Download Presentation on the dti`s Strategic Plan 2015

Presentation on the dti’s Strategic Plan 2015-2020 and
Annual Performance Plan 2015-2018
to the Select Committee on Trade and International Relations
Date: 13 May 2015
Director-General
Mr Lionel October
1
CONTENTS
the dti’s Vision, Mission, Strategic Goals and objectives
Economic overview
Key Interventions for 2015/16
Allocated resources
Strategic Risks
Key achievements 2014/15
2
VISION
A dynamic industrial, globally competitive South African economy,
characterised by inclusive growth and development, decent
employment and equity, built on the full potential of all citizens
3
STRATEGIC GOALS
To 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;
Create a fair regulatory
environment that enables
investment, trade and
enterprise development in
an equitable and socially
responsible manner;
Facilitate broad-based
economic participation
through targeted
interventions to achieve
more inclusive growth;
Promote a professional,
ethical, dynamic,
competitive and customerfocused working
environment that ensures
effective and efficient
service delivery.
CORE PROGRAMMES AND CLUSTERS
Industrial Development – the development of policies and
strategies that promote sector competitiveness, growth, job creation
and efficient administration of support measures.
Trade, Investment and Exports – the strengthening trade and
investment links with key economies and fostering African
development, including through regional and continental integration
and development co-operation in line with the New Partnership for
African’s Development (NEPAD).
Broadening Participation – the development of interventions and
strategies that promote enterprise growth, empowerment and equity
Regulation – the development and implementation of coherent,
predictable and transparent regulatory solutions that facilitate easy
access to redress and efficient regulatory services for economic
citizens.
Administration – effective co-ordination of departmental
programmes and provision of necessary support for efficient
implementation.
5
PROGRAMMES OF the dti
• Programme 1: Administration
• Programme 2: International Trade and Economic
Development
• Programme 3: Special Economic Zones and Economic
Transformation
• Programme 4: Industrial Development
• Programme 5: Consumer and Corporate Regulation
• Programme 6: Incentive Development and
Administration
• Programme 7: Trade and Investment South Africa
6
ECONOMIC OVERVIEW
7
Global Economic Context
The global economy grew by 3.4% in 2014. South Africa’s main trading
partners have experienced divergent economic growth:
 The European Union grew by just 0.9% while Japan shrunk by
0.1%.
 However, Sub-Saharan Africa grew by 5% and the United States
grew by a robust 2.4%. China’s economy continues to slow with
growth moderating to a still impressive 7.4%.
Commodity prices of Iron-ore, Coal, Platinum and Oil are still well
below their 2008 highs.
The substantial drop in the international Oil price has brought benefits
for South Africa but may lead to a slowing of growth in oil-producing
African countries which have become key trading partners for SA
manufactured exports.
8
Domestic Economic Context
The South African economy grew by 1.5% in 2014.
 Agriculture grew by 5.6% and Services grew by 2.1%.
 Mining however shrunk by 1.6% and Manufacturing was flat.
The weaker Mining and Manufacturing growth performance was
primarily due to the lengthy Platinum and Metal sector strikes in the
first half of 2014. In the second half of 2014, electricity shortages
constrained Manufacturing output substantially.
The SA economy would have grown by approximately 2.2% – 2.7% in
2014 were it not for the labour and electricity stoppages.
Amongst the BRICS countries, SA grew faster than both Brazil (0.1%)
and Russia (0.6%).
9
Gross Domestic Product
Annual GDP Growth (%)
4
3
% growth
2
1
0
2009
2010
2011
2012
2013
2014
-1
-2
Years
10
Employment
Employment: Formal and Informal
15,500,000
15,000,000
14,500,000
14,000,000
13,500,000
13,000,000
2009
2010
2011
2012
2013
2014
11
Total Merchandise Trade
1,200
1,000
800
Current Rand Billions
600
400
200
0
2009
2010
2011
2012
2013
2014
-200
Exports
Imports
Trade Balance
12
Trade
 Exports of South African goods continues to grow albeit at a
slower pace than imports.
 SA exports of mineral commodities have slowed due to lower
international prices.
 Trade balance has worsened as global demand has remained
relatively weak. Need for trade protection remains high.
13
Link to NDP, MTSF, SONA
The
Presidency
(SONA) 9point plan
NDP
Impact
ESEI &
ICTS
Clusters of
Cabinet
5-year MSTF
Outcomes
Outcomes
the dti
IPAP
SP (5-year)
MTEF (3-year)
21 priorities
APP (3-year)
ENE (1-year)
Outputs
Activities
Inputs
14
OVERVIEW OF
the dti’s
KEY PRIORITIES FOR
2015-2020
15
Strategic priorities for 2015 - 2020
MTSF
the dti
Strategic Goal
Outcome 4: Decent employment through inclusive growth
Facilitate transformation of the economy to promote industrial development,
investment, competitiveness and employment creation
Priorities
Proclaim three Special Economic Zones (SEZs)
All IPAP (Industrial Policy Action Plan) interventions implemented – 250 projects
implemented
Industrial Development Cooperation (IDC) to fund two higher level beneficiation
projects
Develop Mineral Beneficiation Action Plan (MBAP) and incorporate into IPAP
Increase use of local metals in South African manufacturing
Increase localisation target to 75%
Develop options for stable and competitive exchange rate
16
Strategic priorities for 2015 - 2020
MTSF
the dti
Strategic Goal
Outcome 7: Vibrant, equitable, sustainable rural communities contributing
towards food security for all
Facilitate broad-based economic participation through targeted interventions to achieve
more inclusive growth.
Priorities
Five investors per district municipality
National Rural investment incentive
Develop Supplier Development Incentive for procurement
17
Strategic priorities for 2015 - 2020
MTSF
the dti
Strategic Goal
Outcome 11: Create a better South Africa and a better world
Build mutually beneficial regional and global relations to advance South Africa’s trade,
industrial policy and economic development objectives
Priorities
Export Council to develop African Export Markets
Foreign Direct Investment (FDI) investment pipeline of R50 billion
Economic diplomacy and pavilions
Seven investments and five trade promotion projects
South Africa’s position on Southern African Development Community (SADC) Regional
Indicative Strategic Development Plan (RISDP)
Southern African Customs Union (SACU) development integration
Tripartite-Free Trade Agreement (T-FTA)
South Africa’s position on T-FTA and Continental-FTA
26 bilateral cooperation agreements in Africa
59 bi-laterals with countries of the South
18
KEY PLANNED
INTERVENTIONS
FOR 2015/16 FINANCIAL
YEAR
19
STRATEGIC OBJECTIVES
1. Grow
the
manufacturing
sector
to
promote
industrial
development, job creation, investment and exports
2. Improved conditions for consumers, artists and opening up of
markets for new patents players
3. Strengthened capacity to deliver on the dti mandate
KEY INTERVENTIONS – INDUSTRIAL
DEVELOPMENT
Upscale industrial policy by tabling the annual rolling Industrial Policy
Action Plan (IPAP) to Cabinet and produce quarterly implementation
reports;
Four designation requests submitted to facilitate strategic use of public
procurement to enhance local productive capabilities;
Tool-making apprentice programme
Support 120 students enrolled for the tool, die and moulding skills
development programme through the National Tooling Initiative;
Industrial upgrading programme
 Support 250 workers trained through the industrial upgrading
programme to upgrade the foundry industry;
21
KEY INTERVENTIONS – INDUSTRIAL
DEVELOPMENT
970 enterprises approved to participate in Exporting, Marketing and
Investment Assistance (EMIA) scheme;
400 enterprises approved for incentives under Production Incentive:
Manufacturing Competitiveness Enhancement Programme (MCEP);
Secure R2 billion investments in designated Special Economic Zones
(SEZs) through implementation of the SEZ Programme;
Support 76 Film and Television productions with projected investment of
R 2 billion;
22
INDUSTRIAL DEVELOPMENT INCENTIVES
Planned
Description
Industrial Financing
Automotive Incentive
Scheme (AIS)
Number of projects/
enterprises supported
Potential jobs
supported
Projected investment
25
550
R1.8 billion
Business Process
Services (BPS)
12
2 500
R800 million
12I tax incentive
12
1 800
R9 billion
Critical Infrastructure
Programme (CIP)
13
3 600
R6 billion
23
KEY INTERVENTIONS – TRADE,
INVESTMENT AND EXPORTS
Africa regional development programme implemented-progress report
produced on implementation of agreed programme and projects for
priority development areas in SACU and SADC-FTA.
Status reports produced on the conclusion of the trade negotiations on
the:- Economic Partnership Agreement (EPA) with the European Union
(EU); Southern African Customs Union (SACU) India Preferential Trade
Agreement (PTA); Southern African Development Communities
(SADC)- East African Community (EAC)- Common Market for Eastern
and Southern Africa (COMESA) Free Trade Agreement (FTA)–
Tripartite-Free Trade Agreement (T-FTA).
24
KEY INTERVENTIONS – TRADE,
INVESTMENT AND EXPORTS
Increased export of diversified value-added and locally manufactured
products and services under EMIA facilitated to the value R 3.5 billion
with emphasis on high growth markets, particularly Africa and the BRIC
region;
Investment projects facilitated in pipeline to the value of R45 billion in
targeted sectors
25
KEY INTERVENTIONS – BROADENING
PARTICIPATION
Approve 110 incubators for the Incubator Support Programme (ISP)
incentive
Approved implementation reports on the continued phased-in
operationalisation
of
the
Broad-Based
Black
Economic
Empowerment (B-BBEE) Commission
20 Black Industrialists created in key sectors
20 Regional Clusters and Projects in initiated in under-developed
regions
10 projects approved with investment value of R100 million in the in
Enterprise Investment Programme (EIP): Aquaculture Development
and Enhancement Programme (ADEP)
26
KEY INTERVENTIONS - REGULATION
Impact assessment of regulation on business and economic
citizens
 Eight Regulatory Impact Assessment (RIA) reports (pre) on
Companies Amendment Bill and Intellectual Property (IP) Bills
developed for Minister’s approval (Trade Marks Act, Designs Act,
Merchandise Act, Unauthorised Use of Emblems Act, Counterfeit Goods Acts, Patents
Act and Performers Protection Act).
 One RIA report (post) on National Credit Act (exemptions) developed
for Minister’s approval.
 One monitoring report on the impact of Consumer and Corporate
Regulation (CCRD) agencies developed for Minister’s approval
27
KEY INTERVENTIONS - REGULATION
Policies, Bills and Regulations to enforce fair business practices
 One policy framework on legislative audit report developed for
Minister’s approval (policy position on policies to retain or migrate).
 Eight bills developed for approval by Minister on Companies
Amendment and IP (Trade Marks Act, Designs Act, Merchandise Act,
Unauthorised Use of Emblems Act, Counterfeit Goods Acts, Patents Act and
Performers Protection Act).
 Four regulations on Liquor, Gambling, Copyright and Licensing of
Businesses developed for approval by Minister and published.
28
KEY INTERVENTIONS – ADMINISTRATION
Attract, develop and retain professional and skilled officials




Reduction of the vacancy rate to 5%.
Reduction of the staff turnover rate to 6.8%.
Employment of people with disability to 3.0%.
50 % women employed in senior management.
Creditors’ payments made to suppliers made within 30 days.
29
KEY INTERVENTIONS – ADMINISTRATION
Public Awareness Platforms
 Conduct 20 multimedia awareness campaigns on key sectors
of IPAP and the dti strategic projects.
 Conduct 32 outreach engagements and 40 exhibitions
Conduct 2 evaluations on key programmes.
Service Delivery Improvement Plan (SDIP)
 2014/15 implementation report for SDIP produced and submitted
to DPSA.
30
ALLOCATED BUDGET
31
Medium Term Expenditure Framework
2015/16
Programmes
2016/17
2017/18
Medium-Term Expenditure Framework (MTEF) (R ’000)
Administration
689 740
720 145
763 734
International Trade and Economic
Development
164 754
172 530
180 838
Special Economic Zones and Economic
Transformation
263 224
279 013
285 312
1 973 534
2 045 338
2 143 330
294 496
306 963
321 887
5 795 639
6 554 193
5 369 264
412 328
427 132
444 821
9 593 715
10 505 314
9 509 186
Industrial Development
Consumer and Corporate Regulation
Incentive Development and Administration
Trade and Investment South Africa
Total For Programmes
32
Medium Term Expenditure Framework
2015/16
Economic Classification
2016/17
2017/18
Medium-Term Expenditure Framework (MTEF) (R ’000)
Compensation of Employees
897 730
950 311
1 007 778
Goods and Services
577 945
593 042
622 946
8 083 878
8 928 699
7 843 622
761 528
784 809
855 793
Highest Education Institutions
12 474
13 135
13 792
Foreign Governments and International
Organizations
31 738
33 585
34 523
7 131 597
7 956 512
6 799 523
144 078
138 107
137 352
2 463
2 551
2 639
34 162
33 262
34 840
0
0
0
9 593 715
10 505 314
9 509 186
Transfers and Subsidies
Departmental Agencies and Accounts
Public Corporations and Private Enterprises
Non Profit Institutions
Households
Payments for Capital Assets
Payment for Financial Assets
Total Economic Classification
33
STRATEGIC RISKS
Strategic risks that would impede the achievement of strategic objectives
impacting on the dti include, but not limited to:
•
•
•
•
negative impact of the downturn in the global economic environment on
South Africa's economic growth and employment potential caused by stalled
global economic recovery;
demand for South African exports, international investors response to
changes to quantitative easing leading to currency volatility;
the inability to be competitive and domestic shocks to the economy due to
administered prices (electricity, water and port charges), transport, energy
and logistic constraints, skills for the economy, monopolistic pricing of
privately owned key intermediate inputs; and
Due to previous negative press reports on governance issues around the
department's entities, there is the potential for reputational risk due to actions
of the entities.
STRATEGIC RISKS
These risks are being adequately managed through, but not limited to,
the following mitigating actions:
•
•
•
•
•
early warning system- economic intelligence reporting;
the prioritisation of African continent as major source of demand (more
foreign representatives, more trade missions going to Africa);
energy efficiency programmes (clean audits) and research studies for
alternate energy sources as well as participation in the electricity war room;
skills development programmes for the country; and
regular engagements with entity/management of entities and collective
bargaining pilot programme for entities.
Ke ya leboga
Ke a leboha
Ke a leboga
Ngiyabonga
Ndiyabulela
Ngiyathokoza
Ngiyabonga
Inkomu
Ndi khou livhuha
Dankie
Thank you