D Africa: Budget Speech Consultative Forum

15 March 2006

The Programme Director,
His Excellency Kgosi Jeff Montshiwa,
Dikgosi le Dikgosana tsa Barolong Boora Tshidi,
Honourable MECs present here today,
Members of the Provincial Legislature,
Members of the MIDZ Board,
Representatives of organised business,
The Acting DDG Mr Sehularo,
The CEO of Invest North West, Mr Gabi Jabane,
The Management of Mafikeng Bio-Diesel Company,
The Management of Agro Forestry Bio Energy Association,
Distinguished guest,
Ladies and gentlemen,

Programme Director, under the recently introduced Accelerated and Shared
Growth for South Africa (AsgiSA) initiative aimed at accelerating growth in the
South African economy attention is given to sector specific strategies and
special projects such as the initiative we have come to celebrate this morning,
that being bio fuels as represented in the North West under the Mafikeng
Bio-Diesel initiative.

However, AsgiSA has also identified a number of “binding constraints.” Under
these the following constraints are of critical importance for our province.
These constraints include inadequate skills levels as well as the continued
infrastructure challenges prevailing in the North West Province more
specifically roads and what it refers to as logistics infrastructure.

Ladies and gentlemen, this process is fundamentally dependant on the
existence of suitable and adequate roads infrastructure in the province. In a
recent report by the Council for Scientific and Industrial Research (CSIR) on
research conducted on the state of roads in the North West it reported that the
provincial network required serious attention noting the work required on both
national and regional road networks in the North West.

If we are unable to secure the necessary roads infrastructure for the
province it becomes near impossible to attract investment into a landlocked
province such as ours. In a context in which the Provincial Growth and
Development Strategy (PGDS) seeks to promote the development of manufacturing
and beneficiation activities, this sort of infrastructure becomes critical
friends.

It is critical to the investor because he or she wants to get their products
to markets and hopefully if earmarked for exportation then they will need to
get to the various ports in the country and bad road infrastructure means
additional costs and inefficiencies.

Secondly, AsgiSA highlights the need for greater levels of skills
development in critically required technical, scientific as well as managerial
jobs being required by the economy.

According to Econometrics (Pty) Ltd: “Probably the single biggest challenge
in achieving the above objectives rests with the insufficiency of appropriate
skills in the economy. This impacts both the ability to develop the country’s
infrastructure and on the ability to deliver services efficiently. The skills
required are both of a technical and scientific nature and of a management
kind.”

If this true of accelerated growth and what is required of the province by
way of skills levels then we are confronted with a serious challenge as a
province. I say this as a result of the current statistics on education levels
in the province. According to Statistics South Africa’s general household
survey of July 2004, only two percent of the North West population 20 years and
older are in possession of a degree and higher, four percent of the same
population with a diploma with a grade 12 and 22 percent with a grade 12 or
matric qualification.

These figures clearly outline the extent of the challenge at hand whilst
noting that we have not even done an assessment of the nature of these
qualifications and the specific skills required for accelerated growth.

Having just taken a quick glance at the extent of the developmental
challenge confronting the province in the context of AsgiSA, it should become
clear to all that there has arisen a need for the formation of a movement for
accelerated and shared growth in the province. This new growth trajectory,
albeit in the same direction but at an accelerated pace will require the
collective efforts of all of our social partners and the private sector and
industry in particular.

If this movement I am talking about is the vehicle for shared and
accelerated growth then I submit to you all that the content and character
thereof must be informed by what I refer to as a bias towards hope! In this
regard we need to build a new confidence for development through the creation
of greater coordination amongst stakeholders.

We need to ensure that rapid development and growth does not overrun our own
capacity to support such development, I make specific reference to our ability
to provide electricity and other critical utilities required by industry and
accelerated growth.

Rapid development in AsgiSA requires new momentum for special skills and
competencies, this cannot take place when these skills are lacking. In this
regard the participation of local government is critical as it will in most
instances be the dominant provider of such critically required infrastructure
to the economy.

Under the context of the PGDS we have been able to make meaningful
contributions to growth in the provincial economy and improving the lives of
our people. However AsgiSA calls for an exponential advancement of this agenda.
The vehicle for these partnerships could take the shape of memorandum of
understandings (Moue’s), such as the once we are signing this morning or
alternatively they can also be spontaneous and unsolicited from the side of
government. In this regard we would be encouraged to receive proposals aimed at
jointly tackling these binding constraints to accelerated and shared
growth.

Key areas requiring attention and an all out assault include small, medium
and micro enterprise (SMME) development and the elimination of the Second
Economy. Secondly, the need for increased investment in the province and more
specifically value adding activities such as the local beneficiation of the
province’s natural resources such as those taking place in the agri-processing
sub-sector.

I would like to have our guests consider this call to action and for you all
to consider this in the context of the following processes taking place in the
Department and the work we intend doing in the economy over the next financial
year. Essentially this forum this morning was meant to give our stakeholders
some indication of the content of our plans for next year, our achievements to
date all in an effort to solicit your inputs, comments and more especially how
these could be enhanced and accelerated with you shared participation.

The purpose of the day is two fold ladies and gentlemen. As a Department we
want to interact with you our stakeholders on the content and approach to be
taken in our budget speech to the people of the province. Secondly we will be
furthering a number of strategic partnerships aimed at the development of key
economic sectors in the province.

Significant amongst the latter is the reason behind our hosting this event
at the Bio-Diesel Nursery this morning. We are here with the specific purpose
of celebrating the achievements we have been able to achieve thus far. In
addition to the province’s commitment to bio-fuels development and specifically
bio-diesel we are also here to present to this project the R10 million
committed to the initiative at its launch on 7 May last year.

Many of you would remember that at the launch of the project last year where
we had done the sod turning with Kgosi Montshiwa that this was an empty piece
of land with nothing but a fence around it. Through our commitment and
determination this project has grown and currently forms part of the special
project focus areas identified in AsgiSA.

Currently our efforts here at the nursery has seen the construction of the
laboratories and all the necessary storage and administrative facilities, it
has also witnessed the construction of three tunnels or hothouses where you
will have an opportunity to view some of the saplings being cultivated here.
The establishment of the netted hardening off areas have also been completed
where it is anticipated that the saplings will be nurtured to maturity. You
will be taken on a guided tour of the facility where you will be given an
opportunity to view these developments.

In addition, we are also sealing agreements with two ABSA Bank and the
Automotive Industrial Development Cluster (AIDC), which will greatly advance
the SMME sector and the automotive component supplier sector in the province
respectively.

Our agreement with ABSA Bank as most of you are aware of is primarily
focussed on the joint fund aimed at the funding of SMMEs in the North West.
This initiative will serve to assist thousands of SMMEs in accessing start up
funding for their businesses where traditionally they would not have been able
to get the funding required to start their own businesses.

An additional agreement being entered into today is that of the North West
Provincial Government and the Alternative Information and Development Centre
(AIDC), aimed at the implementation of the provincial automotive development
strategy in the North West. This strategy seeks to develop and expand the
manufacturer base in the automotive component sector specifically located in
the Brits area. This initiative is not only part of a provincial priority being
driven by the North West government, but it is also informed by the tenants of
the National Motor Industry Development Strategy (the MIDS) of national
government. This strategy includes capacity building and industry development
projects ranging from combating HIV/AIDS within the sector all the way to the
development of technical skills in the sector and the retention and expansion
of investment and industry participation in the automotive sector in the North
West.

Ladies and gentlemen, these are the kinds of partnerships we are talking
about, where the province is able to partner with social partners whether in
the area of technology and sector specific development, skills development or
through investment into the province.

This will form the content of a movement for accelerated and shared growth
in the North West Province!!

On to the other business of the day that being the departmental budget
speech and the overview we want to present to you today.

* The Small Enterprise Development Agency (SEDA) rolls out in the province
(incubation in the province)
* SMME access to funds
* SMME debt relief
* The North West Development Corporation (NWDC) rental subsidy scheme
* Research projects
* Local economic development support programme
* Departmental events hosted and participated in by the department
* Liquor trade administration
* Matters relating to gambling
* Tourism
* Key economic development projects, which I will talk about in greater detail
during the tabling of my budget vote to the legislature, will include the
following projects:
* The Mafikeng Industrial Development Zone (MIDZ) project
* The MIDZ infrastructure development
* The youth car wash projects
* The bio-diesel project, which are visiting this morning
* Gayness wild silk project
* Madikwe wild silk project
* Community funded projects by the Department
* Opportunities for SMMEs in beneficiation

I am only making scant reference to some of the issues to be raised in our
budget speech on 28 March, primarily due to the fact that it is our intention
today to merely give you a glimpse into the speech and to share these plans and
ideas with you, as our key stakeholders.

I hope and trust that this would at least entice you to take the time on the
28th to get the total picture on our plans for 2006/07 and it is my sincere
desire to partner with you and your various organisations in making a
difference in the province and ensuring accelerated and shared growth in the
North West.

I thank you and good day.

Issued by: Department of Economic Development and Tourism, North West
Provincial Government
15 March
Source: North West Provincial Government (http://www.nwpg.gov.za)