Hon Chairperson, Ministers and Deputy Ministers present, and hon members of this august House, next week, on Friday, 25 May 2012, Africa marks the 49th anniversary of the formation of the Organisation of African Unity, OAU. This organisation was formed by 30 leaders of the then 32 independent African states. Its historic mission was to ensure that Africa is free from colonialism. One of the founding leaders of the OAU, former President Kwame Nkrumah, said in 1961:
Divided we are weak; united, Africa could become one of the greatest forces for good in the world.
As we participate in this 2012 Budget Vote debate of Trade and Industry, those wise words of President Kwame Nkrumah are still as relevant today as they were 51 years ago. This "great force" that Africa could become could have been obtained from the vast mineral and natural resources of Africa. President Kwame Nkrumah was one of the pioneers of rapid industrial development, propagating that the resources of Africa must be beneficiated before they are sold on the world markets. Hence, he agitated that Ghana should have produced its own chocolate instead of selling its cocoa - industrialisation in action.
I am glad to report that the DTI, through its Industrial Policy Action Plan, Ipap, is doing precisely what President Nkrumah said in the 1960s. Ipap has identified 21 sectors where government should focus its financial resources so that it can stimulate the production of value-added goods. This programme on its own has an investment of about R102 billion over the next five years, through the Industrial Development Corporation.
What is important is that the industrial policy now informs the trade policy. The implication for this is that the tariffs policy will always be informed by industrialisation instead of a narrow view of protecting the local market. For example, when an imported product is deemed necessary for industrial production, it will not draw the trade tariffs it would normally have done in the past. Instead, those imported products will be taken as if they were produced locally so that they can stimulate value-adding.
The important programme of regional integration has received priority from this ANC-led government. That is why, last year, President Zuma hosted the summit for the launch of the Tripartite Free Trade Area agreement. This free trade agreement will cover 26 African countries, with a total population of 527 million people and a gross domestic product of US$624 billion. This big market will be strengthened by the free flow of goods and business people, infrastructure development, for example the North-South rail corridor championed by President Zuma, and the harmonisation of industrial development policy within the participating countries.
The success of the tripartite agreement will depend on the harmonisation of regulations between individual countries, for example customs, the standard of products sold between countries, and the alignment of the information technology systems at the border gates so that they can facilitate the free flow of products. So, if something has entered Zimbabwe, there is no need to undergo the same process when it enters Uganda or Zambia.
This will demand that the standards authorities, like the SA Bureau of Standards, SABS, the National Regulator for Compulsory Specifications, NRCS, and the SA National Accreditation System, Sanas, are well equipped to execute their mandates. It is pleasing to note that the budgets of Sanas, NRCS and SABS have been increased by 47%, 110% and 48% respectively. It shows that this government puts its money where its mouth is.
This will ensure that the goods that are exported and imported by the country are of a high quality. This is more important, considering that the global economic environment is on the decline. The expertise of these standards authorities must be shared with the countries that are in the free trade area agreement.
The portfolio committee has identified the proliferation of counterfeit goods as a serious problem in our country. During the previous year, 112 raids were conducted in 42 clothing industries in three provinces, which resulted in 260 tons of goods being confiscated. So, it means that the very clothing and textile industry we are busy protecting is being undermined if this bad habit is not nipped in the bud.
Over a period of three years, two tons of computer hard drives worth R1 billion were confiscated. So what does that mean? This demands that Sars and its counterparts must upscale and improve their efficiency on the borders, because such actions will undermine the manufacturers in the individual countries.
The increased trade within the Southern African Development Community, SADC, and the Tripartite Free Trade Area is not undermined by tariffs, since only three countries have not complied with the zero-rating of the tariffs. It is the rules of origin and nonaligned infrastructure and nonaligned regulatory framework. These challenges are reflected in the fact that intra-Africa trade is less than 10% of the total trade of the African countries. This means that what President Kwame Nrumah was afraid of in the 1960s still exists: the colonial powers still have an economic hold on African countries. That is why we call on the department, through its International Trade and Economic Development programme, to intensify its efforts in promoting trade and development within the African continent.
Since world economic growth is led by the emerging economies, the ANC-led government must be congratulated for its sterling performance in the world forums like the World Trade Organisation, WTO. The Ministry and the department must be congratulated for sticking to their guns in ensuring that the Doha Development Round is being pursued by the emerging economies in the WTO.
The portfolio committee will give the Ministry all support in fighting pluralitarism of the developed countries in the WTO. We hope that with Russia participating in the WTO, the balance of forces will shift in favour of the emerging economies. [Applause.]
The portfolio committee also appreciates the South Africa-Cuba assistance agreement, which was signed this year and will be ratified by Parliament next week. This agreement is unique because 90% of the R350 million assistance to Cuba will benefit South African companies, but at the same time they will be helping the Cuban people. As a former president of the country, isithwalandwe [much-lauded] uTata Nelson Mandela, once said:
The morality of the South African people demands that we don't abandon our friends in their hour of need.
The Cuban people demand support from South Africa. They did not create the hurricanes. That is why, as a country, we must support them and take our cue from the stalwart uTata Mandela. We know that the Cuban people are our friends. They helped to liberate the African continent from the colonial powers. I know other people would never forgive them for doing that. The Cubans continued to help our emerging democracy by having educational and cultural exchanges with us. [Interjections.] As the ANC made the clarion call to create a better South Africa, a better Africa and a better world, the Ministry has led from the front in concluding this wonderful agreement. That is why it is highly appreciated, Comrade Rob Davies.
The portfolio committee has called for the intensification of the opening of new trade missions in the emerging economies, since these economies will be the economic growth points of the world. The portfolio committee appreciates the budgetary increment in the Trade and Investment South Africa programme by 3,6%. The portfolio committee also appreciates the support the department is giving our exporters, especially in enabling them to take their products to the various international pavilions.
We know that in October there will be a pavilion in Shanghai and Beijing. That information is all over the newspapers. So, the department is communicating properly. That is why those people who are saying the department communicates like a spaza shop are living in their own cuckoo world. At the same time, I know that we have political differences. That is why we have different political parties, but there are certain issues that have been raised in this debate that cannot go unchallenged.
The first one I will address is the issue raised by the hon Oriani- Ambrosini. The hon Oriani-Ambrosini raised a critical issue, saying that the department is in the business of social welfare for industrialists. Hon member, there is no social welfare. There is no country in the world that has industrialised without the support of government. I can give an example here: the armaments industry of America. That industry would not be where it is today if it were not through the support of the different administrations, whether Republican or Democratic. They were all in support. That is why they are so powerful to this day. So, if you want our country to matter in the international world, we have to support our industrialists.