11

Presentation to the Portfolio Committee Presentation to the Portfolio Committee on Trade and Industry – the dti’s 2012/13 on Trade and Industry – the dti’s 2012/13

First Quarter ReportFirst Quarter Report

03 August 2012

2

Presentation OutlinePresentation Outline Strategic Outcome-Oriented Goals

Key Achievements

Departmental Expenditure versus Budget

Key Challenges

2

33

Key AchievementsKey Achievements

Strategic GoalsStrategic Goals

Facilitate transformation of the economy to promote industrial development, investment, competitiveness and employment creation

Build mutually beneficial regional and global relations to advance South Africa’s trade, industrial policy and economic development objectives

Facilitate broad-based economic participation through targeted interventions to achieve more inclusive growth

Create a fair regulatory environment that enables investment, trade and enterprise development in an equitable and socially responsible manner

Promote a professional, ethical, dynamic, competitive and customer-focused working environment that ensures effective and efficient service delivery

4

55

Key AchievementsKey Achievements

SG-SG-1: Facilitate transformation of the economy to promote industrial development, investment, competitiveness and employment creation Clothing Textiles Competitiveness Programme (CTCP) has stabilised production and employment in

the textile sector.

Worked with the South African canning companies to develop 12 products for the schools’ feeding scheme.

Standards for organic produce sector presented to the Organic Agriculture Production & Processing Technical Committee at South African Bureau of Standards (SABS) for approval.

The first pharmaceutical tender of R 2.5 bn Oral Solid Dosage (OSD) (70% of the tender, by volume was set aside for domestic manufacturers ) was designated by Minister Davies in April 2012.

Participated in the Project Team led by Department of Transport (DoT) and Passenger Rail Agency of South Africa (PRASA) for the Request for Proposal (RFP) issued to conclude a 20 year PRASA rolling stock renewal programme for 65% local content inclusion.

The development of data on local government long term contracts has been finalised with further opportunities for designation identified.

the dti has prepared a position paper on the review of the Preferential Procurement Policy Framework Act (PPPFA) and the review led by the National Treasury has commenced.

Industrial Development – Industrial Industrial Development – Industrial PolicyPolicy

66

Key AchievementsKey Achievements

SG-SG-1: Facilitate transformation of the economy to promote industrial development, investment, competitiveness and employment creation

Finalised first draft of the Special Economic Zone (SEZ) incentive framework

Finalised Draft guidelines to align Enterprise Incentive Programme and Manufacturing Competitiveness Enhancement Programme (MCEP)

Revised Film and TV production guidelines approved by the Minister

Completed Special Economic Zone (SEZ) fund proposal

Launched the Manufacturing Competitiveness Enhancement Programme (MCEP) that will be administered by both the dti and the Industrial Development Corporation (IDC)

Industrial Development – Incentive Industrial Development – Incentive AdministrationAdministration

7

Overview of Incentive SchemesOverview of Incentive Schemes

Description

Actual

Number of firms/projects

supported

Potential jobs supported Investment leveragedR'000

Export sales valueR'000

Industrial Financing

MIP 135 2744 R1,8 bn

TSP 32 264 R251.7m

AIS 5 283

BPS 2 750 R167m

Film & Television 17 R526m

12i 0

CIP 2 1000 R711m

Broadening Participation

Co-operatives (CIS) 27

BBSDP 115

SPII 10

Trade, Investment & Exports

EMIA 240

Trade, Investment & ExportsTrade, Investment & ExportsSG-2: Build mutually beneficial regional & global relations to SG-2: Build mutually beneficial regional & global relations to advance South Africa’s trade, industrial policy & economic advance South Africa’s trade, industrial policy & economic development objectivedevelopment objective

Trade and investment approach included in SA’s Brazil, Russia, India, China and South Africa (BRICS) strategy and adopted by Information Co-operation, Trade and Security Cluster (ICTS).

Revised the Trade Policy Strategy Framework (TPSF).

Trade Agreement (T-FTA) negotiations adopted – negotiations among Members of T-FTA without existing preferential arrangements.

Cuba package submitted to Parliament for ratification.

Signed Trade and Investment Framework with United States of America.

One (1) trade and investment Memorandum of Understanding (MoU) signed with Nigeria.

Eight (8) successful technical and business missions to foreign countries and companies.

Participated in the Southern African Development Community (SADC) IPA Forum in Seychelles and made input into the SADC review on investment climate.

Trade, Investment & ExportsTrade, Investment & ExportsSG-2: Build mutually beneficial regional & global relations to advance South SG-2: Build mutually beneficial regional & global relations to advance South Africa’s trade, industrial policy & economic development objectiveAfrica’s trade, industrial policy & economic development objective

Exports of R1.3 billion facilitated (52% of export sales facilitated was from key developing countries of the South of which 15% are from Africa and the Middle East, 32% from Asia and 4% from South America).

R7.31 billion in potential investment projects (26.8% of FDI was facilitated from developing countries notably India).

179 companies assisted financially, of which 39 (22%) were emerging exporters. Organised a successful International Trade Initiative (ITI) to the Democratic Republic of

Congo (DRC) in May 2012 and initial estimates are US$42million worth of export and investment projects will arise out of this.

Organised 6 National Pavillions in Chile, Malaysia, Zimbabwe, China, UAE and Zambia. Implemented a successful World Cup Legacy Exhibition at the Africa Dialogue

Conference. Hosted Africa Dialogue Conference which now serves as a platform to engage Global

Investors and to forge Private Sector Partnerships. In addition, Africa Dialogue has the potential to champion Infrastructure Development and Investment in the Continent.

National Exporter Development Programme (NEDP) has been developed and currently awaiting presentation to Cabinet.

Broadening ParticipationBroadening ParticipationSG-3: SG-3: Facilitate broad-based economic participation through targeted Facilitate broad-based economic participation through targeted interventions interventions to achieve more inclusive growthto achieve more inclusive growth Launched the Provincial Co-ordination Forum (PCF) and with eight (8) provinces attended

the launch Red Tape Reduction workshop held and attended by 43 participants from Provincial

Government departments; municipalities; private sector; South African Local Government Association (SALGA) as well as the Department of Cooperative Governance.

The Co-operatives Amendment Bill has been introduced in Parliament. South Africa hosted the International Co-operatives Alliance Global Board meeting in South

Africa from 13 to 16 June 2012 in Cape Town. The B-BBEE Amendment Bill was tabled to Cabinet in June 2012. The refined Codes of Good Practice received approval from the Presidential BEE Advisory

Council. Conducted the B-BBEE Equity Equivalent Investment Programme workshops for Limpopo,

Free State, Eastern Cape, Gauteng, North West and Mpumalanga provincial governments.

Completed the draft Regional Industrial Development Plan (RIDP). Initiated discussions with Black Business Council, Business Unity South Africa (BUSA) and

United Nations Development Programme on clustering and supplier development.

RegulationRegulationSG-4: SG-4: Create a fair regulatory environment that enables investment, trade & Create a fair regulatory environment that enables investment, trade &

enterprise development in an enterprise development in an equitable & socially responsible manner equitable & socially responsible manner Intellectual Property Policy Framework produced – for harmonization of IP laws - dealing

with IP in relation to access to medicine, access to education, exceptions, interface between competition and IP, Consumers and IP.

Draft Policy Framework for Business Act – in consultations with provinces – provides framework for enhancing the manner in which commercial and business activities are conducted – workshops conducted with stakeholders.

Notice published for public comment regarding country of origin of products emanating from Israel/Palestine.

Regulatory Impact Assessment on the National Credit Act, Business Act Review, Business Reform Registration and IP policy commenced.

the dti/Contralesa Memorandum of Agreement has been implemented and in Kwa-Zulu Natal, Eastern Cape, Free State, Gauteng and Limpopo reaching 1000 directly and over 1 million indirectly through five community radio stations interviews.

Draft norms and standards on liquor developed and are being considered for presentation to the National Liquor Policy council meeting.

Alcohol abuse prevention strategies implemented by running the Youth month campaigns to inform youth regarding the danger of alcohol abuse and to offer them other alternatives of participating in the economy except liquor business.

Administration & Co-ordinationAdministration & Co-ordinationSG-5: SG-5: Promote a professional, ethical, dynamic, competitive & customer-Promote a professional, ethical, dynamic, competitive & customer-

focused working environment that ensures effective & efficient service focused working environment that ensures effective & efficient service deliverydelivery

Exceeded the compliance requirements of 30 days for the payment of creditors by finalising 90% of payments within 14 days and the remainder within 21 days.

2011/12 Annual Report to Citizens approved and submitted to Public Service Commission (PSC).

Exceeded the People With Disability 2.4% target by achieving 2.5%.

Exceeded the Women SMS 43% target by achieving 43.42%.

Vacancy rate is currently 7.39%.

13

Departmental expenditure Departmental expenditure versus budgetversus budget

Expenditure as at 30 JUNE 2012Expenditure as at 30 JUNE 2012 Year to date (YTD) expenditure of the department

is 10,7% of the YTD budget

89,3% of the annual allocation is still available for the remainder of the financial year

Expenditure for the same period in the last financial year was R1,5b compared to R1,6b in the current financial year

Projected expenditure at financial year is not expected to be less that 98% of the allocated budget

14

Budget vs. expenditure for the 2012/13 Budget vs. expenditure for the 2012/13 financial year – per programmefinancial year – per programme

15

Programme

RevisedBudget 2012/13

Year-to-date (YTD)Available budget

% budget available

YTDBudget

YTD Expenditur

e

Variance (Budget less expenditure)

%

varianc

e

R’000 R’000 R’000 R’000 R’000

Administration 609,795 146,453 131,650 14,803 10.11% 478,145 78.41%

International Trade and Economic Development 133,462 30,072 26,159 3,913 13.01% 107,303 80.40%

Broadening Participation 878,838 216,728 209,037 7,691 3.55% 669,801 76.21%Industrial Development:

Policy Development 1,482,856 421,220 417,148 4,072 0.97% 1,065,708 71.87%Consumer and Corporate

Regulation 244,713 117,567 56,063 61,504 52.31% 188,650 77.09%Industrial Development: Incentive Administration 5,437,565 787,602 698,230 89,372 11.35% 4,739,335 87.16%Trade and Investment

South Africa 304,826 63,237 54,173 9,064 14.33% 250,653 82.23%

Total 9,092,055 1,782,879 1,592,461 190,418 10.68% 7,499,594 82.49%

Graphical presentation on YTD Graphical presentation on YTD projection vs. expenditure projection vs. expenditure

Year-on-year comparison Year-on-year comparison

Key ChallengesKey Challenges

The opening of new strategic offices in high growth markets delayed due to the lack of funding required to implement these plans.

Low uptake of incentives.

18

1919

Thank you