Finance Minister Pravin Gordhan. (Picture: AFP) ~ AFP
Cape Town - There is growing confidence in the business outlook, despite difficult conditions, Finance Minister Pravin Gordhan said on Wednesday.
Presenting his 2013/14 Budget in the National Assembly, he said growing the economy means expanding business activity.
"We recognise the key role that private companies play in our economy," he said.
Plans by business included construction and refurbishment by a company in the hospitality sector of R2.5bn in the next 18 months, and expansion of R3bn in the pipeline.
There were two telecommunications investments amounting to R14bn this year, and capital spending of R3.4bn over the next three years by a rail and logistics operator.
There was a R2.5bn expansion as well as longer-term plans of R15bn in mining projects, investment of R1.4bn this year by a leading retailer, and plans to open 100 new stores by another.
Also planned was an expansion of R1.2bn this year by a food and beverage sector firm, and plans for R28.5bn in long-term infrastructure investment by a leading industrial company, which would create 10 000 temporary and 4 000 permanent jobs.
Gordhan said that in recent times the world has become a more uncertain place for businesses, causing some to build cash reserves rather than invest in new or expanding operations.
"As government, we wish to encourage businesses to keep investing in our economy, and seize the opportunities around us.
"We are therefore reinforcing several initiatives that support business development."
- The Manufacturing Competitiveness Enhancement Programme (MCEP) announced in 2012, which has received a total of 215 applications with requests for grants totalling R2.3bn mainly from the chemicals, metals, and agro-processing sectors.
Applications are expected to increase over the period ahead and funding of R1.5bn per year has been provided on the budget of the trade and industry department;
- The Special Economic Zone (SEZ) Programme, also announced last year, which has received funding to build world class industrial parks.
Discussions were being held with Trade and Industry Minister Rob Davies on specific tax incentives to enhance this initiative.
- The Jobs Fund announced in the 2011 Budget, which has concluded two calls for proposals. In total, 3 614 applications have been received and 65 projects approved. Grant funding of R3.3bn has been approved, matched by a further R3.1bn in funding raised by the private sector.
- Small, medium and micro enterprises (SMMEs), which play a key role in the development of the economy and are a significant generator of employment. Financing of SMMEs was simplified with the creation of the Small Enterprise Finance Agency last year.
"We have been progressively working to simplify the tax requirements for small business.
"The turnover threshold will be increased this year and the graduated rate structure will be revised," Gordhan said.