Hansard: NCOP: Unrevised Hansard
House: National Council of Provinces
Date of Meeting: 24 Oct 2017
Summary
No summary available.
Minutes
TUESDAY, 24 OCTOBER 2017
PROCEEDINGS OF THE NATIONAL COUNCIL OF PROVINCES
The Council met at 14:08
The Chairperson took the Chair and requested members to observe a moment of silence for prayers and meditation.
Hon members, I have been informed that the Whippery has agreed that there will not be Notices of Motions or Motions Without Notice except for those Motions which appear on the Order Paper in the name of the Chief Whip.
SITTING OF THE COUNCIL FOR ORAL QUESTIONS
(Draft Resolution)
The CHIEF WHIP OF THE COUNCIL: Chairperson, I move the motion printed in my name on the Order Paper as follows:
That notwithstanding Rule 247(1), which provides that a sitting of the Council will be dedicated for oral questions, the Council considers motions as listed below.
Question put: That the motion be agreed to.
IN FAVOUR: Eastern Cape, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West, Western Cape. [Free State abstains.]
Motion agreed to in accordance with section 65 of the Constitution.
DESIGNATION OF MEMBERS TO THE PAN-AFRICAN PARLIAMENT
(Draft Resolution)
The CHIEF WHIP OF THE COUNCIL: Chairperson, I move the motion printed in my name on the Order Paper as follows:
That the Council amend the motion regarding the designation of members to the Pan-African Parliament adopted by the House on 28 October 2014, by making following replacements:
Dr Hunadi Euphemia Mateme replaced by Ms Thandi Ruth Modise;
Mr Charles Nqakula replaced by Mr Zwelivelile Mandlesizwe Dalibhunga Mandela; and
Ms Thandi Cecilia Memela replaced by Ms Thokozile Angela Didiza.
The CHAIRPERSON OF THE NCOP: The hon Chabangu keeps on pointing to hon Michalakis, hon Michalakis keeps on smiling at me. So, I do not know what I am supposed to do with the delegation from the Free State.
Declaration of vote:
Mr G MICHALAKIS: Hon Chairperson, if my colleague from the opposition - since we have been forsaken by the government of the Free State so wishes, I think he would like me to make a declaration not on the resolution itself, but on the fact that we are not in a position to vote on this resolution either, because we do not have a mandate, and because there is no representative from the government present although they are being paid to be here. Thank you.
The CHAIRPERSON OF THE NCOP: Thank you very much. I shall proceed, the Eastern Cape, Gauteng?
Mr E MAKUE: There is a delegate from the Free State present in the House from the ruling party. Thank you, Chair.
The CHAIRPERSON OF THE NCOP: From the Free State?
Mr G MICHALAKIS: [Inaudible.]
The CHAIRPERSON OF THE NCOP: Okay. Order, order, order! I shall now take the provinces.
Question put: That the motion be agreed to.
IN FAVOUR: Eastern Cape, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West, Western Cape. [Free State abstains.]
Motion agreed to in accordance with section 65 of the Constitution.
LEAVE OF ABSENCE FOR HON R J TAU
(Draft Resolution)
The CHIEF WHIP OF THE COUNCIL: Chairperson, Chairperson, I move the motion printed in my name on the Order Paper as follows:
That notwithstanding the provisions of Rule 17(1) of the Rules of the National Council of Provinces, the Council grants Hon R J Tau leave of absence from proceedings of both the Council and committees of the Council in terms of Rule 17(2) until the hon member is ready to resume his duties.
Question put: That the motion be agreed to.
Mr G MICHALAKIS: Thank you chairperson, no declaration on this one. My apologies for the drama, I can assure you that once we govern the Free State we will be here to represent the people. We abstain on this one.
IN FAVOUR: Eastern Cape, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West, Western Cape. [Free State abstains.]
Motion agreed to in accordance with section 65 of the Constitution.
The CHAIRPERSON OF THE NCOP: Hon members, we ... [Interjections.]
Mr J J LONDT: [Inaudible.]
The CHAIRPERSON OF THE NCOP: Hon Londt, please behave. Hon members, I wish to acknowledge our visitors from the Hershey Gymnasium - Upper Secondary School. We are very happy to see you here. We also have 25 students who are between 17 and 18 from Stockholm in Sweden, who are here visiting Cape Town for a period of a week. You are welcomed to South Africa. [Applause.]
Hon members, we proceed to the questions, and I would like to take this opportunity to welcome the Deputy Minister of Trade and Industry, Ntate Magwanishe.
QUESTIONS FOR ORAL REPLY ECONOMICS
Cluster 4D
Question 308:
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, the
incentives provided by the department are an instrument of industrial policy, not political patronage. They are intended to
support investment in sectors prioritised in their industrial policy action plans. Requirements and qualification criteria are published on the DTI’s website to ensure fair access to information by all prospective investors. I thank you, hon Chair.
Mr M RAYI: Hon Chairperson and hon Deputy Minister, my supplementary question is to find out whether there have been any complaints by any political parties which have been brought to your attention with regard to these incentives. Thank you.
The DEPUTY MINISTER OF TRADE AND INDUSTRY: To the best of my
knowledge we have not received any complaints, hon Chair. We also encourage members, if they have any complaints, that our doors are open. However, up to so far we have not received anything from the public or hon members.
Mr J J LONDT: Good day, hon Deputy Minister. Deputy Minister, with the quick turnaround of Ministers, one of these days you might be a Minister. Hon Deputy Minister, in theory your response sounds great that there is no connected individuals who get any funding but in practice it doesn’t always seem that way. We first need to acknowledge that we have made some progress in expanding the beneficiary base that gets funding but in reality the perception is
there, that it is only the connected few. Perceptions often become reality. My question is: Will the hon Deputy Minister consider establishing and then monitoring a database to ensure that it is not the same connected individuals and companies that get support over and over but rather that more companies get access to funding and can compete in the market?
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, first of all I would like to put it on record that we evaluate cases submitted by the DTI on the basis of project outcomes and intensions with the main focus on investment, job creation, transformation and export promotion. We have also published the list of everybody who has received incentives from the Department of Trade and Industry.
Therefore, we have a transparent process of who gets what and there is criteria published on our website. We allocate funds on the basis of that criteria and not anything else.
Xitsonga:
Man B T MATHEVULA: Ndza khensa Mutshamaxitulu.
English:
The Black Industrialist Programme has been secretive, lacks transparency and the Minister felt the need to hide the names of
beneficiaries even when it was not commercially sensitive. How is the public supposed to believe what the Minister is saying and what has he done to ensure that the processes in the department are transparent? Thank you very much.
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, what we have said was that we were going to publish the list of all beneficiaries and we did that. When we submitted the annual report to the National Assembly, we published everyone who have benefitted from the incentives. You can look at it. Thank you very much, Chairperson.
The CHAIRPERSON OF THE NATIONAL COUNCIL OF PROVINCES: Hon members,
that was my last supplementary question. We now proceed to Question
326 which was posed by hon Khawula who unfortunately cannot be with us in the house today, because of the family bereavement and haD to rush back home. However, the arrangements had been made that the question would be taken care of by hon Gaehler but he is not in the House.
In terms of the Rules, I have to proceed without this question because hon Gaehler is not in the House. I therefore would move to Question 309 which was posed by hon Dikgale who has made
arrangements that hon Makue would take care of that question. So, I proceed to Question 309.
Question 309:
The DEPUTY MINISTER OF TRADE AND INDUSTRY: The Department of Trade and Industry, DTI, is one of the key departments responsible for developing the manufacturing sector. This is done with the support of the number of other departments such as, the Economic Development, the National Treasury, Small Business Development, Mineral Resources, Agriculture, Forestry and Fisheries and Rural Development and Land Reform.
Collectively, these departments oversee the implementation of government’s key economic interventions. One of such interventions is the Industrial Policy Action Plan, IPAP, which is also critical component of the nine point plan. It is very difficult to precisely calculate the effectiveness of the intervention such as IPAP as it encompasses such vast and wide range economic terrain.
In addition, the terrain is dynamic and the IPAP has had to adjust and respond to the changes in the global economic environment.
Notwithstanding these difficulties, we can point to a number of the IPAP interventions, which suggests the magnitude of the IPAP impact.
The auto sector continues to see investment levels at a high record. An industry expects the investments to reach R8,2 billion in 2017.
In 2016 auto exports exceeded R177 billion for the first time. It is widely accepted that the success of the SA Auto Sector is due to the DTI’s provision of an appropriate incentive and regulatory regime which encourages the investments and growth of the sector. By comparing Australia’s Auto Sector which a decade or two ago was much bigger than the SA Auto Sector, has just seen its last auto manufacturer closing down for good.
In clothing and textile industries, the DTI has arrested the decline of the sector. Through careful provision of both financial and nonfinancial support, it has assisted the sector to turn around. It is important to highlight that when the DA was advising the government to allow this grandfather sector to die, this administration chose to intervene to save over 70 000 jobs.
Additionally, 9 000 new jobs were created.
In the Agro-processing, the provision of manufacturing competitiveness enhancement programme has assisted the sector to whether the impact of the global financial crisis and the sector has begun growing the exports rapidly. In 2016, the sector exported
goods valued at over $800 million. There are many other such examples in the metal, business process services, chemical and others.
The impact of the intervention such as IPAP cannot be measured only in terms of contribution to the Growth Development Plan, GDP, jobs and exports, rather, the IPAP is responsible for protecting, deepening and transforming a range of value chains, some of which starts in mining, agriculture and services, but at some point has a manufacturing dimension.
It is the deepening of the industrialisation activities, the sustained creation of decent jobs, the improvement in employee skills and expertise, the transformation of the sector and the continued growth of the entire value chain, that represent the impact of IPAP on the SA economy. I thank you.
Mr E MAKUE: Through you Chairperson, let me say to Deputy Minister that he has given an elaborate reply which is welcomed by the House. But, I just want to look at one component of your reply. When talking about the IPAP and the exports, are you able to give us an indication of what the immediate export activities are, which are being facilitated by the department?
The DEPUTY MINISTER OF TRADE AND INDUSTRY: One of the biggest indicators is in the auto sector. We are exporting something to the value of more than $15 billion to the US in the three series.
Through our Invest SA, we are taking SA exports to the other countries in the world. This issue is one of the many I can talk about in the export sector.
Mr J J LONDT: Hon Deputy Minister, in the words of your political scene, the Minister said that there is even more pressing need for structural change in the economy. We do need to acknowledge that South Africa just cannot get the economic growth to address the massive unemployment by doing the same thing over and over again, and yet expect different results.
In many other developing countries, small businesses contribute a massive percentage of the GDP and employ thousands of people. They even contribute to massive exports by working together through the government. What is your department doing to assist the Department of Small Business Development to create a market for small businesses in South Africa apart from the informal market that they currently have internally?
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Through you Chair, let me thank the hon member for the question. First of all, what we have agreed to do as the Department of Trade and Industry is that we will work with the Department of Small Business Development to have joint export activities, especially to the African market.
We will take small businesses along with us, pay for them and allow those that are export ready to export into the African market and the rest of the world.
The CHAIRPERSON OF THE NATIONAL COUNCIL OF PROVINCES: Hon members
... [Interjections.] ... Your hand was up and you just made a follow up question. Hon members, is there any other member who wishes to make a supplementary question? It should be one supplementary question per member. I’m not sure two supplementary questions in one question are allowed ... [Interjections.] ... Please let me finish!
There is anticipation that we will have four members who will be doing supplementary questions. I suspect that the other members have not been travelling; they have been travelling right in the Chamber. Is there any other member who has a supplementary question? None? We will take you, hon Londt. You will be the last, hon Mathevula.
Mr J J LONDT: Hon Deputy Minister, you said that there is a planning in place with the Department of Small Business Development to take these small businesses into Africa, especially, to find a market for them. The Department of Small Business Development was created in 2015. By my understanding, you said that in the past two years you’ve done nothing concrete in getting the small businesses in that market.
If that assumption is correct and that we are only looking forward on that to happen, firstly, can you please give a date on when that expedition is going to be together with the Department of Small Business Development and also, your commitment of funding that trip you have set for these whole businesses?
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Through you Chairperson, we have a list of trips and we advertise them in our website where we do outbound investment missions and invite the businesses that will be part of those particular trips. But if you also want to know about what the Department of Small Business Development is doing, I think that you can also pose the question to them. In as far as the working together with them, we do and we always ensure that we take the businesses that are export ready to the African market.
Ms B T MATHEVULA: Through you Chairperson, is the lack of substantial subsidies and the protection of the affected industries through the tariffs not the main weakness of the industrial policy action plan? Can I repeat that again?
The HOUSE CHAIRPERSON OF THE NCOP: Yes, please!
Ms B T MATHEVULA: Okay! Is the lack of substantial subsidies and the protection of the affected industries through the tariffs not the main weakness of the industrial policy action plan?
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Through you, Chairperson, we do have the incentives ... [Interjections.]
The HOUSE CHAIRPERSON OF THE NCOP: Deputy Minister, please raise your voice a bit!
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Okay! We do have the
incentives in the film sector and also in the auto sector. Where there is substantial harm that can be shown that an industry has been affected, we do act through a due process outlined by the Industrial Technology and Engineering Center, ITEC.
Question 323:
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, the
Department of Agriculture, Forestry and Fisheries is entrusted with looking at the rescue of the SA poultry industry. In this regard, the Department of Trade and Industry, DTI, is entrusted with the development of industry specific export strategy. The agro processing sector desk is working with Trade and Investment South Africa, TISA, which is a division of the Department of Trade and Industry on developing a strategy. Poultry producers have been invited to participate in Tisa-led missions.
The poultry task team is comprised of representatives from government, business and labour and was established to address a wide range of complex programmes in the domestic poultry. The task team has identified several work streams for work to be undertaken over short and long term to address a wide range of issues affecting the poultry sector. Steady progress has been registered. Achievement to date include a 13,9% safeguard duty on imported products. Work to investigate further safeguard measure is being undertaken by Interagency Trade Enforcement Center, ITEC, in keeping with the due process requirements which apply to trade measures.
The Department of Trade and Industry launched a R1 billion agroprocessing incentives to boost domestic investment including the agroprocessing value chain. Procurement legislation has been used to raise aggregate domestic demands for poultry products and an instruction note has been sent out by the National Treasury instructing all state procurement agencies to use Regulation 9.4 of the amended regulations of The Preferential Procurement Policy Framework Act to procure locally produced products. Ongoing work related to the outbreak of avian influenza in Southern Africa in centenary and phyto-centenary measures is being undertaken by the Department of Agriculture, Forestry and Fisheries.
The work to identify new investment opportunities for parts of the poultry value chain is being undertaken by the Department of Economic Development through Industrial Development Corporation.
Announcement in this regard will be made in due course. Finally, work is underway to increase South Africa’s capacity to export poultry products to traditional and new export destinations and to raise aggregate domestic demand. This work is also being undertaken with the private sector and progress will be reported given in due course.
Mr M M CHABANGU: Chair, let me first apologise for putting the cart before the horse. That is how we are. Deputy Minister, my simple question is; what is the status of the rescue plan which was developed by the interdepartmental task team that was set up by him in order to rescue the SA poultry industry?
The MINISTER OF TRADE AND INDUSTRY: I have just answered, Chairperson.
The CHAIRPERSON OF THE NATIONAL COUNCIL OF PROVINCES: Hon Chabangu,
do you want to rephrase your supplementary? No, no, no, no that member is protected. It might be simple for you. I am saying rephrase, my hon member, because they are saying you are repeating the same question.
Mr M M CHABANGU: I am not repeating, maybe let me repeat myself.
The CHAIRPERSON OF THE NATIONAL COUNCIL OF PROVINCES: Yes, Sir.
Mr M M CHABANGU: ... saying, what is the status of the rescue plan which was developed by the interdepartmental task team that was set up by him in order to rescue the SA poultry industry? That is the question. Thank you.
The CHAIRPERSON OF THE NATIONAL COUNCIL OF PROVINCES: Thank you, you
have repeated yourself, but you have also repeated the principal question. You were supposed to put a supplementary question which would have arisen from the response which the deputy Minister had given. I must proceed, I move on to the hon Magwebu.
Mr L V MAGWEBU: Deputy Minister, I just want to find out from you as you have conceded that this poultry industry has been under stress for so long. The task team was set long time ago and in February this year, 1 350 workers lost their jobs because the abattoir had to close down. Again, research has proven that the poultry industry has a potential to create jobs instead of losing them, but because government is failing to intervene and the task team has not completed its job, I just want to find out from you, how soon can this be completed? Secondly, what are the other measures that can be put in place to avoid this dumping and invest in our poultry industry to grow? Thank you, Chair.
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, I think as I have already said that the first issue to report is that 13,9% import tariff as a safeguard measure has been put in place.
Secondly, in terms of the World Trade Organization, WTO, rules we have a due process if we were to increase the import tariffs and
that work is being done by Itec, which is independent from the Department of Trade and Industry. Once it has reported, then, the report will come to the Department of Trade and Industry. In addition to that, we have an incentive put in place of R1 billion to try and assist agroprocessing including the poultry industry. Thank you.
Mr S G MTHIMUNYE: Deputy Minister, between me and you we will agree that among other reasons that the rescue plan on the poultry industry was put into place is the fact that the United States, US, administration has put in place a piece of legislation called African Growth and Opportunity Act, Agoa. I want to believe that is one other reason amongst others. Are you in the position to share with us even after three or four years now that Agoa has been put in place by the previous administration in the US, even in the aftermath of the election of Donald Trump into the office? If the poultry industry – what do I say – market doubts or market shivers are we able to allay the fears that we have in the country as part of the rescue plan? I am not sure if I am making myself clear.
I am trying to understand in the aftermath of election of the new President in the US with Agoa in place. I want to believe he took it over from the previous administration. Is our industry out of the
rescue plan that the country has developed? Is the industry now beginning to have some hope with regard to the market trends in the world?
The DEPUTY MINISTER OF TRADE AND INDUSTRY: The biggest importers of meat who are dumping are; Brazil, then European Union, EU, and United States, US, is number three. However, we think that the US has introduced what they call out of cycle review, where they can review at any time if there is a complaint. There will come a time where we would have to really ask the question of whether Agoa is still economically viable for us. However, we think that with the strategies of exporting to; firstly, ensuring that the industry is not concentrated, secondly, with this R1 billion incentives we want to assist to ensure that we find other markets and export especially to our Southern African Development Community, SADC, countries and to ensure that we are not highly dependant on Brazil and European Union, EU, for debone meat. Thank you.
Ms T G MPAMBO-SIBHUKWANA: Chair, to the Deputy Minister, Deputy Minister, with some provinces having almost 70% of the poultry due to bird flue, which is our real main concern, the majority of South Africans still want to get the primary protein from poultry which we love as diabetics. Therefore, spending billions on it we will
probably have to import significant amounts into the country in the near future and suppose you buy into this. We will probably have to import significant amounts, I repeat, to the country in the near future.
This makes the phenomena of dumping more pertinent. Deputy Minister, I would like to know from you, what measures have you put in place from your department to ensure that imports are of quality and affordable, furthermore, whilst at the same time sustainability of our poultry industry is ensured?
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, first of all the work related to the outbreak of the avian influenza in Southern Africa and sanitary measures are being is being undertaken by the Department of Agriculture, Forestry and Fisheries. However, from our side we think that the incentive that we have put in place to ensure that firstly; we transform the industry the R1 billion incentive on agroprocessing part of it will focus on poultry industry to ensure that the industry is sustainable and we are not only dependant on imports but we are able to have the industry serve in the domestic markets including the Sadec markets. Thank you.
Mr E MAKUE: Hon Deputy Minister, we, having assisted very much as a select committee when the Deputy Director-General one week after we learnt about the poultry crisis, came to our committee to brief us. One of the things that he shared with us that I want to explore with you further now is, what progress that has been made versus the diversification of the meat that we get from chicken? For example, we learnt that what is happening is that we import polony that is made from chicken from other countries. I want to know if the poultry industry in South Africa has been convinced in terms of looking at utilising chicken as a product, not only the way that it is served and made available to us as consumers now but to explore those other value adds to the chicken as a product?
The CHAIRPERSON OF THE NATIONAL COUNCIL OF PROVINCES: ...
[Inaudible.] chicken moment.
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chair, part of what we are looking at is a transformation of the industry and to that we are investing into ten other companies. We are investing into ten other companies that will be looking at the deboning of the chicken and all of those issues, to ensure that we are part of the whole value chain and to ensure that we protect the South African market. Thank you.
Question 314:
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, the
Department of Trade and Industry has noted its sadness, the loss of jobs due scaling down of operations at a wind turbine factory within the proposed Atlantis Green Tech Special Economic Zone SEZ. Such job losses led to the untold suffering by workers, their families and communities. The scaling down of operations at the wind turbine factory in the proposed Atlantis Green Tech, SEZ, was not due to any delay in designating or gazetting the proposed Atlantis Green Tech SEZ.
The Department of Trade and Industry did not in anyway seek to deliberately or unduly delay the designation and gazetting of the Atlantis SEZ. The delay in finalizing the application for designating the Atlantic SEZ was mainly due to a misunderstanding of some of the requirements of the SEZ designation as outlined in the Special Economic Zones Act.
Following some of the areas where there was noncompliance with the requirements of the Special Economic Zones Act. Applicant wanted the entire Atlantis Industrial area designated as an SEZ. Some of the land and properties in this industrial area belong to various private property owners. Such a proposal, such a proposal was thus
not workable but it took time to resolve these issues with the applicant.
The original proposal was that the City of Cape Town would have control over the SEZ land, and thus make decisions about the use of the SEZ outside of the SEZ entity established to manage the SEZ. This was not compliant with the Special Economic Zones Act. There was no proper financial model for the proposed zone as required by the Special Economic Zones Act. It took time to work out a proper financial model for consideration by the SEZ Advisory Board.
There was no clear governance and institutional framework from the SEZ, clear investments pipeline and letters of commitments; while Atlantis SEZ now has a solid investment pipeline; it was not so in the beginning and thus the viability of the SEZ was difficult to test. All these factors show that the Department of Trade and Industry never having any intention of stalling or hindering the designation of the Atlantis SEZ.
There were purely technical factors that needed to be attended to before the finalisation of the designation process. At this stage the Atlantis SEZ has been gazetted for public comments before the final designation. Public comments are now being consolidated and
the recommendation will soon be forwarded to the Minister for consideration before the determination is made by the Minister.
Mr J J LONDT: Chairperson, hon Deputy Minister, there are hundreds of workers from that factory who are sitting at home for a large part of the month; earning only a fraction of what they used to earn. This has consequences not just for them but for their families and the community at large. The inability to get the necessary documentation and agreement signed by government has affected that entire community.
When we visited them as the NCOP they pleaded with us to engage government, specifically the renewable energy industry said that if we start investing more not less and making sure that the processes run smoothly they would be able to function and do the job that is expected of them. They just want government to facilitate a process; now my question to you is, by what and by when can we expect all the necessary support to help that this factory and other industries are up and running as soon as possible to give the necessary economic boost and ensure that there is no further job losses?
The DEPUTY MINISTER OF TRADE AND INDUSTRY: I think we all agree that job losses are very painful and it is not something that we can be
happy about but at the same time it would be important that as we do things we should not be violating the law. It was important that we stuck to compliance, and that everything is done according to the law. And since now there is a pipeline of investment we think that factories that are going to be opened there will address the issue of unemployment in that particular area. In as far as by when, I have already said that now everything is about public comments and then immediately after the public comments the Minister will be in a position to designate.
The CHAIRPERSON OF THE NCOP: Are you in effect saying that you are now re-establishing the SEZ? I have not forgotten you Mr Shabangu, Mr Magwebu and Mr Rayi.
The DEPUTY MINISTER OF TRADE AND INDUSTRY: The process is that the designation now is with the public comments; in fact, the gazetting of the public comments - after the public comments have been done it goes to the Minister for designation.
Mr M M CHABANGU: Thank you, Chairperson. Deputy Minister, South Africa’s building and production of machinery and parts for renewable energy is continuing to grow; adding jobs and exports; does your department support the proposed nuclear deal given the
negative the consequences the Gupta have on the renewable energy’s production sector.
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, renewables nuclear, and coal are part of the South Africa’s energy mix. Now adoption of nuclear does not mean that you would not do renewables or you would also not do coal-fired power station; that is part of the policy of the South African renewable energy mix
Mr L V MAGWEBU: Thank you very much, hon Chairperson. Minister I hear that you say the department regrets the loss of jobs and that the delay was not intentional but I have a different view because your regret is too little too late. In a country where there is a problem of unemployment your delay not to expedite the declaration and gazetting of this SEZ has been deliberate; precisely because the Cabinet is putting pressure on you department to focus on the nuclear deal because that is what you are up to and this is another corruption, another failure of the ANC. I put it to you, what is your comment on that Deputy Minister?
The CHAIRPERSON OF THE NCOP: Order! Order!
The DEPUTY MINISTER OF TRADE AND INDUSTRY: I think the hon member is just grand standing and trying to say that we must violet the laws of the country. There is an Act that guides us on how we must do these things, the Special Economic Zones Act, and if the application is not compliant with the law, don’t force us to be incompliant with the law. [Interjections.]
The CHAIRPERSON OF THE NCOP: Order! Order! Order!
Mr M RAYI: Chairperson, I know that provinces throughout the country do apply for designation of SEZs; I want to know if there has been an application from Atlantis has it also been dealt with similar to other applications from other provinces?
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, I think the law is the same for all provinces; so we treat all provinces the same we apply the same law. All those provinces that have been able to get designation it’s because they complied with the law. And we are not penalising those that are not complying but we work with them and assist them so that they could be compliant.
Question 310:
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, since the introduction of the Special Economic Zone, SEZ, policy in 2013 and the SEZ Act 16 of 2014, the DTI has worked with provinces and the economic Ministers and Members of Executive Councils, Minmec, to identify, plan and develop the new SEZ initiatives across the country. The economic Minmec appreciated that while there many regions across the country that will benefit from the SEZ programme, the country does not have the resources and capacity to plan and develop many SEZ at a go.
Provinces had to then prioritise their regions for SEZ development. A total of 10 SEZ initiatives were agreed to subject to feasibility and viability studies. In the original list of proposal for new SEZ, in Mpumalanga – the province had identified Nkomazi, Middelburg, Secunda and Bushbuckridge for SEZ development. As a result of capacity issues alluded to above and the understanding on prioritisation, Mpumalanga province then preferred Nkomazi for the development.
Currently, the DTI is still working with the National Treasury to assess resource implications for the SEZ programme and further determine the most appropriate way forward with respect to the second round of SEZ roll-out. Any other consideration to add on the
10 will be dependent on the economic viability assessment as well as the availability of resources for the second round of SEZ initiatives.
Four out of the 10 SEZ initiatives have passed the viability test. The next in line is Nkomazi and Rustenburg. Thank you.
Mr S G MTHIMUNYE: Chairperson, I welcome the Minister’s answer. I think you will also agree that in the second round we need to dig deep with regards to looking at the most needy areas with regard to SEZ. In my view Minister, this is one instrument of the government that can assist areas where there are no economic activity to ignite some thereof.
A typical example is the area I am raising here, which is around the former Kwandebele area, where there is virtually no economic activity except for people travelling every day on that infamous Moloto Road between Tshwane and Kwandebele. I think an instrument like SEZ will be able to assist to ignite some economic activity.
Would you concede if I were to that in the second round of consideration of the executive, such areas will be considered because that is where the poor of the poorest are?
The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, we do understand the issue of Moloto Road and the surrounding areas and the issue that relate to areas like those that are economically depressed. We think that working with provinces in the second round in those areas maybe we can assist you to launch an application but subject to availability of resources and the feasibility studies.
Thank you.
Mr M M CHABANGU: Chairperson, the economic distress of the former Bantustan was due to structural problems of supply of appropriate labour but equally demand. Also, these economies were started with high investment in poorly [Inaudible] spatial planned economy. What is your department doing to ensure that the Special Economic Zones are not going to be compounded by the same problems as those attempted by Bantustans? Thank you.
The DEPUTY MINISTER OF TRADE AND INDUSTRY: It is important to mention that our process is extremely consultative. We work with municipalities and provinces to identify the relevant SEZ. We are not identifying SEZ as pockets like it was done in the past, that’s the first thing.
We always ensure that the SEZ Advisory Board is well capacitated. We have a training agreement with China. Every time the advisory board go for serious training so that they can be able to run the SEZ in a way different from the past ones. Thank you.
Ms L L ZWANE: Chairperson ...
IsiZulu:
Mphathiswa Ngqongqoshe osebenza njengePhini, ngiyafisa ukwazi ukuthi yiziphi izinhlelo ezikhona emnyangweni wakho zokulekelela ukukhulisa ukuhweba nokukhiqiza kuzikhungo zamabhizinisi lawa abizwa ngokuthi abizwa ngokuthi ama-Industrial Development Zones? Ngibuza lombuzo ngoba nge-Provincial Week besilaphaya e-Richard’s Bay Industrial Development Zone sabona ukuthi likhona ikhono nanokuthi bangathuthuka bakhulise ukuhweba kwabo abakuyisa nakwamanye amazwe. Kodwa-ke angazi ukuthi izinhlelo zomnyango wakho zithini ngokulekelela lezo zikhungo zamabhizinisi ezikulelo zinga nje ezweni lilonke noma mhlawumbe kungeyona i-KwaZulu-Natal, KZN, necessarily kodwa nje ezweni lilonke yiziphi izinhlelo ezikhona ngoba sibheke kakhulu Ngqongqoshe ukwakhiwa kwamathuba omsebenzi.
IPHINI LIKANGQONGQOSHE WEZOHWEBO NEZIMBONI (Mnu B G Magwanishe):
Ngiyabonga mama, ngibonge Sihlalo, [Chairperson] okunye esikwenzayo
mama wukuthi indawo uma isikhethiwe [designated] njenge-Special Economic Zone, SEZ, amabhizinisi uma eza siwasiza ngezingqalasizinda [infrastructure] ukuthi imali yezingqalasizinda isize ngezingqalasizinda nokubasiza ukthi silethe, sihehe abantu, abatshalizimali [investors] ukuthi beze kuleyondawo leyo kodwa ngingathanda ukuthi ...
English:
... for especially Richards Bay because according to us, it is one of the better performing SEZs in the country after Ngqura.
IsiZulu:
Ukuthi kunezinhlelo ezifana nalolu okuthi ngaso sonke isikhathi [every time] siyabathatha ukuthi sibanikeze amandla [capacity] ukuthi kube nokuthuthuka okuqhubekayo [continuous improvement] ukuze futhi bakwazi ukuthi balethe utshalomali [investment] bakwazi ukusekela [sustain] utshalomali kulezo zindawo [areas] lapho ... [Akuzwakali.] abasebenza khona.
The CHAIRPERSON OF THE NATIONAL COUNCIL OF PROVINCES: Hon members,
that was my last supplementary on the last question. I therefore would like to take this opportunity to thank you, Deputy Minister,
for standing enably for yourself, your department and your Minister. Thank you very much.
Business concluded.
The Council adjourned at 15:07.
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