Programme director, CEO of MISA, Mr Dana de Villiers
President of Motor Industry Staff Association (MISA), Mr David Pereira
President of Federation of Unions of South Africa (FEDUSA), Mr Danie Carstens
FEDUSA General-Secretary, Mr Dennis George
Vice President of the Frankfurt Exhibition Center, Mr Michael Johannes
Chairman of Johannesburg Expo Centre, Mr Andrew Mthembu
President for Retail Motor Industry, Ms Ferose Oaten
MerSETA CEO, Dr Raymond Patel
Chairperson of MerSETA, Mrs Jeanne Esterhuizen
Ladies and gentlemen
It is my great honour to address the Motor Industry Staff Association of South Africa (MISA) Executive Round Table.
I am optimistic in the potential of this gathering to help us catalyse the vision of reconstruction, development and prosperity that our country needs.
As we all know government has officially declared 2011 the year for job creation.
It follows that this gathering provides a solid platform on which we can share ideas about what together we can do towards the realisation of this important national goal.
In addition, today's breakfast meeting, I believe, carries a potential for government, labour and business to further engage on some key sector-related issues such as local content, transformation and long-term economic growth plans for the benefit of all.
This will go a long way to address poverty and inequalities in several parts of South Africa.
The current Motor Industry Development Programme (MIDP) and Automotive Production and Development Programme (APDP) remain important industrial policy tools to support, promote and advance future sustainability of South African automotive sector.
On this account, we reiterate that the partnership between government, labour, business and other role players will be indispensable for our recovery from the job losses experienced in the past few years as a result of the global economic meltdown.
Ladies and gentlemen,
The primacy of job creation as one of the critical priority areas of government is illustrated in the Industrial Policy Action Plan (IPAP2) as outlined by the Department of Trade and Industry.
This assumed more importance in the light of the many challenges either laid bare or in some case, worsened by the recent recession.
Equally we are alive to the need to gear our efforts to addressing other outstanding areas in this sector.
For instance, despite notable successes achieved by the automotive, medium and heavy commercial sectors, there is still a sore need to build adequate capacity in this sector.
This is the area where the financial backup from the Industrial Development Corporation (IDC) as stated by President Jacob Zuma in the state of the nation address will be critical for our objective of making improvements on a broader scale.
The automotive industry contributes considerably to the Gross Domestic Product (GDP) and job creation.
It is in fact the largest in the manufacturing sector of the South African economy and contributed 5, 9% to the GDP in 2009.
International trends indicate that for every employee in the manufacturing of motor vehicles, two or more workers are employed within the sales, servicing and repair of motor vehicles.
In 2009, the South African motor vehicle manufacturing and the component manufacturing sectors employed 30 000 and 61 000 people respectively.
Meanwhile the Department of Trade and Industry (DTI) reports that during the same period, the whole value chain of the automotive sector employed 230 000 workers.
The International Monetary Fund (IMF) 2010 Annual Report depicts South African economy recovering more rapidly than anticipated at an annual growth rate of 3% of GDP.
Such recovery has also been evident in new vehicle sales for 2010 showing an improvement of almost 25% compared to the previous year.
Programme director,
The role of the automotive industry in the South African economy, and particularly in creating employment has made a compelling case for government to invest significantly to support further growth in this sector.
Government's continued support for the automotive sector has created favourable conditions that made it possible to attract an upward investment of R13 billion from original equipment manufacturers.
Encouraging domestic manufacturing and production of automobile products in South Africa will undoubtedly contribute to the creation of more jobs in our country.
To support this function, I am informed, the original equipment manufacturers Purchasing Council will shortly finalise a proposal for localisation programme which would positively comply with the Competition Act.
Such step will also strengthen the local component supply chain process.
In addition, the draft action plans for development of the subsector have also been completed and will be signed off by the end of the first quarter.
The process to secure further support for the sector desk in the form of a private sector service provider through the Industrial Development Corporation (IDC) is nearing its final stage and is expected to be completed by mid March 2011.
In the context of a rapidly changing environment which needs new skills and technology to remain on par with competition, government will continue to work with the industry in developing and honing skills to ensure that South Africa remains a preferred location for the production of world class vehicles.
Programme director,
It is worth noting that the majority of businesses in the retail automotive sector are small entities which may create job opportunities only if they have the ability to understand challenges facing South Africa and the need to implement correct interventions.
The focus should not only be on creating decent employment but provision of necessary training to enhance the industry's capacity in providing quality service to its customers.
However, a lot still needs to be done in transforming the automotive industry.
To this end, government has consistently raised concern about the level of economic participation by historically disadvantaged individuals at ownership and management levels.
I am sure you will agree, therefore, that much still needs to be done to ensure a more representative industry which draws strength from the diversity of its people and which is therefore better positioned to respond to global imperatives by leveraging our abundant human resources.
Finally, as an engine of economic growth, automotive industry will continue to enjoy considerable government support to realise growth and prosperity.
I am therefore confident that the key role players represented in this gathering will take full advantage of the favourable conditions created by government to grow the automotive industry to levels that will enable it to contribute further to job creation and inclusive economic growth.
I thank you.
Source: The Presidency
