Hansard: NCOP: Unrevised hansard
House: National Council of Provinces
Date of Meeting: 25 May 2023
Summary
No summary available.
Minutes
UNREVISED HANSARD
NATIONAL COUNCIL OF PROVINCES
THURSDAY, 25 MAY 2023
PROCEEDINGS OF VIRTUAL (OR HYBRID) NATIONAL COUNCIL OF PROVINCES
Watch: Plenary
The Council met at 14:05.
The Deputy Chairperson took the Chair and requested members to observe a moment of silence for prayers or meditation.
ANNOUNCEMENT
The DEPUTY CHAIRPERSON OF THE NCOP (Ms S E Lucas): Yes, it is
here. It is done. Thank you very much.
Hon members, good morning. Before we start with anything, I just want to remind the hon members that today, the 25th of May, we usually observe Africa Day. And I thought I should remind the members of this House that we are part of the continent of Africa, and that today it is being celebrated under a very important theme and that is the one of “The
Africa Free Trade Agreement”. I’m sure the Ministers will elaborate a little bit on that. But I also think it’s important for us in the NCOP, since we are not going to have any debate or any observation immediately that we be reminded that we are observing the existence of the continent, the cradle of mankind. That is what is important.
And before we continue, someone whispered into my ear that there is an outstanding ruling that should have been brought to this House. We will just allow the Table to find out how far. The ruling is, and as soon as we received it, we will make sure that we will deliver the ruling to the members.
Hon members, before we proceed, let me remind you of the rules relating to Virtual and Hybrid meetings and settings, in particular, Sub-Rules 21, 22 and 23 of Rule 103, which provides follows. The Hybrid sitting constitutes a sitting of the National Council of Provinces. Delegates in the Hybrid sitting enjoy the same powers and privileges that apply in a sitting of the National Council of Provinces.
For purposes of the quorum, all delegates who are locked onto the Virtual platforms shall be considered present. Delegates must switch on the videos if they want to speak, and they should ensure that the microphones on the electronic devices are muted and must always remain muted unless they are permitted to speak.
All delegates in the Chamber must connect to the Virtual platform as well as insert the cards to register on the Chamber system. Delegates who are physically in the Chamber must use the floor microphones. All delegates may participate in the discussions through the chat room. In addition, I would like to remind delegates that the interpretation facility should be active.
Permanent delegates, special delegates, South African Local Government Association, SALGA, representatives, and members of the executive on the Virtual platform are requested to ensure that the interpretation facility on the electronic devices is properly activated to facilitate access to the service.
Permanent delegates, special delegates, SALGA, representatives, and members of the executive in the Chamber should use the interpretation instruments on their desk to access the interpretation facilities.
Hon delegates, before we proceed, let me take the opportunity to welcome the Minister and the Deputy Minister of Small Business Development, the Minister and the Deputy Ministers of Trade Industry and Competition, the Minister and Deputy Minister of Tourism that will join us all permanent delegates, MECs, all special delegates as well as SALGA representatives into the House.
Hone delegates, I have been informed that there will be no Notices of Motion or Motions Without Notice. That said, we will now proceed to the First and Second Orders. The Policy Debate On Budget Vote No 36, Small Business Development and the Policy Debate on Budget Vote No 39, Trade Industry and Competition. Appropriation Bill. I will now call on the Minister of Small Business Development hon Stellar Ndabeni- Abrahams to open the debate.
APPROPRIATION BILL
(Policy debate)
Debate on Budget Vote No 36 - Small Business Development
And
Debate on Budget Vote No 39 – Trade, Industry and Competition:
The MINISTER OF SMALL BUSINESS DEVELOPMENT: Deputy Chair and members of the NCOP, Ministers and Deputy Ministers, director- generals, DGs, officials from our departments, board chairs, and CEOs of their respective agencies, distinguished guests, entrepreneurs, small and medium businesses, and of course the co-operatives of our country, ladies and gentlemen, today marks the 60th anniversary of the signature of the founding Charter of the African Union, which was found in Addis Ababa in 1963.
On this day, we celebrate the promise and potential of the continent and its people’s heritage and diversity. This year’s theme is “Accelerating the Africa Continental Trade Agreement Implementation”, having the population and youth dividend on its side. I think we all agree that the next few decades will belong to Africa.
There is no doubt that the continent is the centre future demand in consumption, and we have the entrepreneurial spirit together and change the process of consuming to being innovators.
I would like to dedicate this Africa Day to the youth of our beautiful continent as Tony O. Elumelu, one of the continent’s greatest entrepreneurs remind us when he said and I quote:
Young entrepreneurs, and those they inspire are the lifeblood of Africa’s rise. Only entrepreneurship creates opportunities when none seemingly exists.
Hon Chair, the focus of this address is to provide an update on the work done by the department and our agencies since the last Budget Vote address, and of course to outline plans for this year, which is the last year of the Sixth Administration.
Hon member, in the last Budget Vote, we committed to provide business finance to start-up businesses and invest in existing businesses to give them the much needed support for their own growth. The Budget Vote we are tabling today, sets out the achievements from the previous year and highlights our ambition and allocated decisions for the period ahead.
The Budget Vote is aimed at leveraging partnerships and resources from across the small micro medium enterprise, SMME, and co-operatives ecosystem. This is the approach called for in our National Integrated Small Enterprise Development, NISED, Masterplan. Which is the third iteration SMME strategy for our country, and which was completed in the past financial year, as promised in last year’s Budget Vote address.
Remembers, I’m sure we all appreciate that we are operating in an extremely difficult and volatile global context. The International Monetary Fund forecast that up to one third of economies around the world could enter recession this year, and inflationary pressures remain high. This has resulted in what many now referred to as a cost of living crisis. The small businesses are especially threatened by rising factor costs and reduced consumer demand. In our country, we also have load shedding, which makes life difficult for small businesses.
Despite the current difficulties faced by SMMEs and co- operatives, we remain convinced that SMMEs will be the drivers of our economy’s growth, jobs, and transformation. Building a thriving SMME sector will give us a faster growing and more equal economy. This is aligned to the National Development Plan, which suggests that an upward of 85% of new jobs between 60% and 80% of new economic value will come from the small businesses. The Economic Reconstruction and Recovery Plan also prioritizes SMMEs as the core building block of a more inclusive economy as we seek to make sure that we live no one behind.
Our approach as the portfolio to the development of the sector we are responsible for is five-fold. The first pillar is to cut the red tape and address regulatory impairments facing SMMEs and co-operatives. Having completed the regulatory impairments to SMMEs study, we will this year work with various sector departments to develop the regulatory reform action plan against which we can monitor the reduction of SMMEs red tape across government. We want to count on this House. to make sure that when we bring those amendments of the different legislations, this House will make sure that we fast track the process. We beg all members, irrespective of the political parties that they come from, to ensure that we create a conducive environment for the small businesses to thrive.
As things stand, we are reviewing the Businesses Act No 71 of 1991, as it was amended in 1993. We have completed the review process and we are about to introduce the Amendment Bill to
Parliament by the end of the financial year 2023-24. We wish the Act will be repealed and a fit-for-purpose legislation enacted. This will address many of the business licensing issues faced by the SMMEs.
IsiXhosa:
Sihlalo, kwiindawo zonke esihamba kuzo oosomashishini abasakhasayo bayakhalaza ngenxa yemiThetho eHlonyelwayo eyenziwa ngurhulumente ebasusa kwiindawo abathengisa kuzo. Oomasipala abathile bakwenza oko kuba besithi basebenzisa umthetho. Yiloo nto sili sebe sibone kunyanzelekile ukuba siwutshintshe lo mthetho ukuze abantu baseMzantsi Afrika bakwazi ukushishina kwiindawo ezihambelana noshishino lwabo.
English:
Our red tape at municipality level and the progress on it, we have SALGA, who will pronounce on interventions post their national members’ assembly in August. This year, we will assist 30 municipalities to develop red tape reduction action plans building on the 20 that we have supported this past year. We will also proceed on the establishment of the Ombudsman office, which was held back to enable the processes of the of merger of Small Enterprise Development Agency, SEDA,
Small Enterprise Finance Agency, SEFA and the Co-operative Banks Development Agency, CBDA, to progress as it required an amendment to the same Bill, the National Small Enterprise Act.
This year, we will also move to establish the Small Business Advisory Body as envisage International Small Enterprise Act of 1996 as amended.
The second pillar of our work is to enable access to markets. South Africa remains a very concentrated economy by international standards, a legacy of our apartheid past.
Through its market linkage programme, we will link 250 products manufactured by SMMEs and Co-operatives to domestic markets this financial year.
We pledge all of you to please buy products that are produced in South Africa. Here is the collaborative partnership with Proudly SA, which includes the establishment of an e-commerce platform, managed and run by Proudly SA. Through SEDA, we are implementing our comprehensive small business exporter development programme designed to build export readiness and fund emerging exporters to participate in trade shows in exhibitions, whether virtual or physical. And business to
business engagements outside of South Africa with a special focus on African markets and women entrepreneurs through the programme we call SheTrade SA. We are serious about unlocking the opportunities of the Africa Continental Free Trade Area. As a result, we are setting aside R25 million for this support.
South Africa will host the Global Entrepreneurship Network, Africa Plus, which will bring leaders and entrepreneurs from across the continent to see how we can create a more effective continental SMME and start-up ecosystem. This is key to making the Africa Continental Free Trade Area work and to build that inclusive economy that we are talking about.
The other significant market access support you provide as the portfolio is in the area of enterprise supplier development.
Both our agencies, SEDA and SEFA are collaborating on our Enterprise and Supplier Development, ESD work. For example, SEDA is partnering with South African Pulp and Paper Industries Limited, SAPPI, and South African Forestry Company SOC Limited, SAFCOL, Lafarge in the Northwest, Pick ‘n Pay in the Western Cape, Gold One Mine in the East Rand, SIOC-CDT,
the Northern Cape and Retail Motor Industry, RMI, in a number of provinces to mention a few.
SEFA has supported 51 SMMEs to gain access to corporate value chain markets. These were supported with the R201 million revolving credit facility to provide goods and services to Corporates, such as Tiger Brands, United Exports, Grain SA, a Cotton SA, Rainbow Chicken Limited, and Mondi amongst others.
The third pillar of our strategy on the members is access to finance. For the financial year ending on 31 March 2023, SEFA through its development, finance interventions and programmes financed 74 762 SMMEs and co-operatives and dispersed R2,4 billion to these enterprises. Through this disbursement SEFA was able to reach 74 486 black-owned SMMEs to the value of R2,1 billion, 15 535 youth-owned businesses to the value of R564 million, 72 651 women-owned businesses to the value of R928 million, 2 953 township-based businesses to the value of
541 million, 66 302 rural-based businesses, to the value of R952 million. Collectively, these fund interventions have created 32 665 new jobs and sustained 71 882 existing jobs.
SEFA, through this Budget Vote will seek to approve loan finance, the value of two R2,5 billion and disbursed just over R2,2 billion to 93 000 small businesses and co-operatives.
Of this planned disbursements across the direct lending, wholesale lending in formal and microfinance and KCG Instrumentation, 13% will go to the Eastern Cape, 6% to the Free State, 24% to Gauteng, 15% to KwaZulu-Natal, 7% to Limpopo, 9% to Mpumalanga and 5% to the Northern Cape. Whilst we give 6% to the Northwest and 15% to the Western Cape. This is based on the demand of the SMMEs that have made applications for access of the funds that we are talking about.
Of course, hon members, this is an improvement from last year. With more resources now going to poorer and less developed provinces. We will continue with this to ensure more equitable economic activity across our beautiful country. We will definitely leave no one behind.
The department has also finalized the SMMEs and Co-Operative Funding Policy, which will accelerate addressing the credit
gap through expanded access to finance and early stage investment.
Enabling youth entrepreneurship is a priority for our department. For this financial year, R122 million has been allocated to the Youth Talent Fund. The Township and Rural Entrepreneurship Programme, TREP, is aimed at supporting local productive business ventures in townships and rural areas.
For the previous year, we set a target of supporting 20 000 enterprises and surpassed this target, providing financial and or non-financial support to 23 344 enterprises located in townships and rural areas. This year we have increased the target to 30 000 enterprises. And have allocated R909 million for the programme that we are talking about.
The provincial breakdown of the 30 000 enterprises targeted by TREP in 2023-24 is as follows: The Eastern Cape will receive support for 3 916 enterprises, Free State will receive support of 1 760, Gauteng 6 243, KwaZulu-Natal 5 961, Limpopo 3 372,
Mpumalanga 2 552, Northern Cape 951, Northwest 2 116 and Western Cape 3 129 enterprises. These are clearly rated by
district which will allow effective alignment with the District Development Model, DDM, planning and processes.
Of this R909 million TREP allocation, R500 million goes to SEDA and it will be broken as follows: Two hundred and fifty million rand to equipment targeting SMMEs with a turnover less than R3 million, R100 million for product markets, which will be piloted in 70 district municipalities, R70 million to energy support for product markets, R50 million for general dealer support and additional R30 million for spaza shop support.
SEFA’s allocation to TREP is R409 million. We take R200 million for township and rural businesses for power purchase product, 209 normal TREP lending. In addition, SEFA will allocate R220 million for other businesses for the power purchase product because load shedding is really hitting hard on the small businesses. One hundred million rand is set aside in SEFA for automotive aftermarket support. Businesses can get up to R1 millions of which R100 000 is a grant and R32 million is set aside for spaza shop support and will be implemented through SEFA and SEDA.
We have travelled the country. Most of our people are complaining about the influx of the foreigners in the spaza shop area, and we are trying to reclaim the business back to South Africans.
The other financial support instruments we have as the portfolio include the Informal and Microenterprise Development Programme, which is a 100% grant offered to informal and microenterprises from the minimum grant of R500 up to R15,000 in order to assist them to be competitive and sustainable. To this programme, we have allocated R20 million, and of course, we intend to support 1 333 informal businesses this financial year.
Chairperson, we are aware of the challenges that our co- operatives are facing. As a result, through our co-operatives Development Support Programme, we have set aside R73 million to assist them with assets. This programme will be rolled in various provinces as follows: Eastern Cape 13%, Free State 12%, Gauteng 10%, KwaZulu-Natal 12%, Limpopo 14%, Mpumalanga
9%, Northern Cape 8%, Northwest 12% and Western Cape 10%. We are deliberating empowering our communities to create opportunities for self-sufficiency through co-operatives.
The fourth pillar is access to business development services. Our core here is to make sure that we provide space in incubation and entrepreneurship support. For this administration, we had set a target of 100 incubators, and as we speak, we have 110 incubators nationally that align to government’s priority sectors. These 110 incubators are broken into different sectors of the economy. For the previous financial year, a total of 25 000 and 2 507 SMMEs were supported via the incubation programme, and 1 607 jobs were created while 6 995 jobs were sustained. A total of R148 million has been put aside for incubation for this financial year. Of this, a total R44 million has been put aside to implement the approved 11 incubators in rural and township areas. In total, we have allocated R702 million to enterprise development and the SEDA Technology Programme. The ANC-led government is committed to building a more equal economy.
We also have the shared infrastructure facility, which is aimed at improving market infrastructure and SMME precincts and hubs to support local SMME trading and production. Just like we walk into malls of the bigger corporates, we also want you to work into the markets that are providing services through small businesses.
We have provided support to the Chris Hani Development Centre, we have provided support to King Dalindyebo Ntozonke Market in the Eastern Cape, Letsatsi Retail Space in the Free State, Mahikeng Trade Market project in Northwest, Kokosi container structures precinct, and the Spartan Industrial Hub in Gauteng, the Manguzi Precinct Market stores and the Kwamashu train station product market in KwaZulu-Natal, the cultivate trading manufacturing, and agricultural facility, Limpopo, and the informal sector, SMME villages in the Northern Cape are what we have supported in the previous financial year.
The last pillar is to build our capacity and capabilities to deliver in all of this. We have finalized our organogram. We are in the process of filling in the vacancies. We are finalizing the process towards the Business Development Plan that goes to the merger of the three agencies that I spoke about in order to strengthen the DDM plans. With have appointed district development champions in order to enhance the work that we do at a district level. We are rolling out our digital SMME license application systems, including systems integration and interability.
This year, we are also implementing key partnerships with the Department of Higher Education. Through which SEDA, together with the National Skills Fund, will train 1 500 graduates and support 12 500 spaza shops and general dealers with business development support training. With the wholesale and retail, SETA 3 000 spaza shops and general dealers will be receiving a stock of up to 6 000 rental and training on stock management.
With Manufacturing, Engineering and Related Services Sector Education and Training Authority, MerSETA, we are training 600 employees of SMMEs in the automotive industry to obtain trade certificates for a period of two years. In addition, 300 SMMEs within the automotive sector will receive business deployment support training.
With the South African Breweries that is going to invest an average of R100 million a year in small business development in our country, including in Township Economic Revitalization Programme. With Tiger Brands on supporting SMMEs in the agriculture and food distribution value chain with Johannesburg Stock Exchange, JSE, to develop a pipeline of small businesses for the JSE’s Enterprise Acceleration Programme.
Chairperson, we are committed in ensuring that the designated groups participate in the economic growth of our country. We have developed our gender, youth, and disability strategy. One of the objectives is to provide entry points for increased inclusion of women, youth, and persons with disabilities into all SMME development and financing initiatives to benefit equitably from these initiatives. We have funds that support these designated groups.
For our Disabled Entrepreneurs, SEFA administers Amavulandlela Fund, which is administered ... [Interjections.] ... We are continuing with the Youth Challenge Fund. As I indicated, we thank Parliament, hon members, the department and the counterparts for the support that they have provided to us.
Hon Chair, as you agreed that, I must conclude, I now want to make sure that I plead with everyone here that despite the challenges we face as a country, the people should know that the ANC remain the leading force of change in the country and carries the hopes and aspirations of our people. I have no doubt whatsoever that we will succeed.
Ma-Afrika, let us all unite and toil together to give the best we have to Afrika, the Cradle of Humankind and found of culture, our pride and hope at break of dawn. Mayibuye!
The DEPUTY CHAIRPERSON OF THE NCOP (Ms S E Lucas): I-Afrika.
Thank you, Nkosazana.
The MINISTER OF TRADE, INDUSTRY & COMPETITION: Hon Deputy
Chairperson, Minister Ndabeni Abrahams, Deputy Minister Majola and Deputy Minister Gina, MECs, hon members of the NCOP, and fellow South Africans, today, as our presiding officer has said, is Africa Day. It is about celebrating our continent, this continent that is the birthplace of humankind, but also a continent that has been through hundreds of years of colonialism, and is now addressing the legacy of that past, a continent of young people, energetic, connected, increasingly urbanized and keen to change our storyline. As we observe Africa Day, we must continue to show commitment to the integration of our continent and the development of value chains, trade, and investment across Africa.
Hon members, despite extraordinary headwinds and challenges, we have made considerable progress with pursuing the goals of
growth and transformation, and we have laid substantial foundations for economic recovery based on increased investment, industrialization, localization, and trade. We promised, last year, in this House to focus on industrial development in at least 25 districts across the country. We have met and indeed exceeded that target. We now at least have one project that we finance or that we partner in in 49 of the
52 districts. I want to highlight a few of those projects.
Last week, as part of the presidential imbizo, I visited the Cape Winelands District. This is the heart of South Africa’s industry for grapes, apricots, pears, cherries, apples, citrus fruits, and many fruits. A place of mountains, valleys and rivers with a beauty that takes your breath away. A place whereabout one million citizens live and over 300 000 are working. Within just this one district, we identified more than 50 actions, projects and partnerships by the Department of Trade Industry and Competition, DTIC, group to contribute to jobs, innovation, or opportunities for small businesses, and to exports.
It is in this district that the DTIC action saved thousands of jobs Worcester Rainbow Chicken facility when floods of poultry imports threatened to destroy those jobs, and we put tariffs
in place as part of the Poultry Master Plan. It is in this district in Ashton, where one factory alone employs more than
4 000 workers at the height of the season that produces
60 million cans of fruit a year. It was saved from closure last year, following engagements between the DTIC and the company, as well as partnerships from workers and local farmers.
It is in the same district where two companies: Heineken, when it bought a controlling stake in Distell, and Shoprite/Checkers agreed to competition settlements with the DTIC that secured workers’ shares in firms that they work for, resulting in more than 3 000 workers benefitting in that district municipality alone.
The DTIC group also provides financial support to establish businesses and to new black industrialists in the areas. This Saturday, the Stormers take on the Monsters, an Irish team in the finals of the United Rugby Championships. A few days ago, Janette Hilton-Gericke, the owner of the clothing factory and Rosanne Heins sewing machines gave President Ramaphosa a stormers jersey made with the hands of South African workers. It is at the same factory that we make the Bafana Bafana
jerseys, the Mamelodi Sundowns jerseys, and the South African Netball supporters’ jerseys. It is in the same district that government provide support to black industrialists and to farmers such as Into Energy, who are into rooftop solar and water treatment projects, or Worcester farmer in cherries and almonds, the reopening of the old Hextex textile factory by Tina Eboka, and the funding of the development of an App by Njabulo Khulu that allow small business to list services, schedule appointments and manage time whilst they do their business.
On the same trip, we visited a factory in Stellenbosch that makes electric three-wheel delivery vehicle led by Neil du Preez of Mellowvans and a team of innovators supported by the Industrial Development Corporation, IDC, and the DTIC.
I have raised examples from this one district, and a small number of examples from a much wider group. Our work is reaching many different parts of the country. In the available time, I want to look at a few of the areas of success and where we have been able to get traction in the economy. Let me take the example of KwaZulu-Natal, the DTIC provided an incentive that supported the expansion of the Sappi Saiccor
dissolving pulp mill that was officially opened by the President in KwaZulu-Natal. It creates jobs in forestry, jobs in the factory, it gets South Africa export earnings.
We also opened the Hesto Harnesses factory that employs 4 000 workers in Kwadukuza in KwaZulu-Natal, making wire harnesses. Defy completed its wide goods manufacturing investment facility in Ezakheni valid at R317 million. This means jobs and this means investment. In Mpumalanga, I opened a new facility in the Highveld Steel complex manufacturing railway lines for the South African market and for export to other African markets. One of the poultry farms that I told this august House last year, has now been able to open for production. In the Eastern Cape, that is the home of the auto industry of South Africa, and hon Rayi would be pleased to know that Isuzu launched its new D-Max bakkie, produced by the ands of the workers of Eastern Cape using the facilities of the Auto Master Plan. We supported new component production for the Mercedes C-Class vehicle. In North West, we secured the export of grapefruits through working with a large global importer. The IDC funded the plant to process crude nickel sulphate into pure battery grade material that can be used for energy storage. Last year, in Gauteng, we promised that 11
automotive component plants should be completed in the Tshwane Special Economic Zone, SEZ, in support of Ford’s major new investment. Ten factories were opened, employing more workers than projected, just over 2 500 in all. Just a few years ago it was open veld. Today, these factories are harming, producing parts, and creating jobs for South Africa. In the Northern Cape, construction is underway for a large energy project by a Saudi investor, ACWA Power, announced at the South African investment conference. We supported the efforts of the Lulu Group to import raisins from the province to the Middle East markets. If you haven’t had the grapes, and the raisins, please do so, very tasty. In Limpopo, talking of fruits, we worked with a large retailer to be able to source avocado, lemons, and oranges from the province. We backed several mining and other projects. In the Free State, the IDC funded a poultry farm. In May last year, Hangda Trading opened its production in Thabanchu. The factory manufactures bullets, steel angle irons, steel tubes, as well as rebar. It employs
300 people. A helium project did its first production in Free State, and a poultry farm has now opened.
I gave many examples of the Western Cape, so, let me just conclude with one of it. Sigma opened its call centers,
employing workers from Mitchells Plain and Khayelitsha in the Western Cape. There are moving human stories behind the blend announcements of opening. Stories like that of Nokwazi Mbele, a young vibrant program manager at a factory in Kwadukuza that makes wire harnesses for cars, or a nuclear engineer, Dr Ramatsemela Masango who manufactures electrical inverters, or Sanele Luthuli, a production analyst producing pulp that will go on to be used for making viscose and pharmaceuticals, or Mike Nkuna and Rashid Gutta, who both run their own furniture manufacturing businesses and are now supported with the Furniture Master Plan. Cornelius Grevale works with the factory that make bottles, and the drinking glass used by the President during Sona meeting, or disabled workers, Kyle Turner and Thato Mbhele who works at a factory that makes plugs, that was previously imported, and now we are supporting that company to get orders from more retailers, or trainees, Nwabisa Bavuma and Garrison Cotzee who work at a company that makes underwater LED lights and cameras that are used for the cables that connect South Africa with the rest of the world.
It is not just these human stories; it is also how we are transforming our economy structurally. We committed last year to hold a conference of black exporters. We met that commitment. We held it together with a wider focus on black
industrialists that attracted more than a thousand participants and showed the progress that we made. Black-owned firms are now involved in space technology, in food, in engineering, in the making of car components, in poultry, in sugar production, in clothing, in skin care, and in pharmaceuticals.
We promised to launch the Japan-South Africa Business Forum, and the Saudi Arabia-South Africa Business Council. We made that promise last year here. Both bodies were launched. We also held business forums with Ivory Coast, Kenya, Tanzania, Botswana, Spain, and the United Kingdom. We visited a supermarket in Saudi Arabia that’s now importing R340 million worth of products to the chains across the Middle East markets. We promised that 55 deals will be finalized under the DTIC-J.P. Morgan small business partnership. I know that Minister Ndabeni Abrahams would be very happy to hear that they exceeded the target, and 70 enterprises were supported.
We promised the six black-owned poultry farms will be opened, supported by the IDC. Five of the six have already opened and sold their first chickens, and one is under construction, and they include several different provinces. We promised that the DTIC supported the film The Women King telling the story of a
female warrior army in Dahomey, in the West Africa, which was co-funded by the IDC, will be released – telling our story as Africans. It premiered at the Toronto International Film Festival in September, last year. It is available on Netflix globally. We promised 200 black women and youth business, and persons with disability will be assisted with export training and support. We exceeded this target. Seven hundred individuals were trained in eight provinces. We committed to meeting the target of R1,2 trillion investment commitments over a five-year period. The President announced at the conference held in April, this year, that we exceeded that target, securing pledges of just over R1,5 trillion in that period.
On Africa Day, I am pleased to say that we met our target for the work on the Africa Continental Free Trade Area, AfCFTA, and our promise that an offer will be developed for the Southern African Customs Union, SACU. The DTIC is now taking a roadshow to all provinces to highlight the details of the AfCFTA, what it means for firms, and what it means for local businesses.
Sugar is important to KwaZulu-Natal and Mpumalanga. We made progress with the Sugar Master Plan when the three-year period contract expired. The Health Protection Levy, and the postponement of the increase was agreed for a further two years. WE are now working on the problems that Tongaat Hulett is undergoing because of fraud by company insiders.
I want to turn to the current financial year. Spatial development and fairness are important to delegates of the NCOP. To address spatial inequities, we will take several steps: firstly, we are working with all the agencies of the DTIC group to decentralize opportunities across more provinces. We are targeting that up to R15 billion in industrial incentives should be approved outside the five main metros. In June, we will be publishing for public comments.
Out intention to establish a Special Economic Zone in Namaqua, in the Northern Cape, which will open beneficiation opportunities in an area with large deposits of zinc and which is in the proximity of the new green hydrogen hub of Boegoebaai. This is an important step to find ways to beneficiate more of our minerals. In a new step for the department, we will undertake outreach visits or programmes in
52 district municipalities and metros. One visit to each
district in every province in South Africa where possible working in partnership with other departments, including bringing to local communities the funding agencies, the ability to register a company, to register for tax and business support. Yesterday, I provided the National Assembly with the number of key targets that we will seek to meet in the year ahead. They include R400 billion in new investment commitments, R40 billion in additional local output,
R800 billion in manufactured exports to the rest of the world. One million workers to be covered by the DTIC-linked programmes or measures and partnerships, and 20 000 more workers with shares in the companies they work for. We will also target to export R330 billion to other African countries over this financial year. Subject to the approval of the SACU offer, we plan to start trading under the Africa Continental Free Trade Area, building on the foundations we have laid last year.
Hon members, whilst our efforts have focused on supporting and protecting existing jobs, given the size of the unemployment challenge, our industrial policy a producing is based on identifying new sectors with potential to growth. They include the medical value chain, like medical devices, vaccines,
cannabis use for medical purposes and other products. In the green value chain, solar and wind energy components, battery manufacturing and electric vehicles. In the digital value chain, artificial intelligence, AI, applications, 3D-printing, high end call centres and attracting digital migrants. In the food value chain, covering fruits, meat, nuts, oils, and processed products.
Energy continues to be the foundation of industrialization, and I have announced eight major actions that the DTIC will take to contribute, and support partnered departments in addressing the energy crisis.
We are also shifting the focus of our black economic empowerment, BEE, programme. Instead of aiming to get 5% or 10% in an existing company, we are actively trying to increase the number of firms in the economy, backing black industrialist firms, but also want to widen empowerment. We are now promoting a greater level of worker-ownership in the economy. Just last year alone, more than 100 000 additional workers were able to obtain shares in the companies they work for, giving them additional dividends, and several cases giving them a seat on the board of the company.
Over the next few months, we will be working actively. I can in the available time just highlight a few areas, Deputy Chairperson. In June, Procter and Gamble will launch their production facility for Ariel laundry liquid in Kempton Park. VIA Aluminium will launch a secondary smelter producing aluminium alloys. It’s located in Tembisa. In July, the DTIC Group will formally launch the energy resilience scheme worth R1,3 billion for small and medium-enterprises, and a one-stop shop on energy. Future Life will start producing cereal in Dube TradePort. The DTIC will host the BRICKS Trade Ministers’ meeting, and the construction of the Orion Engineered Carbons black oil tank project will be completed, hon Rayi. We hope to complete a site handover of bricks manufacturing that’s owned by two young black females in Mokopane in that month. In August, Tetra Pak will complete a manufacturing facility in KwaZulu-Natal. The IDC backed black-owned firm will begin planting almonds and cherries in the Boland. In September, Vhadinda Utilities will have completed implementation of the investment in manufacturing electrical hardware for the telecoms industry. A black-owned citrus farm will have commenced planting in KwaZulu-Natal, with the IDC support.
In October, we hope to have held the workers conference celebrating ownership by workers of shares in their companies. And Future Life will complete construction of their cereal production facility. The update of the green hydrogen strategy would have been done. In November, Wilmar will launch the edible oil refinery in Richards Bay, which will boost localization content of cooking oil. So, when we cook, we can use more locally refined cooking oil.
As I conclude, hon Chair, I have spoken of many actions in the economy of work we are doing with cars, food, pharmaceuticals, jobs that have been created, and of investment that is being mobilised. But the DTIC work is also about building the South African story, our narrative of telling a wider story both now and our history.
One film series supported by the DTIC Shaka iLembe is due to be released shortly. It sets out the story of an extraordinary man, and an early nation-builder. I look forward to having feedback from members of the NCOP on how well we are telling our story. I thank you, Deputy Chairperson for this opportunity to set out the work of the department. We have taken just a small sample to illustrate the depth of work, and
how working together with business, with workers, provinces and with local government, we can, in fact, grow the economy, and grow it in an inclusive manner. I thank you.
Mr M I RAYI: Hon Deputy Chairperson, greetings to you and to the Ministers, the Deputy Ministers, MECs, permanent and special delegates, as well as director-general of the two departments and the staff – Happy Africa Day! The South African economic history has been characterised by ruling elites that controlled the country’s mineral wealth, particularly that of diamonds, gold, iron ore and platinum. From the 1890s through to the 1990s, this wealth was shared between the white English and Afrikaner capital that has ruled the economic landscape for most of South Africa’s modern economic history.
The Economic Reconstruction and Recovery Plan, ERRP’s, goal of creating a new economy that differs from that which existed at the time of the “crisis before the crisis,” requires extensive structural transformation. Structural transformation, as we understand it, has several dimensions. First, it means breaking the chains of our colonially defined place in the imperialist division of labour as producer and exporter of
primary products, by moving to higher value-added production. This must involve industrialising and reindustrialising in such a way that it supports a broad-based rise in incomes through the creation of higher income and higher quality livelihoods, as well as greater inclusivity. This does not mean just growing the manufacturing sector in a narrow sense, though it includes this. It would also include promoting mineral beneficiation, adding more value to mineral commodities rather than exporting them as dirt out of the ground as well as smart agriculture aiming, inter alia, at capturing more of value chains of exported product. History teaches us that almost all but a few countries that have broken out of underdevelopment and poverty have done so by undergoing such structural transformation. History also teaches us that all those who have followed this path, without exception, have implemented state-led, high impact industries. Industrial policy has therefore a central pillar of structural transformation.
Some of the structural constraints that continue to reproduce our challenges include, amongst others, the lack of coherence between our skills development policy and industrial policy - which means that firms tend to privatise the necessary
training that merits public provision, which implies a bias against smaller firms. According to the Competition Commission’s latest report on “Measuring concentration and participation in the South African economy,” the number of large firms has grown by an average of 3%, while the number of small, medium and micro-sized enterprises, SMMEs, declined by an average of 9% from 2012 to 2016. This indicates that there is a poor survival rate for SMMEs in our economy. Small, medium and micro-sized enterprises are key creators of jobs and without their increased participation we may not be able to effectively liberate our people from the clutches of poverty and joblessness.
The imperative for addressing high levels of concentration and low levels of participation in the economy extends beyond the Competition Commission to all areas of government and civil society. Regulatory frameworks, licensing processes and procurement across government directly impact the spread of ownership and opportunities for effective participation in the economy, which will ultimately impact concentration. Some proactive interventions are achievable through the Competition Commission’s ability to undertake market inquiries.
Industrial policy refers to efforts by the state to shape the sectoral allocation of the economy and promote structural transformation, by targeting specific industries, firms or economic activities. These include both firm-focused measures and general efforts to improve economic performance.
The ANC-led government through the Department of Trade, Industry and Competition has taken a different, clear and bold approach on industrial policy and structural transformation in the current annual performance plans, APP, and placed at the centre structural transformation through industrialisation.
This will be a success if the African Continental Free Trade Area can be steered towards development integration and the emergence of new regional value chains, more opportunities for deeper industrialisation will be created not just in South Africa but across the continent. This we believe should involve greater inclusivity. We believe that we are on the path to develop an economic framework to support a sustained economic development necessary to catapult the majority of South Africans into improved livelihoods and be able to realise their full human potential. Conventional approaches have not been able to do this over the past three decades nor have they transformed the deeply unequal and highly
corporatised economy inherited from the colonial and apartheid eras.
With regard to the Special Economic Zones, SEZs, amongst other strategic interventions is a Special Economic Zones Programme, which specifically includes targeted economic activities, supported through special arrangements which include laws, regulations, incentives and systems that are different from those that apply in the rest of the country. Special Economic Zones seek to create a sustainable environment for foreign and domestic direct investment, build sector-based industries, which will help the South African economy to develop its strategic industrial capabilities. The Special Economic Zone Programme serves as a key policy programme underpinning spatially integrated industrial development, particularly in the context of unlocking or optimising South Africa’s comparative and competitive advantages. The Special Economic Zones Programme has now entered a full implementation phase with designated SEZs continuing to show a positive progress in terms of the number of investors operating in the zones.
The number of designated Special Economic Zones in South Africa has now reached 10, covering seven provinces. These
SEZ’s are real and practical drive at industrialising our economy. For example, in Gauteng, 10 newly built factories opened in the new Tshwane Automotive Special Economic Zone last year, producing parts for the new Ford Ranger bakkie, the hon Minister was referring to. A total of 3 200 additional manufacturing jobs were created in Ford and its suppliers. The new vehicles that the Minister referred to in the Eastern Cape, which is the Isuzu G-Max began rolling off the production line in Gqeberha not so long ago. In KwaZulu-Natal, government supported Toyota to get its plant back to production after the devastating 2022 April floods. The spin- offs of this are jobs and sustained economic growth, we may not see the impact immediately but the seeds are being sown for economic development.
On state capability, what will further strengthen our resolve to build our economy is state capability and our efforts at industrialisation will only be successful if we have a capable state that is able to deliver on its developmental imperatives. Building a capable state is one of the key pillars of the National Developmental Plan. Capable and decisive state is characterised by a strong planning and co- ordination in the implementation of government programmes,
breaking free from unnecessary red tapes and strong on turnaround times in achieving timelines without fail. In this regard, the District Development Model mechanism in government as an instrument of breaking silos in government and enforce planning at all three levels of government is beginning to show signs of co-ordination in our reindustrialisation policy implementation with provinces and district municipalities.
We are living in uncertain times, with risks and opportunities, global development ranging from inflation, high interest rates, inequality and poverty, compounded with the cost of living both Global North and Global South, caused suffering and hunger for the poor and squeezing the middle class and the social progress of the working people remain stagnant.
South Africa, in terms of trade is much dependent to the major economies such as China, Germany, EU, UK and USA. Trade opportunities, both in the African continent and global village should be used strategically to support the economy and further access global talent to boost skill base and access new markets. We have said in may platforms that both globally and in South Africa, that the Russian-Ukraine War
must end, and lasting peaceful solution must be found. Globalisation must be about the wellbeing of all citizens of the globe.
The Department of Trade, Industry and Competition presents its budget and spending plans under uncertain period, as I have just highlighted. Domestically we have our own challenges much more pronounced in the electricity industry. We also know by now that the electricity crisis is hurting individuals, households, markets and society in general. In the 2023 Budget Review and in the state of the nation address, government has announced both plans to tackle the crisis, given the time, painful as it is. We shall overcome the electricity nightmare.
Government has taken over R254 billion of Eskom’s debt to ease the pressure on the company’s balance sheet. This should allow Eskom to invest in transmission and distribution I infrastructure. Further, the entity would be able to scale up maintenance essential to improving the availability of electricity.
In the 2023 budget, government introduced tax incentives measures to support the roll-out of rooftop solar for
households to encourage electricity generation and expand the renewable energy tax incentive for business. Many businesses, big and small will benefit from these incentives. As Parliament, we need to oversee that indeed businesses and households across the country fully benefit from the government’s introduced measures. The government measures will go a long way to attract private investment in expanding electricity generation and there tackling electricity crisis.
Over the medium term, the department has undertaken commitment to its regulatory processes to attract private sector investment in electricity generation and huge completion laws to broaden participation of SMMEs in the electricity industry and also introducing energy resilience scheme to assist firms to mitigate the impact of load shedding, and further to introduce measures to protect consumers and energy users.
The introduction of renewable energy will further deepen government action to ensure that the industrialisation process respond to aspirations and make the economy future fit proof. Government has identified opportunities in the transition to a greener economy. The department, in collaboration with other sister departments, develop finance institutions, research and
academic institutions and working to unlock opportunities in green hydrogen economy, hybrid electric vehicle, renewable energy generation and battery storage technologies.
The main focus of government as articulated in the state of the nation address is to reset the economy and to make sure that the economy moves beyond economic ... [Inaudible.] ... but becomes more sustainable, jobs also created as we move the economy forward. Thank you very much.
Afrikaans:
Mnr J J LONDT: Agb Ondervoorsitter, dit is lekker om u in die Stoel te hê.
English:
Hon Ministers, hon members, fellow South Africans but also fellow Africans, it is indeed a day where we celebrate Africa. We have so much to be proud of on this beautiful continent and
... the beautiful people we have along its length and breadth, and we must never shy away from celebrating what’s good and beautiful about this continent. We must also never hesitate to call out what is often wrong and, unfortunately, on our continent quite often what’s wrong are the elected
governments. In that sense, we are definitely not unique on the African continent.
Hon Minister, when the Department of Small Business Development was started, one of the key targets was that unemployment must be reduced to 6%, not to reduce it by 6%. It’s to 6%. However, since the establishment of your department, we have regressed year in and year out. We are now sitting with unemployment at a staggering 32,9%. There are a myriad of reasons that you can put forward as to why we are regressing. You will put forward COVID and you will put forward the global recession. However, this affected the entire world, yet we are still going on the wrong trajectory when many other economies like ours have gone on a different trajectory. We are in fact potentially in one of the fastest growing markets — Africa, but we are not tapping into that.
Our youth unemployment figure is now sitting at a staggering 46,5%. How does this government say that we are truly looking at the future because quite often the speeches only look to the past and look there for excuses instead of truly finding workable policies and solutions? Hon Ndabeni-Abrahams, you are one of the younger Ministers, so you are the one who is going to take the longest criticism. When some of your colleagues
have retired, you will still be criticised for sitting in a Cabinet that is not focussed on a youth enabling economy.
The question should then be, why is it that this department is failing so miserably in addressing the unemployment crisis?
Hon Rayi touched on it when he said that we are actually regressing. Our small, medium and micro enterprises, SMME, market is contracting. For the past few financial years, this department has regularly missed its own performance targets. When will you start turning that trend around? How can you start contributing to the solution, if in-house you cannot even sort out what is going on there?
Small business owners are ambitious individuals who start with small enterprises but dream of reaching the top. Occasionally, we come across success stories of these small start-ups that become massive, employing thousands of people and inspiring others to start their own businesses.
Recently, I spoke to a small business owner who has spent his entire life painstakingly building up his small business and who over the years has employed hundreds of people who then in turn can look after their families. The truly remarkable thing
about this business owner is that he is achieving this in spite of three massive hurdles. The first hurdle is that he is stationed in an ANC-run municipality, the second hurdle is that he is stationed in an ANC-run province and the third hurdle is that he is stationed in an ANC-run country. These business owners are the true heroes that are trying to prop up an economy that is struggling because of failed policies implemented by the ANC.
These business owners are jealous of those businesses stationed in the Western Cape under DA-run municipalities, and that only have to deal with a national government that is unable to cut red tape, that is unable to provide a safe environment through an efficient SA Police Service, the SAPS, that is unable to use the tax money that they diligently pay year in and year out and trust that that money won’t be stolen and that that money will in fact go to where it is intended to build the infrastructure that is needed to grow this economy.
That is only if we are looking at the internally focussed SMMEs that rely primarily on the Southern African markets. Then we have the thousands of SMMEs that rely on the broader international market; a market that this government takes for
granted with your stance on international events such as the Ukraine. The African Growth and Opportunity Act, Agoa, is up for renewal in 2025. I do not think we can underestimate and understate the importance of that, not just to South Africa but to the broader Africa. Yet, for some bizarre reason we are willing to risk billions in trade and thousands of job opportunities. Hon Ministers, it should be that we look after the most vulnerable in our own country first, instead of looking after our relationship with Russia.
President Cyril Ramaphosa emphasised that small businesses are vital for South Africa. Like I said, Agoa currently supports at least 60,000 direct jobs in the country. Losing Agoa would negatively impact this. It is essential for government to prioritise small businesses and job creation.
Hon Patel, you spoke about the recent imbizo in the Cape Winelands and I feel sorry for you because you get allocated to a district that your party loses and where there are five municipalities where your party loses. So, you come here and I want to thank you for the good work that you do there.
However, I also wonder when you go up on stage and you look at the results of the most recent elections and you say, hey, I
failed. However, the only reason why you have failed is because voters in the Western Cape have realised that supporting ANC policies will negatively impact them. That is why voters in this province have rejected you now, election after election after election. You are getting less than 20% because they know that here there is policy certainty. There is a red tape reduction unit and if you want to start up a small business, you can go somewhere and they will help you get through the hurdles and hoops. If they start up a small business in a municipality, they know they do not have to pay a bribe in order to get the necessary permissions. If they start a small business in one of the DA-run municipalities, they know that the refuse will be removed. They know that they do not have to spend money to fix their vehicles that drive through potholes. It’s the small things, like creating an enabling environment ... why we are so successful in this province, and once you learn that, colleagues, the rest of the country will be successful as well.
An analysis of South Africa's economic growth cycle and trade flows reveals a strong correlation between export-led growth and overall economic expansion. When our exports thrive, our economy prospers. South Africa is strategically located in one
of the world's fastest growing regions — Africa. This geographical advantage should offer lucrative opportunities for South African businesses and entrepreneurs should be able to tap into this market, similar to how China and India rely on their large internal markets.
However, our trade with African countries and other southern economies is hindered by cumbersome and costly import-export procedures, complex customs processes, limited regional integration and a lack of a clear trade strategy. Linked to this is how we treat our brothers and sisters from the African continent. Hon Rayi, you had a lot to say now about the conflict in Ukraine but you and your party were deathly quiet
- I think you called it quiet diplomacy - when our neighbours went through turmoil and that caused millions of our neighbours from the north to move to South Africa for opportunities. Yet now, because of your failed policy, the growing unemployment and a competition for resources, we get instances of xenophobic violence towards our own brothers and sisters. That is a direct flow from the failed policies that were implemented.
Hon Patel, we did your question and answer session on the scrap metal ban ... I see I’ve now actually run myself out of time, but hon Ndabeni-Abrahams, your session that was postponed ... we will get you back here on the 21st and then we will get to the rest of those questions.
I want to briefly touch on a few aspects. We often hear the critique from ANC colleagues that we only come here with criticisms, which is not true. We have put solutions to you quite often but I don’t know if it’s the willingness or the unwillingness to hear it that is the problem. However, I’m just going to touch on five key principles that speak to the heart of what both the Department of Trade, Industry and Competition and the Department of Small Business Development should do.
On the one hand you have the ANC that only targets the elites, the connected insiders. A small group of people benefit from your policies. You say a large group of people do but it’s not the case. However, on the other hand, the DA targets the vulnerable and the disadvantaged. Of course there is space for improvement. Of course there is space to expand on that, but at the end of the day, if you look at the scoreboard — and hon
Patel, it’s Munster not monsters, but I mean it’s great for the economy that Munster will be travelling to us — you actually have a 25% unemployment rate, which is still unacceptably high. However, that is a good 10%, 15%, 20% less than the rest of the country or other provinces.
The DEPUTY CHAIRPERSON OF THE NCOP (Ms S E Lucas): As you
conclude, hon member.
Mr J J LONDT: I know that you gave some extra minutes ...
The DEPUTY CHAIRPERSON OF THE NCOP (Ms S E Lucas): Hayi suka!
Continue. I’m treating you the same as I treat everyone else. So continue.
Mr J J LONDT: I’m going to finish off with the last one. The big difference is also that the ANC’s policies deter investors. Hon Dangor laments the fact that people criticise South Africa. The problem is that it’s not just the opposition that criticises South Africa. It’s the people living ... expatriates living here that have family here; other Africans that live here and they tell their friends and their families how they are treated. So, hon Dangor, maybe if you look in the
mirror and change your own policies, and you follow the example of what the DA is doing, you might get a little bit more investment. Hon Patel, you have a chance to change that course, otherwise, like the rest of Africa, the youth will step up and make that change for you. Thank you.
Ms N PIETERS (Eastern Cape): Hon Deputy Chairperson, Ministers and Deputy Ministers present, MECs, all hon members of this august House, ladies and gentlemen, ...
Afrikaans:
... goeie middag.
English:
It is an absolute pleasure and honour to take part in today’s debate on behalf of the Eastern Cape province. I wish to submit that the province welcomes and supports the Budget Vote of the Department of Trade Industry and Competition, DTIC, as presented by Minister Ebrahim Patel. The speech that he made demonstrated current economic challenges, progress on strides for recovery and plans to improve the current situation.
This financial year presents a rather interesting year, as it presents the final year of the current government term of administration, but also the final year before the 2024 national elections. We can all agree that the incumbent administration operated in a rather unique environment, as the government was forced to use its resources responding to the numerous economic blobs, including the Civid-19 pandemic, the July 2021 riots, the electricity crisis, recurring disasters and labour unrests.
We have seen steady recovery of the economy post the effects of Covid-19 and other economic shocks. The Eastern Cape is also recording good recovery figures. Our unemployment numbers are steadily decreasing, as the Eastern Cape’s unemployment rate now stands at 40%, down from 42,1% in the previous quarter.
We are also the province that registered the largest decrease in unemployment in the country year on year, as our unemployment rate decreased from 44% in quarter one of 2022 to 40% in quarter one of 2023.
Whilst the decrease in unemployment numbers is pleasing and presents hope, they remain a concern for us and the concentrated support from the DTIC and national government will make meaningful impact on growing our economy and creating much-needed jobs.
The spatial planning and the structure of our economy must be revised to benefit the Eastern Cape and other rural provinces. For our economy to continue to be largely at the hands of Gauteng, the Western Cape and KwaZulu-Natal provinces creates a huge economic risk for our country, as we have seen during the 2021 riots.
Our economic developmental agenda for 2023-24 is anchored on, amongst others, township and rural economy, the revitalisation if state-owned entities and climate change. This aligns with the Minister’s vision to intensify the industrialisation as part of de-risking our economy.
The revitalisation of our state-owned industrial parks remains one of the top priorities in the province. Since 2015 to date, the government has contributed close to R600 million towards infrastructure projects in the various industrial parks. These
parks need to be upgraded to provide world-class services to current and future industrial investors in the province.
We appreciate the support from DTIC and the provincial government for the upgrading of bulk infrastructure in the parks, which resulted in 460 deconstruction jobs and 46 operational jobs created during the event.
The parks are spread over the province, thus ensuring spread of the industrial infrastructure and include Vulindlela in Mthatha, Dimbaza in Buffelo city Metro, Butterworth, Ikomani and Somerset East.
The Wild Coast Industrial Park in Mthatha is the latest addition to the portfolio and is at the development stages, with R35 million invested for security fencing and for R49,5 million for bulk infrastructure. The park has an investment pipeline of R1,7 billion of agro-processing companies, with a mixture of local and foreign investors.
Operationalisation support for the Wild Coast Industrial Park has resulted in 796 construction jobs being created and supporting 96 SMMEs. Additionally, a total of 10 investors
were secured, 21 in the pipeline and, in total, equating to R2,4 billion.
This has resulted in us submitting an application to grant the Wild Coast Industrial Park as a special economic zone status, SEZs. The SEZs in the province, which by nature have a better economic impact are currently located on the border of the western side of the Eastern Cape. This is our attempt to expand industrial activity beyond its concentration in the urban metropolitan areas.
It is our firm belief that branding the Wild Coast Industrial park in Mthatha as a SEZ would change the lives of our people that reside on the eastern side of the province. We therefore implore the Minister to prioritise our application.
We are delighted about the support from the DTIC for increasing the attraction in the province, which is largely driven by the Eastern Cape Development Corporation and the two special economic zones - East London Industrial Development Zone and Coega Development Corporation, CDC.
That positive trajectory is the culmination of multiple interventions undertaken by the province, in collaboration with the Minister’s department and at attracting numerous investors and positioning the Eastern Cape as a preferred investment destination.
The Eastern Cape held its provincial Investment Conference towards the end of 2022, which saw the announcement of 10 new projects with an investment value of R46 billion.
The Eastern Cape is home to most of the automating original equipment manufacturers, OEMs, in the country and these manufacturers account for a large portion of jobs created in the province and also contributes meaningfully to the GDP of the country.
The current challenges are inadequate electricity supply, and policy uncertainty on electric vehicles in the country poses a huge risk for the future of our relationship with these OEMs. We however believe that our recent interaction with the Minister of Electricity and the leadership of the automotive industry will yield positive results, to enable these OEMs to operate effectively and efficiently.
We appreciate that the DTIC had the White Paper on Electric Vehicles in 2021, and the province subsequently submitted a response to this paper for consideration of critical elements that would enable the province to transition to the electric vehicles, in line with global trends underpinned by climate change consideration.
We are however moving ahead with our plans of developing viable infrastructure in the province, including the establishment of at least 13 charging stations across the province.
I wish to appreciate the continued support by DTIC and its leadership, as the province advances its efforts for inclusive economic growth and development, in particular the support they give at our SEZs and industrial parks. Our long-term plan is to capacitate the CDC and East London IDZs to be more than just bringing investment locations, but to be engines of economic growth and employment in the province.
We shall continue to explore and grand giant leap forward to excel the existing potential of these entities to achieve
sound industrial development for massive economic growth in our province. I thank you.
Mr K M MMOIEMANG: Hon Deputy Chairperson and greetings to our hon Ministers and Deputy Ministers. Also a word of greetings to my colleagues both permanent and special delegates. Indeed in honouring Africa Day, Deputy Chairperson, allow me to pay homage to one of Africa’s outstanding sons the late President of Tanzania and our appreciation that they are celebrating Africa Day with us today. The outstanding son that we are celebrating is Mwalimu Juluis Kambarage Nyerere. In celebrating and paying homage to this outstanding son, allow me to quote his words:
Unity will not make us rich, but it can make it difficult for Africa and for African people to be disregarded and humiliated. My generation, led Africa to political freedom. The current generation of leaders and the peoples of Africa must pick up the flickering touch of African freedom, refuel it with their enthusiasm and determination and carry it forward.
It is within this context Deputy Chairperson that I want to also follow suit in articulating the line as set out by our two Ministers and the Chairperson of the Select Committee on Trade Industry by recalling what the President of our country said in 2019 and I quote:
We will stimulate local demand and grow South African Manufacturing by making sure the “Buy Local Campaign” is everywhere and present.
Indeed the President was doing this within the context of articulating the reimagined industrial strategy which is indeed underpinned by the ethos to localise. This is one of the key areas that was raised by Minister Patel.
Since the announcement made by the President in the midst of the global pandemic we have observed the ANC-led government putting in place an intergraded approach together to drive that strategy. Implementing it and harvesting early fruits.
The buy local efforts typically have to address more than simple and appeal patriotism. It must broaden the productive forces which is inherently unjust. Consumers look at price and
product relation or quality. Investors look to the size of the market and whether it justifies the investment. Consumers loot at the local availability on the shelves and the marketing there off.
Therefore, the integrated approach it surround’s seeks to address these complementary elements of the Buy Local Campaign. To improve local products competitiveness, we have seen our government launching a series of industry masterplans to strengthen the supply side of industry.
As the select committee we had an opportunity to interact with the leadership of the department on these masterplans. To address the need for larger markets, the President furthermore launched the start of the trading under the African Continental Free Trade Area to enable ... [Inaudible.] ... to kick in.
Indeed, Deputy Chairperson, to address the availability of locally produced products there are number of commitments that the business community and retailors has made in partnering with the ANC-led government around localisation campaign. For
an example, Coca Cola has made a 250ml available to drive the campaign as part of its competition commitments.
This indeed will help us monitor implementation gaps and to identify new opportunities including products where we can scale up.
South Africa is not unusual in the focus on local production. We have seen even people from other countries doing the same appealing for local consumers to buy goods made in their communities. Like was also the two successive years administration has done the same under the slogan the Buy America Campaign.
South Africa recognised during the pandemic to rely on global suppliers came with enormous challenges and difficulties for our country. The pandemic has both exposed the fragility of global supply chains and revealed a great capacity we have here in South Africa innovation and adaptation in manufacturing.
More recently as indicated by the chairperson of the select committee, Ukraine and Russia has further exposed the
vulnerability we are faced with due to the import reliance. It has nothing to do with the ANC-led municipality or ANC-led provincial government as a huddle.
In the space of just two year during the pandemic, through collaboration and out of necessity, we managed to build local production probability as the Minister has indicated around ventilators and sanitizers, medical grade, face masks, and gloves, vaccine and therapeutic masks and anaesthetics. Not only did we produce as the ANC-led government these goods to meet local needs, but also to meet the needs of other countries on the continent.
Local production is important because it encourages national pride in the goods and services and products made on our home soil. It supports the growth of small business and the expansion of larger fields. It creates employment and sustain livelihoods. Local production supports our manufacturing sector. It enables us to build much needed infrastructure and improve our services.
An example around localisation and its successes there of is that of Mr Rasheed who was a trader and an importer of Italian
furniture. With the weakening of the rand Mr Rasheed Gutta moved his procurement from Italy to China where, Italian designed furniture was manufactured for Mr Gutta’s design requirement. Over the years Mr Gutter noticed that Chinese Pradacian Mucize was steadily increasing and the rand was further weakening and is pleased with his profit margins. As we speak now, Mr Gutta is operating his production facilities in Gauteng. He is now vertically integrated and supply to his own stores. He also sells to leading furniture chain stores in South Africa. This are the successes of the ANC-led government in terms of localisation.
As part and parcel of the investment pledges and we saw since the start of the Sixth Administration, that the ANC-led government introducing the Investment Conferences to mobilise private sector contributes towards development as the Minister has indicated. We can indeed agree Minister, that there are currently, 161 projects that are either finalised or under construction. An example is the production of the new generation Ford barky which follows the R16 billion investment in the United States, US, car makers operation. Also the production capacity has increased of the Ford which now produces new Ranger from 164 000 to 200 000 units. This
construction will be completed and since were advice, by the end of 2023.
Hon Deputy Chairperson, it is also an established fact that trade is not necessarily developmental, but rather preferential. Either in the form of bilateral or a regional form.
However, it is important to note that they are essentially preferential in nature as they are intended to benefit signatory countries. However such agreements are sometimes abused by competitive third countries that penetrate the entire regional preferential markets.
However, there are lessons to learn, the 21st Regional Trade Agreement such as the Association South East Asian Nations are about more than simply opening markets between preferred trading partners. They are also intended to encourage and incentivise investments particularly in the higher value-added manufacturing.
It is important that we also look into the analytical framework called by the African Continental Free Trade
Agreement which is centred on four parallel pillars. Operation on building mutually, beneficially, fair trade integration and co-operation also on industrial development and upgrading in regional value-chains, but also on investment in cross border infrastructure and also building on democracy and on good governance.
We also appreciate the platform created by the Brazil, Russia, India, China and South Africa, Brics, block. The percentage share among Brics countries was just under 11% when compared to the East global trade in 2017. The engagements in Brics summits provided a platform and the discussion and the exchange of issues of mutual interest that have helped develop closer co-operation in strengthening of trade and investment ties between the Brics nation. We have seen that the commitments under the Brics plus configuration the benefits that will flow from the broadening or the growth of Brics including among other countries such as the United Arab Emirates, Saudi Arabia, Egypt and Kazakhstan will further and create an opportunity for the Brics nations or the Brics to grow. This will ensure shared benefits of trade. Our continents needs an adequate policy tool for building a
regional value-chain and promoting transformative industrialisation.
It is important to also that in the interactions that the Africa Continental Free Trade Area will be looking forward to. It will be around five ideas. Amongst them is that the government needs industrial policy that supports the building of local firms that are crucial for cumulative capability.
Secondly, is that the industrial parks as well as the attractive investment conditions should be created through fiscal financial and infrastructural incentives. The third one is the regional initiatives to upgrade infrastructure and create commonly regular frameworks across the region are fundamental. However, also there is a need for Africa to take control and revitalise its consumer market by addressing issues of second hand garments. It is important that we ensure that emerging trend which is a major opportunity for African countries must be embraced if we want to compete in the global economy. We have to take our integration of trade to higher level with the changing balances of forces globally. As South Africa we have to build internal capacity to enable us to survive global shocks.
Let us intensify our Buy Local Campaign to be able to drive up demand in our country. Thank you, Deputy Chairperson. As the ANC we support this budget.
The DEPUTY CHAIRPERSON OF THE NCOP (Ms S E Lucas): Thank you
very much, hon Mmoiemang. As we continue with the debate, we will apologise for the hon Duma from KwaZulu-Natal. He is currently still presenting in the legislature. We will call on the hon Hadebe of the IFP to continue with the debate.
Mr N M HADEBE: Hon Deputy Chairperson, hon Ministers hon members. The Department of Small Business Development was established to support small businesses and corporatives, with a strong focus on programmes seeking to advance entrepreneurship amongst the most vulnerable groups in society. However, in the 2023-24 financial year, there have been budget cuts on entities which support small businesses.
This is concerning as it is these very same entities, which are the backbone of the survival of SMMEs.
A number of issues such as the conflict and hostility between local and foreign-owned businesses and the lack of established legislation intended to specifically safeguard townships and
rural enterprises have been raised over and over. The department has done nothing to this effect, despite the consistent calls to find a workable solution between local and foreign-owned businesses. Not only with these budget cuts to agencies such as Small Enterprise Development Agency have a direct bearing on small, medium and micro-sized enterprises, SMMEs access to finance, by they will also have a negative impact on the growth of the economy as SMMEs account for 34% of the country’s gross domestic product, GDP.
Hon Minister, it is important for this department to offer all the financial support to small businesses as they are struggling to cope with the intensity of Eskom. The frequency of load shedding has intensified with government offering little foresight of the problem is subsidising. These small businesses have to select hours to trade, limit their services especially those economic services, which make use of electricity such as hairdressers with hair dryers. These small businesses struggle to make ends meet as they are facing the growing pains of any business, but they are added the burden of load shedding which will surely enforce their closure.
So, adding in mechanisms such as generators and invertors to fend off the load shedding in their businesses is simply unaffordable. One of our constituency business owners has advised that, they are small tyre shop that is located rurally, has to turn away people at times if a job will fall into a load shedding time, as they are unable to operate the lifts to bring customer cars down. This is just one example of
... [Inaudible] ... that people are being forced to turn away as a result, not to mention the job losses that these businesses face.
To address this, the department can establish a working relationship with commercial banks to make available and expand credit and loans to small businesses. Guaranteed access to loans for small businesses, of course under monetary will encourage more and more young people, women and people living with disabilities to also start their own businesses and subsequently be able to sustain themselves.
In dealing with the matters of Trade, Industry and Competition, the IFP has seen the great potential initiative at the Africa Free Trade Agreement has to bring. We are increasingly worried that the budget presented before us will
not adequately set the foundation for Africa Free Trade Agreement to be of major benefit to South Africa. Whilst we strive to work to an agreement that will unite Africa to work together efficiently, and yet our own country is struggling to get working.
Today making marking Africa Day should unite us on how we can work together as Africans and make this continent self- sufficient and debt free from other world powers. Our agenda should today focus on the benefit of Africa Free Trade Agreement and the ways in which marginalised people could be given new hope. Instead, we see a very poorly allocated budget to of the biggest changes in Africa to come. Africa trading, manufacturing development in its own countries could have exponential growth.
SA Revenue Service, Sars needs to be funded, incapacitated to manage illicit financial flows, and monitor monies owed to the revenue connector from foreign nations will conduct business in South Africa. We must look to develop infrastructure support for industrial zones of South Africa so that we can once free, trade between fellow African countries, capitalise on the benefits of opening up borders to free trade with other
African countries. Hon Chairperson, the IFP wishes to support both Vote 36 and Vote 39. I thank you.
The DEPUTY CHAIRPERSON OF THE NCOP (Ms S E Lucas): Before we
call on the hon F Majola, the Deputy Minister, we just want to acknowledge our guests up there. You are welcome to the debate. I see that in the past few days they have been quite interested in the debates that have been presented here. We will now call the hon Majola, the Deputy Minister of Trade, Industry and Competition. Hon Majola was the first person to present the Africa Free Trade Agreement to the National Council of Provinces and it is historical that we are welcoming him back here. Over to you Deputy Minister.
The DEPUTY MINISTER OF TRADE, INDUSTRY & COMPETITION (Mr F Z
Majola): Hon Deputy Chairperson, Ministers; Patel, Ndabeni- Abrahams and De Lille, Deputy Minister, Gina; members of the executive council, MECs; hon members and fellow South Africans, let me begin by wishing all Africans in the continent and in the diaspora a happy Africa Day. This year’s celebrations mark the 60th anniversary which is being celebrated under the slogan: “Our Africa, Our Future.”
As we observe Africa Day, we must continue to show our ongoing commitment towards the all-inclusive integration of the African Continent. We are emboldened by the words of Haile Selassie, the former Emperor of Ethiopia, in the first meeting of the Organisation of African Unity when he said, and I quote: “Today, we look to the future calmly, confidently and courageously. We look to the vision of an Africa not merely free but united.”
Today, we are pursuing that dream of our forebears to achieve a free and united Africa. Our focus on the African Continental Free Trade Area has been primarily on negotiating the legal frameworks for preferential trade to commence. While we continue to prioritise the conclusion of outstanding negotiation issues, we are now shifting our focus and efforts towards facilitating and maximising the opportunities presented by the African Continental Free Trade Area, AfCFTA.
I would like to inform you that after substantial delays in achieving a common position, in February this year, the Southern African Customs Union achieved a common offer covering 90% of its tariff book. In the coming week, Minister Patel and I will travel to Nairobi Kenya, to attend the
Council of Ministers which is expected to consider and approve the Southern African Customs Union, SACU, offer.
In collaboration with provincial governments, the Department of Trade, Industry and Competition, DTIC, is undertaking a targeted awareness strategy in all provinces to identify opportunities for businesses. We want to identify and match key export priorities of each province with the new market access opportunities in countries and regions that have finalised their tariff offers.
The first of these provincial sessions took place in KwaZulu- Natal today and will be followed by Limpopo, Mpumalanga and the Western Cape in June and we hope to complete the process by the end of July 2023. Deputy Chairperson, last year we made a commitment to revise our spatial strategy in order to build and support a new model of special economic zones. This was informed by the need to involve all spheres of government as the only way in which we can speedily drive the special economic zones’ programme. The success of the new approach as evident in the Tshwane Automotive Special Economic Zone has prompted us to further expand the scope to other districts across the country.
The new approach recognises the capacity of special economic zones to advance regional economic development in support of the District Development Model. Yesterday, Minister Patel announced the imminent publishing of our intention to establish a special economic zone in Namaqua, Northern Cape. This special economic zone will catalyse growth and development in the district and neighbouring economies and will also bring more jobs and further investments to the entire province. In the Vaal, unemployment and poverty levels remain acute and the District Development Model presents an opportunity to harmoniously deploy state resources to uplift the quality of life of our people.
Addressing the Sedibeng Presidential Imbizo held on the 12 August 2022, President Ramaphosa said, and I quote:
By far unemployment is the biggest challenge. The Gauteng government has ambitious plans to revitalise Sedibeng by developing agriculture, by developing logistics, tourism and industries as well. These plans are pivoted around the Vaal Special Economic Zone.
Working together with the Gauteng provincial government, the district and local municipalities, we are on a path of regeneration and rejuvenation in this region. The initial phase of the implementation of the proposed Vaal Special Economic Zone is anchored by two investment projects that are valued at R5,6 billion.
The Mitochondria Energy will establish a Solid Oxide Fuel Cell manufacturing facility in the Emfuleni local municipality for a total project cost of R4,3 billion. The Bluedrop Energy will establish a facility in the Lesedi Local Municipality for the manufacturing and distribution of composite liquefied petroleum gas, LPG, cylinders for a total investment of
R1,1 billion. These two projects, which are scheduled to break ground within this financial year, will create a combined
2 300 jobs during construction and 1 000 direct jobs at the operational phase.
Hon members, Minister Patel is leading a process that will unlock an investment that will catalyse the development of the Vaal Aerotropolis and the Vaal River City projects. The Minister announced these investments by City Bank earlier today. These two megaprojects along with the proposed Vaal
Special Economic Zone, are the cornerstone of the interventions that will revitalise the Vaal economy and stimulate massive direct investment flows into the region.
I am also proud to announce that our department in partnership with the Limpopo provincial government, district and local municipalities has advanced plans to create the Fetakgomo Industrial Park in Sekhukhune as a base for the creation of the proposed Fetakgomo-Tubatse Special Economic Zone. The proposed Fetakgomo-Tubatse Special Economic Zone has developed a positive investment pipeline of 35 domestic and global companies to the tune of just over R40 billion. Eight of these investors have shown keen commitment and confirmed to be ready to locate in the next 6 to 12 months and projected to invest just over R5,5 billion.
This proposed special economic zone has also presented an opportunity for government to collaborate with private investors to establish a new smart city in the Sekhukhune District. These investments will benefit communities of Fetakgomo-Tubatse, Sekhukhune District and the entire Limpopo province. Hon Deputy Chairperson, as we continue with the task of connecting with our people, two weeks ago I joined other
government leaders as we accompanied the Deputy President to Jagersfontein, a community ravaged by the tailings dam disaster.
Working with Deputy Minister Tau, the Free State provincial government and other departments we are embarking on a programme to help bring normality to the community of Jagersfontein. We will canvass resources to enable adequate and efficient service delivery to the people of this town, drive infrastructure investment and advance local economic development. The project to refurbish the rail corridor linking the Tshwane automotive hub with the port of Port Elizabeth in the Eastern Cape is gathering momentum.
The project is driven by national government working together with Gauteng and Eastern Cape governments and will help attract more investors and create more opportunities and jobs. The MEC has already covered the progress we are making in the Wild Coast Industrial Park. Ladies and gentlemen, I would like to take this moment to share with you some of the projects funded by the department and its entities. Alpla, a world leader in the development and production of innovative plastic packaging solutions has an investment of R1 billion in the
City of Cape Town. The new plant will produce various plastic products including bottle closures and special packaging for the food and pharmaceutical industries.
Creslow Energy Solutions is a 100% black-owned business founded in December 2021 based in Emalahleni, Mpumalanga, and will operates in the energy storage industry. ArtSolar is based in Durban and is capable of designing and implementing renewable energy solutions. This, hon members, is very important for our objective to establish South Africa as a critical role player in the supply of solar products.
As I conclude, I would like to thank Minister Patel and Deputy Minister Gina for their support, the Department of Trade, Industry and Competition family led by the acting Director- General, Ms Malebo Mabitje-Thompson. Lastly, the leadership of our entities. Once again, happy Africa Day. Our Africa, our future. I thank you.
Ms C LABUSCHAGNE: Hon Chairperson, Hon members, Hon Minister and fellow South Africans, it cannot be denied, economic hardship is increasing for most South Africans. Unemployment is persistently high, food price inflation is rising, the
economy is perishing and small business confidence has plummeted due to inter alia power cuts which are on an indefinite stage 6 or even more. This sector and country are facing very dark times with the Consumer Price Inflation above the SA Reserve Bank target band of between 3% and 6%.
The real crisis is that the ANC appears incapable of turning around state failure and boosting growth and jobs. Why is this? It is because your ANC government keeps favouring the elite when it comes to the awarding of contracts and course the exorbitant public service wage bill. For the elite, it’s government contracts, for the unions it’s pay increases.
Minister, support from your department is few far and few between as we see small, medium and micro enterprises, SMMEs, having to divert to alternative sources of energy as they can no longer rely on the national grid. This has led to businesses facing severe financial losses, a drop in productivity and having to retrench many workers. Around 27% of businesses have indicated that their businesses will not be able to invest in alternative energy solutions. Even the CEO of Business Leadership of South Africa has stated:
Electricity insecurity has damaged many of our businesses, made many investments impossible and destroyed jobs. It affects businesses both big and small while damaging the quality of lives of ordinary South Africans.
Looking at township businesses, they have also indicated that they are struggling to stay afloat amidst the constant and crippling blackouts, this is according to a Nedbank Insights Report which was conducted in partnership with the Township Entrepreneurs Alliance. This report further indicated that 64% of township small businesses completely cease operations during load shedding, 66% of these businesses have shed jobs and load shedding has also led to increased operating costs, loss of revenue and declining margins which of course affects profitability. Businesses say that they don’t know how to look for solutions as they are not in a position to do so as they lack funding to become self-sustainable. This Minister is a source of grave concern and it would appear as if you and your government are very complacent about it as we see little to nothing being done to support this specific sector. A perception has been created that progress is being made in reducing red tape and promoting the ease of doing business with the establishment of the Red Tape Team in the Presidency.
However, following last year’s Sona, where the President announced the establishment of the Red Tape Team, this team has been established in name only as since their inception nothing has happened.
Sipho Nkosi, the Task Team Leader, even indicated that this team has no permanent structure with no administrative capacity. The question that needs to be asked is, what purpose does this budget serve for this team, could these finances not rather have been utilised in supporting the struggling small, medium and micro enterprises businesses and industry?
Minister, in February of this year you stated that the department and its agencies are urgently working on an energy relief package for small, medium, informal and micro sectors and that the details of the package are expected to be announced soon. We are now in May 2023 and still, we have not seen anything of this relief package on the table. Is it all talk or rather an attempt to chase votes for the 2024 elections with the usual empty promises?
Minister, it is time that you put action to words to enable this sector to continue doing business and to furthermore
ensure that this assistance is not another opportunity for corruption. I thank you, Chair.
Ms M O MOKAUSE: Thank you, Deputy Chair of the Council, when the EFF was formed 10 years ago, men and women from all walks of life throughout South Africa came together and advise on the question of what needs to be done. Amongst those were ordinary South Africans, SMMES being part of those because they contribute towards economic freedom in our lifetime. They wanted to be a part of it. They wanted to be a part of this journey because a black child suffered before. This journey is about attaining economic freedom in our lifetime.
We are here 10 years later to reassure those ordinary people who are on a journey with us to attain economic freedom in our lifetime. That’s when we take over power in May 2024, the first task is to end load shedding. Their businesses will not suffer any loss under the EFF government. Chair, we say this because we are publicly inviting all those small businesses to come and showcase their businesses and sell their goods during the EFF 10th anniversary at the end of July at FNB Stadium when the commander-in-chief will be gracing this beautiful gathering of the masses of South Africa with the 10th year
message July 2023. We do this because we are all aware that they are sometimes being evicted from their places of trade in all these big cities of South Africa governed by the ruling party, the African National Congress.
The Economic Freedom Fighters reject the proposed budget for Small Business Development and that of Trade and Industry. We reject the budget of this department which is simply meant for salaries and procurement and not assisting small businesses.
As the EFF, we stood on many platforms before and made it very clear that there is no need for this Department of Small Business, as there is no basis to separate Small Businesses from Trade and Industry.
We therefore reject this budget, as it is a budget intended for a department which was created out of a need to create positions for a certain faction in the ruling party and adding a burden to the already bloated Cabinet. We know this to be true as we have been on the ground, in various provinces across South Africa, understanding the decision to separate small businesses from industrial policy.
From our groundwork, we have learnt that what was meant to be industrial zones in eMonti, Dimbaza and many other areas has turned out to be a feeding scheme for comrades who act as industrial entrepreneurs while their main aim is to loot what is meant to produce jobs for our people.
Even when the communities in which these industrial areas are based kept on alerting this department that some of the claims that are made by the people who are getting large sums of taxpayers’ money to form viable industries are not doing so but they are enriching themselves. This fell on deaf ears.
This department keeps on acting as if it is well. Small businesses are not only suffering in the initiated industrial zones but in areas where the small business used to be vibrant, places such as Zwelitsha in the Eastern cape, Zone 1, eQonce, Mdantsane, Sada where the Minister originate from.
We found the same to be true in construction, retail, textiles, and hospitality industry. Black businesses, who need to meet rental demands in order to maintain a presence in malls and city centres, have closed down due to incompetency, because they have received no support from this sitting
government. This is disappointing to note for a Ministry which should have had by now a very clear program on how to assist women, young people and persons living with disabilities, especially those who are deliberately excluded by the current system, made to be slaves for white masters forever by this government. This is disappointing for a department which should have by now, had a database of all young people who are interested in starting and owning their own businesses regardless of their political affiliation.
In almost all the so-called industrial zones, there is no clear plan on how to deliberately push for women, youth and persons with disabilities to play a role in established businesses. It is only the few connected, especially those who have links with the ruling party who get funding and even that without any proper business guidance or mentorship.
It is worse in Dimbaza Industrial Zone, where out of 130 workers only four women are employed. But this department is led by a woman. You should have picked that one up. It is from your province. This clearly chows your incompetence within this department. What is even worse is that the government, especially municipalities, is the biggest culprit in killing
small businesses. They accept services from small businesses but do not pay them on time and neither they pay attention to the progress in these industrial zones.
In November 2022, a small business called Capotex which was based in Ward 7 and 8 at Inxuba Yethemba, in Chris Hani, had to stop working before the completion of the project because they hadn’t been paid yet. Yet, you take a podium and say we need to appropriate this. This is so wrong. We must close this department and make a small business, the business of industrial policy.
It is high time that we stop this empty bragging about getting our people to actively participate in the business. The so- called industrial zones must not be about a talk to get votes during elections, but they must be functional and good running. All this needs decisive leadership which unfortunately cannot be found in the ruling party. Small businesses are the backbone of any economy in the world. If this country could actively push for more support on those who are doing small businesses, this could greatly reduce the unemployment rate in our country.
As I conclude, unfortunately, the ruling party simply uses budgets allocated for enriching their corrupt, ruling party comrades and their partners when they are deployed to these departments. Chairperson, the former liberation movement will never be a sustainable solution to South Africa’s developmental problems in the foreseeable future. We therefore call all South Africans as we move to 2024 general elections to choose wisely and must know that the EFF is the only political party which will liberate the black child. We therefore reject this budget with the contempt it deserves.
Mr M A P de BRUYN: Hon Chair, as the FF Plus recognises that small businesses are essential for the fabric of our communities. They contribute to local economies, create jobs and they provide goods and services that enrich our lives. As a party that values individual freedom and self-determination, we are committed to empowering all business owners to succeed.
It is essential that we invest in our infrastructure, to support small businesses and this includes the building of modern roads, transportation systems, reliable water and electricity supply and high quality communication networks, as
these investments will not only benefit small businesses, but they will also create jobs and contribute to economic growth
Afrikaans:
Kleinsake-ondernemings het ondersteuning nodig, om te groei en ’n meetbare, betekenisvolle impak te skep. Dis ondersteuning wat deur hierdie departement moet gee.
Volgens Statistieke SA het die amptelike werkloosheidskoers wat vandeesweek vrygestel is marginaal tot 32,7% afgeneem. Alhoewel dit redelik positiewe nuus is, het die feit dat meer as 700 000 gegradueerdes en jongmense aansoek doen vir maatskaplike ontwikkelings toelaes, weereens die behoefte beklemtoon om Suid-Afrika se Kleinsake-ondernemings te ondersteun en te ontwikkel.
Die uitdaging lê in die feit dat nie genoeg kleinsake- ondernemings tot so ’n mate suksesvol is dat hulle wesenlik kan bydra tot die volhoubare verligting van werkloosheid nie.
Gegewe die ekonomiese uitdagings ná die Covid-19 hersteljaar in 2021 en vroeë 2022, sukkel baie klein besighede steeds om wesenlik te groei te toon. Hierdie uitdagings sluit in,
stygende inflasie en rentekoerse, die oorlog in Europa, die gesamentlike uitwerking wat hierdie faktore op die voorsieningsketting en koste gehad het, asook die verwoestende effek van beurtkrag.
Tussen Maart en April die jaar is 523 besighede in Suid-Afrika gelikwideer - 168 in Maart en 112 in April. Dit is 523 besighede wat werk geskep het en ’n bydra gelewer het tot die ekonomie van Suid-Afrika waarsonder ons nou sit. Studies wys dat 76% van besighede in Suid-Afrika nie die vermoë het om alternatiwe krag op te wek nie.
Baie besighede, veral in die produksiesektor, is gedwing om hul besigheidsure aan te pas volgens beurtkragskedules, wat ’n groot finansiële inpak het op produksie en arbeidskoste.
Verder moes ons hoor hoe die Adjunkminister op 16 Mei in Nasionale Vergadering ’n pleidooi rig aan nasionale en provinsiale departemente om hul rekeninge aan diensverskaffers binne 30 dae vereffen, aangesien kleinsake-ondernemings nie kan bekostig om hierdie rekeninge onverwyld te dra nie. Ons moet onsself afvra hoekom ons tot hierdie punt gekom het, dat Ministers hul eie “vennote” moet vra om hul skuld te betaal.
Beurtkrag het reeds ongekende skade aan die kleinsakesektor aangerig, en hierdie kragkrisis gaan vir die aansienbare toekoms steeds ’n ernstige demper op besighede in geheel plaas. Hierdie departement spreek geen daadwerklike prosesse aan, wat daarop gemik is om -ndernemings by te staan met alternatiewe energie verkryging tydens beurtkrag nie.
Eerder word verdere beleide en beloftes gemaak om die sogenaamde “redtape reduction” [rompslomp] te verseker – ’n proses wat al sedert die vorige begroting adviseur word, maar nog geen vordering toon nie.
Die ontwikkeling van spesiale ekonomiese sones en nywerheidsparke deur die Departement van Handel en Nywerheid om plaaslike, streeks en landelike ekonomieë te ontwikkel is positief, maar vir hierdie inisiatief om enige kans te staan, het ons ’n plaaslike regering nodig wat funksionerend is, en dit is ongelukkig iets wat min in Suid-Afrika bestaan.
Hierdie inisiatiewe word heeltemal ondermyn deur mislukte munisipaliteite, wat nie in staat is om konsekwente dienslewering daar te stel of te waarborg nie. Geen besigheid, klein of groot, kan oorleef sonder elektrisiteit, veilige
padinfrastruktuur, toegang tot skoon water, funksionerende rioolstelsels, wetstoepassing, ensovoorts, nie. Feitlik geen munisipaliteit in Suid-Afrika kan dit alles vir inwoners en besighede bied nie.
Suid-Afrikaners verdien beter. Ons verdien ’n toegewyde, verantwoordbare regering wat ekonomiese beleid met duidelike teikens, rigting en deursigtigheid sal bestuur. Suid- Afrikaners verdien beter as die huidige regering, waar korrupsie, staatskaping, wanbestuur en onvermoë om groei en ontwikkeling te bewerkstellig aan die orde van die dag is.
Suid-Afrikaners, besighede en die ekonomie verdien ’n Suid- Afrika sonder n ANC. Dankie.
The HOUSE CHAIRPERSON (Ms W Ngwenya): The following speaker is Cllr M Mogoje. I don’t know whether I am pronouncing your surname well? From Salga!
Cllr M MOGOJE (SALGA): Yes, you are right, Chair. Thank you very much Chair, Ministers and Deputy Ministers Small Business
... [Interjections.]
The HOUSE CHAIRPERSON (Ms W Ngwenya): Is it possible for you to show us your face? Please, open the video. Yes, hon member, we can see you.
Cllr M MOGOJE (SALGA): Thank you, Chair. Ministers and Deputy Ministers Small Business Development, hon Members of the National Council of Provinces, distinguished guests, I greet you all. Our mandate as local government in relation to economic development is that of being an enabler and facilitator. We are therefore duty bound to see to it that we create the most fertile operating environment for businesses, especially SMMEs, as they are poised to be the future engines of our economy.
With the Department of Small Business Development, DSBD, being responsible for the policy aspect in relation to small business development, our mandates are interwoven in nature, and it is therefore incumbent on us to improve mutual co- operation and synergy in our working relationship.
This Budget Vote is taking place amidst a period of significant challenges for businesses and the nation as a whole, characterised by intensified power outages and the
rising cost of energy. This situation has considerably escalated the cost of conducting business and led to inflationary pressures from all fronts.
In addition, there is an anticipation of another increase in the repo rate by the Reserve Bank’s Monetary Policy Committee, MPC, further exacerbating the predicament for small businesses. This ‘perfect storm’ places businesses in an extremely precarious position with limited leeway to navigate.
As a government, it is our paramount responsibility to ensure that we provide the essential support required to shield small businesses from further deterioration. We must act diligently to implement measures that would alleviate the burdens they face and safeguard their survival and growth.
Hon Chair, it is widely acknowledged that cities, particularly metropolitan areas, serve as the central hubs of the South African economy. This trend is expected to persist due to the ongoing increase in urbanisation rates. Nevertheless, we must recognise the significance of our townships and rural areas in shaping South Africa’s economic future.
Previously overlooked, these areas hold immense potential and are characterised by a strong spirit of entrepreneurship. As a government, we bear a solemn responsibility to actively contribute towards the development and fortification of the township business ecosystem.
To this end, we should commit ourselves to improving access to support services and financial resources, augmenting skills and capabilities, and other initiatives aimed at empowering our township and rural enterprises to effectively adapt to the demands of the evolving economic landscape.
In this regard, Salga expresses its appreciation for the commendable efforts undertaken by the department through the implementation of the Township and Rural Entrepreneurship Programme, Trep. The progress achieved thus far is duly recognised. That said, Salga emphasises the necessity of augmenting the funding allocated to such programs – based on available resources – to effectively attain the desired impact.
In addition, we express our willingness to collaborate with the department to enhance the visibility of these programs. It
has come to our attention that certain small businesses, particularly those situated in non-urban areas, possess limited awareness of these programs.
To address this concern, Salga intends to engage with its members to facilitate the utilisation of municipal offices for the department to conduct pop-up campaigns showcasing their offerings and funding schemes. Salga remains committed to promoting the growth and prosperity of rural and township businesses and looks forward to productive collaborations with the department, to ensure the comprehensive dissemination of information and enhanced support for these enterprises.
We have recently become aware of a significant challenge regarding the capacity of Local Economic Development officials in municipalities to effectively aid small businesses in preparing their applications to meet the stringent requirements of the department and its affiliated entities, such as the Small Business Finance Agency, Sefa. This shortcoming often leads to a misguided perception that these programs are ineffective, while - in reality - it is the flawed application process that hampers their success.
In light of this, we propose a collaborative effort to develop a capacity building program for LED practitioners. The primary focus of this program will be to equip them with the necessary skills and knowledge to assist small and medium-sized enterprises, SMMEs, in packaging funding applications and proposals that align with the department's criteria. By addressing this specific deficiency, we firmly believe that we will witness an increase in the number of small businesses receiving support from the department.
It is worth noting that we have previously experienced success
... [Interjections.]
Ms O M MOKAUSE: On a point of order, Chair!
The HOUSE CHAIRPERSON (Ms W Ngwenya): What is your point of order?
Ms O M MOKAUSE: Chairperson, is it parliamentary to have such a posture for a video in a Council sitting? If there is nothing wrong that you are seeing with that, then we see everything wrong with it!
The HOUSE CHAIRPERSON (Ms W Ngwenya): Hon member, some of the members have network challenges, so they have to move to get it. [Interjections.] Yooh, hon Mokause! Hon Mokause! [Interjections.] Hon Mokause, please. Please! Hon member, can you please continue?
Cllr M MOGOJE (SALGA): Thank you very much, Chair. It is worth noting that we have previously experienced success in capacity building collaborations with the Small Enterprise Development Agency, Seda. Building upon this solid foundation, we are confident that we can expand our efforts to encompass other training interventions as part of our joint endeavour.
We remain dedicated to promoting the growth and prosperity of small businesses and look forward to working together in curating this capacity building program for LED practitioners. By enhancing their capabilities, we will foster an environment where small businesses can access the necessary support and resources, ultimately contributing to the broader economic development of our nation.
Hon Chair, we would like to extend our sincere appreciation to the department for engaging in consultations with Salga during the initial phases of the Business Act ... [Interjections.]
The HOUSE CHAIRPERSON (Ms W Ngwenya): Can you please switch off your video, hon member? Switch off your video.
Sesotho:
E time! E time ngwaneso, o tswele pele. Metsoso ya hao e mengata.
Cllr M MOGOJE (SALGA): Furthermore, we express our gratitude for accepting ... [Inaudible.] [Interjections.]
Sesotho:
MODULASETULO WA NTLO (Mme W Ngwenya): Tswela pele!
Mokh M MOGOJE (SALGA): Ke e timile, Modulasetulo.
MODULASETULO WA NTLO (Mme W Ngwenya): Okay, qhoba!
Cllr M MOGOJE (SALGA): Furthermore, we express our gratitude for accepting ... [Interjections.] ... our invitation to present at our National Working Group on Economic Development.
While the process of gazetting for public comments is yet to commence, we kindly request the department to allow organised local government ... [Inaudible.] ... sufficient time to consult its members. This will enable us to compile a comprehensive and mandated submission that accurately represents the interests of our members. The proposed ... [Interjections.] ... amendments hold great significance for organised local government, and it is crucial that we undertake a diligent approach in consulting our members to gather their perspectives.
By allowing sufficient time for consultation, we can ensure
... [Inaudible.] [Interjections.] ... that our submission reflects a collective mandate and encompasses a wide range of viewpoints. We value the collaborative partnership between Salga and the department, and we are committed to ensuring that our engagements with members in the amendment process is thorough and representative.
Hon Chair, it would be remiss of me if I did not touch on the dilapidating impact of loadshedding. It is crucial to highlight the findings presented in a report published by Nedbank ... [Inaudible.] [Interjections.] in collaboration with the Township Entrepreneurs Alliance, TEA. According to the report, more than 60% of township businesses are compelled to halt their operations during loadshedding, while over 66% of businesses have been compelled to lay off employees due to this persistent challenge. [Interjections.]
These distressing statistics illuminate a stark reality: All our endeavours to support small businesses would prove futile unless the issue of load shedding is promptly and decisively resolved. The gravity of this situation necessitates our undivided attention and concerted efforts. Resolving the persistent issue of load shedding is imperative to safeguarding the stability and viability of small businesses. It is therefore essential that we prioritise the urgent resolution of this matter to create an environment where small businesses can thrive and contribute to the growth of our economy.
In closing, I would like to commend the department for tabling a Budget Vote that proportionally responds to the challenges and realities of today. [Time expired. As Salga, we take this opportunity ... [Interjections.]
The HOUSE CHAIRPERSON (Ms W Ngwenya): You time is over, hon member.
Ms B P SHIBA (Mpumalanga): House Chairperson, Mme Ngwenya, let me greet you, let me also greet the Deputy Chairperson, Mme Sylvia Lucas, hon Ministers that are here with us, the Deputy Ministers, hon members of the NCOP, special, as well as permanent, my colleagues, the members of the executive council, MECs that are present here, as well as those that are in the virtual platform, Secretary and officials of the NCOP
...
IsiZulu:
... sanibonani.
English:
It is encouraging to learn how much the Department of Small Business Development has done in supporting the small
developing businesses in the country. It is also appreciative to see their commitment to developing the young entrepreneurs both at policy formulation and implementation. The department has planned for the creation of sector specific youth catalytic project with higher impact through leveraging on existing opportunities in the priority sectors of the economy. They focus on projects according to specific sectors in the economy such as green economy, information and communication technology, etc.
This is covered in detail in the Youth Enterprise Development Strategy Programmes, of particular, is the Youth Entrepreneurship Collateral Fund that aims to assist the young entrepreneurs who have challenges in securing funding due to their lack of assets to serve as collateral. This will enable
the small, micro and medium enterprises, SMMEs, and the co- operatives in the country to achieve their full potential in terms of contributing to inclusive economic growth.
House Chairperson, the Mpumalanga province has adopted the revitalisation of the township economy, by the provision of support to the SMMEs in the townships such as funding, machinery and skills development. This will cover hair salons,
car wash equipment, agro-processing, equipment for production of peanut butter and castor oil, provision of spaza shop equipment and green economy waste management equipment.
Other programmes include tyre initiative programme where the province has formalised the relationship with tyre manufacturers, and currently supporting rural and township outlets located in all the districts, four in Enhlanzeni, three in Kangala and Gert Sibande. The incubation programme focusing on steel initiative in Steve Tshwete Municipality, and the furniture technology centre in the City of Mbombela Municipality helps businesses in the township to access the prerequisite skills.
We have also committed to provide funding to 100 young people through Mpumalanga Development Fund and 50, to generational mix, to stimulate township economy through agriculture, retail and tourism and manufacturing. The agro-processing support focuses on green, meat products, fruits and vegetables. The developing entrepreneurs are supported with infrastructure, equipment, training and market.
The province is working with all the municipalities to ensure that, the regulatory environment in the townships and rural areas is conducive for small businesses to thrive, as some are experiencing red tapes. The red tape reduction strategy has been adopted to provide support to the municipalities in an easy way of doing business by the SMMEs and the broader informal sector. Thank you very nuch, House Chairperson.
Mr D R RYDER: House Chair, the South Africa of Nelson Mandela was filled with hope and promise. South Africans were keen to work together, and investors were queueing up to give us money and opportunity. The potential was unlimited, and we took our place as Africa’s powerhouse across so many metrics, and then the African National Congress government used every method available to it to destroy the goodwill, the potential, and the foundation that had been laid, from bad policy decisions to cadre deployment, to empowerment mechanisms that were designed to be nothing more than get rich quick schemes for a few connected individuals.
We limped along through the Mbeki era with a pontificating president more interested in his international legacy than domestic growth and development. Then of course came the nine
wasted years of corruption and wholesale state capture under Zuma, where nothing new was built and the green shoots that we had begun to see were decimated. Along, came the promise of a New Dawn, and people rallied with hope behind President Ramaphosa, but policy uncertainty, a lack of decisiveness, hamstrung leadership forced to put party loyalists ahead of competent leaders and an unwillingness to abandon outdated ideologies, just for the sake of unity, have cost this country our future.
Yesterday, the African Development Bank released its economic outlook report, where they concluded that South Africa is dragging down regional growth. The die-hard trumpeters of the New Dawn are all offering public apologies, Peter Bruce, Magda Wiercyka, the list goes on. I was even going to include Prince Mashele, but he blew his credibility this week. We have squandered our inheritance and are left destitute, with a shrinking economy, a tarnished reputation, failing infrastructure and a government intent on finding new and absurd ways to further entrench our downward spiral.
As Ms Wiercyka said, South Africa has become irrelevant to investors. What hope is then there for small businesses, for
trade and industry? The obstructions placed by government does not only come from President. There’s a raft of Ministers and MECs that makes things worse. I could barely believe the audacity of the ANC sending MEC Motara to debate here, after the court lambasted her, heavy handed axing of the Gauteng Growth and Development Agency, at least show the decency not to show up. Now, the Small Business and Development department is giving funds to districts to pop up the District
Development Model, DDM, bringing mayors and members of the mayoral committee MMCs, into the circle.
Minister, do yourself a fovour, follow up after one year, go back and find the equiproperly.t you would have funded, ask the person that is in possession of that equipment, which council they are related to, and then ask them, when last did the equipment worked properly? On that note, let’s discuss how little respect SA Local Government Association, Salga, has, for us as the House and the South Africans in general.
The councillor couldn’t even be bothered to stop the car, to bombard us with an absolutely shockingly bad delivery of the speech that has been written for her. It’s just a pity we have a wrong Chair on the seat. Minister Patel, you have mentioned
a few businesses that you have helped. Should your focus not be so much on individual businesses, but on creating environments for all businesses to be thriving, and creating places for all businesses to trade?
You also mentioned the district municipalities, but have you looked at the state of the fresh produced markets that are in the country which are managed by the municipalities? Too many of them are falling into ruin. This is a key market for our small-scale businesses, farmers and on both sides of the equation, both buying and selling. Too many of them are falling into ruin, and there is none of the beneficiation that hon Rayi mentioned in his speech, except of course, in the Western Cape.
The initiatives like Project Khulisa in Drakenstein. Wesgro is doing the work that your department should be doing, Deputy Minister. Go and visit them, take a notebook. The exports from the Western Cape grew by 36% in 2021. Think of others compared to the rest of our economy which is practically shrinking.
What a boost would that be to the economic growth? Your programme seven of your Budget Votes gets so little attention,
so little finding and so little support. The benefits of opening African markets.
Minister, you also spoke about the sugar industry, and the problem are there. The stalling of the malls in KwaZulu-Natal, is killing the subsistence and the small-scale farmers. The issue about the levies that are paid by the small-scale farmers across the big operators that are not being paid to the government are taking people out of the industry. The actions that you are taking are too slow, Minister. Right now, with the urgency, lives are at stake. We saw it for ourselves when we took Parliament to the People.
Ministers, you have both come to tell us about your respective Budget Votes like today. Minister Patel bought not so much new, doubling down on staff that hasn’t worked already in the past. Poor Minister Ndaben-Abrahams has merely inherited the budget and programmes of Minister Ntshaveni. So, no real authority or power to change the direction of the department, and I blame the President for taking so long to shuffle his dirty pack.
With the African Growth and Opportunity Act hanging by a thread, and the ANC and government making faux pas of the faux pas, Minister Patel, you should be fighting like a Trojan in Cabinet to stop your colleagues from leading us down the wrong path. Minister Ndabeni-Abrahams the same for you, but you both lack the political support. So, the business owners in South Africa from small businesses to the big industry, the people who we rely on to provide the jobs that will bring South Africans out of poverty, that will reduce the inequality in our country and put people to work.
These people are left to do what they can, not thanks to government, but in spite of government. Contrast this with the enabling environment that is created by the DA-led Western Cape provincial government that resulted in 98% of the jobs created in the last quarter being created in this province. Do you think that it’s a coincidence that the DA-led Midvaal Municipality, the sixth vast growing municipality in terms of growing population, still manages to have a lowest employment rate in Gauteng?
As I conclude, House chairperson, when business thrives people thrive. We all know this, Ministers, you as well. Your
programmes are not working, and your plans are failing. Just look at the brand new mission that banned scrap metal exports. Step aside and let the DA fix South Africa. Failing that ...
IsiZulu:
... woza 2024.
English:
Thank you.
Mr M DANGOR: Chairperson and Minister Patel, I am glad the DA has acknowledged that you will be there for a long time. Hon Londt said that you are young, and you will be there for along time. This means that he acknowledges that the ANC will be there for a long time. The mandate of the ANC-led government is to respond to the legacy and imbalances created in the past, and to deracialise the South African economy through a radical socioeconomic transformation process. This can only be achieved through structural transformation and the proliferation of small and medium-sized enterprises particularly in highly concentrated sectors to enable our economy address challenges of social reproduction by enabling an environment whereby small, micro and medium enterprises,
SMMEs, will create nine million jobs by 2030 as enshrined in the National Development Plan, NDP.
Hon Rai, I support you. I support for the SMMEs, as they are the backbone of our economy, contributing significantly to job creation, innovation and economic growth. It is crucial that we recognise the vital role they play and take proactive measures to support their development and success.
The support for SMMEs in a developing economy like ours cannot be overemphasised. It is concerning that 40% of our SMMEs do not make it past the first year of existence, 60 % passed the second year, and 90% pass the 10 years of inception. We need to create a conducive environment for SMMEs to be sustainable. It is therefore imperative that the Department of Small Business Development forge ahead with the Implementation of the SMMEs and co-operatives Funding policy which will ensure improvement of access to affordable finance for SMMEs and co- operatives, and further accelerate the implementation of township and rural entrepreneurship programme, which is a dedicated programme to provide financial or nonfinancial support to the township and rural enterprises with emphasis on
enterprises owned and managed by women, youth and persons with disabilities.
We are concerned that the Small Enterprise Finance Agency, Sefa, continues to deny funding requests and business plans developed by the Small Enterprise Development Agency, Seda, without providing any remedy or corrective action.
Additionally, some programmes such as the Informal Traders Support programme are implemented at the national level with insufficient information being cascaded down to the provinces to conduct monitoring and evaluation of those projects. We call on the department to correct this and ensure that it enables SMMEs to access fundings.
What is of greater concern is the fiscal austerity in relation to funding for the department's and entities' budget cuts, with Seda's budget in particular likely to decrease by
R95 million during the year under review. The Small Enterprise Development Agency, Seda, spending is anticipated to decline at an average annual rate of 2,2% from R1 billion in 2022-23 to R944 million in 2025-26.
Small enterprises which employ the vast majority of South Africa's people and suffer greatly from three to four hours without electricity, are the backbone of the country's economy. It may, therefore, imply that government should pursue expansionary fiscal policy by increasing spending on small enterprises.
The agency will continue to support localisation, viability and business competitiveness over the medium-term with an emphasis on the growth of township, rural and informal enterprises. Over the period ahead it will facilitate the establishment of 250 focused business incubators. This will be funded by allocations amounting to R503 million over the medium-term and complemented by private sector funding.
Throughout the Medium-Term Expenditure Framework period, the agency aims to support 9 000 SMMEs and co-operatives in becoming competitive in local markets and to create 15 000 jobs for the SMMEs. We need to look at how we develop the township economies.
It is common course that our economy in the townships is largely based on the services sector. It is also factual that majority of our townships spaza shops, hair and beauty salons
have been outsourced to foreign nationals, which has overtime fuelled a xenophobic sentiment amongst our people. We have to in developing our SMME sector to create a sense of cohesion and cooperation among foreign nationals and South Africans in order to integrate for further expansion, and as a consequence create a vibrant and dynamic township economy.
As I go ahead and my time coming to an end, I want to deal with the issue of the DTIC intervention on energy issues in particular. The continual power outages are having an adverse impact on the broader economy and the ability for the government to effectively implement the industrial policy.
These outages have caused many businesses across all sectors of the economy to experience lower production, higher costs and reduced income. Stable electricity supply at an appropriate price is essential for economic growth and industrialisation. Notwithstanding the new annual performance plan, APP, without the reliable and affordable supply of electricity, slow economic growth and limited foreign direct investment would be perpetuated.
Hon Labuschagne, being the backbone of the economy the DTIC is at the centre of fostering growth and development. As a
result, the DTIC cannot immunise itself from the energy crises. As a result, the ANC-led government through the DTIC has formulated eight key actions to contribute towards resolving the energy challenges.
These include the establishment of an Energy One-Stop Shop to assist power-generating companies to navigate the different legislative processes and improve turnaround times by assisting investors to submit applications through a single window process. To increase private-sector investment in electricity generation. The South African Investment Conference and the Industrial Development Corporation of South Africa Ltd, IDC, serve as primary conduits to unlock investment in that particular sector.
Regulatory flexibility in terms of transformation is being considered in the form of a customised broad-based black economic empowerment, BEE, scorecard which takes account of the unique characteristics of utility scale electricity projects. At the centre of this is pursuing transformation that is necessary for inclusive growt, while at the same time improving regulatory flexibility.
The establishment of a blended funding facility of
R1,3 billion between the DTIC, IDC and National Empowerment Fund, NEF. This Energy Resilience Scheme aims by means of working capital to assist companies with alternative energy solutions, support to local component manufacturers and support township and rural businesses with acquisition of capital equipment, technical support and nonfinancial assistance.
Work to focus on attracting investment in component manufacturing, providing support through the DTIC and its development finance institutions, DFIs, and pursuing trade and export remedies relating to renewable energy components with a focus on accessing regional markets.
Chairperson, I wish to turn to the issue that was raised by the Minister. He raised the quesrion of attracting investment into South Africa. He raised the question of aqua. Aqua in particular has a particular history. When I was outside the country I persuaded the Saudi investors to come to South Africa, and amongst them was aqua. Fortunately, the Deputy Chairperson of the NCOP was the Premier of the Northern Cape at that time. She took those aqua investors around in a
helicopter and persuaded them to invest. That is a positive measure of how you can attract investment without being negative. I know there is a difference between a positive and a negative. In the old days you had photographs, and you had the positive and the positive. Sometimes the opposition sounds like they are the negatives continuously.
Also, Minister you have raised the question of Defy. Defy is a Turkish company that has heavily invested in South Africa.
Unfortunately, they have not come across as other Turkish companies, whether is a situation of some people still playing as new crusaders. We have new crusaders here amongst ourselves.
Minister, you also raised the question of Boland movie that you have facilitated for producing. I want to encourage you to look at something else in the movie industry. Look at the question of slavery in South Africa. Look at the question of producing the history of slavery in South Africa and its consequences thereof. If hon Londt could agree he would put together a programme to get the descendants of the slave masters to apologise for slavery in South Africa.
Hon Minister, I think what we need to do is to encourage people, as I have said yesterday and the day before, to renew their patriotism to South Africa and to stop talking down the investment potential of South Africa. Every day when they make a negative statements they push down the negative position.
Hon Ryder raised the question of the hope that came up after 1994. The year 1994 was a situation where we have created hope by including everybody. The year 1994 was a situation where nobody was excluded. Maybe if we can return to that kind of era we can move forward as South Africa, as part of a successful South Africa, as part of successful Africa and as part of a successful world. We are taking into consideration not only our relationship with the US, our relationship with Brazil, Russia, India, China and South Africa, Brics. I just want to repeat the words of the Prime Minister of Malaysia that I heard the other night. He was asked this question, what is your relationship with the United States? He said we have good relationships with them, and we are friends. He was asked the same question about China, and he said we are largely neighbours, and we are good friends. We have our own foreign policy, we are independent, and we are friends with them all. These is the position that we have taken in South Africa. We
are friends with them all. We want to create a peaceful world and we don’t take position.
An Hon MEMBER: What about Ukraine?
Mr M DANGOR: Yes, the question of Ukraine I think is as important as the question of Israel and Palestine. What did we say about that? Nothing! Of course, you renew colonialism.
An Hon MEMBER: You are changing the subject.
Mr M DANGOR: No, no, it is not changing the subject. Dispossession and the taking of land are the same thing. Thanks very much, Chairperson.
IsiXhosa:
UMPHATHISWA WEZOPHUHLISO LWAMASHISHINI ASAKHASAYO: Sihlalo
weNdlu, ndicinga ukuba kubalulekile ukuba amalungu ePalamente
English:
... when they are to engage on matters that affect the livelihoods of our small, medium and micro-sized enterprises, SMMEs, equip themselves with what is happening in our country.
I think that is very important. Earlier on I stood here stage here, I outlined the number of SMMEs that have benefited from the interventions by the department. And yet you have hon members who come here and lie blatantly to say this department has not done anything for the small businesses. I counted numbers here.
We invited members to go and see what is being done there. Yes, hon members, with the budget that we are tabling here of R2 billion plus, indeed it is not sufficient to deal with the challenges that are faced by small businesses. I think it should not be right that you feel comfortable to come and lie and say there’s nothing that has been done. As I say that, it is also important to listen because you represent the public and the constituencies that you come from. When you listen coming into a Budget Vote, it is important to go out and outline exactly to those that brought you to this House, what is happening.
You are saying there is nothing that has been done on red tape, blatant lie again. I stood here and I said we are the process of amending the Small Medium Enterprises Act. I said we are in the process of amending the Business Development
Act. I outlined the processes to say, by the end of 2023-24 we would have presented it here in this House, and hopefully when it is finalised, then we will be able to make the changes.
Right here in this city that we are in, the Western Cape, specifically Cape Town, our small businesses especially those that are African are excluded. As they are excluded hon members it is this city that is charging hawkers and informal businesses and other small enterprises R5 000 for a permit. I am talking about a city that prides itself for supporting small businesses, whilst all the other municipalities that they claim to fail as not doing anything for small businesses, charge R250 to R50.
Now I want everyone and all South Africans and the small businesses that are watching and listening to us here, they must know what it means for other parties to govern. What it means to support small enterprises because it is those that they love so much, but unfortunately, you don’t have it that they must like and love you. That is why they continue to exclude you in the economy and come here and want to even dictate and undermine the country’s stance on international matters, because it suits their personal interests.
Unfortunately, at the department hon Chairperson, we have a responsibility to embrace all small businesses. That is why in this Western Cape I outlined the number of small businesses that we have supported even though we are an incompetent and failing department. They are small businesses that were never serviced by this government that is claiming here and a party that takes pride in saying that it can do better and better than the ANC. I really feel for the people of the Western Cape, but most importantly, I feel worse for the hon members because I understand they really have to do everything in order for them to come back to this House. Failure to criticise everybody on what we are doing would lead to them being out of this House and never again come back to Parliament, because that is what the up party does.
Hon members, we are here as I indicated earlier, to table the budget for this financial year, which was allocated to us. A budget of R2,5 billion which constitutes transfers and subsidies of R2,226 million. Compensation of employees
R225 million, goods and services R118 million and capital expenditure R4,94 million. I don’t know what this means if it doesn’t really indicate the commitment by the ANC government to say, out of the budget of R2,5 billion, ... [Inaudible] ...
goes to transfers that must support entrepreneurs of our country, irrespective of their geographical area.
Hon members, I would like to invite you to go and visit for yourselves the businesses that we’ve spoken about, but most importantly, to also consider what we outlined earlier to say, we will be building market centres for small businesses. I did highlight that as you go to the big malls, we also invite you to go and support small businesses. This we do because we understand that the rent is too expensive for small businesses. Therefore, government takes responsibility to build properties where in small business can come and trade.
Yes, I did talk to the R200 million that we are going to provide on energy relief, but I guess hon members are not listening. I said R70 million to me to power up all the markets outside the R200 million. We invite you to accept this budget and stay away from people who are so ignorant, that they think that they can politic cheaply so on the affairs of the small businesses. We need you fellow fighters, the real economic freedom fighters must rise. It is only you entrepreneurs of our country that can change all this rhetoric that has been said in this House. Thank you, House Chair.
The MINISTER OF TRADE, INDUSTRY & COMPETITION: Hon
Chairperson, I want to thank the hon members for the contributions made in the debate today. Hon Rayi and hon Dangor reflected on the policy framework of the Department of Trade, Industry and Competition, speaking to industrial policy, promoting mineral beneficiation, structural transformation, addressing the real challenges of economic concentration and also how the Department of Trade, Industry and Competition actions on energy will seek to address and turnaround the energy challenges.
Hon Mmoiemang spoke about localisation as a driver of growth and he pointed to the potential for more value chains. His comment is borne out by the experience in the pandemic. Will we ever be able to use South Africa’s industrial base to ensure supplies of critical goods to citizens and indeed to neighbouring countries. Hon Pieters illustrated the way in which the Department of the Trade, Industry and Competition’s budget supports provinces. She also gave us an insight into the measures taken by government across the country to deal with township and rural economies, the revitalisation of industrial parks and the potential for sectors like the water sector.
Hon Radebe saw the African Continental Free Trade Area, AFCTA as a great opportunity and I am delighted at his suggestion that the department needs more budget to take forward this important mandate. In contrast to this, the members of the DA and EFF are in full election mode and in the process they missed the opportunity to offer thoughtful ideas or suggestions to the country’s problems. Even by my low expectation what I thought they would say, I was disappointed.
In an effort to rubbish all that is good, the DA took the absurd position that there is no progress, that all is bleak. It is a hopeless vision filled with rhetoric and despair. No wonder they cannot keep their own coalitions together leading to unstable governments. It is easy but empty reflecting the absence substantial proposals by the DA. Hon Londt and Ryder however, made many claims and in the limited time I want to challenge a few of those claims. The first claim, South Africa is not tapping into the African markets. Is it true? Well, South Africa chairs the council of the Ministers of the AFCTA and during our stewardship, the large percentage of rules of origin were agreed, the legal basis of trade was put in put and a number of developments around sorting out the modalities of the AFCTA were wrapped up.
The President led state visits, involving Tanzania, Uganda, Kenya, Côte d'Ivoire, Botswana and Namibia just in this period since the last budget vote. The last I checked, they were all on the African continent. Most importantly, almost
R500 billion in imports last year to the rest of the continent, a growth of 25% over one year. If we look at the period over 10 years, it is a growth of 88%, real, substantial drive of our efforts and building the African continent, not with rhetoric but with action.
The second claim is that it is only the politically connected people that are benefiting from the opportunities. Is this true? I want to point to the 85 000 workers that Shoprite and Checkers who are now shareholders in the companies. Are they politically connected? I point to the 25 000 workers that Coca Cola, Pepsi and Heineken who are shareholders in their companies and nominated members to the board of those companies. Are they politically connected? I can point at 1000 industrialists who told their stories at the Black Industrialist Conference. People who work hard, who run businesses, making car parts, supplying South Africans with food and clothing, providing industry with chemicals, with steel, with engineering products, industrialists who export to
other African markets and global markets. Are they politically connected?
It is deeply disturbing that when an industrialist is black, the assumption is that they improperly benefitted from government’s largess and support. I want to tell you the story of Jessy Ndaba and Khalid Manjoo who formed a company called Astrofica Technologies derived from the work Africa and Astro. Astrofica Technologies designs and builds satellites for specifications. Facture ground bay support system for the export market. The company exports to the United Arabs Emirates, Saudi Arabia, Europe, Australia and the USA. We celebrate that excellence of South Africans.
The third claim is that they say it is misleading to give reasons such as COVID-19 and the global recession to explain the performance of the economy. Is this true? Wow! I started the debate by saying despite the major challenges we have made considerable progress with pursuing the goals of growth and transformation. We could have focussed on the headwinds, the problems that we have but we chose not to do so though those headwinds are real.
COVID-19 is not an excuse. It led to the sharpest recession since the WWII. In April this year, the International Monetary Fund, IMF reported that one quarter of the countries have not recovered yet to the levels before the pandemic. The July 2021 unrest and the April 2022 floods are not excuses. They have destroyed billions of rand of industrial infrastructure assets. What do we do in the department despite of these constraints to see how we boost the economy, new jobs, growth with transformation? Yes, it is tough but the officials of the department have refocused their efforts. For example, every senior department’s official will be allocated a district to champion so that the work of the department would strongly reflect the needs of the communities and businesses.
The fourth claim, the Western Cape as the DA-governed province is well run and the DA targets the vulnerable. Is this true? I must concede that hon Londt is right that the DA targets the vulnerable but not perhaps in the way that he thinks. I would invite hon Londt to walk in townships where people live in overcrowded backyards where young children at the start of the year are not placed in schools. I invite you to visit Masiphumelele or Khayelitsha, Phillipi, Du Noon and see the deep challenges faced by black South Africans.
Yes, it is different picture to the wealthy suburbs but it belies the claim of the DA that it cares about the vulnerable or the bitterly poor in Boland towns. Let us go to the City of Tshwane Metropolitan Municipality and see the circumstances of residents of Itereleng Township living in impossible roads or the constant shortages of water supplies in suburbs in Pretoria leading businesses to be in despair.
Or go to the Nelson Mandela Bay Metropolitan Municipality when it was under the DA rule where I visited an area which is running through the yards of residents and young children were playing in filth while the DA was in power. Hon Ryder says there is nothing new in the programme this year. Is it true? I would invite hon Ryder to take off his blinkers. I am happy to give him the copy of the annual performance plan of the department in largest script. Read it hon Ryder, learn, educate yourself and see the successes we have gained.
Recognise it even in the portfolio committee or select committee. The DA recognised that the annual performance plan was welcome and had some very useful points in it.
The Western Cape story is one that is constantly raised by the DA. We work with Wesgrow. I celebrate when Wesgrow gains or
any firm in the Western Cape, or Eastern Cape, Gauteng or Mpumalanga. It is because we represent all of South Africa. The extent of the support given by national government to firms in the Western Cape is not acknowledged. Let me give you a few examples. When we negotiated a deal with the United Kingdom, I said down with the Minister, we worked out the modalities and 70 million additional litres of wine can be exported from South Africa largely from Stellenbosch to the United Kingdom free off duty. We provide examples after examples of us giving support to small farmers to large farmers to export citrus fruit, peaches and apples to the rest of the world. We want the rest of the world to benefit from it because it creates jobs here.
As I wrap up, our annual performance plan supports industrialists to addressing the obstacles to investing. It supports small businesses through greater opportunities to take part in the economy. It supports workers through the focus on jobs on expanding worker ownership. It also supports energy users through the exemptions from part of the Competition Act that I announced yesterday. It supports young people and women through the incentives to enable them to start businesses. It supports foreign investors through
addressing red tape and constraints to doing businesses. It supports local firms through trade measures that have assured a playing fields and an incentive package that enables more firms to upgrade their operations. This is something we can celebrate. Let us not ignore the challenges but let us celebrate what we get right as the country. This is what is being proud of being African and being proud of being South African. I thank you.
The HOUSE CHAIRPERSON (Ms W Ngwenya): Thanks very much hon Minister, hon members we have come to an end of the debate of Vote 36 and 39. I would like to thank the Ministers and the Deputy Ministers for their participation. Hon members, I would like to invite House Chairperson Nyambi to continue with the next debate.
Mr F J BADENHORST: Hon House Chair, on a point of order: Just before you go and thank you so much for allowing me. I appreciate the gesture. Is it not the time for the ruling of yesterday’s point of order by the bench?
The HOUSE CHAIRPERSON (Ms W Ngwenya): We are still continuing, you will get it. Do not worry. Do not rush. Be patient. This is South Africa, do not be in a hurry.
APPROPRIATION BILL
(Policy debate)
Vote No 38 — Tourism:
The HOUSE CHAIRPERSON (Mr A J Nyambi): Order, members! Hon delegates, let me take this opportunity once again to welcome the Minister, the Deputy Minister present here for the third order, policy debate on Budget Vote 38 Tourism — Appropriation Bill [B 3 – 2023] (National Assembly – sec 77). Hon Minister de Lille and Deputy Minister Mahlalela you are welcome to this National Council of Provinces, and special delegates, MECs and Salga on the virtual platform and the guests in the gallery.
We are now going to call hon de Lille, our Minister of Tourism, to open the debate.
The MINISTER OF TOURISM: Good afternoon, molweni, As-salamu alaikum. House Chairperson, thank you for the welcome. Hon
Deputy Minister, hon members of the select committee, all the hon MECs, hon members of the NCOP, the Deputy Director of the Department of Tourism and the officials of the officials of the Department of Tourism, all our tourism stakeholders, members of the public and the media, it really gives me great pleasure this afternoon to present the 2023-24 Budget Vote to the NCOP as we look forward with renewed passion for this important sector of our economy.
House Chairperson, our country remains one of the most sought- after travel destinations and their mission is clear: We cannot become complacent, and we must work much harder to grow the tourist numbers beyond pre COVID-19 levels. Over the past three months I have been engaging with players from across the tourism sector focussed on how government and all partners in the private sector can implement solutions to grow tourism exponentially. I also held a MINMEC meeting with MECs for tourism two weeks ago and impressed on them the level of urgency and partnerships that we need to grow this sector together.
One of the key issues we need to address is the safety of our tourists and the safety of our people, and I will be hosting a
safety forum of tourism on Monday 29 May with the MECs, private sector representatives and government departments to work on a plan of action to improve safety measures for visitors.
Happy Africa Day to everyone. As we celebrate Africa Day, to create the Africa we want, this year marks the 60th anniversary of the establishment of the Organisation of African Unity, OAU, now the African Union, AU. This year we celebrate Africa Day under the theme: “Our Africa Our Future”. As a proud member of the AU, we must accelerate actions that will move the country and continent towards achieving its socioeconomic and political development for the Africa we want.
We must collaborate to see greater implementation of the African Continental Free Trade Area Agreement, Minister Patel referred to, to bring greater prosperity to our continent.
Tourism has a key role to play in this regard as Africa is a diverse continent, with vibrant cities and rich cultures.
The United Nations World Travel Organisation, UNWTO, has shared in its Africa Day message that Africa is also a hub of
entrepreneurship and innovation and boasts some of the most exciting tourism destinations in the world and on the planet.
Let me turn to the budget, hon House Chairperson. The budget is R2,524 billion. The main allocations are as follows:
R1,344 billion to the department’s main entity the SA Tourism, R347 million on the compensation for employees, R303 million for the Expanded Public Works Programme and R225 million for the various tourism incentives programmes that we are running.
The largest portion of the department’s budget allocation in the past and over the medium terms is allocated to its public entity the SA Tourism, SAT, whose primary mandate is the marketing of South Africa as a tourist destination to local and international tourists.
The department is left with R1,1180 billion to implement programmes which support the most vulnerable in society, including unemployed youth, as well as small, medium and micro enterprises, SMMEs, in rural villages and towns. We are targeting all of these groups on a national basis.
So, in summary, the department’s implementing programme which support the most vulnerable in society as well as SMMEs in rural villages and town, and these programmes include Working for Tourism programme to EPWP, the tourism incentive programme which supports greater destination competitiveness, transformation and accelerated tourism and enterprise growth. For the current financial year, R303 million has been allocated for EPWP in the Destination Development Programme.
The department’s Enterprise Development and Transformation Programme also enable us to implement projects that provide various support packages to SMMEs that drive transformation and ensure the development of emerging operators.
There are key issues that SA Tourism will focus on in this current financial year. They will continue to prioritise domestic tourism, followed by regional and then international tourism as per the tourism sector recovery plan. Key to this will be the global tourism brand campaign that seeks to ensure that South Africa is embedded as a top-of-mind destination for all potential tourists, with the intention to connect and promote South Africa as a lucrative destination to international airlines.
Let me turn to some of the programmes that the department will be implementing in this financial year. House Chairperson and hon members, safety and security are critical for tourism in South Africa, impacting on visitor safety, destination reputation, economic growth, regulatory compliance and community support. We need to confront the safety issues, and in this regard, we need collaboration ideas and solutions from the public and the private sector. We are reviewing the curriculum of the department’s safety monitors programme; where they are recruited from and where they are deployed in terms of priority areas.
The current budget to train 1 845 tourism monitors across the country is estimated at R147,6 million. We also have called on the private sector to add some more resources and support us in this programme. Another programme from the department is the Market Access Support Programme. In terms of the key programmes by the department to support the growth of the sector, this is one of the key programmes, which is a tool to stimulate the growth, development and transformation of the South African tourism sector.
The Tourism Incentive Programme has been allocated
R225 million for this financial year for implementation of the following interventions: The Market Access Support Programme, the Green Tourism Incentive Programme, the Tourism Transformation Fund and the Tourism Grading Support Programme, just to name a few.
The Market Access Programme offers partial financial support towards the cost of exhibition space, return airfare or hotel accommodation to qualifying small tourism enterprises that wish to participate and exhibit at selected tourism trade platforms. For the first two months of this year already, we have supported 152 small enterprises to exhibit at the World Travel Market of Africa and also the Africa Travel Indaba to the value of R11,8 million. These enterprises come from all nine provinces. So, we still have between R3 million and R3 and R8 million available for this financial year to support more SMMEs to attend the travel trade shows.
The Green Tourism Incentive Programme where we offer a partial grant on the cost of retrofitting tourism facilities with energy and water efficiency equipment systems based on the outcome of a resource efficiency audit. The total budget
allocated for this year is R76 million, and on 2 May we advertised and encouraged tourism establishments to apply for this funding to retrofit their establishment with energy and water efficiency. This will close on 30 June, and all the information is available on our website.
Turning to township tourism. The township tourism sector is a vital one for our economy and I have fruitful engagements with South African Township and Village Tourism Association, SATOVITO. Working with them and other stakeholders, the department is finalising plans to ensure our communities enjoy the full economic benefits of tourism. We will do this by broadening participation in the tourism value chain for SATOVITO members and other businesses to develop new programmes into townships and villages, while also focusing on skills development and business acumen training.
Briefly on infrastructure. Tourism infrastructure and maintenance of the assets are aligned to both projects, ‘Protect and Rejuvenate’ and ‘Reignite Demand’ pillars of the Tourism Sector Recovery Plan. In this regard, the department has rolled out an infrastructure maintenance programme.
The maintenance programme is aimed at refurbishing tourism assets, increasing visitor experience, supporting sustainability of tourist attractions and providing employment. So, in this current financial year in our APP we target, and we will monitor the implementation of 29 community-based tourism projects in the following provinces: Limpopo, Eastern Cape, Free State, Kwazulu-Natal, Mpumalanga, North West and Northern Cape. I will provide the names of all the places where this is going to happen.
The maintenance programme in the provincial state owned attractions is implemented together with the Development Bank of South Africa, DBSA, with a total budget of R124,4 million. The infrastructure maintenance programme is also aimed at refurbishing tourism assets, increasing visitors experience, supporting sustainability of tourist attractions and providing opportunity. The department has a total budget of R97 million for 25 maintenance projects in this current financial year.
Again, I will provide a list of the sites: Four in Mpumalanga, five in Limpopo, six in the Eastern Cape, four in Free State and six in the Western Cape.
Turning to domestic tourism. We performed very well, and we must continue to put attractive packages together so that South Africans can make bookings and explore their own country’s vast beauty and tourist offerings. The domestic travel market for the first quarter of this year, January to March 2023, with overnight trips we exceeded the pre-2019 levels by 41%. The spend in the first quarter was also more than increased by 24%. Expenditure from local holiday trips in the first quarter was R9,5 billion compared to R7,9 billion in 2022.
South Africa offers a diverse range of captivating destinations for international travellers, and they tend to spend most of their nights in the Western Cape, followed by Gauteng, Eastern Cape, Northern Cape, KwaZulu-Natal and the North West also draw tourists to their unique charms. While smaller provinces currently see fewer visitors, we encourage tourists to explore these hidden gems as they too boast of unparalleled beauty. So, domestic tourists are important because this sector is mainly being sustained by the domestic tourism sector and is gradually recovering.
South African tourism continues to encourage the South African Product Owners, SAPO, to cater for domestic travellers’ needs to their various products and offering. The Sho’t Left travel campaign must be accelerated in and we encourage South Africans to participate by offering discounts of up to 50% off during the week starting from 4-10 September. We will be encouraging South Africans to travel our beautiful, vibrant and diverse country. To market this, we are calling on businesses to make these offers and in return we will market the deals all over our marketing sites. This initiative is in collaboration with local tourism trade partners, and that will offer up to 50% discount locally within the market, I encourage all South Africans and local tourism agencies to participate.
Hon House Chairperson, all tourism stakeholders, MECs and government tourism departments must focus our efforts to implement the Economic Reconstruction and Recovery Plan and the Tourism Recovery Plan. Our goal must be to surpass the pre COVID-19 arrival numbers. We are still 21% behind 2019 levels and which we want to exceed in this current year.
In conclusion, I urge EMCs to supplement the programme by the Department of Tourism aimed at supporting tourism enterprises so we can spread the benefit and growth in all our provinces, in all our little towns, dorpies and villages across our country. I thank you.
Mr M I RAYI: Hon House Chair, greetings to you. Greetings to the presiding officers. Greetings to the Minister and the Deputy Minister, permanent and special delegates and the Director- General of the Department of Tourism. We are proud that today marks the 60th anniversary of the historic founding of the Organisation of African Unity, OAU, the forerunner to the African Union.
I will also quote Emperor Haile Selassie and take further the quotation made by hon Majola in his speech to the founding Summit of the OAU Emperor Haile Selassie of Ethiopia said:
We stand today on the stage of world affairs before the audience of world opinion. We have come together to assert our role in the direction of world affairs and to discharge our duty to the great continent. ... Africa is today at midcourse, in transition from the Africa of Yesterday to the
Africa of Tomorrow. Even as we stand here, we move from the past into the future. The task, on which we have embarked, the making of Africa, will not wait. We must act, to shape and mould the future and leave our imprint on events as they
slip past into history.
In the midst of global turmoil and threats of World War III and nuclear Armageddon, we salute the founding leaders of the
project of building African unity for their far-sightedness and
self-sacrifice. Indeed, we stand on the shoulders of giants.
We say to fellow Africans listening: Salaam, Jambo, Bonjour Sanibonani.
We are considering this Budget Vote two months after the Tottenham Hotspur sponsorship debacle. Thankfully to the Minister, whoever thought that taking almost R1 billion of taxpayers’ money to sponsor one of the biggest and richest football clubs in the world was a good idea while millions of our people live in abject poverty, failed. So, we thank the Minister for her intervention and also thanks to the whistle- blowers who exposed the shenanigans at the SA Tourism Board, that deal was cancelled just in time.
In the current economic climate, the use of public funds must
be carefully considered. For any department to fulfil its
mandate, it must be done cost-effectively, exploring multiple options and with due consideration to all priorities.
Hon House Chair, the COVID-19 pandemic has fundamentally reshaped the tourism business environment. The hybrid work model has become the new standard. One of the largest trends from the pandemic within the hybrid work concept is the rise
of the so-called “digital nomad”. Digital nomads are people who travel freely while working remotely using technology and the internet.
According to Forbes, there was 49% increase in digital nomads from 2019 to 2020 alone. Software as service offerings such
as Zoom, Uber have greatly facilitated the rise in digital nomads across the world because of their accessibility.
Employees across industries are simply able to visit a
website and log into their accounts to access their company’s platform and their cloud stored personal data from anywhere around the world.
Studies revealed that 79% of surveyed South Africans indicated that they worked from home and had a hybrid work concept compared to just 26% pre-pandemic. In the wake of COVID-19, the tourism industry has worked hard to ensure that
it provides maximum service to make sure that no need goes unmet whilst continuing to protect traveller safety.
According to the forecasts from the World Travel and Tourism
Council the tourism sector is forecasted to grow at an
average rate of 7,6% annually over the next decade, significantly outstripping the 1,8% growth rate of the
country’s overall economy. By 2032, the sector’s contribution to GDP could reach more than R554,6 billion, which is 77,4%
of the total economy. The tourism industry has responded well to the tourism sector recovery plan.
We must ask, what are the critical inter-sectoral
interventions that can be used to boost the tourism
industry? The key focus of government and social partners should be cross-sectoral responses to boost Tourism investments in technology and innovation to support the growth of the tourism industry. The significant role of the private sector should be outlined working with government
at all levels and will guarantee success and turnaround of global standing. It is also significant to demonstrate how government can leverage public spending to attract investment in tourism.
We believe that the department and SA Tourism, SAT, spending plans underscore the need for coordinated responses across the government and to work closely with the private sector. The key challenge is to align provincial and local government tourism development strategies and action plans with national action plans. We believe that if the District Development Model is effectively implemented, it could address some of the issues faced by provincial and local governments in terms of implementing tourism development plans.
The department’s medium-term focus areas are in line with the pronouncements of the 2023 state of the nation address. The Sona continues to prioritise the following issues identified in 2022: Support of SMMEs towards recovery of tourism sector and its growth. An amount of R715 million has been prioritised over the medium term towards tourism sector support. An amount of R944,8 million has been prioritised over the medium term to enhance tourism assets and infrastructure projects. An amount
of R4,2 billion will be transferred to South African Tourism over the medium term to reignite demand for tourism in both domestic and international markets.
The department has also allocated R82,7 million over the Medium Term Expenditure Framework, MTEF, period to fund operational expenditure within the Enterprise Development and Transformation sub-programme in the Tourism Sector Support Services Programme.
We recognise the Tourism industry’s role in generating foreign exchange, including boosting local economic development.
Further, Tourism plays a significant role in terms of job creation and its potential to boost rural incomes and stimulating growth and expansion of businesses.
We also highlighted a need to aggressively invest in infrastructure such as roads, energy, water and sanitation as well as ICT infrastructure to support the growth of the tourism industry across the country.
Hon Minister, we met with you in the select committee. We then made some recommendation for your consideration. In our recommendation we have emphasised that at all levels of
government, there is a need for a co-ordinated way in implementing development projects. There is a need for an integrated tourism action plan to accelerate the implementation of tourism infrastructure.
Further, we underscored a need to leverage public spending to attract private sector investment to tackle transformation objectives and expansion of tourism industry in both urban and rural economies.
We also highlighted the need to lift cultural tourism and open opportunities in wildlife tourism to contribute to the great of rural economies, including small towns and local communities. Collaborative initiatives between the Ministry of Tourism and other Ministries responsible for arts, culture and environment should build and be enhanced to support the growth of tourism industry.
Further, there is a need for the Department of Tourism to establish a robust monitoring and evaluation mechanism to monitor the implementation of Tourism Sector Recovery Plan. Spending tracking should cover funds allocated to each strategic focus area.
We note the concern raised by the industry players about the need to strengthen resilience of the tourism economy addressing structural weaknesses, accelerating economic transformation, and encouraging more sustainable models of tourism development, and improving competitiveness.
We also make the following recommendations as well. Firstly, investment should also reach rural communities and exploit and build cultural and heritage assets, sporting events, and wildlife. To this end, we recommend that over the 2023 medium term, the Minister, through the support of the department, should craft an action plan that will incorporate arts, culture, sport, wildlife and gaming as critical components of the tourism industry. In this regard, the Minister should craft the action plan working in collaboration with the Minister responsible for arts, culture, sport and environment.
We reiterate that the Minister, through the department, need to fast track review and development of Tourism White Paper, 1996; the Tourism Act, 2014, the National Tourism Sector Strategy, 2016, the National Grading System to provide policy and strategic direction to grow and expand tourism to take into
account new development such as sustainability consideration, digitalisation in policy consideration, over the medium term.
We recommend that the Minister, before the end of the 2023 medium term, with the support of the department, apart from existing funds, should create a dedicated Tourism Development Fund to support tourism industry within a specific focus on regions lagging behind in terms of economic development. Further, private sector financing should be leveraged to broaden access to funding and financing of SMMEs in tourism industry. To this end, the role of National Treasury is essential.
In conclusion, South Africa has always attracted visitors from the old colonial powers like Britain and Netherlands. Following a big influx of visitors in 2022 and 2023, we call on the department to note that time is running out to seek new markets and continue to focus on markets where there will always be a solid base. This position is made more complex by uncertainty over the future of our national carrier - SA Airways. And while country sells itself easily with its big open spaces and beaches, the crime rate is a concern. That is why a whole-of-government approach is essential, as outlined by President in his 2023
state of the nation address and called for a whole-of-government approach. The ANC support Tourism Budget Vote. Thank you.
Ms C LABUSCHAGNE: Hon Chairperson, Hon members, Hon Minister and fellow South Africans, tourism as we are all aware, is of vital economic and social importance to South Africa.
Presently tourism’s direct contribution to the GDP is bigger than either agriculture, utilities or construction. Statistics SA states that this sector’s direct contribution to the GDP was 3,70%, or R209 billion prior to being crushed by the pandemic.
However, Minister, even though the statistics have highlighted the huge contribution of tourism to the economy, it appears as if your government does not fully grasp the importance of this sector. To have a national Minister of Tourism and a department to support you, does not suffice. The working relationship between your department and other government departments together with the inefficiencies of these departments is costing tourism dearly.
Minister, you must agree that there seems to be a lack of collaboration between your department, SA Tourism, SAT, and
the private sector. South Africans were recently exposed to the utter arrogance of SA Tourism when they unilaterally took a decision to engage with Tottenham Hotspurs for a proposed sponsorship deal of close to R1 billion. Fortunately, you stepped in and put a stop to that. To see greater growth in this sector, we need to see a more intensive engagement with the private sector in regard to the crafting of marketing strategies.
We need to move away from a unilateral political angle and stop favouring the Brics countries as they are not translating into the figures and fiscal support we require. Looking at the Department of Transport’s backlog in issuing operating licence renewals to tour operators is impacting negatively on this section of the sector. We need to see that your department shows an understanding of, and appreciate the contribution of this sector. The acceleration of processes and policies will go a long way in assisting the tourism industry.
Structural challenges such as securing a visa are something that your department together with the Department of Home Affairs must sort out as a matter of urgency. The e-visa system was rolled out with great fanfare but has not yielded
the results South Africa was hoping for. We see that American and many European tourists can visit, visa-free for up to 90 days and that is why they make up the bulk of tourists visiting our shores. We could see a massive change and increase in travellers if the Department of Home Affairs focused its action on improving visa turnaround times. The Department of Home Affairs is currently sitting with an enormous backlog of visa applications which is having a negative impact on the tourism industry as travellers then choose other destinations to travel to.
Another challenge is providing our tourists with a safe environment. Crime against tourists can impede tourism by significantly damaging a location’s image and is, therefore, vital that more visible law enforcement agents are deployed in the country’s hot spot tourism attractions. The National Tourism Safety Strategy does not seem to have the desired outcomes and needs to be revised and implemented to garner the traveller’s trust, be it international or domestic.
Minister, if we look into fixing structural issues that make domestic travel more efficient and accessible, this will inevitably lead to improving the experience foreign tourists
have while visiting South Africa. If these experiences are enhanced and broadened, the effect of word-of-mouth could be exponential for the industry. South Africa has such a rich history which should be exploited but we find the Apartheid Museum struggling with funding and Robben Island is in real need of improvements. The lack of attention to these sites with historical relevance speaks to the broader need to rethink how we market our history to tourists. To restart the tourism industry and promote South Africa’s brand abroad, emphasis should be distributed between increasing local opportunities and reducing structural barriers.
Hon Chair, with all due respect, on a point of order from where I am standing, it is not parliamentary for a Member of Parliament to move between the speaker and the audience. I thank you. I have seen everything in the NCOP, I must say ... yeah ... let me try again.
Improving transportation networks and options, along with rethinking pricing models, will make it easier for South Africans to travel domestically, and for anyone interested in visiting South Africa to make the decision to do so, and to tell someone else to do so after having a great experience.
Minister, tourism’s aspirational target was to reach
21 million tourist arrivals by 2030. Unfortunately, this figure was far out of reach, even before the COVID-19 pandemic and now even more so with the constant load shedding which is wreaking havoc on this industry as the costs to the industry in becoming self-sustainable has pushed up every single cost related to this sector. Under the current circumstances, your figure of attracting 21 million visitors to our shores is in my mind an unreachable target and unless a lifeline is provided to this industry, we could see many more job losses in the near future. To restart and reignite the tourism industry, and to promote our brand abroad, emphasis should be distributed between increasing local opportunities and reducing structural barriers, as I have already said.
Improving transportation networks and options, along with rethinking pricing models, will make it easier for South Africans to travel domestically, and for anyone interested in visiting our beautiful country to make the decision to do so.
You and your department have it in your hands to achieve the figures you are striving towards. This will require a united front. Every like-minded tourism stakeholder must be given the
assurance from you, as the Minister, that you are in this position to see the industry grow to enable them together with the government to redefine the travel experience this beautiful country of ours has to offer. I thank you.
Ms N PIETERS (Eastern Cape)): House Chairperson, greetings to you, and also continues to the hon Minister and the Deputy Minister, MECs that are in the platform, all the hon members of this august House, and also viewers at home, ...
Afrikaans:
... goeienaand almal.
English:
House Chair, let me first take this time and appreciate the time I’ve been given to partake in today’s debate. On behalf of the Eastern Cape, I wish to welcome and support the Budget Vote No 38 of the Department of Tourism, that has been delivered by Minister De Lille. Indeed, tourism has been one of the resilient sectors of our economy during the most difficult economic times of our country. As an enabler for economic growth, we had identified it as one of the pillars of our Economic Reconstruction and Recovery Plan. The recovery we
are seeing in the provincial economy is partly because of the sector’s contribution.
As the Eastern Cape, we are well on course with our grand plan to sustain the positive trajectory of the sector so we can have a meaningful contribution to the economy and create more employment opportunities. The Eastern Cape Tourism Master Plan 2032 has identified the following priority development areas. That is, visitor experience, destination, accessibility, destination management, product development and transformation. To enhance the visitor experience, the province, in collaboration with the Department of Community Safety, is prioritizing the development of a Tourism Safety and Awareness Strategy. This is anticipated to identify activities to be undertaken to deal with crime incidences that detrimentally impact on local communities and tourists alike.
To position the Eastern Cape as a premium African destination, statistics from South African Tourism shows that there were 5,77 million domestic holiday trips in 2022. Which were more than 760 000 trips under ... [Inaudible.] ... than in 2021.
This indicates a growth of 16% for the Eastern Cape. This was higher than pre pandemic levels. This has placed the Eastern
Cape at position five when compared to other provinces. A total spend of R99,4 billion was recorded in 2022 in South Africa. Gauteng contributed the most by R29,6 billion, followed by KwaZulu-Natal and with R20,1 billion, Western Cape with R12,7 billion and Limpopo with R11,6 billion. The Eastern Cape contributed R8,7 billion ranking fifth in the country.
This achievement illustrates the success of our smart marketing approach. Despite the success, funding for tourism, marketing is a priority.
Whilst we appreciate the support from Department of Tourism, more is needed if we are to reach the desired levels of marketing the province as a tourism destination. Most of the financial resources that have been mobilized through national government and the province, were used for infrastructure development, focusing on provincial protected areas in the last financial year. These funds amounted to R205,5 million. This is expected to continue when implementing the Eastern Cape Seaboard Development and Oceans Economy Initiatives by the end of 2022-23 financial year.
The following projects were completed; the development of a 90-seater restaurant and accommodation facility at Cape Morgan
Nature Reserve through funding from the Department of Forestry, Fisheries and Environment, the construction of the hikers huts at Hluleka Nature Reserve, refurbishment of cuts, recreational area in Port Alfred, and the refurbishment of Middle Beach admissions in Port Alfred. These were funded by the national Department of Tourism.
We acknowledge lack of innovation of products and lack of diversification of tourism experiences due to inadequate development of rural and township tourism. Inadequate inter- governmental collaborations on tourism to improve effectiveness and efficiency of tourism structures. Capacity, building to improve tourism service standards, will be enhanced through various initiatives such as the business incubation programs to improve human resources, and skills development.
There is a very slow pace of transformation in the sector. Thus edging all spheres of government and the private sector to do more to ensure that marginalized individuals and communities actively benefit from biodiversity and tourism. Our transformation initiatives currently, are focused on game management and other tourism related businesses. We therefore
call on the department and other role players to review related policies so we can accelerate full participation of our people into biodiversity and tourism economy.
In order to catalyze the tourism industry in the country and the Eastern Cape, a number of binding constraints need to be addressed, and these include, poor or inadequate resourcing and co-ordination of tourism plans by all levels of government. The absence of co-ordinated planning has resulted in poor product packaging, roots, heritage sites. Including marketing, management of content and integrated brand and also poor or inadequate provision of enabling economic infrastructure. Poor or inadequate transport infrastructure makes it difficult for visitors to access tourism products in the province.
Furthermore, inadequate tourism safety and security is compounded by the bad state of Eastern Cape roads. Certainty of land ownership has made it difficult for commercial ventures to invest in areas with high tourism potential, particularly along the Wild Coast. Inadequate air service inhibit the ability of international tourists to access the province. The high cost of domestic air travel likewise
discourages domestic tourists from visiting the Eastern Cape. All these constraints require a collaboration between the province and the national government for solutions.
However, in order to exploit the identified opportunities in the tourism industry and to address the binding constraints that affect the industry, the Provincial Economic Development Strategy proposes several policy interventions and key initiatives. These include, ensuring stronger support for heritage and liberation tourism, ensuring stronger support for sport tourism through exploring partnerships between government and industry, expediting the Eastern Cape Parks and Tourism Agencies, commercialization of provincial nature reserves and infrastructure investments.
Proper tourism planning around the development of the Wild Coast N2 and Wild Coast Meander routes, including addressing land tenure and new investments in tourism facilities, ... [Inaudible.] ... Port and Port St. Johns Waterfront, tourist skills development through the national Department of Tourism learnerships, national chefs program and alignment to ... [Inaudible.] ... seater program with the needs of industry.
SMMEs support programs undertaken by the Eastern Cape Parks
and Tourism Agency focusing on market access, business development and service standard product quality and tourism safety. With the support from national Department of Tourism, these are some of the initiatives that could change the short tourism landscape of our province for the better.
This time requires customer care and service excellence as paramount antidotes. Teamwork, partnership and collaboration is the ultimate currency. I want to urge all tourism and hospitality product owners to join us on this journey. We have already shown, through the many successful public private partnerships and collaborations forged during the pandemic, that our collective abilities far exceed our individual efforts. In closing, I want to tell travellers across the world, and also those that are residing in South Africa that the Eastern Cape stands ready to welcome you all. Eastern Cape is yours to explore. Thank you, hon House Chairperson.
(no sound from 18:14 until 18:20)(technical glitch)
Mr F J BADENHORST: ... sanitation. Tourists very quickly see where they will be able to receive good basic services and
will choose to go to areas where they feel this is better provided.
The statistics bear this out. Tourist arrival figures to South Africa indicate that the country is still far behind the 2019 levels. For Europe, the source of most of our key traditional source markets, South Africa is 36% behind 2019 levels, with the biggest lags seen from France (-45%), Germany (-43,9%), Italy (-42,5%) and the Netherlands (-40,7%).
And while this continues, other African states are literally eating our lunch. South Africa’s current and future arrivals are lagging behind East African competitors and, in fact, the global average. Kenya’s recovery is 15% behind 2019 levels while South Africa is still sitting at -40%.
It is clear, more than ever, that a coordinated approach is needed, which would go some way to speed up the recovery of the sector, particularly as South Africa positions itself as a destination that delivers on the greatest of all trips desire, so many international travellers have, coming out of covid.
The government needs to remove all the unnecessary red tape so that the tourism and hospitality sector has the space it needs not only to create jobs, but also to promote the destination in such a way that our international visitors see the value that South Africa offers.
The bottom line is that the lack of finances is not deterring tourists, raw sewerage and government failures are deterring the tourists. The new deterrence is health hazards and lack of basic services in some provinces. The very basics are being ignored by this inadequate government. Tourists want a care- free break, they don’t want raw sewerage entering rivers, dams and our seas, they want a consistent supply of water and electricity. They want safe roads and security. They want to visit tourist attractions that work.
Stakeholders and players in the tourism and hospitality industry will tell you that municipalities’ and the government’s failures to provide consistent safe bulk services is the biggest obstacle to the sustainability of their businesses and the retention of their staff.
In a difficult business environment, one only has to look to the Western Cape, and particularly the City of Cape Town, to see the type of coordinated innovation to keep the tourism industry afloat.
Persistent power cuts have forced the country’s hospitality and tourism industries to proactively source alternative energy and adapt to ensure that the guest experience remains uncompromised.
The V&A Waterfront, which experienced 80% of its usual footfall in October 2022, has been investing in energy efficiency since 2008, adding R30 million in solar systems and leading to a 35% decrease in overall energy consumption.
Cape Town’s Table Mountain Cableway Company has invested in a hydraulic backup motor that kicks in during loadshedding to replace the electric motor that operates its cable cars.
Cape Town spends huge efforts attracting digital nomads, working tourists, that are estimated to spend individually approximately R50 000 during their stay; which has the potential to add up to a significant benefit for the economy.
The Western Cape provincial government has developed the Municipal Energy Resilience, MER, initiative to enable municipalities, businesses and private households to generate, procure and sell power back to the provincial grid on the open market.
These are but a few of the examples of how DA-led government innovate in a coordinated fashion to drive tourism. Sadly, none of these innovations are evident in the current tourism budget. This budget, at best, is a myopic effort at being adequate in an environment demanding excellence. I thank you.
Mr M J MAGWALA: Chairperson, let greet the Minister, the Deputy Ministers, members of the House.
Will have to also greet the councillor of Mogale City who was sitting in a car and addressing this House; very much disrespectful to this House, took it on herself to take the decorum of this House and put it in the drain. But that’s the ANC for you, how they take the people of South Africa. I wonder how is that councillor taking the people of Mogale City. [Interjections.]
Chairperson, let me first start by giving a brief history of Africa Day. This day is the day that the leaders of Africa had a vision of one Africa, one currency, open the borders for all of us. That is the vision of today, not dressing in traditional clothes celebrating. The only way to celebrate this is for the ANC to open the borders for our people.
Hon Chairperson, this year the EFF celebrates 10 years of existence and 10 years of being the voice of sanity and super logic.
It has been 10 years of resilience, bravery and selflessness despite the many doomsayers who tried to frame the EFF as designed for failure. It has been 10 years of an unbroken struggle for economic freedom.
Chairperson, the EFF rejects the budget for the Department of Tourism.
Tourism is critical to South Africa’s socioeconomic development as it provides a number of benefits such as employment and entrepreneurship opportunities. It is a key
growth area which can lead to significant job creation across the country.
And whilst the sector is vulnerable to disease outbreaks, economic downturns and other shocks such as climate threats, the Minister has failed to revitalise South African tourism and has often overlooked the need to boost it.
This department has failed to find ways of making it easier and cheaper to travel within the country. And far too many South Africans still do not have the opportunity to visit other parts of South Africa with the same ease enjoyed by foreign tourists.
Initiatives aimed at developing local tourism are often overlooked in favour of nonsensical international deals which do not stand to benefit our people.
Just recently, the department made headlines over a R1 billion deal to sponsor an England team, just imagine, Tottenham Hotspur. A deal which is scheduled to go ahead despite widespread criticism from our people; an insult for all South Africans.
This department has also failed to address the issue of inequality development, specifically in rural communities. It has ignored rural tourism or leisure activities which could be carried out in rural areas and has failed to revitalise tourism activities such as community-based tourism, ecotourism, culture tourism, adventure tourism, guest farms, backpacking, riding and agritourism.
Rural areas are often forgotten by this Ministry even though there exists great potential to bring wider benefits to these areas.
Chairperson, this sector has a responsibility to contribute in the economic development of the rural and township communities. Yet, year in and year out they fail to do so.
In all different shapes and development of rural tourism in South Africa, is of growing importance in changing the rural tourism landscape of post-apartheid South Africa.
Yet, the Minister has done nothing to promote community-based tourism activities in villages and has created no opportunities in villages and townships.
We know this to be true as during a recent oversight visit which we took in the Northern Cape province, we discovered that the majority of young people in these areas are not included or participating in the tourism industry.
And we are equally surprised to learn that the sector is still largely dominated by males but the Minister is female.
This sector has made no efforts at enhancing gender equality and instead we find that in most cases females only participate when they are hired as domestic workers or employed for cleaning purposes.
It must be made clear to this department that women are capable and they must be given an opportunity to operate as tour guides, game rangers, drivers as well as guest house operators and managers.
Under the leadership of this Minister major historical sites like Robben Island have also been left neglected and are in need of improvements.
Chairperson, the lack of attention paid to sites with historical relevance, whether through poor upkeeping or outright neglect, speaks to the broader need to rethink how South Africa markets its history to tourists.
Much more is needed from this department so as to encourage and popularise heritage sites so that visitors can be able to understand and learn more about our cultural diversity.
Our tourism sector is on the verge of collapse, just like other state-owned companies. The tourism industry has been a victim of the incompetence of a government and failure to protect the industry.
The EFF rejects this budget. I thank you.
Afrikaans:
Mnr S F du TOIT: Agb Voorsitter, die toerismesektor is op hierdie stadium, net soos die landbousektor, een van die sigmente van die ekonomie, wat aan almal bewys het, dat ons nie sal toelaat om slagoffers van die ANC te wees nie.
Hierdie regering het met opset, deur regulasies, selektiewe hulpverlening en transformasie inisiatiewe gepoog om groot gedeeltes van die toerismesektor van kant te maak, en te transformer, maar hulle het nie daarin geslaag nie.
Die VF Plus loof elke persoon in die toeristebedryf, wat nie die afgelope vyf jaar moed opgegee het nie, en ten spyte van al hierdie aanslae, aangehou en deurgedruk het.
English:
We have seen how employers in the tourism sector scraped the bottom of the barrel to pay out wages, when government restricted trade and travel. We have seen how fellowship was put to practice, when communities supported businesses locally and prevented them from closing their doors.
South Africa, you are proof that your natural urge to survive and prosper is stronger than the restrictive legislation and laws of the ANC government. When restricted by government, you diversified, evolved, thrived and excelled with entrepreneurial initiatives.
Afrikaans:
Julle strewe om oorlewing, is toonaangewend van ’n nasie wat sal aanhou en wel oorleef. In die Noordwes en Noord-Kaap provinsies, het verskeie nedersettings ... [Tussenwerpsels.] langs die Vaalrivier en Oranje-rivier ...
Mr K MOTSAMAI: Chairperson, on a point of order: ...
Setswana:
... e le gore le tlile go busa leng ditoloko tsa rona? Fa e le gore ga go na madi re boleleleng re le thuse gore le dire jang, ka gonne ga e yo mo. E lebelele ... [Tsenoganong.] ... nyaya, ke Seisemane. Ke bua ka Setswana. Ga go na Setswana mo.
Lona le batla ke tle go bua Seisemane ka gonne le makgoa a mantsho. Ga go na Setswana mo.
English:
The HOUSE CHAIRPERSON (Mr A J NYAMBI): Hon Motsamai, your order is sustained. As far as I am concerned, channel nine was supposed to have the Setswana. We will find out what the problem is.
Mr K MOTSAMAI: Let us collapse the meeting. We will see when Batswana are here ... [Interjections.] When the people can interpret for us ...
Setswana:
... gore re kgone go utlwa gore go buiwa ka eng ...
English:
... let’s collapse the meeting ...
The HOUSE CHAIRPERSON (Mr A J NYAMBI): Can you please take your seat. They will assist you with channel nine.
Hon Motsamai ...
Setswana:
Rre K MOTSAMAI: ... [Go sa utlwagale.] ... mona fela ga ke utlwe sepe ...
English:
The HOUSE CHAIRPERSON (Mr A J NYAMBI): Hon Motsamai. Hon
Motsamai.
Ms M O MOKAUSE: Chairperson, on a point of order: The reality is that we are sitting here with ANC-misdadigers [criminals.] who steal everything that is to their disposal. [Interjections.] These misdadigers [criminals] ... [Interjections.] There is no interpreting, because you cut staff. [Interjections.]
The HOUSE CHAIRPERSON (Mr A J NYAMBI): Can you take your seat.
Ms M O MOKAUSE: You need to be honest with the House.
The HOUSE CHAIRPERSON (Mr A J NYAMBI): Hon Makause, can you take your seat.
Ms M O MOKAUSE: We are sitting with misdadigers [criminals] here.
Afrikaans:
Tronkvoëls.
The HOUSE CHAIRPERSON (Mr A J NYAMBI): Hon Mokause, you are totally out of order. Stop what you are doing.
Setswana:
Rre S F du TOIT: Motl Modulasetilo, ke kopa gore motl Motsamai a bule ditsebe fa ke bua Seburu. Motl Motsamai wa se itse Seburu.
Afrikaans:
In die Noordwes en Noord-Kaap provinsies het gemeenskappe die afgelope paar maande onder gebuk gegaan onder rampe en vloede wat hulle geteister het. Hierdie vloedskade het sonder enige regeringshulp gekom.
Ons waardeer Minister De Lille se poging wat sy aangewend het om wel besoek aan Parys in die Vrystaat af te lê, waar sy met besigheidseienaars en persone wat direk deur die vloede geraak is, ontmoet het en in gesprek getree het. Dankie daarvoor, Minister. Hierdie was egter nie die eerste vloed nie. Ons versoek dat daar beter onderhandeling en skakeling met wees tussen u departement en die Departemente van Water en Sanitasie, asook rampbestuur, aangesien dit blyk dat dit nie noodwendig die geval was met die afgelope vloed nie.
English:
According to Statistics SA, the travel and tourism sector’s contribution to the GDP between 2005 and 2019, used to be in the region of 7,38% to 8,31%. That is huge contribution.
Unfortunately, in 2021, it declined to 3,2%, as a result of the ANC government and the restrictions that were imposed.
Afrikaans:
Ons moet onthou dat hierdie sektor nie bloot papierbesighede is nie. In die toerismesektor het ons te doen met individue, families, gemeenskappe wat die sektor aandie gang hou. Dis verskillende kultuurgroepe wat ’n rol speel. Menselewens en nalatenskappe is ter sprake.
Die regering moet groter fokus begin plaas op die ondersteuing, bemarking en ontwikkeling van bestaande besighede in hierdie sektor, om werksekerheid en ekonomiese groei en stimulasie tot gevolg te hê.
Fokus eerder op die uitbreiding en stimulering van hierdie besighede wat ruimte en geleenthede sal skep vir opkomende entrepreneurs, om ook te groei en om in hierdie sektor voete te vestig. Daar is genoeg plek vir almal om deel te neem, nie net om transformasie voor te stel nie.
English:
The tourisms sector still has numerous challenges such as load shedding, sustainable clean water supply and restrictive and racist labour laws, to name but a few.
Afrikaans:
Besigheidseienaars langs die Oranje- en Vaalrivierstelsels herbou steeds na die onlangse verwoestende vloede, wat hulle geteister het. Vereeniging, Vermaasdrift, Orkney, Bloemhof, Douglas, Keimoes en Kakema, ek haal my hoed vir julle af.
Dankie dat julle opstaan en bou en verseker dat daar ’n nalatenskap vir julle is en dat julle bydra tot die ekonomie en werkskepping.
English:
The tourism sector in South Africa preserves the environment for future generations to enjoy; offers destinations of excitement that puts fire in your soul; educates, informs and preserves our countries heritage; gives meaning to the terms peace and tranquillity; represents the past; and stimulates thoughts of the future; is part of special moments in people’s lives, is the excitement, the journey and the destination; and it is South Africa! We salute you. Thank you.
The DEPUTY MINISTER OF TOURISM: Hon House Chair, hon members of the National Council of Provinces, Members of the Executive Council, MECS, that are on the platform and here in the House, director-general of the department and senior management, acting chief executive officer, CEO, and executive managers of the South African tourism and distinguished guests.
More than any other time, the state of our tourism and travel sector is demanded that we inspire and organize all our people to act together as one, mindful that together we all hold our own future in our own hands.
As we transit from Africa month to youth month, we do so with vigour and hope always remaining cautious. But in everything we do, there's both prospects of great progress and risk of reversal.
Indeed, our implementation of the Tourism Sector Recovery Plan has demonstrated a remarkable success for recovery of the sector to the set back of COVID-19 which induced 70% losses of arrivals and earnings.
A crude glance at the first quarter of 2023 clearly indicates that domestic travel has far exceeded the 2019 numbers and at the same time, international tourists’ arrival in South Africa are continuing to recover. The 2023/24 budget is clearly dedicated to the revitalization and rejuvenation of the sector that has been so much lost.
With the resilience and vibrancy of our people, there is a huge potential of reclaiming our international arrival and demonstrate our appetite for strong recovery. Rejuvenating the country's tourism sector, is a key aspect of our country's Tourism Sector Recovery Plan and it aims to ignite economic growth and create jobs.
Investing and paying attention to addressing barriers that deter South Africans, for exploring their own country is extremely important. It is quite clear; information and affordability are the utmost importance to make population travel. Unfortunately, racial and profiling also remain a big concern for many domestic travellers.
We will encourage South African product owners to cater for domestic travellers’ needs through various products and
offering, also implement deal driven campaigns like your Easter travel week and summer.
These campaigns are aimed to inspire domestic segments of people to get out of their houses and take more day and holiday trips by showcasing a variety of affordable, desired experiences in a clear and accessible manner but are underlined by personal safety messages.
In our quest to train youth with the requisite skills, during the last financial year, we implemented new skills development program targeting 2 500 retrenched and unemployed youth.
These learners were trained on a norms and standards for safety tourism operations.
Last financial year, 30 chefs were enrolled in a recognition of prior learning process, to obtain a professional qualification. The chefs underwent Artisan Recognition of Prior Learning, ARPL, process and got awarded a National Qualifications Framework, NQF level 5 artisan chefs’ qualification by the South African Chefs Associations.
In this financial year, we're targeting 50 chefs from Western Cape and KwaZulu-Natal to undergo a recognition of prior learning process to obtain professional designation or qualifications.
In addition, 660 learners will be trained in food and beverages, with 100 of each of the following provinces, Limpopo, Mpumalanga, North West and Free State, while 120 from Gauteng and 140 from KwaZulu-Natal.
On food safety quality assurers, we earmark 165 learners from KwaZulu-Natal at the tune of R2,6 million and professional crockery 120 learners from North West at the tune of
R2,8 million.
We're currently supporting three existing incubators program that is tourism, innovation and incubator food services in incubator and community-based tourism enterprise. For your own information members of the EFF, all of these are taking place in the rural areas.
In addition, two new business incubators will be established. That is business advisory services for women in Limpopo, in
the rural areas and home stay pilot program in the Eastern Cape, in the rural areas and townships. I can take you there and show you.
As part of the investment in the tourism infrastructure, we funded fun parks to implement infrastructure maintenance program in 19 national parks. This program commenced in 2019 and ended to the 31st March 2023.
The department made a funding of R120 million with an addition of R25,5 million received from the Presidential Employment Stimulus. About R145 million was spent on the programme creating 953 temporal jobs in some of the most remote areas in our country with 345 women, 519 youth and 30 people with disabilities were employed.
In total, 116 small medium-sized enterprises, SMEs, all of them in the rural areas, were employed in the maintenance program for the Kruger National Park and other national parks. This program created decent training opportunities.
We are implementing 29 community projects that the Minister has alluded to. All those 29 community projects are in the
rural areas, and they are community projects. If you were listening, the Minister mentioned where.
In this financial year, we aim to complete the review of the grading criteria and continue to innovate in this area of work, which includes short term rental, sustainable and new rentals. The continued growth of the basic quality program, which service to provide certification in home space and tourism establishment in the villages, townships, and small dorpies/towns, will be rolled in the northern part of KwaZulu- Natal.
The South African National Convention Bureau, actively seeking to develop leads for future business events so that South Africa can continuously enhance its bidding pipeline. Business development is one of the key strategies to maintain South Africa's position as the number one business events destination in Africa and the Middle East, and to retain the destinations competitive advantage in the global sector.
The key initiatives in this financial year of business events will continue in villages, towns and small dorpies, thereby
aiding the impact of less visited areas throughout the country.
We are bidding for 95 bids this year at a cost that is going to bring the economy R1,2 billion and several visitors coming into our shaw. These secured conferences will be hosted in various provinces, mainly, Gauteng, Western Cape, Free State, Limpopo and KwaZulu Natal.
South Africa will continue to advance South Africa's tourism interest participating in multilateral fora which is United Nations, UN, World Trade Organization, WTO, Brics, SADC, fora and G20 and African Union, AU. The department will, in this financial year, continue to host 2 diplomatic outreach programs, with special focus on Asia and Africa.
We will work harder to make the development of the eastern Europe, Asia, particularly China, India, and the African continent.
Let me conclude by saying, let us work together together to make tourism an enterprise for everyone in our quest to build
earnestly a prosperous sector that will benefit all our people. Thank you very much.
Mr J J LONDT: Hon House Chair, we are currently sitting with 32,9% unemployment rate, youth and 45,6%. The easiest way and whether the lowest hanging fruit to tackle is to make sure that we enable the tourism market.
Hon de Lille, the first thing you'll have to do is to educate your Cabinet colleagues is that the success of tourism is not just about having a mountain and oceans as hon Thulas Nxesi thinks. However, I don't know if they would fully comprehend that because I don't see a lot of tourists going to the Horn of Africa, even though there is an ocean.
The big thing is that you need an enabling environment for the private sector to offer a broad basket for a tourist market, that's as simple as it is. You need to make sure that all the poorest markets that feed into one another are connected.
We missed hon Moshodi’s speech because after four years on the online platform and the committee, she still showed that she cannot raise her hand and today she showed that she cannot,
even unmute. Hon Moshodi gets trumped by the House Chair Ngwenya, but at least House Chair Ngwenya, you are here, unlike our Chief Whip that has been absent for months, and just every now and then pops up and adds no value to the House. You get paid to be in the House and manage it hon Chief Whip. It's time to come back.
So you wonder why ... yes, that's correct. I will point that out. It's very important. They get paid to be in the House and they're not here.
So now what we need to talk about is why it is that the tourist numbers in the Western Cape skyrocket and elsewhere in the country it has flatlined or it has gone down. It is not that difficult. I mean if you compare Durban to Cape Town now, you would much rather go to beaches on Cape Town because often you will be a lot safer.
You won't have to swim through sewage in Cape Town compared to Durban. You have leap offices that make an impact that make it safe for tourists to come here. If you come into the Western Cape, you will have small towns connected with one another on
roads that do not have potholes. That allows tourists an opportunity to experience diverse offerings.
So, hon de Lille, I'm not 100% sure though, about your commitment to this portfolio because you were brought in as an insurance policy for the ANC when they fall below 50%. You were given a very important department and then the Beitbridge saga happened, Parliament burned down.
Hon Motsamai, you're asking why there's no interpretation services, here's the reason. The interpreter booths burned down and that's why they don't have a place to work from anymore.
Hon de Lille, the problem is that I think you're so fixated in fixing your own party with three of your only ward councillors in the country, all your ward councillors in the country resigned and they left. So, you're a dying party.
The ANC's already replacing you with the personal assistant, PA. So, you won't be the kingmaker. Hon de Lille, there's one thing what we need to remember, and this is, the EFF finally embraced the full diversity that Africa offered. Yesterday,
the EFF put a candidate Lulu de Beer that even beat the ANC, even though the DA still won the ward. I thank you.
The CHIEF WHIP OF THE NCOP: House Chair, can I get your attention. I’m raising a hand. I was respecting hon Londt. On a point of order.
The HOUSE CHAIRPERSON (Mr A J Nyambi): Chief Whip, you are recognised.
The CHIEF WHIP OF THE NCOP: House Chair, we need to put it on record that there was a technical glitch. There was a disconnect between members in the Chamber and members ... [Inaudible.]
Mr D R RYDER: That’s not a point of order, Chair. Sorry, it’s not a point of order.
The HOUSE CHAIRPERSON (Mr A J Nyambi): Hon Ryder, you can’t do that. You can’t call a point of order whilst we are still listening to a point of order. Let’s allow the hon Chief Whip to finish. You can continue, Chief Whip.
The CHIEF WHIP OF THE NCOP: Hon Londt says that today hon Moshodi and hon Hadebe could still not ... four years of virtual ... press a button to raise a hand. It’s not the case. The matter was reported. That is why we are not disrespecting the House. We could only hear ourselves ... those who were on the virtual platform instead of those members in the Chamber. That’s why other members even thought that we were disrupting the proceedings in the House. It is not the case. We can’t. It went even further. However, the point I’m making is that both hon Hadebe and hon Moshodi notified us immediately and we tried to communicate that message. It’s a pity that, that message was ... but the Table Staff can confirm that the technical glitch impacted those who were outside the Chamber. So, members cannot be disadvantaged from participating in the debates. I’m not saying you are doing that but I’m appealing to you Chair to please consider that members are ready to participate in the debates.
With regard to the other matters that hon Mokause raised, I don’t want to venture into it but it insulted the House ... and said that all seated in that House are thieves and criminals. It is incorrect to abuse language. Chair, I appeal to you ... that those two members ... [Inaudible.]
[Interjections.] This is a hybrid sitting. This is a hybrid sitting. So, I appeal to you to make a ruling. Thanks.
The HOUSE CHAIRPERSON (Mr A J Nyambi): Order! Thanks, hon Chief Whip. Let’s continue with the debate. I understand that there were some glitches, but because the order of the speakers is in a particular way, that created a problem.
Instead of adjourning and allowing the glitches to be sorted
... Of course, it was ... reasons not of their own making. We understand that, but we have already passed that stage. Thanks for bringing it to the attention of the House that it is beyond the control of the members who are on the virtual platform. Hon Dangor is our next speaker but before hon Dangor, it’s the Deputy Chair.
The DEPUTY CHAIRPERSON OF THE NCOP (Ms S E Lucas): Hon
Chairperson, we raised our hands when hon Mokause spoke, and I really think we need to determine whether it is correct and parliamentary to call people ...
Afrikaans:
... misdadigers en tronkvoëls ...
English:
... because she used unacceptable language. I think it is casting aspersions on members of this House. So, I really want you to determine whether it is parliamentary ...
Afrikaans:
... dat iemand kan opstaan en ander mense misdadigers en tronkvoëls noem. Ons beskou dit as ’n belediging. Die feit van die saak is ... Voorsitter, ek gaan nie op wat hierdie mense sê antwoord nie maar ek voel julle sal daarna moet kyk. Ons gaan ook nie langer aanvaar om in hierdie Huis beledig te word nie.
Mr K MOTSAMAI: Point of order, Chair.
The HOUSE CHAIRPERSON (Mr A J Nyambi): I’m not taking a point of order. Let’s allow hon Dangor to continue.
Mr K MOTSAMAI: I just want to say that the hon Lucas must not be a crybaby. When the hon ... [Inaudible.]
The HOUSE CHAIRPERSON (Mr A J Nyambi): You can’t do that. Can you sit down? Continue, hon Dangor.
The DEPUTY CHAIRPERSON OF THE NCOP (Ms S E Lucas):
[Inaudible.] ... but you are going too far. You are going too far. [Interjections.]
An HON MEMBER: You are out of order.
Mr M DANGOR: Chairperson, as I speak to the budget and not to the peripheral things, I hope people will listen. In the world of tourism ...
Mr N M HADEBE: Chairperson, on a point of order: I’m raising the point that you are presiding over this sitting. That includes the system of the sitting. So, if there’s a system glitch it’s not the members’ fault. You have authority over the speaker’s list. However, it was decided by ... It was not the doing of the members who were skipped, like hon Moshodi and I. So, I think ... [Inaudible.]
The HOUSE CHAIRPERSON (Mr A J Nyambi): Hon Hadebe, the Chief Whip has already made that point and I sustained the point of order. However, beyond that, I indicated that I decided not to collapse the House and to continue with the speakers because of the numbering. If people are dissatisfied with my ruling,
there’s a process that they have to follow. I’m not going to review my ruling. We have moved on but the point of order is in order. Let’s allow the debate to continue. Let’s have hon Dangor continue with the debate.
Mr M DANGOR: As I continue, tourism is a genuine driver of solidarity and development. Let us all fully harness its power to bring people and communities together, abiding by the Global Code of Ethics for Tourism. In this way, tourism can keep delivering better opportunities and sustainable development for millions across the globe.
Tourism is widely recognised as a key driver of economic growth and as we reconstruct our economy it ought to be acknowledged for its potential to contribute significantly to the realisation of an inclusive economic growth agenda and job creation.
Our Economic Reconstruction and Recovery Plan recognises the tourism sector as a focal growth point, able to absorb varying skills levels through employment. It also alludes that industrial linkages of the sector have important implications for the general stimulation of South Africa’s economy through
the multiplier effect from the expenditure side and the fall in demand of related sectors such as agriculture, transport, petroleum ... has started filtering through the economy. Gross value addition in this sector is rooted in the value chain and has a strong relationship and linkages with other sectors of the economy.
To this effect, for many women, rural communities, indigenous peoples and many other historically marginalised populations, tourism has been a valuable vehicle for integration, empowerment and generating income. It has enabled service delivery in remote locations, supported the economic growth of rural areas, provided access to training and jobs, and often transformed the value that communities and societies ascribe to their cultural and natural heritage.
With regard to the tourism sector’s recovery, the COVID-19 pandemic, and it was a pandemic ... If people still want to dispute that it was a pandemic as people are disputing it today, I think they should still have lived at that particular point in time, and they should’ve considered the doctors and medical scientists and their expressions of what should and should not happen. So, I think that as we belittle the whole
question of the state’s response to COVID-19, we have to take that into account. The COVID-19 pandemic ravaged the tourism sector and literally brought it to its knees. However, we remain confident in our conviction that if there is any sector that is able to bounce back from a catastrophic disaster stronger and better, it is without a shadow of doubt the tourism sector. We can already bear witness that the measures and reforms that the ANC government has put in place and recommended in the Tourism Sector Recovery Plan are bearing fruit. A total of 849,675 tourist arrivals were recorded in January 2023, which was an increase of 125% compared to the same month in 2022.
If we look at the performance of the sector on the continent, research from the department shows that four of the top African source markets remained in the same position in those periods, namely Lesotho, Eswatini, Botswana and Zambia, which ranked in 2nd, 4th, 5th and 8th positions respectively.
Zimbabwe moved up from 3rd to 1st position in 2023 when compared to 2022. Angola and Kenya replaced Tanzania and Nigeria on the top 10 list in this period. All top
10 countries recorded a positive growth, with Zimbabwe recording the highest increase of 264% followed by Kenya and
Angola. As we develop our tourism market, we should develop the Southern African Development Community, SADC, market and not only South Africa, because when we sell tourism we sell the SADC.
With regard to women, youth and persons with disabilities, we are encouraged to see that our government, through various infrastructure projects, has been able to contribute to much- needed jobs as well as support the most vulnerable in our society — women, youth and persons with disabilities.
Evidently, just yesterday the Deputy Minister was on the ground at the Agulhas National Park to assess progress on the department’s infrastructure development programme at the Lighthouse precinct in the park. The department endorsed this link for tourism and its enhancements at the Agulhas National Park, which focusses on the construction of the iconic Map of Africa monument, the construction of a 1 km rehabilitation road and the remain ... of the realignment of the boardwalk. This R14 million project, which was phase 1, was completed in 2018.
The second phase of the Lighthouse project commenced in 2017. It includes a 60 seater ocean view restaurant, a reception
area, an interpretive centre, a curio centre, vendor stalls, paving and walkways and a conference facility. This project is to be completed by 2024. The department provided a budget of R54,704 million for this phase of the particular programme.
The ANC welcomes that over the Medium-Term Expenditure Framework, MTEF, period, the department will allocate R82,7 million to fund operational expenditure within the
Enterprise Development and Transformation subprogramme in the Tourism Sector Support Services programme. This will provide developmental support to enterprises while establishing a channel of emerging operators within the sector.
In terms of support to small, medium and micro enterprises, SMMEs, the Department of Tourism has supported by funding
30 SMMEs to attend the World Travel Market Africa to display their offerings and products. Of the 30 SMMEs, 25 are majority black-owned, of which 16 are women-funded, while two businesses are run by the youth. Half of the operators were providers of accommodation and other services.
We remain hopeful that through collaborative efforts and forging a strong social compact, these issues can be
addressed. What also gives us courage is knowing that while this sector is easily susceptible to economic shock waves, it has proven to be resilient and has managed to build a black, stronger and better industry.
As I conclude, I want to say to Minister De Lille that this is Africa Day. You and I worked together to bring back the exiles. It did not matter if we said mayibuye or izwe lethu.
We brought them back together. We brought them back in unity. We brought them back to shape a better future for a united, transformative, nonracial, nonsexist and democratic South Africa. Unfortunately, some of our partners that entered with us into that kind of negotiation did not respect that particular position. They were there. They entered the negotiations with a particular agenda. They left and have now become the opposition, but they’ve become the opposition for the minority in this country and not for the majority ... to transform. For that I thank you very much.
The HOUSE CHAIRPERSON (Mr A J Nyambi): Hon members, there was a point of order raised about some utterances made by hon Mokause. What will happen is that ... Yes, you are correct.
She’s not here. I will definitely go through Hansard to check
what was said by hon Mokause, so that we can have a proper ruling based on what she said in this House. Hon delegates, that concludes the debate. I would like to thank the hon Minister of Tourism, hon De Lille. Before I go to that — I was dealing with the ruling — I’ll allow the hon Minister to conclude the debate. It’s because of what you are doing, hon Mathevula. Hon De Lille, you are the last one. Sorry.
Mr M DANGOR: House Chairperson, as I continue, tourism is a genuine driver of solidarity and development. Let us all fully harness its power to bring people and communities together, abiding by the Global Code of Ethics for Tourism. This way tourism can keep delivering better opportunities and sustainable development for millions across the globe.
Tourism is widely recognised as a key driver of economic growth and as we reconstruct our economy it ought to be acknowledged for its potential to contribute significantly to the realisation of an inclusive economic growth agenda and job creation. Our economic reconstruction and recovery plan recognises that the tourism sector as a growth focal point, able to absorb varying skills levels through employment. It also alludes that industrial linkages of the sector have
important implications for the general stimulation of South Africa’s economy through the multiplier effect from the expenditure side, and the fall in demand of related sectors such as agriculture, transport, petroleum industry has started filtering through the economy. Gross value addition in this sector is rooted in its value chain that has a strong relationship and linkages with other sectors of the economy.
To this effect, for many women, rural communities, indigenous peoples and many other historically marginalised populations, tourism has been a vehicle for integration, empowerment and generating income. It has enabled service delivery in remote locations, supported economic growth of rural areas, provided access to training and jobs, and often transformed the value that communities and societies ascribe to their cultural and natural heritage.
The tourism sector recovery, the coronavirus disease, Covid- 19, pandemic, and it was a pandemic, people also want to dispute that it was a pandemic as people are disputing today, I think they should ... [Inaudible.] ... livid at that particular point in time, and they should have considered the doctors and the medical scientists and their expressions of
what should happen and should not happen. Therefore, I think that as we belittle the whole question of the state’s response to Covid-19, we have to take that into account.
The Covid-19 pandemic ravaged the tourism and industry sector and literally brought it to its knees. However, we remain confident in our conviction that, if there is any sector that is able to bounce back from a catastrophic disaster stronger and better, it is without the shadow of a doubt the tourism sector. We can already bare witness that, the measures and reforms the ANC government put in place and recommended in the tourism recovery plan are bearing fruit. A total of 849 675 tourist arrivals were recorded in January 2023, which was an increase of 125% compared with the same month in 2022.
If we look at the performance of the sector in the continent, research from the department shows that, four of the top African source markets remained in the same position during both periods, namely, Lesotho, Eswatini, Botswana and Zambia, which ranked second, fourth, fifth and eighth position respectively. Zimbabwe moved up from third to first position in 2023, when compared to 2022. Angola and Kenya replaced Tanzania and Nigeria in the top 10 list during this period.
All top 10 countries recorded a positive growth with Zimbabwe recording the highest increase of 264% followed by Kenya and Angola. As we develop our tourism market we should develop the Southern African Development Community, SADC, market and not only South Africa because when we are selling tourism, we are selling SADC.
Women, Youth and Persons with Disabilities, we are encouraged to see that our government through various infrastructure projects has been able to contribute to the much-needed jobs as well as to support the most vulnerable in our society, women, youth and persons with disabilities. Evidently, just yesterday the Deputy Minister was on the ground at the Agulhas National Park to assess progress on the department’s infrastructure development programme at the Lighthouse precinct in the park. The department endorsed this link for tourism and its enhancements at the Agulhas National Park which focussed on the construction of the iconic Map of Africa Monument, construction of 1 km road, rehabilitation of the terrain and the realignment of the boardwalk. This R14 million project, which was Phase 1, was completed in 2018.
The second phase of the Lighthouse Project, commenced in 2017. It includes a 60-seater ocean view restaurant, a reception area, an interpretive centre, a curio centre, vendor stalls, paving and walkways and a conference facility. This project is to be completed by 2024. The department provided a budget of R54 740 000 for this phase of the particular programme.
The ANC welcomes that the department over the Medium-Term Expenditure Framework, MTEF, will allocate R82,7 million to the fund operational expenditure within the enterprise development and transformation sub-programme in the tourism sector support services programme. This will be to provide developmental support to enterprises while establishing a channel of emerging operators within the sector.
Small medium and micro enterprise, SMME, support. The Department of Tourism has supported through funding 30 small SMMEs to attend the World Travel Market Africa and display their offerings and products. Of the 30 SMMEs, 25 are majority black-owned, of which 16 are women funded, while two businesses are run by the youth. Half of the operators are the providers of accommodation and other services. We remain hopeful that through collaborative efforts, and forging a
strong social compact these issues can be addressed. What also gives us courage, is knowing that while the sector is easily susceptible to economic shock waves, it has proven to be resilient and has managed to build back stronger and better industry.
As I conclude, I want to just say to Minister De Lille that this is Africa Day. You and I worked together to bring back the exiles, and it did not matter if we said “Mayibuye!” or
... [Inaudible.] ... we brought them back together. We brought them back in unity. We brought them back to shape a better future for a united transformative nonracial and nonsexist democratic South Africa. Unfortunately, some of our partners who entered with us into that kind of negotiation did not respect that particular position. They were there, they entered the negotiations with a particular agenda, they left and now become the opposition. However, they become the opposition for the minority in this country and not for the majority transform. With that, I thank you very much.
The HOUSE CHAIRPERSON (Mr A J Nyambi): Thank you. Hon members, there was a point of order raised about some utterances made by hon Mokause. However, what will happen is that ...
[Interjections.] ... jaa, you are correct, is not here. I will definitely go through Hansard to check what was said by hon Mokause so that we can have a proper ruling out of what she has said in this House. Hon delegates, that concludes the debate. I’d like to thank the hon Minister of Tourism, hon De Lille. Before I can go to that, I was dealing with the ruling, and I’ll allow the hon Minister to conclude the debate. Hon Minister, it’s because of what you are doing hon Mathevula.
Hon De Lille, you are the last one, I’m sorry. Order, let’s allow the Minister.
The MINISTER OF TOURISM: House Chairperson, I just want to make three quick points. The first is I want to assure members that definitely, we are working together. On the e-visa system I met with Minister Motsoaledi, he will be making announcement soon on the digital nomad visas.
I’m working together with the Minister of Transport on the issue of tourist licence; therefore, I can tell you today, there are 418 in the system. And we are working to bring a moratorium on the harassment of tourism operators next week.
I am working with the Minister Department of Sport, Arts and Culture, DSAC, Minister Zizi Kodwa, we have identified all the heritage sights in South Africa. Starting with Robben Island and all the others and there’s specific plans that we are on how to promote them but also how to do some repairs there.
The Tourism Equity Fund that was stuck in the legal system for almost two years has been finally settled, hon House Chairperson, R1,4 billion in the Tourism Equity Fund is now available. We are working on the concept plan together with the Deputy Minister and other departments so that we can start releasing that money.
Also, I would really encourage members, hon House Chair and the Director General, DG is here, that if you want a list of all the green incentives programmes that would be doing, just two weeks ago, I went here to Grabow, there’s the Houw Hoek Hotel. There are many of these small institutions that we’ve been assisting to green, you know, they put a solar panel on and with water. Get that list go and encourage them, they do need your encouragement.
Similarly, I will also encourage members to get the list of all the training that the Deputy Minister spoke about. Go and encourage those young people, where we are training them and give them hope, so that we know that they have hope in our country going into the future.
Also, I would like to get the EFF member where in the Northern Cape, he was making reference to... but again I would encourage the committee House Chairperson, to call this South African Tourist, Township and Village Association, you would be surprised what good work they are doing. They told me Minister, nothing about us without us. And so, we are working closely with them. Again, they will show you what is happening in the small dorpies and towns.
Yes, in terms of the statistics hon Dangor, you are right, last year we’ve received just over 5,7 million tourists in 2022, four million came out of Africa. Again, in the first quarter of this year, we received 1,2 million, again it was led by Zimbabwe and Mozambique and therefore we have to focus on the continent.
And we have to make sure that we deal the visa issues. But people can travel already freely within Southern Development Community, SADC. So, that is a very, very important market for us. We have seen a decrease in the first quarter from the United Kingdom, UK, market of 135 000 tourists. So, the tourist figures go up and down.
But you know there are some hon members that participate in the debate, and I don’t think that they know how to spell tourism. So, let alone understand what tourism is, because they have got no idea and certainly cannot give advice.
Afrikaans:
In Afrikaans sê hulle, die dwase man bou sy huis op die sand. Nou as jy dwaas is en jy koop mense ... Hulle koop raadslede oor vir R40 000, dan kom sê hulle hier hulle het bedank. Ons weet hulle het die mense omgekoop. Moenie ... Jy is ’n dwaas. Jy het die mense oorgekoop. Dis wat die DA gedoen het, maar ons sal nie nou oor hulle bekommerd wees nie.
English:
We are there to build this country, we are there to give hope to our people in this country and with or without those who
say our country is going nowhere. We will continue to give hope to our people, and build our country together, without the ...
Afrikaans:
... dwase.
English:
Thank you.
The HOUSE CHAIRPERSON (Mr A J Nyambi): Thank you, hon delegates, that concludes the debate. I would like to thank Minister De Lille, Deputy Minister, Mahlalela, special delegates, Members of Executive Council, MECs, South African Local Government Association, Salga, representatives for availing themselves for this important debate. Thank you very much hon Minister and Deputy Minister, D M and the special delegates and MECs. Then I will allow mama House Chairperson Ngwenya to come and make the outstanding ruling of yesterday before we can conclude today, hon House Chairperson Ngwenya.
Debate Concluded.
RULING
The HOUSE CHAIRPERSON (Ms W Ngwenya): Thanks very much House Chairperson Nyambi, hon members, I will start with the introduction. Hon delegates during the Policy Debate on Budget Vote 10, Public Enterprise and Budget Vote 40, Transport. Hon Londt rose on a point of order. I undertook to consult Hansard and revert to the House.
Despite my undertaking that I will return to the House with the ruling at the later stage, hon Londt with a loud voice persisted that I deliver the ruling immediately. Hon delegates, my undertaking was made within context of the rule
69 (6) of the Rulings of the NCOP, which allows when a point of order has been raised a presiding officer has the right to make a ruling immediately or defer the decision to a later stage.
The insistence of hon Londt that I make a ruling immediately after a point of order have been raised was therefore misplaced. Hon Londt’s point of order was directed at the statement by the Deputy Minister of Public Enterprises, hon
Obed Bapela, that “Nhanha is willing to sell his soul if he has one”.
Hon Londt paraphrased these words to mean hon Nhanha doesn’t have a soul issue. The question that arises is whether hon Bapela, said “Nhanha is willing to sell his soul if he has one”. He did, whether the statement may be interpreted to mean that hon Nhanha doesn’t have a soul, as paraphrased by hon Londt and therefore unparliamentary.
Ruling, listen, having view the record as indicate above, I have ascertained that hon Bapela is recorded to have said that “Nhanha is willing to sell his soul if he has one”. The question is whether this statement is capable of being interpreted to mean that hon Nhanha doesn’t have a soul as stated by hon Londt.
Although hon Bapela did not say hon Nhanha doesn’t have a soul, his statement that “Nhanha is willing to sell his soul if he has one” seems to cast aspersion on the integrity of hon Nhanha. This may mean that hon Nhanha is willing to express views even if he does not believe in them or is not committed to those views.
As hon delegates we assume that each delegate is here to represent his or her constituency and as such expresses a view of a constituency. I therefore rule, although hon Bapela did not make the statement as alleged by hon Londt. The statement he made reflect negatively on the integrity or dignity of hon Nhanha. I therefore rule that the statement made by hon Bapela to be unparliamentary. I thank you; the House is adjourned.
The Council Adjourned at: 19:23.
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