The black industrialisation programme set up by the dti (Department of Trade and Industry) was crucial for radical economic transformation in South Africa, dti deputy minister Mzwandile Masina said on Thursday.<\/p>\n
Referring to a recent memorandum of understanding between SAA and the dti to address the inclusion of black industrialists in the industry, Masina said it might seem out of the norm, but \u201cwe have to do things a bit differently\u201d to achieve the above objective.<\/p>\n
The dti announced in 2014 that it would create 100 black industrialists in the next three years.<\/p>\n
\u201cThe reality is that [after] 21 years of democracy \u2026 [only 3% of the JSE is owned by black business, which] is an insult to the majority of our people,\u201d he said, ahead of his budget speech in Parliament.<\/p>\n
\u201cThey continue to suffer from unemployment and poverty and inequality and something different has to be done so this is what we\u2019re doing as a starting point,\u201d he said. \u201cSAA is just one programme in a greater scheme of what we\u2019re doing in the economy.<\/p>\n
\u201cIf we fundamentally want to change, we have to introduce programmes,\u201d he said. \u201cWe are resolute. We will do it.\u201d<\/p>\n
Masina said he found it puzzling that people would criticise the programme, as they\u2019re doing something similar to what the previous government did, but differently.<\/p>\n
\u201cWe have learnt a lot about what happened in the past. You will remember how IDC (Industrial Development Corporation) created [businesses like] Sasol …,\u201d he said. \u201cThere was a deliberate programme that was set up by the state.\u201d<\/p>\n
Masina\u2019s black industrialisation speech<\/strong><\/p>\n Masina\u2019s budget speech, which followed that of Minister Rob Davies, focused heavily on black industrialisation.<\/p>\n He said the Black Industrialist (BI) Programme referred to black people directly involved in the origination, creation, a minimum 51% ownership, management and operation of industrial enterprises that derive value from the production of goods and services at a large scale; “acting to unlock the productive potential of our country\u2019s productive assets for massive employment locally”.<\/p>\n He said black-owned manufacturing entities had \u201climited capacity to finance their industrial ambitions and have difficulty accessing private credit without productive assets to use as collateral\u201d.<\/p>\n \u201cThey are likely to pay higher interest rates on loans than their peers,\u201d he said. \u201cThis is added to the likelihood of being denied loans by funding institutions. It is in this context that we intend on using this Black Industrialists scheme to provide various support mechanisms to transcend these barriers to entry and growth.”<\/p>\n Advisory panel<\/strong><\/p>\n Masina said the Black Industrialists Advisory Panel was made up of experts from different sectors to help draw up a policy and implement framework.<\/p>\n He said draft policy proposed a combination of financial and non-financial support mechanisms intended to boost the industrial asset share of black industrialists. These broadly include:<\/p>\n Criteria for qualifying<\/strong><\/p>\n The central properties to this criteria is 51% black ownership, majority black management and control of the enterprise, and production of products with wide use in specified sectors of the economy, said Masina.<\/p>\n \u201cWe have prepared and will present a consolidated policy implementation plan before Cabinet. This will assist us to release, for public engagement, a final policy action plan from government to the people,\u201d he said.<\/p>\n \u201cWe have 40 applicants who volunteered as soon as we announced the idea of the BI programme,\u201d he said.<\/p>\n \u201cThey have not undergone any adjudication process, but will be processed alongside all other applicants when the implementation starts.<\/p>\n \u201cAs part of our implementation plan, we want to have processed and accredited 50 beneficiaries under the scheme by the end of 2015.<\/p>\n \u201cThis will increase to 100 at the end of the second year. This is in view of our three year medium-term objective of assisting 100 black industrialists.<\/p>\n \u201cThe third year will be used for preliminary assessment of the implementation and what reinforcement mechanisms are required as we leap into the future.\u201d<\/p>\n\n