The Deputy Minister of Trade and Industry, Mr Bulelani Magwanishe says the South African government is committed to supporting the local production of vehicles in order boost exports, job creation and economic growth. Magwanishe was speaking at the launch of the new Polo by Volkswagen South Africa in Uitenhage, Eastern Cape.
“As the government, our commitment to local vehicle production is marked in our Industrial Policy Action Plan (IPAP), with a prime focus towards adding value in the manufacturing and industrial sector. Export promotion, job creation and inclusive growth remain as the fundamentals to this policy,” said Magwanishe.
He added that the automotive industry is the largest and leading manufacturing sector in South Africa’s economy. The industry currently employs about 300 000 people, 31 000 in vehicle assembly, 82 000 in component manufacturing and the rest in retail.
“As government we commend VWSA on the launch of its new invention with investment value of R6.1 billion. This investment is particularly strategic to ensure expansion, and Radical Economic Transformation, which is inclusive of Black Industrialists,” he added
He also said that the Department of Trade and Industry’s (the dti) Automotive Production and Development Programme was successfully providing the much-needed support to the automotive sector.
“Under this programme, we have the Automotive Investment Scheme (AIS), which has disbursed R8 billion from its inception in 2009 to 2017. The government’s total commitment to the scheme is R13.5 billion. Moreover, this programme has supported a total of R48.3 billion in investments during this period. The country’s new Automotive Master Plan and associated support programmes will be announced in the near future following Cabinet endorsement,” he added.
Magwanishe also said the government has partnered with the automotive industry in creating the Automotive Supply Chain Competitiveness Initiative (ASCCI).
“Applied through various interventions, ASCCI has cultivated competitiveness in the past three years. To date, support has been facilitated to more than 23 firms. 30 more firms are currently being taken through various interventions, since 2017. Through these interactions, we believe as a department that it is not about the role that we play but mainly about the goals that we aim to achieve,” stressed Magwanishe.
He reiterated that the dti would be persisting in pursuing efforts intended to increase local content in vehicle production, attract component manufacturers, provide investment assistance for expansion as well as advance competitiveness improvement programme.
Magwanishe lauded VWSA’s efforts of supporting the entrance of Black Industrialists in the automotive value-chain through their Ntinga empowerment project which is in line with the Enterprise and Supplier Development element of the Broad-Based Black Economic Empowerment Codes of Good Practice.
“Our Black Industrialists Policy is fixated on expanding our industrial base and injecting new entrepreneurial dynamism into the economy. Similar initiatives by other vehicle manufacturers must be advanced through the partnership of the public and private sector, and other stakeholders. It is imperative to additionally facilitate effective transformation across the value-chain in areas such as dealerships, panel beaters and mechanical workshops,” said Magwanishe.
Distributed by APO Group on behalf of The Department of Trade and Industry, South Africa.