Economic Development Minister Ebrahim Patel has noted solid progress in government’s localisation programme, citing the example of the minibus taxi industry. South Africa has improved localisation in this industry from zero percent of the annual local demand for taxis being assembled locally at the beginning of 2012 to about 50% in 2013 with an aim of reaching two-thirds by the end of 2015.
Minister Patel says government will continue to invest millions of rands to improve localisation of supplies in the manufacturing sector. The Minister said the Industrial Development Corporation (IDC) has been mandated to develop a national localization strategy which will guide all spheres of government.
The Minister says labour-absorptive capacity of local manufacturing industries must be boosted to help stimulate job creation and economic growth in South Africa. He added that a strong local manufacturing sector can have a positive impact on the country’s balance of payments.
The Economic Development Department has spearheaded a number of initiatives to enhance localisation which include partnerships with the two local taxi manufacturers, Toyota and, through the IDC, Beijing Automobile Works, a Chinese manufacturer. These companies have already employed 220 people to assemble the taxis locally with the number set to increase significantly by 2015.
The South African government is leading a campaign to promote local procurement of supplies across all industries to boost the economy’s capacity to create decent jobs. In October 2011 social partners that included representatives of government, business, labour and community-based structures signed a Local Procurement Accord and the partners have been making progress in its implementation.
Examples of progress include the local sourcing of 80% of all inputs and supplies in the manufacturing of bus bodies for the rapid public transport systems in the Tshwane, Cape Town and Johannesburg metropolitan municipalities. For instance, all bus bodies for the R327 million tender for Gauteng’s rapid transport scheme will be sourced from the Gauteng-based manufacturer – Marco Polo. The chassis will be sourced from the East London based manufacturer Mercedes Benz.
NB: The Economic Development Department is responsible for overall coordination of economic development interventions of government and uses it various implementing agencies such as the IDC and SEFA (Small Enterprise Finance Agency) to make targeted support of industries to enhance job creation, small business development and the industrialisation of the South African economy.
Enquiries:
Manelisi Wolela
Cell: 083 626 0304
E-mail: mwolela@economic.gov.za
