President Jacob Zuma called on both public
and private sectors to focus on creating
jobs for South Africans.
(Image: Bua News)
• Zizi Kodwa
Special Advisor on Communications
+27 11 547 5600
Job creation in South Africa looks set to move into higher gear, following incentive-driven schemes recently announced by President Jacob Zuma.
Delivering the State of the Nation address in Parliament on 10 February 2011, Zuma announced a R9-billion jobs fund and a tax-incentives scheme for the manufacturing sector – both received a hearty welcome response from the House.
The employment fund will focus on financing new job-creation initiatives over the next three years. It’s expected that allocations will go towards sectors offering mass employment opportunities, such as infrastructure development, agriculture, mining and beneficiation, manufacturing and tourism.
Zuma pointed out that research shows these industries have the potential to be among the biggest job-spinners. With such key sectors being run almost exclusively by the private sector in South Africa, it’s probable that a sizeable chunk of the R9-million will go in that direction.
“We urge every sector and every business entity, regardless of size, to focus on job creation. Every contribution counts in this national effort,” said Zuma.
The announced R20-billion tax-break incentives for the manufacturing sector are meant to promote investments, expansions and upgrades, Zuma said.
Manufacturing companies must make investments of no less than R200-million for new projects and R30-million for expansion projects to qualify for the tax breaks, Zuma said.
The Industrial Development Corporation has allocated R10-billion over the next five years for investment in sectors with potential to produce the much-needed jobs, the president announced.
South Africa has undertaken to generate at least 5-million jobs within the next decade. This ambitious drive is a major focus of the New Growth Plan announced in late 2010. “We cannot create these jobs alone. We have to work with business …” Zuma added.
Departments to play their role
All government departments will announce job-creation targets within the next two months when they deliver their Budget Vote speeches.
Zuma said all spheres of the government have to focus on creating new jobs. A high volume of jobs can be produced in national, provincial and local government’s institutions.
State-owned enterprises, which include the likes of Eskom and Transnet, are being geared towards offering massive employment opportunities. The parastatals have also been urged to formulate initiatives that develop artisan skills.
“While looking to the private sector in particular to help us create most of the jobs, government will certainly play its part,” Zuma said.
The government will also introduce policies to improve the working conditions of those already employed.
Political parties’ reactions to Zuma’s address have been mixed, but most have welcomed the job-creation interventions.
The jobs fund investment was “a step in the right direction”, said leader of the United Democratic Movement Bantu Holomisa.
About 7 000 industrial jobs were saved over the last year through government intervention, according to Zuma. He said the government provided financial support for struggling firms.
The tourism industry has been at its best in the last year. Zuma noted that over 7-million tourists visited the country in 2010, which was a massive increase from the 6-million-plus who came to the country in 2009.
The tourism boom of the last 12 months can be largely attributed to the 2010 Fifa World Cup, but the influx of visitors is expected to continue. “Our country also continues to be a popular destination for international gatherings,” he said.
International events that South Africa will host in 2011 include the 123rd International Olympic Committee General Assembly Session in July and the UN climate change summit in December. Both will be held in Durban.
“We have declared 2011 a year of job creation through meaningful economic transformation and inclusive growth,” Zuma said.
* The South African Rand was R7.34 to the US Dollar at the time of publishing