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the dti Implications of SONA on the dti

the dti Implications of SONA on the dti. Presentation to the Portfolio Committee on Trade and Industry Date : 24 February 2012. Contents. Introduction Industrial Development Trade, Investments and Exports Legislation Allocated Budget. Implications of SONA. Industrialisation

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the dti Implications of SONA on the dti

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  1. the dtiImplications of SONA on the dti Presentation to the Portfolio Committee on Trade and Industry Date : 24 February 2012

  2. Contents • Introduction • Industrial Development • Trade, Investments and Exports • Legislation • Allocated Budget

  3. Implications of SONA Industrialisation • SONA’s focus on massive infrastructure investment programme • Major driver of economic growth • Addresses specific needs of economy • Potential driver of economic development • The dti’s focus on promoting industrial development • IPAP: Capital goods, metal fabrication and transport equipment and green economy and others seek to build on infrastructure programme to develop local manufacturing • Budget indicated Manufacturing Competitiveness Enhancement Programme (MCEP) will receiveR5.8 billion; Using the Textile and Clothing production incentives methodology; Strengthening of the sectors • Designations - December 2011 • In addition to section 12I of Income Tax Act, budget referred to SEZ Bill, additional support for SEZs at R2.3bn and additional tax relief • Administered prices – Electricity and Port Charges

  4. Implications of SONA Industrial Development Procurement • The amended Regulations of the Preferential Procurement Policy Framework Act (PPPFA). Sectors designated include buses; clothing and textiles; power pylons; rolling stock; and canned vegetables. Pharmaceuticals and Set Top Boxes will follow • Progressive approach to procurement and supplier development -awarding of 72% or R2, 69bn of R4, 2bn ARV tender to SA manufacturers without additional cost to the state and in compliance with B-BBEE considerations

  5. Implications of SONA Trade, Investment & Exports Africa Regional Development • On trade diversification, the Tripartite Free Trade Agreement (T-FTA) made up of the Southern African Development Community (SADC) the East African Community (EAC) and the Common Market of Eastern and Southern Africa (COMESA) • AU CFTA • North South Corridor (Trans Kunene) Trade • An agreement on strategic negotiations on BRICS Telecom Submarine Cable project which entails the construction of a new high capacity 28 400 kilometres. • Efforts to advance SA’s trade and investment interest at BRICS and IBSA • The top ten investment projects and the top ten value-add export products have been identified for SA’s engagement with China • Development of a BRICS engagement strategy • Engagement of fast growing emerging economies – Arabian Gulf and Asean • Reviewed strategy for investment and exports

  6. Implications of SONA Legislation • Reviewing the B-BBEE and the refinement of the Codes of Good Practice will be finalized • SEZ Bill will be introduced • Review of the Co-operative Act, No 14 of 2005 • Lotteries Amendment Bill • Special Economic Zones Bill 6

  7. Budget allocation over the next MTEF • The departments overall budget increases year on year from 2012/13 by 32%, 14%, 7% over the MTEF period • The increases largely relate to new budget allocations for the following:- • Economic Competitiveness Support Package • 2012/13 - R1,224 billion • 2013/14 - R1,964 billion • 2014/15 - R2,462 billion • SEZ’s • 2012/13 - R500 million • 2013/14 - R750 million • 2014/15 - R1 billion

  8. Thank you

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