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Cape Town - South Africa must narrow the divide between big business and township business in order to create an inclusive economy, according to Lionel October, director general of the department of trade and industry (dti).
On top of that a culture of buying locally must be created to, in his opinion.
October presented the dti's annual report to the portfolio committee on trade and industry in parliament on Friday.
“While it may still be too slow for the liking of some people and while a full recovery may still take some time, the good news for South Africans is that the SA economy is recovering," said October.
"There are indications that the fundamentals that were put in place and the decisions that were taken when the "Great Recession" and the Eurozone crisis started biting, are starting to bear fruit.”
SA is on a slow road to recovery, but is continuing to face challenges, he said.
The main challenge is the slow contribution to global growth made by advanced economies - 1.6% in 2011 and 1.3% in 2012, in his view.
"The problem for SA is that it still has a skewed reliance on advanced economies for exports. The economic woes of countries making up this bloc meant fewer export opportunities for South Africa,” said October.
Another big challenge centred on South Africa's trade deficit.
"We have seen an improvement in exports, but this still lags behind the expansion in our imports," he said.
He sees a silver lining, however, in that emerging economies have performed far better over the past two years.
"This provides clear proof of the astuteness of the dti in increasing efforts to diversify SA's trade and investment markets, by turning to Africa, South-East Asia, the Middle East and South America," said October.
Currently the dti is achieving its best successes in the auto industry, clothing and textile industry, business process services and the film industry, he explained.
Highlights
To him one of the highlights of the past year was the Chinese automotive company First Automobile Works' commencement of the construction of a truck plant at the Coega Industrial Development Zone in the Eastern Cape.
He also mentioned the investment by Beijing Automotive Works to the tune of R196m in a taxi assembly plant for South African and sub-Saharan markets.
Another success story of the year for him was the continued recovery of the clothing industry, due mainly to the dti-inspired Clothing and Textiles Competitiveness Programme.
This programme has helped to create 12 200 new jobs.
The footwear sector also showed that it was bouncing back after a long period of decline. There are expectations that the production of shoes will increase from 52 million to 100 million over the next three years.
The Business Process Services Incentive Programme provided R1.3bn to create an estimated 4 500 jobs over the next three years.
Through the Monyetla Work-Readiness Programme 3 819 learners were trained in business process services.
As for the film industry, the dti had, through its industrial development cluster, approved 70 film productions, including the recently released Long Walk to Freedom.
Other programmes October mentioned include the Manufacturing Competitive Enhancement Programme, which approved grants of almost R1bn to 189 enterprises and led to the retention of 33 551 jobs), the 12I tax incentive scheme, which drew an investment of R10.2bn and 1 357 projected jobs and the Technology for Human Resources Industry Programme, which funded 1 506 students and 1 135 researchers.
- Fin24
On top of that a culture of buying locally must be created to, in his opinion.
October presented the dti's annual report to the portfolio committee on trade and industry in parliament on Friday.
“While it may still be too slow for the liking of some people and while a full recovery may still take some time, the good news for South Africans is that the SA economy is recovering," said October.
"There are indications that the fundamentals that were put in place and the decisions that were taken when the "Great Recession" and the Eurozone crisis started biting, are starting to bear fruit.”
SA is on a slow road to recovery, but is continuing to face challenges, he said.
The main challenge is the slow contribution to global growth made by advanced economies - 1.6% in 2011 and 1.3% in 2012, in his view.
"The problem for SA is that it still has a skewed reliance on advanced economies for exports. The economic woes of countries making up this bloc meant fewer export opportunities for South Africa,” said October.
Another big challenge centred on South Africa's trade deficit.
"We have seen an improvement in exports, but this still lags behind the expansion in our imports," he said.
He sees a silver lining, however, in that emerging economies have performed far better over the past two years.
"This provides clear proof of the astuteness of the dti in increasing efforts to diversify SA's trade and investment markets, by turning to Africa, South-East Asia, the Middle East and South America," said October.
Currently the dti is achieving its best successes in the auto industry, clothing and textile industry, business process services and the film industry, he explained.
Highlights
To him one of the highlights of the past year was the Chinese automotive company First Automobile Works' commencement of the construction of a truck plant at the Coega Industrial Development Zone in the Eastern Cape.
He also mentioned the investment by Beijing Automotive Works to the tune of R196m in a taxi assembly plant for South African and sub-Saharan markets.
Another success story of the year for him was the continued recovery of the clothing industry, due mainly to the dti-inspired Clothing and Textiles Competitiveness Programme.
This programme has helped to create 12 200 new jobs.
The footwear sector also showed that it was bouncing back after a long period of decline. There are expectations that the production of shoes will increase from 52 million to 100 million over the next three years.
The Business Process Services Incentive Programme provided R1.3bn to create an estimated 4 500 jobs over the next three years.
Through the Monyetla Work-Readiness Programme 3 819 learners were trained in business process services.
As for the film industry, the dti had, through its industrial development cluster, approved 70 film productions, including the recently released Long Walk to Freedom.
Other programmes October mentioned include the Manufacturing Competitive Enhancement Programme, which approved grants of almost R1bn to 189 enterprises and led to the retention of 33 551 jobs), the 12I tax incentive scheme, which drew an investment of R10.2bn and 1 357 projected jobs and the Technology for Human Resources Industry Programme, which funded 1 506 students and 1 135 researchers.
- Fin24
