Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Industrial Policy Context and Strategic Direction DTT Roll-Out and Local Content Development Workshop 28 May 2014, CSIR Mhlanganisi Masoga: Director - Creative Industries 2 Objectives of the Industrial Policy Action Plan South Africa’s long term vision of an equitable society is defined by the National Development Plan (NDP). The IPAP is informed by this vision and is both framed by and constitutes a key pillar of the programmatic perspectives set out in the New Growth Path (NGP). Its core objectives remain as set out in the National Industrial Policy Framework (NIPF) of August 2007: • To facilitate diversification beyond our current reliance on traditional commodities and non- tradable services. This requires the promotion of increased value-addition per capita characterised particularly by movement into non-traditional tradable goods and services that are competitive in both export markets and the domestic economy. • The long-term intensification of South Africa’s industrialisation process, and movement towards a twenty-first century knowledge economy. • The promotion of a more labour-absorbing industrialisation path with a particular emphasis on tradable labour-intensive goods and services and economic linkages that catalyse employment creation. • The promotion of a broader-based industrialisation path characterised by greater levels of participation by historically disadvantaged economic citizens and marginalised regions in the mainstream of the industrial economy. • Contributing to industrial development in Africa, with a strong emphasis on building regional productive capabilities. 3 CONTEXT ISSUES Consumption-driven growth path • SA’s growth path has hitherto been characterised by consumption-driven sectors growing at twice the rate of its productive sectors. Financialisation & import intensity • The economy has experienced extensive financialisation, but the financial sector has not supported productive sector investment; growth has been import-intensive rather than based on growth in the domestic manufacturing sector. Structural unemployment • High structural unemployment has remained a constant, oscillating between 22,5% and 25% on the narrow definition. 4 UNDERLYING PRINCIPLES OF IPAP Driving structural change in the economy • IPAP’s goal is to bring about significant structural change in the economy, reverse the threat of deindustrialisation and strengthen and diversify SA’s manufacturing base, especially in value-adding, labour-intensive strategic sectors. Defending & promoting industrial development • IPAP is predicated on the state supporting, nurturing & defending industrial development; it seeks to assert state leadership in a context where the state largely ‘steers but does not row’. Refining conditionalities & obligations • IPAP seeks to implement stronger developmental conditionalities and extract stronger reciprocal obligations from beneficiaries of state support in areas such as competitiveness upgrading, employment retention and creation, investment etc. 5 UNDERLYING PRINCIPLES OF IPAP • Successive iterations of IPAP have consistently sought to articulate a deeper, more comprehensive and integrated set of solutions to the major fault-lines of South Africa’s economic structure; an orientation that necessarily implies a fundamental shift of policy emphasis in favour of the productive sectors of the economy. • In order to deliver on these objectives, the following key areas of intervention will continue to be energetically pursued throughout the 2014-2016 period contemplated in IPAP - and further into the medium and longer term future: 1. Economy-wide: • Pursuit of a stronger articulation of macro- and micro-economic policies, greater policy coherence and better implementation. • Stronger alignment of industrial policies and programmes with investment and export-promotion programmes such as the National Exporter Development Programme (NEDP) focussed on widening and balancing SA’s exporter base. • Better policy alignment, both in general and in relation to specific sector strategies, focussed particularly (but not exclusively) on those sectors where the domestic economy enjoys global competitive advantages. 6 UNDERLYING PRINCIPLES OF IPAP 2. Procurement: • A sustained effort to secure compliance with existing public procurement policies and strategic supplier development/sourcing measures, with the overall aim of supporting the manufacturing sector to raise domestic production and grow employment. • This effort will be combined with: o further policy framework and institutional improvement measures flowing from the Public Procurement Review: and o strong persuasive initiatives to secure greater private sector support for local manufacturing - a contribution that large companies in particular are well placed to make, given their significant procurement spend. o It also includes providing further support for broad based black economic empowerment (BBB-EE) and better alignment between BBB-EE and industrial development objectives. 3. Industrial finance: • Stronger alignment and progressive strengthening of industrial financing across all DFIs - and within the Industrial Development Corporation (IDC) in particular in order to secure an optimal mix of public and private sector funding that can progressively strengthen investment in the productive, especially manufacturing, sectors of the economy. 7 UNDERLYING PRINCIPLES OF IPAP 4. Developmental trade policy: • Ongoing strengthening of developmental trade policies; with the following key components: o deployment of trade measures such as selective and strategic tariffs and their improved alignment with industrial policy objectives; working closely with the International Trade Administration Commission (ITAC) while recognising their independent role; o closer and more detailed cooperation with the Customs Division of the South African Revenue Services (SARS) to combat the ever-present (and steadily growing) problem of illegal and fraudulent imports – one of the key pillars of the illicit economy; o steady and incremental strengthening of the capacity and capabilities of the Standards, Quality Assurance, Accreditation and Metrology (SQAM) institutions, which provide an indispensable support framework for a modern and competitive economy. 8 UNDERLYING PRINCIPLES OF IPAP 5. Competition policy: • Strengthened interventions to combat anti-competitive and collusive behaviour in both the private sector and State Owned Companies - and in so doing, lower the cost of procurement to the national fiscus and of wage goods to working families. 6. Regulation and intellectual property: • An Intellectual Property Rights (IPRs) regime that seeks to create a supportive environment for South Africa’s industrialisation objectives. • The regime should provide broad terms of scope for protection and less stringent criteria for novelty. • The recently signed Intellectual Property Amendment Bill enables the regime to strike a balance between encouraging incremental innovations, providing protection for indigenous knowledge and providing enough incentives for innovators to make the necessary research and development investments. 7. Innovation and technology: • New policies and programmes to ramp up competitive capabilities in the production and services sectors of the economy, taking advantage of every opportunity to leverage the quantum advances on offer in the sphere of digital and other globally emergent advanced technologies. 9 IPAP TRANSVERSAL INTERVENTIONS 10 IPAP SECTORAL INTERVENTIONS 1 Sectors supported since 2007: scale up and broaden interventions 11 IPAP SECTORAL INTERVENTIONS 2 & 3 2: Qualitatively new areas of intervention 3: Development of long term advanced capabilities Cultural and Creative Industries • South Africa has long identified the potential of the Creative Industries to contribute to both economic and social development as evidenced in CIGS, ASGISSA, NIPF, NDP and in recent years IPAP • The Economic Contribution of Copyright Based Industries to the South African Economy the creative industries (copyright-based industries) were responsible for almost 4.11% of the total economy in terms of value added, while 4.08% of the work-force was employed in the creative industries in 2008. • World exports of creative goods have continued to grow, reaching $454 billion in 2011 — more than double their 2002 level • The creative industries hold great potential for developing countries that seek to diversify their economies and leapfrog into one of the most dynamic sectors of the world economy. 16 Value of the Film & Television Sector • In 2011, filmed entertainment grew Millions at a rate of 3.4% with a value of US$ 85,433 million and television at the rate of 8.1%, at a value of US$ 400,541 million (PWC Outlook, 2012). Value of Global Film and TV Industries 600,000 485,433 500,000 • The total combined value of global film and television was at US$ 485,433 million • From 2002 to 2008 exports of audio-visual goods and services increased from $14.1 billion to $27.2 billion, from growing on average by 9 per cent annually. • Most of this trade was for audio- visual services, which accounted for $26.4 billion, while audio-visual goods totalled only $811 million.(UNCTAD,2010 ) 400,541 400,000 300,000 200,000 85,433 100,000 0 Filmed Entertainment Television Film and Television 17 Value of the SA Film & Television Sector • The Film industry grew by 3.1% between 2008 and 2009, while there was only 1% growth from 2010 to 2011 valued at R2, 889 billion ; while the Television industry from 2010 to 2011, grew by 13.4% from R20, 326 to R23, 051 billion. • The total value of the South African Film and Television industry for 2011 amounted to R 25,940 billion. • South Africa’s share of the global television and film market growth in 2011 is minimal, pegged at a mere 0.67% market share. • (Statistics: Price Waterhouse Coopers 2012). 18 Share of the Film Market • The share of the local film market by South African produced content continues to be minimal. • South African films were not as successful in 2011 as in 2010, accounting for about 5% of 2011 box-office spending compared with 11% in 2010. • Although that are a few South African films breaking into the international film market, the presence is still very limited. • While foreign films continue to dominate the local market, SA content has struggled to break into international markets 19 Share of the Film Market 100 90 80 70 60 SA Content US Content UK Content 50 German Content French Content 40 Italian Content 30 20 10 0 SA Box Office US Box Office UK Box Office Ger Box Office Fr Box Office Ita Box Office 20 Share of the Television market 120 • The television market continues to grow at a phenomenal rate of more than 10% year on year. 100 80 60 • But the share of this growth does not benefit local content • When comparing the share of local audio-visual content on local television screen over a week’s period chosen at random,, it is apparent that the majority of local screen time on television is dominated by foreign content with the exception of soapies. 40 20 0 LOCAL FOREIGN 21 Share of the Television market 1 week snapshot of TV programming across broadcasters - Oct 2013 120 100 80 60 LOCAL FOREIGN 40 20 0 SOAPIES TV SERIES FEATURE ANIMATED ANIMATED FILM TV SERIES FEATURE FILM 22 The potential impact of DTT • The DTT roll out will result in high demand for audio-visual content • Given current local content share of the broadcasting market, it is likely that foreign content would continue or even exponentially increase and dominate the content market across the existing and new channels • The potential for job creation would thus be limited to the broadcasting with minimal benefits and opportunities for content creators and producers Strategic Thrust • A range of IPAP instruments ranging from government procurement, incentives, tariffs as well as local content quotas across all creative industries would need to be instituted to stimulate accelerated domestic growth. • The stimulation of domestic demand and consumption is central for the development of the Creative Industries and their contribution to economic growth and job creation. • The focus on domestic demand, local production and consumption is not at the exclusion of export development and growth, but emphasises a strong local market as a springboard for export • The Copyright Review Commission recommendations which were adopted by Cabinet in October 2012 should be vigorously implemented not only just for music but for film. • The CRC amongst others recommends local content quotas as follows: • 80 % for the Public Broadcasters and Community Broadcasters • 50% for private broadcasters THANK YOU