20 April 2011
The Department of Trade and Industry has helped to conclude R28-billion in investment in South Africa’s economy and aims to facilitate R115-billion in investment over the next few years, says Trade and Industry Minister Rob Davies.
Briefing journalists in Cape Town on Tuesday following his budget vote speech in Parliament, Davies said the R115-billion target was part of a performance agreement that he signed with President Jacob Zuma last year.
Davies said that of the R28-billion which had already been committed, R13-billion was in the automotive sector, with much of the remainder in business-process services.
There had also been plenty of interest in infrastructure projects and “green” industries, he said.
He said Trade Investment South Africa (Tisa) had offices across the world which helped to facilitate investment deals, and in some cases Davies himself met with potential investors.
“When we go abroad with these state visits, we convey to investors from other countries we are visiting information about the investment climate in South Africa,” he said.
The Industrial Development Corporation (IDC) as well as the National Empowerment Fund (NEF) played a critical role in investments, he said, both financially and in terms of their partnership value.
Davies said the department and the President’s Black Economic Empowerment (BEE) advisory council were also debating how to strengthen links between small and big businesses by overhauling the enterprise development element.
Strengthening big, small business links
Under the BEE scorecard, businesses that assist black-empowered or black-owned enterprises with mentoring or business support, grants, interest-free loans or early payment, can score BEE points.
Davies said the current debate was whether to take away points from the overall scorecard for not supporting black businesses.
He said the private sector needed to be more actively involved in supporting black entrepreneurs, rather than handing money over to a fund or incubator that then carried out a support intervention on their behalf.
“In Asia, you find that small and big businesses have a symbiotic relationship, and big businesses get a lot of input from small businesses, and then you don’t want a lot of bad inputs, so you actually work to ensure that your suppliers are able to improve their capacity, their technology,” Davies said.
Improving small business support
In his budget vote speech, Davies said the department had set up an advisory group to help improve the government’s small business support (SMME) programmes.
He said the ramping up of incubation programmes had already been identified as a move that would benefit small enterprises, but he said partnerships would have to be cemented.
“We will accordingly be seeking more active partnerships with business, and are looking at ways to tweak BBBEE programmes, as well as direct SMME programmes to develop the necessary synergies.”
He said the Small Enterprise Development Agency (Seda) was planning to roll out support for 250 incubation schemes over the next five years, as the first phase towards a target of 1 000 small business incubators.