Chairperson, may I start by saying thank you for a number of contributions that have significantly enriched the debate on economic development and the issues that we need to respond to in the 12 months ahead.
I particularly appreciate the way in which a number of speakers have begun to take on the framework of the New Growth Path. They are seeing how we are provincialising it. They are also seeing in the infrastructure plan an opportunity to lay the basis for long-term sustainable growth.
Cllr Mafefe from Salga raised the issue of partnership. Local government is a critical partner in what we do and we will certainly be working very closely with you.
To respond to the content of the debate, I will start with an observation made by the hon Van Lingen on job numbers. It is perhaps worth explaining that the Quarterly Labour Force Survey publishes information every three months. The information can be compared to either the previous quarter or to the same period one year earlier. Quarter 1 of every year causes difficulties from a statistical point of view because companies, retailers and factories tool up for the Christmas period and they tool down immediately thereafter. That is called a seasonal problem. So, what we need to look at is this: What is the trend line on a like-for-like comparison? So, we compare Quarter 1 last year with Quarter 1 this year, to see what the trend line is and to take out the distortion of seasonal changes. On that trend line, the economy grew about 300 000 new jobs for the year. We now need to build on that, strengthen it and also improve it.
I would like to refer to the comments made by MEC Mokoena, who noted the global context and the more difficult environment we face. What happens in Europe or Greece matters to us. It can have a very deep and profound impact on the demand for South African cars, fruit, electronics and minerals. Therefore, the lesson to take from the global uncertainty and the fragile state of the global economy is that we have to discover a stronger basis for growth in our own economy and on the African continent. Minister Davies devoted some time in his introductory comments specifically to the importance of African development. In that context, more can and needs to be done in South Africa. I want to refer to a few things that we have done and continue to do.
Let's start with rural development. Hon Gamede raised the issue of rural development and the green economy. MEC Jonas talked about the importance of deepening the agroprocessing value chain as a means of lifting rural communities out of poverty. They are right, because it is in rural development where there are some of the biggest opportunities to create new jobs. When you compare Brazil's industrial structure with that of South Africa, you see one of the most significant differences is the greater success Brazil has had in absorbing people into agriculture and agroprocessing. We have to focus on that.
So, what are we doing? We are now using a range of tools, such as trade. Hon Dikgale pointed to what Itac had done regarding tomato paste, namely creating a demand for South African tomatoes and the processing of those tomatoes into tomato paste. I gave the example earlier of chickens and of how Itac added on an antidumping duty. The IDC then moved in and aggressively supported an expansion of chicken broiler activities and the jobs that can come from that.
We are doing work using competition tools. Pioneer is a good example of where we have worked on one of the big problems. Farmers cannot always have access to competitive markets because you can have a competitive industry upstream but downstream you may find controls, price-fixing and collusion. So, our work in the Competition Commission is intended precisely to open that up.
One of the hon members referred to the example of Walmart. What is critical for us regarding Walmart is this. We know we will be able to shop at Walmart. The question is where the goods will be made. Will we basically be creating jobs elsewhere in the world by buying greater and greater levels of imported products or can we have a commitment from the retail sector to purchase more South African-made goods and put them on the shelves?
However, this is not just an act of will. It also means addressing the competitiveness challenges of local industry - skills development, improvements in technology, better factory layout and a broader improvement of productivity. That means partnership, and that brings me to the issue that has come up regarding youth employment.
Let us start with the facts. The level of youth unemployment is extraordinarily high. It is a feature we have seen in many countries. If we look at the example of Spain, we see it has now become very similar to South Africa. We cannot simply sit back and accept this high level of youth unemployment. We need a youth-centred set of employment programmes - there is no question about it.
But how do you implement it? Do you implement it by creating a war zone between old workers and new workers? Do you create it by a zero-sum game, in which some must give up their jobs to bring in others? Or do we now aggressively - aggressively - increase the number of jobs in the economy and introduce programmes that can bring young people into jobs?
For example, at the skills level, at the moment we have shortages of people in the economy who can be employed. There are people out there who are ready to work, and there are employers wishing to employ, but there is a mismatch in skills. As was said by hon Nyambi, the National Skills Accord that we concluded is one effort to better connect the skills of young people and the employment opportunities in the workplace. It is about internships. It is about exposure to work experience and placement. It is about creating a ratio of trainees to artisans. It is about incentivising companies to bring more people into the training pipeline. But it goes beyond skills - it also means opportunity. So, how do we create that opportunity? In the infrastructure programme we will be setting very clear youth targets to ensure that we bring young people into areas in the green economy where there are no employment opportunities currently. An infrastructure programme is being launched and we will then disproportionately draw in young people to give them work exposure. It means, for example, in Public Works, that we are now setting targets regarding the number of jobs.