1 / 48

Briefing to the Portfolio Committee on Trade and Industry 14 March 2007

MTSF 2007 - 2010. Briefing to the Portfolio Committee on Trade and Industry 14 March 2007. MTSF 2007 - 2010. Presentation covers:. Part One - Context & Strategic Objectives Part Two - 2006/07 Key Outputs Part Three - 2007 -2010 Strategic Deliverables Part Four - Challenges

coryanderson
Download Presentation

Briefing to the Portfolio Committee on Trade and Industry 14 March 2007

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. MTSF 2007 - 2010 Briefing to the Portfolio Committee on Trade and Industry 14 March 2007

  2. MTSF 2007 - 2010 Presentation covers: Part One - Context & Strategic Objectives Part Two - 2006/07 Key Outputs Part Three - 2007 -2010 Strategic Deliverables Part Four - Challenges Part Five - Resourcing the Strategy Part Six - Economic Cluster

  3. MTSF 2007 - 2010 CONTEXT & STRATEGIC OBJECTIVES PART ONE

  4. ECONOMIC CONTEXT • Step change in economy towards a higher growth path well established, with GDP growth of 5% in 2006 • Key drivers have been robust consumer spending & increased fixed investment by both public & private sector • Leading growth sectors: construction (13.2%), finance & business services (7.9%), trade (6.9%), transport & communication (5.6) • Business confidence high, despite rising inflation, interest rates & import competition

  5. ECONOMIC CONTEXT MTSF 2007 - 2010 Annual growth % Unemployment rate: 31.2 (2003), 27.9 (2004), 26.5 (2005), 25.6 (2006)

  6. ECONOMIC CONTEXT Challenges • Increased imports exerting pressure in trade balance • Unemployment still high despite improving job creation • Exports & FDI performance modest • Millions still on economic margins & poverty stricken • Economy’s fortunes tied to global economic developments (e.g oil price), although prospects positive

  7. ECONOMIC CONTEXT Policy & Strategy Responses • Asgisa introduced; identifies key binding constraints & interventions to address them • dti key in Asgisa conception & dti MTSF is informed by Asgisa aims & plays lead role in Economic Cluster’s implementation of Asgisa • Economic Cluster POA 2007-2009 to focus on: • Increasing economic efficiencies • Promoting dynamic sectors • Integrated small enterprise service delivery

  8. STRATEGIC OBJECTIVES MTSF 2007 - 2010 • Promoting co-ordinated implementation of the accelerated & shared growth initiative • Promoting direct investment & growth in the industrial & service economy, with particular focus on employment creation • Contributing towards the development & regional integration of the African Continent within the Nepad framework • Promoting broader participation, equity & redress in the economy • Raising the level of exports & promote equitable global trade

  9. MTSF 2007 - 2010 KEY OUTPUTS – 2006/07 PART TWO

  10. KEY OUTPUTS IN 2006/07 MTSF 2007 - 2010 This section will broadly cover the following areas: Enterprise & Industry Support & Development Consumer & Corporate Regulation International Trade & Investment Marketing & Communication Resource Management

  11. 2006/07 DELIVERABLES MTSF 2007 - 2010 Enterprise & industry support & development • ASGI-SA identified need to develop a robust industrial policy to promote diversification, competitiveness & labour-absorption • The National Industrial Policy Framework finalized & approved by Cabinet with directive to implement immediately • Implementation being planned, focusing on priority sectors and key interventions • strategies in the following key sectors in advanced stage: • Capital Equipment, Metals, Rail • Automotives & Aerospace • Agro-processing, forestry • Clothing & Textiles • Chemicals, Plastics & Pharmaceuticals • ICT/Electro technical • BPO & Services • Cultural Industries • Finalisation of Regional Industrial Development Strategy (RIDS) to stimulate growth in slower growing provinces, towns & rural areas so as to deal with regional disparities

  12. 2006/07 DELIVERABLES MTSF 2007 - 2010 Enterprise & industry support & development • National Industrial Participation created over 12 000 direct jobs • 150 projects, US$7,5b investment, sales & exports, implemented since 1996 from investments made & exports generated • Launched SEDA & SAMAF provincial offices to widen reach & improve access to services • Rollout of SAMAF progressing well through network of 30 institutions country wide having 2 600 borrowers & 9 000 savers over 3 year period

  13. 2006/07 DELIVERABLES MTSF 2007 - 2010 Enterprise & industry support & development • Support for Enterprise Development • Established National Small Business Advisory Council • Khula loans & advances increased from R34m(2002) to R137m (2006); three new funds launched & capitalised at R300m • Products for targeted procurement by Government Departments (set asides) have been identified and will be implemented • IDC approved investments anticipated to be in excess of R6b • Co-operatives • 15 co-operatives from 6 provinces (Eastern Cape, KZN, Gauteng, North West, Northern Cape & Limpopo) supported financially benefiting 205 youth & 188 women

  14. 2006/07 DELIVERABLES MTSF 2007 - 2010 Enterprise & industry support & development • Support for Enterprise Development – cont. • Investment Incentives • Small Medium Enterprise Development Programme: • Since Inception 2000 to date: 11 309 approved projects with incentive value of R 12.7 billion and R 2.3 billion has been disbursed. • 01 April 2006 to date: 2 501 approved projects with a projected qualifying investment of R13.4 billion. The value of incentives approved is R 2.96 billion and R 598 million has been disbursed. • Strategic Industrial Projects (SIP) • 45 projects approved with qualifying investment value of R28,7 billion. 22 projects have established with actual investment value R10 billion

  15. 2006/07 DELIVERABLES MTSF 2007 - 2010 Enterprise & industry support & development • Support for Enterprise Development – cont. • Critical Infrastructure Program (CIP) • 19 projects approved to date with qualifying investment value of R32 billion and infrastructure investment of R9.2 billlion • The following Technology Support delivered • SPII Projects worth R52m • Technology & Human Resources for Industry Programme – 746 researchers, 3 178 students & 371 industry partners assisted • SANAS accredited 134 facilities • Standards South Africa (STANSA), division of SABS developed & revised 639 standards

  16. 2006/07 DELIVERABLES MTSF 2007 - 2010 Enterprise & industry support & development • Support for Enterprise Development – cont. • Film & TV production rebate • Since Inception 01 August 2004 : Approved 31 productions. Value of Qualifying South African Production Expenditure (QSAPE) is R1,8 billion. To date the 17 productions have been completed and received rebate of R122 million • Since Inception 01 April 2006 to date : Approved 16 productions and value of QSAPE R1.07 billion • Industrial Development Zones • Investment in infrastructure of R1,07 billion • Facilitated investment to the value of over R28 billion • Export marketing and Investment assistance • 438 projects approved to the value of R 29 million. R 15.8 million disbursed during the year. Top 3 sectors supported : Agro-processing, Electro-technical, Metals. • Sector Specific Assistance Scheme • 28 projects approved to the value R13 million

  17. 2006/07 DELIVERABLES MTSF 2007 - 2010 Enterprise & industry support & development • Broad Based Black Economic Empowerment • The codes of good practice were gazetted. • BEE Advisory Council to be established which will oversee & monitor implementation • National Empowerment Fund has disbursed R424m from approved investment of R590m • Black Business Supplier Development Programme • 854 projects approved to the value of R46 million. • R25 million disbursed during the year.

  18. 2006/07 DELIVERABLES MTSF 2007 - 2010 CONSUMER & CORPORATE REGULATIONS • Corporate Law Reform: New Companies bill approved by Cabinet & published for comment. Expected to increase investment in firms by reducing regulatory & administrative burden on small & medium size firms • Consumer Law Reform: New consumer protection bill subjected to 12 months of consultation & amended to reflect public inputs & will revert to cabinet in March 2007. Bill will promote a fair & competitive market place for consumers • Credit Law Reform: Act proclaimed & regulation published for implementation. Will improve consumer protection, remove discrimination & create single market for credit. Will remove adverse data for approx. 1,7m consumers • Competition Policy Review: Review completed & amendments to be drafted. Will improve competitiveness of concentrated sectors & address ant-competitive behaviour.

  19. 2006/07 DELIVERABLES MTSF 2007 - 2010 International Trade & Investment • Contributed to Jan 2007 resumption of WTO Doha Round • Led development of position on industrial tariffs in Doha • Led development of SADC negotiating position on Economic Partnership Agreement with EU/aligned to SA-EU TDCA • SACU-EFTA FTA ratified Dec 2006: on entry into force, duty free quota free market access for SACU industrial exports • New SA-EU Agreement on Auto trade in force in Dec 2006: Will encourage new investment in SA and increased auto exports to the EU • Implemented SA-China MOU on economic co-operation to provide relief to textiles and clothing sectors • Annexes on SACU tariff board & national body adopted by SACU Council in December 2006

  20. 2006/07 DELIVERABLES MTSF 2007 - 2010 International Trade & Investment • Export Promotion activities undertaken: • 3 International Trade initiatives supporting 79 companies • 33 National Pavillions generating R589 million in exports • 42 Trade missions to 36 countries and from 6 countries • Export Development assistance given to exporters • 577 verified trade leads • 1 400 customers advised on the export process • 4 000 publications distributed • Investment Promotion activities undertaken: • 5 Investment seminars • 5 Investment pavilions • 18 Sector specific presentations and 31 briefs • 2 Presidential International Investor’s Council meetings

  21. 2006/07 DELIVERABLES MTSF 2007 - 2010 Marketing & Communication interventions • Various road shows and workshops were held to make communities aware of the services of the dti • The customer contact centre has been in-sourced which resulted in large cost savings & better accountability

  22. RESOURCE MANAGEMENT MTSF 2007 - 2010 • Human Resources • Targeted filling of 150 vacancies by 31 Jan. Filled 135 = 90% • Launched special recruitment project on identified posts via a recruitment agency • Establishment reflects a 25,8% vacancy rate at 28 February 2007 • Extensive training provided via bursaries, in-house training, internships, Adult Basic Education & Training programs & Regional Trade & Investment Capacity building programs • Department certified for Employment Equity Act compliance

  23. RESOURCE MANAGEMENT MTSF 2007 - 2010 • Finance • Unqualified audit report for 2005/06 • Auditor General’s interim audit for 2006/07 – no major issues • Payment of suppliers – minimum 7 days and maximum 14 days • Yearly spending trend reflected in attached graph which reflects an average of 95% spending of allocated budget over the past four years

  24. 7 YEAR EXPENDITURE TRENDS MTSF 2007 - 2010 the dti SPENDING TRENDS

  25. REASONS FORUNDER-EXPENDITURE MTSF 2007 - 2010 Over the past three years the under-expenditure was largely due to limited spending on critical infrastructure resulting from the nature of the incentive scheme which requires:- • Payment to be made only after expenditure is incurred • Only 30% of the expenditure to be reimbursed, which has not proven optimal in attracting investment in infrastructure The under expenditure in 2005/06 was largely due to: • R50m on APEX fund which only became operational on 01 April 2006 • R166m on critical infrastructure for reasons mentioned above

  26. MTSF 2007 - 2010 2007 - 2010STRATEGIC Deliverables PART THREE

  27. 2007 - 2010STRATEGIC DELIVERABLES MTSF 2007 - 2010 This section will broadly cover the following areas: Enterprise & Industry Support & Development Consumer & Corporate Regulation International Trade & Investment Marketing & Communication

  28. 2007 - 2010STRATEGIC DELIVERABLES MTSF 2007 - 2010 ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT • Implementation of National Industrial Policy Framework (NIPF) • Continue Sector Strategy development in alignment with NIPF & implementation of key sector initiatives (eg, BPO & Tourism) • Over 40% of budget to support enterprise through incentives • Develop a human capital strategy to support critical skills areas, including industrial centres of excellence to develop, design & engineering capabilities • Continue technology support to enterprises via current schemes • Finalise regional growth support strategies, including IDZ’s • Increase targetted support for women owned enterprises • Implementation & Monitoring of BBBEE strategy focusing on Codes of Good Practice and Advisory Council

  29. 2007 - 2010STRATEGIC DELIVERABLES MTSF 2007 - 2010 ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT • Increase financial support of the BBBEE through the DFI’s • Increase financial support for small business through Khula, including repositioning the agency • Continue with financial support for co-operatives through the co-operatives fund • Finalise & implement review of current incentive schemes to support NIPF & customised sector interventions

  30. 2007 - 2010STRATEGIC DELIVERABLES MTSF 2007 - 2010 ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT • Continue & step up non-financial enterprise development support through effective SEDA service delivery network providing the following: • Export readiness for SMEs • Training & mentorship • Manufacturing support • Information & advice to businesses • Continue & step up roll out of micro finance through SAMAF: • Average of R62m disbursements per annum • Average Increase of 2 000 borrowers per annum • Average Increase of 2 000 savers per annum • A minimum of 50 partner organisation for 2007/08

  31. 2007 - 2010STRATEGIC DELIVERABLES MTSF 2007 - 2010 CONSUMER & CORPORATE REGULATIONS • Corporate governance & company formation enhanced through enactment of new Companies Bill & institutional framework • Consumer rights & redress strengthened through enactment of new Consumer Bill & institutional framework, as well as review of regulation of Estate Agents • Innovation & protection IP rights holders promoted by reviewing & reforming regulatory framework for intellectual property rights • Improving competition in concentrated sectors & reducing harm to downstream industries by strengthening Competition law & institutions • Assessing effectiveness of existing regulation in areas of Liquor & Lotteries

  32. 2007 - 2010STRATEGIC DELIVERABLES MTSF 2007 - 2010 International Trade & Investment • Pursue successful development outcome in WTO • Deepen regional integration/cooperation in Africa under NEPAD Framework, notably SADC and SACU • Review customs union options following SADC Summit, Oct 2006 • Pursue common policies and institutional development in SACU • Strengthen investment and trade links with dynamic emerging markets (key African countries, India, Brazil, China, Gulf). • Develop 100 emerging exporters through a Small Exporter Development Programme • Advance trade cooperation under IBSA • Align SA-EU TDCA/SADC-EU economic partnership agreements • Implement SACU-EFTA FTA and raise awareness of its opportunities to business • Pursue Trade and Investment Development Cooperation with US • Implement revised Export and Investment strategies in alignment with NIPF and sector priorities • Review the strategic alignment of Foreign Office network to enhance trade and investment facilitation

  33. 2007 - 2010STRATEGIC DELIVERABLES MTSF 2007 - 2010 Marketing & Communications • Intensify its communication and outreach efforts focusing on major policy initiatives & offerings with particular emphasis on second economy • Build a positive profile, effectively manage perceptions and protect its reputation

  34. CHALLENGES MTSF 2007 - 2010 PART FOUR

  35. INSTITUTIONALCHALLENGES MTSF 2007 - 2010 Recruiting and retaining requisite capacity & requisite skills Ensuring continued good Corporate Governance Ensuring continued sound financial management Oversight over agencies Increase the budget to support the dti’s new & expanding mandate

  36. RESOURCE MANAGEMENT MTSF 2007 - 2010 PART FIVE

  37. RESOURCE MANAGEMENT MTSF 2007 - 2010 • Reducing the level of vacancies to less than 15% • HR development & capacity building • Dedicated HRD strategy • Competency enhancement & development • Programme on investors in people • University network – bursary programme • Development of supportive dti organisational culture • Maintain and improve best practice Corporate Governance, including agencies • Information Technology • Continue with Implementation of Enterprise Content Management strategy • Completion of Disaster Recovery project • Strengthen Supply Chain Management

  38. MTEF ALLOCATION MTSF 2007 - 2010

  39. MTEF ALLOCATIONADDITIONAL FUNDING MTSF 2007 - 2010

  40. ANALYSIS OF CURRENT MTEF MTSF 2007 - 2010

  41. ANALYSIS OF CURRENT MTEF MTSF 2007 - 2010 On average the structure of the budget allocation over the MTEF period is: • 34% to agencies of the dti • 44% to incentive payments • 7% to compensation (11% after deduction to agencies) • 12% to goods & services, of which a large percentage are for committed expenditure • 3% to Capital & Other Payments

  42. STRUCTURE International Trade and Economic Development Ministry Office of the DG Policy co-ordination The Enterprise Organisation Marketing Enterprise and Industry Development Trade and Investment South Africa Consumer and Corporate Regulation 18 Agencies MTSF 2007 - 2010

  43. ECONOMIC CLUSTER MTSF 2007 - 2010 PART SIX

  44. ECONOMIC CLUSTER MTSF 2007 - 2010 • the dti chairs the Economic Cluster of Departments • The Cluster’s three-year programme of action for 2007-2009 was adopted at the Cabinet Lekgotla in January 2007 • The programme of action focuses on: - Increasing economic efficiencies - Promoting dynamic sectors - Integrating small and micro enterprises

  45. CLUSTER’S KEY INTERVENTIONS MTSF 2007 - 2010 (1) Increase economic efficiencies • Strengthen economic regulator capacity in key industries • Amend competition policy to support effective regulation • Increase access, uptake & usage of ICT infrastructure • Phased roll-out of overhauled public transport network • Monitor implementation & impact of infrastructure roll-out • Coordinated NHRD, with focus on ASGI-SA priorities (2) Promote dynamic growth sectors • Implement industrial policy framework, focusing on key sectors and leveraging public spending • Supportive macro-economic management (esp. competitive and stable real effective exchange rate) (3) Integrate small-and micro-enterprises • Integrated small enterprise service delivery (incl. comprehensive procurement strategy, marketing cooperatives, business development support and access to finance) • Reduced SMME regulatory burdens (incl. by-laws)

  46. ADDITIONAL STRATEGIC CLUSTER MTSF 2007 - 2010 • ICT Infrastructure, especially Broadband • Critical to success of knowledge economy and integration of marginalised households into the economy • Public transport • Intervention that will support labour mobility and reduced cost of living • Energy • Economy needs more energy whilst rebalancing energy sources • Transformation of Second Economy • Second Economy interventions are crucial to the achievement of the 2014 unemployment and poverty targets

  47. CONCLUSION MTSF 2007 - 2010 The department will build on the considerable momentum already established i.t.o its strategic objectives, focusing on: • Coordinated implementation of Economic Cluster projects as per the three-year Cluster POA and the NIPF • Implementation of sector strategies that have been completed (e.g. BPO, Clothing and Textiles, Tourism etc.) as a force for investment, diversification and job creation • Strengthening of regional integration initiatives & support for NEPAD • Strengthening of enterprise development initiatives • The implementation and enforcement of policy & legislation in the areas of companies, consumers, credit, competition & BBBEE • Implementation of Export & Investments strategies and the pursuit of developmental outcomes in both WTO & bilateral trade negotiations This will requires strengthened Monitoring and Evaluation, a technically skilled and highly motivated workforce, continued improvements in government coordination, and continued engagement with and support of Parliament and other stakeholders

  48. MTSF 2007 - 2010 THANK YOU

More Related