadequate and it needs a comprehensive rethink. The DA would equip teams of well-trained trade diplomats to go and hunt opportunities for South African companies abroad ... [Interjections.] Give us time! [Laughter.] We would link local suppliers with new customers, and grow our exports. [Interjections.]
Listen, rather listen! [Interjections.]
Finally, we need to end the it's-not-my-job mentality. All of these problems sit squarely with government. It is simply unacceptable to shrug one's shoulders and pass the buck to another Minister.
This government, and this department in particular, are adherents of the idea of a developmental state. They see the state taking the lead role in the economy. As Minister Davies has said, the state must steer, not row. Ironically, that comment sums up the problem. This government wants to set the direction the economy must take, but it's not prepared to do the difficult work required to achieve the necessary growth. A commitment to a developmental state must start with the state removing the major impediments to growth that it controls itself. [Interjections.] Start with your own house. That is taking the lead.
HON MEMBERS: Yes!
The DA knows that it is possible to accelerate GDP growth from the current anaemic 2% to the 6% plus growth experienced by our competitor economies. [Interjections.] With true leadership and with a few key interventions, we can put South Africa on a much higher growth path and begin to create large numbers of new jobs.
With higher growth, we will significantly reduce unemployment, poverty and income inequality, which concerns us all. We will have more money to invest in basic services, to protect vulnerable South Africans, and to truly realise an open-opportunity society for all.
It doesn't need to take another 20 years for this to happen. South Africa can be the next breakthrough economy. The DA believes that emphatically and we have a solid, costed plan to do this. The question is, Minister and colleagues opposite, do you? Thank you. [Applause.]
Chair, may I please ask that you do not remind me when there are two minutes remaining, because I am not going to tell a story. I am going to debate the politics of industrial expansion. [Interjections.]
Hon Minister, the Freedom Charter says that the mineral wealth beneath the soil, the banks and the monopoly industries shall be transferred to the ownership of the people as a whole. The sentence immediately after that states that all other industry and trade shall be controlled for the wellbeing of all people. [Interjections.] That is what the Freedom Charter says. Those who admit that the Freedom Charter is a programme, not of the ANC, but of everyone, understand that it means that the nationalisation of mines, banks and monopoly industries should happen, whilst all other trade and industry is controlled for the wellbeing of the people. That is the basis upon which we, as the EFF, debate industrial and trade policy, which is one of our cardinal pillars.
There are two decisions that were taken by the Portfolio Committee on Trade and Industry. One was the commitment that we are going to pass legislation that will compel government to procure 75% of its goods and services locally. If that is indeed the case and it is true, and if it happens and government indeed purchases 75% of goods and services locally, it looks like it is going to lead somewhere. We agree with that. It should include the food that the government buys for school feeding schemes, hospitals, prisons, and such areas. It must include electronics. It must include textiles. It must include all purchases for government activities. However, that must be coupled with building local capacity to manufacture and produce these goods and services.
With regard to food, there is low agricultural productivity in South Africa. Why? It is because we do not have access to land. [Applause.] If we continue at the current pace of land redistribution, it means we are going to take more than 100 years just to redistribute 50% of the land in South Africa. That deprives South Africa of the space to produce food locally. These are some of the things that we must deal with at a policy and ideological level.
The second issue we agreed upon in the Portfolio Committee on Trade and Industry was that a certain component of the mineral resources produced in South Africa should be locally beneficiated and industrialised. The ANC says 20%; the EFF says 50% of these minerals must be locally beneficiated and industrialised. [Interjections.] You can't do that now, because you do not have access to mineral resources.
Minister, none of the platinum from Platinum Group Metals is for sale in South Africa. We are saying that, while we know the ANC won't nationalise the mines now, at least use the state-owned mining company to extract minerals in order to locally beneficiate and industrialise them. That is the only thing you can do. You have a policy instrument and the space to deal with those issues.
The multinational corporations that are in mining will not work with you to beneficiate platinum and all these other mineral resources. Why not? It is because they are involved in practices and occurrences of transfer pricing and base erosion, and all these issues we have been speaking about.
I am happy that the chairperson of the portfolio committee has now admitted that there is no proper alignment and co-ordination of industrial policy intra- and intergovernmentally. That is the reality. Earlier on, the Department of Economic Development denied that this was the case. However, it is the case that there is no proper co-ordination of industrial policy in respect of what provinces and local municipalities do and what national government and various departments do. That is your primary responsibility. You know about the Ministry of International Trade and Industry in Japan that successfully industrialised Japan post-World War II. If you could design a model like that, then we can talk about the industrial success of South Africa. [Interjections.]
The other issue which is very important is to keep a close eye on your development finance institutions. If you don't give them proper guidance, they will do what the National Empowerment Fund, NEF, did - take money that is supposed to be financing sustainable industrial development and give it to friends who are opening up boutiques and selling luxury goods and services with access for a few individuals only. [Interjections.]
Those are the basic, logical things that you have to deal with. You don't have to agree with the EFF with regard to our radical economic policy position. [Interjections.] You can work with your current policy instruments and institutions to realise successful industrial expansion, as anticipated. Thank you very much, Chair. [Applause.]
Hon Speaker, members of the NA, Minister Davies and Minister Lindiwe Zulu, Deputy Minister Thabethe and other Deputy Ministers who are here, other Ministers, heads of department, the Acting Secretary-General of the ANC Youth League, Comrade Magasela, the Speaker of the Council of Ekurhuleni, other officials of government who are here, distinguished guests, ladies and gentlemen, I am humbled to be part of the fifth administration led by President Zuma. Even more so, as the ruling party, we have received an overwhelming mandate from our people to push for radical economic policies in which our department, the Department of Trade and Industry, DTI, is going to play an important role.
When President Zuma called for radical socioeconomic transformation, he called on all South Africans to build an inclusive economy anchored in a large and growing industrial sector underpinned by broad-based black economic empowerment, BBBEE.
In the coming financial year, the DTI will continue to improve its implementation of the Industrial Policy Action Plan, Ipap, as well as the Minerals Beneficiation Action Plan, MBAP. We will also move decisively to develop bolder and sharper instruments to support black industrialists and youth entrepreneurs. But, more importantly, we will ensure that they are sustainable and viable.
The groundwork required to fulfil these imperatives has been done in terms of policy frameworks. These include the black economic empowerment, BEE, legislation that has been put in place as well as the National Industrial Policy Framework, NIPF, and Ipap.
The Broad-Based Black Economic Empowerment Act and its codes were amended last year to close a number of loopholes that were identified dealing specifically with issues in respect of companies that were engaged on matters of fronting and also to ensure that we better align the BEE imperatives with the need to promote industrialisation of the South African economy.
Over the past 20 years of freedom, we have also been able to analyse the extent to which the BEE has been able to achieve the required results, from the number of black people who have been able to participate in either shareholding, with little board influence and strategic oversight, to the extent to which black people have direct executive responsibility for major enterprises in manufacturing, agriculture, mining and other services.
There is therefore a need to intensify black participation in the productive sector, especially in sectors prioritised in Ipap, such as plastics and chemicals, automotives, agro-processing, metal fabrication and downstream mineral beneficiation, to name but a few.
To facilitate a more meaningful participation of black people in the mainstream economy, we will look at various ways to develop black sustainable industrialists. I will be leading a team that will be working closely with the Presidential Broad-Based Black Economic Empowerment Advisory Council to develop special action in this regard.
One such action will be the creation of a targeted incentive to support black entrepreneurs entering the industrial sector, including the film sector, as well as focusing more on talent support, which is often ignored. The government's Infrastructure Build Programme, as well as government's procurement of goods and services for its normal operations, provides a crucial opportunity for deepening and transforming the industrial base in South Africa.
Assisting local enterprises to provide these goods and services will create jobs in South Africa, develop skills and create a springboard for these enterprises to progressively develop their capacity and eventually enter the export market. Doing so is not just patriotic from our side, but also, more importantly, is an economic and financial necessity that we as the DTI will have to do. We will be working towards meeting the target of 75%, as set by the ruling party, of government procurement of goods and services produced by local manufacturers throughout the country.
However, the government cannot drive the industrialisation agenda alone. There is also a clear need for partnerships with the private sector and broader society if we are to be able to drive this agenda successfully. The focus over the medium term will be on engagement with industry through an initiative called "Taking the DTI to the factories", amongst others, so that we get to exchange the programmes of government that we lead.
We believe that to create new opportunities for the private sector to engage with the DTI, and for the DTI to provide information on the kinds of support that is available to them, will enable us to take our economy forward.
Given the challenges of unemployment in the country, we are calling on the private sector to utilise state instruments to fully participate in the One Company, One Job initiative, the campaign that will be driven by my office, working together with business, labour and civil society so that we can deal with issues of unemployment. [Applause.]
We will further monitor government expenditure linked to the ruling party's commitment to job creation, including imposing some requirements on companies doing business with the state at all levels. We will also focus on companies that are accessing some of the incentives of the state, like companies that approach the state requiring licensing as well as those that are doing imports and exports, so that we are able to engage the broader economy. [Interjections.]
Minister David has correctly articulated that we are now more determined to implement a high-impact industrial policy that would respond to the imminent threat of de-industrialisation and will lay the basis for the creation of a stronger industrial base. Equally, when the Minister was speaking here, he correctly reminded all of us about designated goods and services that are to be procured to meet the said percentage.
Indeed, we should welcome the next designation of strategic products to be added to the R1 trillion in goods and services that our government spends per annum so that those products can be procured from our people, as proposed.
The youth forms a large part of our population and it is a segment that is mostly affected by unemployment, at the rate of 36,1% according to the statistics of the first quarter of 2014.
As the DTI, we are going to launch a number of initiatives to address issues of youth unemployment. Due to the time factor, I am not going to elaborate further on those issues.
The process of developing financing mechanisms to ensure that small businesses as well as young people access start-up finance is at an advanced stage. We will work together with other financial institutions to ensure that young entrepreneurs are able to access these benefits from government.
Furthermore, a range of financial reforms are on the cards to ensure that inclusive growth is realised as well as access and participation by the majority of our people who have not been able to have access. It is not going to be "business as usual" if we are to achieve the radical economic programme. We must just state at this point that we are not going to be reckless or adventurous, but we are going to be much more radical, bold and decisive in proposing some of the reforms. [Interjections.]
Women's empowerment is still central to our plans as the DTI. We recognise that women play a critical role in South Africa's economy. As such, we have a number of programmes that we are going to implement, which our colleagues in the small, medium and micro enterprises, SMMEs, are going to be alluding to so that we can share some of the experiences. Over the years, the DTI has developed mechanisms to ensure that we integrate women into the mainstream economy. [Interjections.]
With regard to the current review of the National Export Strategy, NES, we aim to prioritise markets around Africa as a continent as well as in the Brics countries, because we think that those markets are fast developing. [Interjections.] [Laughter.] We must just state that some of the key initiatives that we are going to be looking at concern issues relating to the antipiracy programme that we are going to be rolling out. More importantly, we are also going to focus more on film and television, which have continued to play a major role in the country. There are a number of other proposals that we have here, including looking at the issue of needle time in the music industry.
We want to call on our colleagues to work together with us to ensure that we bring integrity to the work that we as a department do. However, the opposition must assist us where we are not making inroads so that we are able to grow the economy of South Africa. [Interjections.]
The President has made a call for radical socioeconomic transformation. All of us will have to work towards that. Thank you very much. [Time expired.] [Applause.]
Chairperson, is it parliamentary for the Deputy Minister to refer to the Minister as "the hon David"? I thought his name was "Davies". [Laughter.]
Hon member, sit down. [Interjections.] Order!
Chair, please allow me to acknowledge Minister L Zulu, Minister R Davies and other Ministers present; Deputy Minister Masina and other Deputy Ministers; members of the NA; MECs, if they are here; Acting Director-General, Ms P Ncaphayi; Director-General of the Department of Trade and Industry, Mr L October; leadership of SA Women Entrepreneurs Network, Sawen, represented by Ms Ruth Masokoane, Ms Gail Downing as well as Ms Zanele Xaba; Chair of Technology for Women in Business, Twib; Speaker of Ekurhuleni Metropolitan Municipality; leaders of business, labour; distinguished guests, I would like to specifically recognise my Techno-Girls competition winners from Photani Secondary school in Malamulele, Limpopo province, who are seated over there. [Applause.] These are future industrialists, economists, people who are going to change our country and whom we believe in nurturing and, as a caring ANC-led government, have trained them. We hope that they will do well - congratulations. [Applause.]
As we begin the fifth term in Parliament, we are more eager to move South Africa forward and strongly believe that our products and services as the new Department of Small Business Development will respond to the needs and aspirations of our entrepreneurs. In this regard, the Department of Small Business Development, led by Minister Zulu, will aggressively explore opportunities for small, medium and micro enterprises, SMMEs, and co- operatives locally and across the globe. We have already begun work and will move our people out of poverty and help create the 6 million job opportunities that President Zuma spoke about during the launch of the ANC's manifesto.
I can assure you, hon members, that we are already working towards achieving this goal by supporting our entrepreneurs in sectors of the economy that have the potential to create jobs as they increase production, hence my emphasis on access to markets despite many other challenges faced by SMMEs, including access to finance, skills development and so forth.
A week ago, I led a delegation of women, and a few men, of course, to Santa Fe in New Mexico, and Atlanta. In Santa Fe ... [Interjections.] We were not shopping. Listen, we do not spend taxpayer's money on shopping, but the Folk Art Market attracts buyers from many countries and this year's participation was even greater. The project, though small in scale compared to other missions, provides crafters from the most rural areas an opportunity to present to modern-day collectors traditional artwork that some of the middle persons - that I am sure some of you people are supporting by buying products that cost R200 - sell for 200E and 200$. That is what we have tried to ensure; that we can take our people straight there to sell their products. Some of them make money that they can live on for two or three years. This is what the Department of Trade and Industry has been doing and will now be done by the Department of Small Business Development. We do not just theorise, we do work and this is exactly what has happened [Interjections.] Listen! Again, shut up, thula! [Interjections.]
Chairperson, on a point of order: It is not parliamentary for the hon member to say "shut up" to hon members. I want the hon Deputy Minister to withdraw that now.
Hon Deputy Minister, I think that "shut up" was too sharp. [Laughter.] I would like you to withdraw that.
They are also too sharp. I apologise, and move on.
Thank you very much. Continue.
We have also re- established a permanent showroom in Atlanta, USA, showcasing home dcor lifestyle products from this beautiful country. The products displayed in our showroom are primarily produced by co-operatives and small businesses owned by women and men. We have also ensured that they represent our diverse culture and rich heritage.
I am proud to share with you that we received the Hashtag and the Atlanta Market Favourite awards for ottomans made by Ozzy's Eco Decors, owned by Yolanda Msutwana from East London. [Applause.]
Congratulations!
These are the two primary awards that are offered by a third party to identify the most impressive, unique, inspiring products at all of the 2014 July markets. It is quite prestigious for exhibitors to win even one of these awards, but to win two of them is quite an exciting honour; a good story to tell. [Applause.] Not theory, a good story! You can talk to those crafters and they will be able to tell you that through the ANC-led government they managed to reach those markets.
While South Africa and Africa as a whole have an abundance of creative talents and handicrafts, it is sad that out of the 10 leading crafts and arts exporting economies, only three were from developing economies, namely China, the Republic of Korea, and India, with the rest being made up of Belgium, Turkey, the USA, Italy, France, the Netherlands and the United Kingdom. No African economy features in this top 10. This is definitely a niche market that the department should explore, working together with the Departments of Economic Development and of Trade and Industry. [Applause.]
Our continued participation in the Santa Fe Folk Art Market depends on the support of all. Make sure that you are in the showroom; make sure that you give access to our people so that they can create jobs in terms of making sure that they have orders. There are figures that you can research for yourself, but the increase is there in respect of our products, because our people make very good products. Of course this is all done within the Department of Trade and Industry and now will be done by the Department of Small Business Development.
So, some of the members need to do their research. Yes, I agree, we do not yet have everything, but on the other hand we cannot just get two international awards while not making good products. We are indeed making good products and, of course, supporting business. We have started, in the portfolio committee, to discuss the issue and I am sure hon Chance will not come again and tell us that the ANC is not pro-business. We have proven that we are pro-business; we have taken some of the entrepreneurs abroad just last week to make sure that we can and we do support them.
We hope that you will be able to agree with me that we opened small business offices here in the Western Cape under the Small Enterprise Development Agency, Seda, after the DA-led government closed Red Door. It is because we support entrepreneurship. We support small businesses because we believe that it is what we must do. That is a clear, straight point that we do not have to debate too much. We will go ahead and then deal with the implementation of the co-operatives academy, together with the Department of Higher Education and Training. I saw the Deputy Minister here.
Allow me to say that we have trained 170 women, that is women falling under Sawen, together with the Consumer and Corporate Regulation Division, CCRD, from the Department of Trade and Industry and the gender unit, to sit on many boards. Given the fact that few women are sitting on boards, we will continue with this programme. It is making quite good progress.
Ba re bommangwana ba tshwara thipa ka fa bogaleng. Nna ke a re, kgale dithipa tse di re sega. [A mother will do anything to ensure that her children are taken care of. But I must say we are used to carrying out this responsibility.]
We are no longer feeling the pain. We are ready to move our country forward. Under the leadership of the ANC-led government, our department will be able to move forward and make sure that we support small business and create job opportunities. I thank you. [Applause.]
Chair, I rise on behalf of my colleague, the hon Dr Mario Oriani-Ambrosini.
We are critical of this department that we see as a department of welfare for traders and industrialists rather than a department for the promotion of trade and industry. We wonder how much longer it will take before it is recognised that welfare policies do not promote economic growth.
Economic growth is happening north of our boundaries in countries such as Botswana and Zambia that have adopted the type of pro-business and free market-based approach which the IFP has been appealing for decades. This department should be the grand advocate of business concerns within the collegial thinking of Cabinet, but it is not. It goes along with the mindset of a welfare state that will never become a developmental state.
Under its umbrella responsibilities, in terms of the Industrial Policy Action Plan, Ipap, this department should make its voice heard on a variety of issues and should do so publicly, loudly and effectively, but it has not done so, remaining meek and weak.
It should have proclaimed to the Minister of Finance the madness of the obsolete and absurd Exchange Control Act, which makes it a nightmare for foreigners to do business in our country. It should have criticised the Minister of Home Affairs for the new immigration regulations, as these are also an expression of policies having been derailed as they stop those wanting to settle in our country.
Closer to home, the department should have more openly welcomed the IFP's Private Member's Bill introduced by Dr Ambrosini - the Medical Innovation Bill - which promotes the legislation for and regulation of cannabis for commercial and industrial purposes. This Bill ticks all the boxes in that it promotes a viable product with a varied domestic and international market, within a framework in which we can finally use co-operatives, both as ground-level and as second-tier co-operatives. Cannabis is the perfect product to show the viability of the newly established co-operatives, and yet not a single word of public support has come from this department, in spite of the country having intensely debated the issue for six months.
The examples could have multiplied, but have not. Further to the point, this department has yet to find the inspiration, courage and ideological fortitude to do its job and be the countervailing force to the prevailing policies driven by labour and welfare considerations.
This department should have raised its voice when the Minister of Land Affairs allowed the publication of the draft policy forcing the gratuitous transfer of 50% of farmland from owners to tenants, something that has placed an entire segment of our economy in disarray.
It should have spoken out against the continuously disastrous role of the South African Airways, whose monopoly and trade practices have undermined tourism, one of our few viable industries.
It should have continued to demand the reform of the Labour Relations Act to introduce maximum flexibility in the labour market so that South Africa may become productive and competitive throughout its territory, and not only in designated special economic zones. [Interjections.] All this and much more this department should have done, but did not, and under its present leadership ...
Chair, I rise on a point of order: The Minister is expected to respond after this. The hon member is going on and on and I cannot hear what he is saying. I am sure that the Minister is also unable to grasp what he is saying. So, could he speak more slowly, please? [Interjections.]
Thank you. Continue, hon member.
Sihlalo, vele phela enenxeba kusheshe kuzwele kuyona. Futhi siyijwayele le genge ephaphayo ngoba nakhu ifuna ukugqama ... [Chairperson, the truth often hurts. Also, we are familiar with people who are forward, who always want to be in the limelight ...] [Laughter.]
Thank you, your time has expired, hon member.
Uma ethi akezwa ... ngiyaqhubeka impela. [If he says he doesn't hear...let me continue.] [Interjections.]
Hon Hlengwa! Hon Hlengwa, your time has expired.
Zonke lezi zinto ... Ngiyathokoza Sihlalo. [All these things ... Thank you, Chairperson.] [Interjections.]
Chair, I rise on a point of order: I would like to know whether it is parliamentary for the hon member to say "la magenge aphaphayo" [these forward fellows]. [Interjections.]
Hon Hlengwa, it is derogatory and I am sure you know what you meant by that. I would like you to withdraw the words "la magenge aphaphayo". Please assist the House.
Hon Chairperson, with due respect to the Chair, I would like clarity with regard to what I am expected to withdraw, because "amagenge abantu" is a group of people. [Interjections.]
Hon Hlengwa, I did not really ask for an explanation. What I have raised is that "la magenge aphaphayo", the utterance that caused the hon Deputy Minister to raise the point of order, is derogatory. Therefore I am asking you to withdraw the words "la magenge aphaphayo".
Chair, I am unable to do so, because I was not referring to the Deputy Minister or a member of this House. I am unable to withdraw that, sir.
Hon Hlengwa ... Wait for a while, hon Mncwango. I am still addressing hon Hlengwa.
Ngiyabonga, Sihlalo. [Thank you, Chairperson.]
For the benefit of the Chair ... [Interjections.]
Order, hon members! Order! Could we all keep quiet! I have not recognised you, hon Mncwango. I am still addressing hon Hlengwa.
Thank you.
Hon Hlengwa, what I said is that the words "la magenge aphaphayo", in reference to the point of order raised by the Deputy Minister, are derogatory. I therefore request that you withdraw the words "la magenge aphaphayo". [Interjections.] Can we be orderly in the House! [Interjections.] I expect hon Hlengwa to respond by withdrawing those words so that we can move forward.
Hon Chairperson, with all the respect due to the Chair, I want to repeat again that if I withdraw that statement I would be setting a precedent that would stifle the expression of the isiZulu language. [Interjections.] Therefore, I am unable to do so. [Interjections.]
Chair!
Order! [Interjections.] Order, hon members! [Interjections.] Order! Hon Hlengwa, if you do not accept the Ruling, you will need to excuse yourself from the House. [Interjections.]
Thank you, Chair. [Interjections.]
Order! Order, hon members! I expect hon Hlengwa ...
On a point of order, hon Chair.
Just hold on! I expect hon Hlengwa to respond to the Ruling. [Interjections.] I said that if he did not accept the Ruling to withdraw those words, he would have to excuse himself from the House.
May I please address the Chair on the Ruling?
That is the final Ruling on the matter pertaining to hon Hlengwa. Will hon Mncwango please be seated for now. [Interjections.]
Chairperson, as I indicated to you, with all due respect, I am not going to legitimise ... [Interjections.]
Hon Hlengwa, excuse yourself from the House! [Interjections.] Order, hon members! [Interjections.] Order, hon members! [Interjections.]
The member thereupon withdrew from the Chamber.
Chairperson, may I address the House? [Interjections.]
Are you raising a point of order? [Interjections.]
Chairperson, I am concerned about the level of screaming in the House. Could we perhaps just have some order and hear one person at a time? [Interjections.]
Hon members, I need to call on all of you to behave in an orderly manner. We cannot all speak at the same time. It seems as if you are singing. You are ruining the decorum of the House, and that is untenable. When we call for order, hon members must respond to the call and keep quiet. Thank you.
Chairperson, Minister, the committee and the department form the firewall of South Africa in the sense that without economic expansion the fabric of our society will start to unravel. What the committee does and what the Minister and the department plan and execute are to a great degree the difference between having a country that works or not.
In this endeavour it is important that the tool used to create wealth must be the free market. It is the only system proven to work. The question is finding the right model.
Scientists, especially those from the fields of econophysics and the chaos theory, have confirmed that the equilibrium and rational economic agent theories are flawed. The real-life economic system is complex, chaotic, in disequilibrium and the economic agents are not rational. This means that the system needs clever nudges to provide the desired outcomes, but these require a light touch to avoid unintended consequences due to the system's complexity.
Die onsigbare hand van die vrye mark werk ongelukkig nie perfek nie en kan vasval in die aantrekkingskrag van magskonsentrasies, tot nadeel van talle mense. In daardie opsig steun die VF Plus wel uiters beperkte inmenging. Daarom aanvaar ons aspekte van die regering se industrile beleidsaksieplan as sodanige poging, soos plaaslike produkontwikkeling. (Translation of Afrikaans paragraph follows.)
[The invisible hand of the free market does, unfortunately, not function perfectly and can get stuck in the appeal of power concentrations, to the disadvantage of numerous people. In that regard the FF Plus no doubt supports extremely limited interference. That is why we do accept aspects of the government's Industrial Policy Action Plan, Ipap, as such an attempt, like local product development.]
You are already on your last two minutes.
Thank you, Chair.
Die problem is egter dat, ten spyte van die Ipap, industrialisasie steeds aggresief plaasvind. Hoewel daar verskeie negatiewe faktore is wat van buite die landsgrense die ekonomie benvloed, daar wel faktore is wat binne die land se beheer is. (Translation of Afrikaans paragraph follows.)
[However, the problem is that, in spite of Ipap, industrialisation is still happening aggressively. Although there are several negative factors that are impacting on the country's economy from outside its borders, there are indeed factors that are within the country's control.]
Let us make some suggestions, Minister, to kick-start the economy with this budget.
Firstly, entrepreneurs and businesspeople detest red tape. In light of this, we request the Minister to drop the Business Licensing Bill or only to allow licensing for those businesses that deserve regulation for the public good, such as those in the food industry.
The parliamentary portfolio committee has accepted the proposal of the FF Plus, as contained in the budget report, which requires any policy by the department to be supported by research to be submitted to the committee for interrogation. This includes a regulatory impact assessment for every Bill and every regulation. This will strengthen the committee's oversight function. We trust the Minister will accept this request. This will reveal broad-based black economic empowerment, BBBEE, as an irrational policy that leads to rent-seeking and really strengthening the status quo by enriching a few individuals. We need a new policy that works and creates wealth.
Verder versoek ons die Minister om beter finansiering vir die Verbruikersraad en die aanstel van Afrikaanse en amptelike taalsprekers sodat almal in die land inklusief bedien kan word. (Translation of Afrikaans paragraph follows.)
[Furthermore, we call on the Minister to provide adequate funding to the Consumer Council and to appoint speakers of Afrikaans and other official languages in order to provide services in a more inclusive manner to everyone in the country.]
Lastly, we think that experimenting with economic programmes to test what truly works must be considered. In that respect, while it may seem counterintuitive to traditional ANC thinking, pockets of freedom zones should be created where strict interventionist policies like BBBEE and affirmative action are not applicable. Thereby one can gauge whether those pockets create more jobs than other areas.
Once we have proper research in place we can make proper decisions on what works at the end of the day. Thank you. [Time expired.]
Hon Chairperson; hon Ministers and Deputy Ministers; hon members; the Acting Director-General of the department, Ms Ncaphayi and her team; the small, medium and micro enterprises, SMMEs, and co-operatives represented here; ladies and gentlemen and fellow South Africans, the ANC has tasked me with explaining the context in which the ANC government is developing SMMEs and co-operatives. Before I do that, I will explain why we are participating in the Budget Vote debate of the Department of Trade and Industry.
I will briefly report on the oversight conducted by the Portfolio Committee on Small Business Development since the proclamation of the Department of Small Business Development so that hon members can understand where the process is now.
The Portfolio Committee on Small Business Development is participating in the Budget Vote debate of both the Department of Trade and Industry and the Department of Economic Development, because the budget allocated for SMMEs and co-operatives is currently in these two departments. The Minister of Small Business Development briefed the portfolio committee on the mandate of the department, which the portfolio committee supports.
The process of establishing the Department of Small Business Development to become a fully fledged department with its own budget is progressing well. The budget report of the Portfolio Committee on Small Business Development therefore relates only to the mandate of the department for now.
All the political parties that attended the portfolio committee meeting that considered and adopted the report supported it. We thank all parties for their frank political engagement with the Ministry, pointing out issues that affect SMMEs and co-operatives, which the Department of Small Business Development will need to address.
The exclusion of the word "co-operatives" from the name of the department was sharply highlighted by the ANC in the context of marginalising and treating co-operatives as a secondary issue. All parties supported the view of the ANC study group. The ANC study group believes that co-operatives have a political-perspective role to play in the development of SMMEs. If adequate support is given to SMMEs and they are made to understand the concept of co-operatives, SMMEs could become a powerful co-operative movement that could control the economy, as is the case in Kenya, and the Mondragon co-operative in Spain.
The Portfolio Committee on Small Business Development thinks that the department should be named the "Department of Small Business and Co- operative Development". A number of co-operatives that have contacted the portfolio committee share the same view.
Kungaba kuhle ukuthi silungise igama lomnyango kusaqala nje, kungaze kwakheke isithombe sokubukela phansi izinhlangano ezisebenza ngokubambisana ezingqondweni zabantu. Kumele senze abantu bazi ukuthi izinhlangano ezisebenza ngokubambisana zinezimiso zokwakha imiphakathi, azifani namabhizinisi ancike kogimbelakwesabo anenhloso yokwenza imali kuphela.
Izinhlangano ezisebenza ngokubambisana yizo ezingasiza kakhulu ekushintsheni indlela yokuphathwa komnotho waleli zwe, ubuyele ezandleni zabantu nakubasebenzi bezimboni, kuphinde kuphele nokuxhashazwa kwabasebenzi ngongxiwankulu nogimbelakwesabo. (Translation of isiZulu paragraphs follows.)
[It would be a good idea to change the name of the department at the very beginning of its establishment before the general impression that co- operatives are looked down upon is created. We must inform our citizens that co-operatives are aimed at developing communities, unlike capitalist businesses whose sole aim is the generation of profits for themselves.
Co-operatives could play an important role in changing the manner in which the economy of the country is handled. They could pave the way for ordinary people and blue-collar workers to play an important role in the development of the economy, thus eliminating the exploitation of workers by greedy capitalists.]
We should avoid having a narrow perspective of co-operatives and begin to place them at the centre of our radical socioeconomic transformation agenda. We also need to confront the evils of capitalism that are dominant in our economic space. The issue of the name of the department therefore becomes very crucial in creating the correct mind-set about what we seek to achieve through SMMEs and co-operatives. [Applause.]
The portfolio committee and the Ministry have agreed to have a strategic planning workshop before the final configuration of the department so that the portfolio committee can also provide the political leadership required of it. The strategic planning workshop will take place before the Budget Review and Recommendation Report process.
We still need to understand which programmes will migrate from both the Department of Trade and Industry and the Department of Economic Development.
Hon members, resolutions of the 53rd conference and the Election Manifesto of the ANC outline specific interventions in the identified challenges of poverty, unemployment and inequality. The establishment of the Department of Small Business Development is a direct intervention in these challenges.
The 53rd conference of the ANC resolved that, in the second phase of our transition, the ANC government would lead a radical economic transformation agenda as a continuation of our struggle for liberation and a consolidation of our democracy. The focus of the ANC government on small business and co- operative development is in the context of building a developmental South Africa, wherein ordinary citizens would actively participate in their own development. Our job creation drive is in the context of enabling workers to own the means of production. [Interjections.]
The small, medium and micro enterprises, SMMEs, and co-operatives therefore become an important pillar in mobilising communities actively to participate in the second phase of our transition. Those who think that SMMEs and co-operatives are Cinderella businesses that deserve only breadcrumbs have a lot to learn about our radical socioeconomic transformation approach and should prepare themselves for a radical paradigm shift.
The current situation in market share that is 80% big business and 20% SMMEs and co-operatives will have to change to 80% SMMEs and co-operatives and 20% big business. [Interjections.] This would demonstrate the firm commitment of the ANC government to inclusive economic growth that begins to address the socioeconomic inequalities that exist in our society. The growth of our economy should have a direct impact on poverty reduction, resulting in poor families becoming self-sufficient and self-reliant. There should come a time in South Africa when not so many poor families are dependent on social hand-outs for daily survival. [Interjections.]
The development of SMMEs and co-operatives should be aimed at creating a permanent exit of poor families from the social grant register and the indigence registers of municipalities.
Sihlalo, ngokuthuthukisa amabhizinisi amancane asafufusa, phecelezi ama- SMMEs nezinhlangano ezisebenza ngokubambisana siqonde ukuthi uma kufika unyaka wezi-2030 babe sebabaningi abanezithakazelo, abayobe sebenezitolo emadolobheni amakhulu nezimboni zokukhiqiza ukudla nezimpahla. Akungabi sengathi thina bendlu emnyama sasidalelwe ukuthenga nokuba yizisebenzi ezimbonini zabokufika kuleli zwe lobabamkhulu. (Translation of isiZulu paragraph follows.)
[Chairperson, we have set ourselves a target, that by 2030 small and developing businesses - that is SMMEs and co-operatives - should be well developed. Our goal is that many of these business owners should own businesses and factories that produce food and other products in big cities. It should not look like we black people were destined to be only customers and servants in the industries owned by those who are not the indigenous inhabitants of this country.]
We will not only give people fish to eat, we will also teach them how to fish. [Applause.] We will ensure that SMMEs and co-operatives operate in the mainstream of the economy and become the backbone of our economic transformation process. Through SMMEs and co-operatives, the ANC government seeks to bring about sustainable development. One of the objectives is to effectively reduce the gap between the rich and the poor. [Applause.] We can only achieve this goal by putting in place proper support systems and creating investment opportunities for SMMEs and co-operatives, as well as ensuring that there is a sustainable market for them, starting with government becoming such a sustainable market.
The biggest challenge to the development of SMMEs and co-operatives would be our own failure to understand the role that SMMEs and co-operatives can play in reversing the inequality that exists in our economy. We should be brave enough to admit and overhaul policies when we realise that some of them do not adequately address the needs of SMMEs and co-operatives and, as a result, retard progress.
We will not be shy to exercise our power to legislate and to use the space we occupy to remove obstacles that prevent the development of SMMEs and co- operatives.
Some of the policies that we will focus on to assess their impact include the Preferential Procurement Policy, the Set-aside Products Policy, the Broad-Based Black Economic Empowerment Policy and the price-based Supply Chain Management Policy. Our target group for development includes organised groups that operate on the periphery of the economy and continue to be exploited. These groups include the taxi industry, street vendors and hawkers, stokvels and burial clubs. These are real broad-based black economic empowerment groups that organise themselves. They resemble the structural design of co-operative movements that exist in other countries, yet they are continuously exploited and marginalised in South Africa. Our role will be to release them from the shackles of exploitation.
An announcement by the President is non-negotiable. That should be understood by all government officials. This includes an announcement like the 30-day payment policy relating to all invoices for goods and services supplied to government that was announced by His Excellency President Jacob Zuma.
This means that all government departments and all spheres of government must pay service providers within 30 days of the invoice. [Applause.] There are government officials in various departments who do not process and pay invoices of SMMEs and co-operatives within 30 days, resulting in affected SMMEs and co-operatives being forced to close down due to nonpayment by a government they voted into power - a shame, an embarrassment and a complete lack of understanding of what the struggle was all about.
To government officials with an ANC background, I would like to say that we depend on you, comrades, to instil revolutionary values and principles at bureaucracy level. [Interjections.]
Order, hon members! Order!
Failure to comply with a command of the commander-in-chief, President Jacob Zuma, and nonpayment of invoices of SMMEs and co-operatives within 30 days is counter-revolutionary in the true sense. [Interjections.]
Sihlalo, sifuna kucace kumuntu wonke ukuthi uKhongolose wathi uzovula amathuba emisebenzi. Amabhizinisi amancane asafufusa kanye nezinhlangano ezisebenza ngokubambisana azikwazi ... [Ubuwelewele.] (Translation of isiZulu paragraph follows.)
[Chairperson, we would like everyone to know that the ANC promised to create job opportunities. Small businesses and co-operatives cannot... [Interjections.]]
On a point of order, Chairperson.
Order!
There is no interpreting service.
... ukuthi zingakhokhelwa nguhulumeni zize ziwe, zivalwe, kuphele imisebenzi kuze kulambe imindeni ngoba nje umsebenzi wahulumeni efuna ukufumbathiswa noma evilapha ukwenza umsebenzi awuholelayo. Yinto embi neyihlazo ebonisa ukungazi lutho ngomzabalazo waleli zwe kanjalo nokungabazweli abantu abahluphekayo.
Abasebenzi bakahumeni abajwayele lo mkhuba abawuyeke. Labo abangakawenzi abangawuqali, usho kanjalo uSotswebhu ohloniphekile, u-Comrade Stone Sizani. [Ihlombe.] Abenza lo mkhuba sizobabiza bazosichazela ukuthi abawakhokheli ngani amabhizinisi amancane asafufusa kanye nezinhlangano ezisebenza ngokubambisana, zingakapheli izinsuku ezingama-30, ngoba phela le mali akuyona eyabo imali kahulumeni. Uma beshwashwatha kuyodingeka ukuthi bajeziswe. Asidlali! (Translation of isiZulu paragraphs follows.)
[... survive without getting their due payment from the government to the point that they run out of business and close down, which leads to the loss of jobs and the impoverishment of families. This happens when government officials demand bribes or are too lazy to do the jobs that they are paid to do. Such acts are so disgraceful, since they imply their ignorance of the history of the struggle for freedom in this country and it also indicates that they do not have the poor's best interests at heart.
Government officials who continue to display such disgraceful behaviour should refrain from it. Those who have not yet started it should not even start as the hon Chief Whip, Stone Sizani, said. [Applause.] The government officials who are involved in corruption will be summoned and asked to explain to us why they do not pay out small businesses and co-operatives for services rendered within 30 days, since the funds paid out come from the government not from their own pockets. If they cannot explain themselves they will have to pay the penalty. This is not a joke!]
We are moving South Africa forward. The ANC strongly believes that the establishment of the Department of Small Business Development is a step in the right direction. The ANC supports the budget allocation for SMMEs and co-operative development. I thank you. [Applause.]
Chairperson, hon members, visitors in the gallery, good evening, sanibonani, goeienaand. The hon members across from me like telling stories, but let me tell a story of my own. And thank you so much, hon Bhengu, you gave me the perfect introduction. For many South Africans the formation of the Department of Small Business Development is a fairytale come true. And in all fairytales there are heroes as well as villains. Will the heroine be the new Minister, the hon Lindiwe Zulu? Perhaps so, if she casts herself in the role of Cinderella.
HON MEMBERS: Viva!
As Cinderella she can shake off the shackles of her two ugly sisters - the Departments of Trade and Industry, DTI, and of Economic Development - which for the past five years have been a great disappointment as regards creating opportunities for small business. Like Drizella and Anastasia, with their big feet and unwieldy frames, they have been slow to move and have presented the disagreeable face of the ANC government to small business. Now small businesses have an opportunity to emerge from their shadows and be nimble of foot. I have made it clear to the hon Minister that I will adopt a constructive approach to the department and in the committee.
So let me take the analogy a step further by saying I am willing and ready to play the role of Prince Charming ...
HON MEMBERS: Viva! [Applause.]
... opposite Minister Zulu's Cinderella. The DA has the experience and finesse to fit the slipper of enterprise and opportunity onto the hon Minister's delicate foot. Instead of the clumsiness displayed by her sister, the DTI, the new Ministry has an opportunity to tread boldly along the path of small business development. Her inheritance is mixed. On the report scorecard we might say: Good intentions. Short on delivery. To paraphrase Winston Churchill, the hon Davies would have us believe he is a very modest man. Indeed, he has a lot to be modest about. [Laughter.]
The FinScope Small Business Survey found that only 4% of small businesses had heard of the DTI's flagship small business support agency, Seda. By its own admission, Seda had to refocus its strategy after years of mediocre performance. We will be scrutinising it closely in the coming years and expect a dramatic improvement. We need a massive upscaling of support for small business and co-operatives in South Africa. Brazil, for example, has over 400 business incubators. The DTI's target is 250, but it has not yet set a date for the implementation of this.
Nearly two years after the incubator support programme was announced, reportedly only eight are up and running, of whom only two have received the promised funding. That is just not good enough. Perhaps the most urgent priority for Minister Zulu is to lead the creation of an entrepreneurial ecosystem in South Africa. The Global Entrepreneurship Monitor 2014 Report, arguably the most authoritative of its kind, rate South Africa below our SADC neighbours and other emerging economies in all the major markets of entrepreneurship.
In South Africa it is more attractive and lucrative to get a comfy job in government than to start a business. This has to change for the country to create the jobs we so desperately need. By rigorously pursuing the strategy outlined in the National Development Plan, NDP, the Department of Small Business Development can reduce the cost of doing business, make it easier to hire employees, boost local procurement and greatly expand instruments for financing and marketing small businesses and co-operatives. This includes implementing the latest recommendations of the Davis Tax Committee.
With regard to the issue of local procurement, let this be interpreted to mean not just South African products, but also those produced by small and informal township and rural enterprises for local retail and wholesale outlets. If hon Zulu sticks to this plan, we can make history by voting in unison on the new department's budget later this year. I look forward to constructive engagement in the coming months with that end in mind. But please, Minister, no more flirtations with the national democratic revolution - that is the ugliest sister of them all.
Ngiyabonga. [Thank you.] [Time expired.] [Applause.] [Interjections.]
Chairperson, on a point of order: Do you know that since we have begun with this process, there is an hon member from the ANC who is always interrupting people who are speaking. Maybe she should be given a chance to speak, because we can't hear what she is saying. It's really irritating.
Okay, sit down, hon member.
Please.
Thank you.
Modulasetulo ya kgabane, Matona a kgabane a teng kajeno le Batlatsi ba bona, Ditho tse kgabane, Bahlanka ba Lefapha ba etelletsweng pele ke Molaodi e Moholo le Molaodi ya tshwereng mokobobo, ba amehang esitana le ditheo tsa Lefapha la Kgwebisano le Indaseteri, DTI, baeti ba hlomphehang, bomme le bontate, tjhebelo pele ya nako e telele ya Aforika Borwa ke ho bopa setjhaba se lekanang. Jwalokaha e hlaloswa ke Moralo wa Ntshetsopele wa Naha,National Development Plan, NDP, le Industrial Policy Action Plan, Ipap, eitshetlehile mohopolong ona mme e thathisetsa ebile e fupere tshiya ya bohlokwa ya dintlhakemo tse radilweng ho ya kamoo di tekilweng kateng motjheng wa kgolo e ntjha. Tsena di kgonne ho etswa feela ke ANC. Ke kahoo kajeno lena re utlwang ba ka lehlakoreng lane le letona ba bua ba etsa mabinabine hore NDP, Ipap le Freedom Charter ke eng? Kaofela ditokomane tseo - ANC.
Mmuso o tlameha ho thea tsebe o be o bontshane mabaka le setjhaba ka kakaretso. Ha o ntse o hahamelletse momahanong ya maano kahare ho mafapha a mmuso, esita le ho bohle ba amanang mmoho le balekane bao re sebedisanang le bona.
Diphephetso tsa bohlokwa tsa moruo wa Aforika Borwa di amana haholo le boqhetseke ba mosebetsi, leqeeme la mesebetsi le kgaello ya bokgoni ba ho phetha mesebetsi ditheong. Ho ya ka maemo a renang mothathing wa jwale, esita le manti-a-makoma a hore ANC e se e busitse ka dilemo tse 20, jwale re tlameha ho latela motjha o hlwahlwa wa phethoho e kgolo moruong ho rarolla mathata a bofuma, ho se lekalekane le leqeeme la mosebetsi. Katoloso ya seabo moruong e bolela ntshetsopele ya maemo le mawa a thehwang tikolohong e ntle bakeng sa SMMEs, ebile e ntlafatsa qothisano ya lehlokwa ya meruo ya dibaka le ya diporofensi ho fihlela kgolo e lekanang le tlhahiso ya mesebetsi.
Modulasetulo, katoloso ya seabo ke e nngwe ya mawa a ileng a talolwa ke Moporesidente Puong ya Pulo ya Palamente. Lena ke lenaneo la boraro le leholohadi la DTI ka kabo e fetang R1 bilione bakeng sa selemo sa ditjhelete sa 2014-2015. Tjhelete ena e reretswe mesebetsi e latelang: ho fana ka tshehetso ya ntshetsopele ya dikgwebo dikoporasing ho ya ka Molao wa Dikoporasi le ho bapatsa broad-based black economic empowerment, BBBEE; matlafatso ya basadi ka Letlole la Basadi la Isivande, le fanang ka ditjhelete tse lekanang dikgwebong tsa mahaeng makaleng a fapaneng a moruo. Nako e kgolo le e nyenyane dibui di bua hore ha ho na mosebetsi o etswang mane dibakeng tsa mahae. Hona ke sesupo sa hore ha ba latele ditokomane tsa mmuso ka botlalo hore ba tle ba utlwisise hore le dibaka tsa mahae, le dibaka tse fapaneng di a kgona ho fihlellwa ke mmuso o eteletsweng pele ke