CLOTHING, TEXTILES AND AUTOMOTIVE SECTORS KEY BENEFICIARIES OF ADDITIONAL BUDGET ALLOCATION

During his inaugural Budget address in February 2010 Finance Minister Pravin Gordhan announced that an additional allocation of R3,6 billion would be set aside for the Department of Trade and Industry (the dti), mainly in support of investment and production in the automotive components and clothing and textiles industries.  This bodes well for local companies and Proudly South African members who are active in these industries.

This initiative will promote the creation of sustainable employment in these labour-intensive sectors  and will partly support the second version of  government’s Industrial Policy Action Plan (Ipap2), for the period 1 April 2010 up to 31March 2013.  Ipap2 is seen to be critical in making the economy more labour absorbing and dynamic.

The overall allocation for industrial incentives would be R2,8-billion in 2010/11, R3,3-billion in 2011/12 and R3,7-billion in 2012/13.

This would be allocated across the automotive and clothing schemes, as well as a number of other schemes, including, amongst others,  the Small and Medium Enterprise Development Programme, the Business Process Outsourcing Incentive, the Film and Television Production Incentive, the Small and Medium Manufacturing Development Programme, the Staple Food Fortification Programme, Industrial Development Zones, the Enterprises Investment Programme, and a number of other smaller schemes.

Minister Gordhan, furthermore, indicated that industrial policy was one of seven components of South Africa’s "new growth path", which included the following:

• A concerted effort to reduce joblessness among young people;
• Support for labour-intensive industries through industrial policy interventions, skills development, public employment programmes and a rural development strategy;
• Sustaining high levels of public and private investment and raising of the national level of savings;
• Improving the performance and effectiveness of the State, especially the provision of quality education and training at all levels;
• Reforms to increase inclusion and participation in the labour market, alongside efforts to improve competition in product markets;
• Keeping inflation low, striving for a stable and competitive exchange rate, and providing a buffer against global volatility.
• Raising productivity and competitiveness, opening up the economy to investment and trade opportunities that can boost exports.

The Proudly South African Campaign welcomes the announcement of financial investment in industries, such as clothing and textiles that have great potential to support the creation of sustainable employment and a reduction in unemployment and poverty. 

Members of the Campaign and local producers should continue to play their part by building the competitiveness of their products, both for domestic, and, where applicable, export markets.

The Buy Local campaign has an important role to play in promoting a demand for quality, homegrown products and services.

Buy local and help create and retain jobs!