South Africa in Davos: Zuma's nine-point economic plan

20 January 2016In February 2015, in his State of the Nation address for the year, President Jacob
Zuma unveiled a nine-point plan for economic recovery and growth in South Africa. During the
course of the year, progress reports from the various government departments detailing the
development of the plan were presented.Now, these reports will form part of South Africa's key
message to the rest of the world at the World Economic Forum (WEF) in Davos, Switzerland. The
annual international gathering is taking place between 20 and 23 January this year. The overriding
message that South Africa wants to convey to thousands of business, finance and government
leaders from around the world is that the country is open for business for manufacturing, investment
and trade.The theme in Davos this year is "Mastering the Fourth Industrial Revolution", in an
atmosphere of an increasingly challenging global economy.South Africa is determined to show the
world that the country is serious about meeting those challenges, while sustaining a strong
economic relationship with the rest of the world.As a country, it wants to achieve the critical targets
set by its National Development Plan (NDP), namely: attaining a real gross domestic product growth
of 5%, a crucial reduction of the unemployment rate from 25% to 6%, and the reduction of income
inequality. These are all to be achieved by the year 2030.[embedded content]Resolving the energy

challenge
(Image: Media Club South
Africa)Much has been happening in the energy sector. In December 2015, the Department of Energy
published a determination on the nuclear programme, whereby 9600 megawatts (MW) should be
generated from nuclear energy.The Medupi Power Station Unit 6 went online in August 2015,
producing an additional 794MW to the total installed grid capacity of 45000MW.The R2-billion
Coega Wind Farm project was officially opened in September 2015.Eskom has signed short-term
power purchase agreements to secure additional electricity during peak periods, while a further
800MW will be added to the grid through co-generation.Energy-efficiency programmes have
resulted in savings of 450MW.Various renewable energy projects under the Renewable Energy
Independent Power Producer Procurement Programme (REIPPPP) currently supply 1800MW to the
grid.In October 2015, the minister of energy announced the 10 preferred bidders in the small
projects REIPPPP.The department's State of Renewable Energy in South Africa report revealed that
the renewables sector had attracted R192.6-billion in investment, had contributed more than 109000
construction jobs and had cut the equivalent of 4.4million tons of carbon dioxide.[embedded
content]Revitalising agriculture and the agro-processing value chain

(Image: Media Club South Africa)Similarly,

work has been ongoing in agriculture, with 43 agri-park sites identified by August and one agri-park
already launched in North West. The programme aims to create 300000 new small-scale producers
and 145000 new agro-processing jobs by 2020. The number of jobs in agriculture increased by
183000 between 2014 and 2015, reaching a total of 891000.Through the Agricultural Policy Action
Plan, 24162 hectares and the commodities on these were acquired, which were allocated to
smallholder farmers.Fruit production for the year to date increased by R685-million, adding 1868
jobs.Aquaculture growth over the last five years resulted in production increasing fivefold, to 20000
tons. Growth between 2013 and 2014 was 25%, exceeding the average global growth rate of 7%, and
contributing almost R3-billion to the national economy.[embedded content]Advancing beneficiation

or adding value to our mineral wealth

(Image: Media Club South Africa)Regarding mining, draft amendments to South Africa's Mineral and
Petroleum Resources Development Act which would give provisions to stimulate local beneficiation,
are currently with Parliament for consideration.The Department of Trade and Industry (DTI) is
developing a Mineral Beneficiation Action Plan, which will be incorporated into the general national
Industrial Action Policy Plan (Ipap).In addition, the country's rich platinum deposits are being used
in the development of hydrogen fuel cells.[embedded content]More effective implementation of a

higher impact Ipap

(Image: Media Club
South Africa)The seventh iteration of Ipap, which is aimed at raising the impact of government
interventions to support industrial development and re-industrialise the country, was launched in
May 2015.The DTI has designated 16 sectors, subsectors and products for local procurement,
including transformers, power-line hardware and structures, steel conveyance pipes, mining and
construction vehicles, and building and construction. In 645 infrastructure projects across the
country valued at R3.6-trillion, the state procures these products from local manufacturers.The
Black Industrialist Programme, designed to transform the manufacturing sector and unlock the
potential of black entrepreneurs, secured initial funding of R1-billion from the DTI for the 2015
financial year. A further R23-billion from the Industrial Development Corporation (IDC) will be made
available for the programme over the next three financial years.The IDC established a new
industries unit earlier in 2015, focused on supporting and funding the entire value chain of emerging
innovative sectors.Rail and ship manufacturing is been revitalised with ships for the South African
Navy and locomotives for long-haul rail transport being manufactured in South Africa.[embedded
content]Encouraging private sector investment

(Image: Media Club South Africa)A DTI

investment clearing house was set up in August 2015 to support local and international investment.
In addition to identifying process bottlenecks, removing administrative barriers and reducing
regulatory inefficiencies, the function of the clearing house is also to set up norms and standards
and improve turnaround times, as well as to co-ordinate and fast-track investment enquiries.In the
past financial year, the DTI helped to facilitate an investment pipeline of more than R43-billion.As of
August 2015, South Africa was handling 116 foreign direct investment (FDI) projects. South Africa
registered an FDI inflow of R43.3-billion from January to July 2015, creating 5037 jobs. Six industrial
development zones around the country attracted R10-billion in investment during 2015.Regulations
for special economic zones (SEZs) are being finalised. With an SEZ board and supporting secretariat
being established and approved, the DTI is close to completing the feasibility studies for eight new

SEZs.The Promotion and Protection of Investment Bill that clarifies investor protection and ensures
more open foreign investment was tabled in Parliament in 2015.A feasibility study for an initiative
aimed at supporting increased investment to meet the needs of the National Development Plan is
currently in process.[embedded content]Moderating workplace conflict

(Image: Media Club South Africa)Under

the leadership of Deputy President Cyril Ramaphosa, a continuous and special dialogue between
business and labour is under way to improve labour relations. Specialist research and exploration
teams are currently working on the nature of labour disputes and on finding solutions to the issue of
wage inequality.A consensus on a working definition of a national minimum wage has been reached
at the National Economic Development and Labour Council.[embedded content]Unlocking the
potential of SMMEs, co-operatives, and township and rural enterprises

(Image: Media Club South Africa)The

Department of Small Business Development continues to pilot its informal sector support policy,
including the provision of business training, grants and co-funding. The department's partnership
with municipalities is continuing to revamp factory and business premises infrastructure.The
Department of Planning, Monitoring and Evaluation has set up a unit to investigate late or nonpayment of suppliers. And Minister Jeff Radebe, the minister in The Presidency responsible for
planning, monitoring and evaluation, presented a comparative analysis of national departments
between 2013 and 2014 that showed despite delays in payment remaining a major problem that
there had been improvement in the average number of invoices paid within 30 days.Provincial
departments for the same period also revealed an improvement of 5% in the average number of
invoices paid within 30 days.[embedded content]State reform and boosting the role of state-owned
companies; ICT infrastructure or broadband roll-out; water, sanitation; and transport

 infrastructure
(Image: Media Club South
Africa)ICTIn addition, work has been ongoing in getting the country connected. The government
rolled out 41351 kilometres of fibre optic cables for broadband coverage during January to August
2015.Telkom has a whole sale division, Openserve, that is aimed at facilitating the entry of new
internet service providers, particularly black-owned companies.In line with stipulations by the
Independent Communications Authority of South Africa's universal service obligations, 623 schools
around the country have been connected to the internet.The Universal Service and Access Agency of
South Africa connectivity project is currently under way in the Vhembe and Gert Sibande
districts.[embedded content]WaterIn October 2015, the Department of Water and Sanitation,
together with Umgeni Water and the Ugu District Municipality, announced the completion of the
Mhlabatshane Dam in Umzumbe in KwaZulu-Natal. It will provide about 100000 people with potable
water.Water was supplied to 19119 households in the 27 priority district municipalities.In addition,
11 waste water treatment works have been refurbished.More than 75 projects involving the
maintenance and upgrading of existing water infrastructure are under construction.The government
is intervening to stop water leaks, which cost the country R7-billion a year. The Department of Water
and Sanitation is training 15000 artisans and plumbers to fix water leaks in their communities; the
first 3000 people were recruited during 2015/2016.[embedded content]Operation Phakisa, aimed at
growing the ocean economy and other sectors

(Image: Media Club South Africa)Small

harbour upgrades are being undertaken in Saldanha Bay, Struisbaai, Gansbaai, Gordon's Bay and
Lamberts Bay, in Western Cape.In addition, nine catalyst projects are in progress, and 10 fish farms
have been supported. The industry has invested R305-million and the government R105-million and
521 new jobs have been created.Operation Phakisa has also resulted in decisions to expand the
domestic shipbuilding sector and the development of Saldanha Bay as an oil and gas hub.A Mining
Phakisa, aimed at replicating the ongoing success of the ocean economy plan in the mineral sector,
was launched towards the end of 2015.[embedded content]Source: South African Government News

Agency
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