How incentives and SEZs are creating jobs and uplifting poor areas, According to Rob Davies.
25 June 2018
Davies said his department has allocated a budget of R18.8bn allocation to enable the government to continue providing financial support to the private sector. The focus would be on labour-intensive sectors that will create jobs for the youth. In 2016-17 the Department of Trade and Industry spent R12.8 billion on grants, tax allowance schemes and loans - which was expected to generate R39.4bn in projected investments, R7.1bn in export revenue, and create 23,351 new jobs and retain 38.192 existing jobs.
Davies said the black industrialist programme, to date, has 79 projects, which have been approved, and the Total grants that have been disbursed by the department amount to R1.9bn, which has facilitated R6.9bn in investments. The sectors benefiting from black industrialist programme were plastic and pharmaceutical (R567m), agro-processing (R316m), metals (R279m), the green sector (R149m), and manufacturing and logistics (R116m). In 2016-2017, 88 projects were approved in the automotive sector, to receive grants of R3.6bn, related to project investment value of R12.4bn. Total investments of R3.9bn have been approved for 25 projects in 2016-2017 under the section 12i tax allowance incentives scheme with associated projected investments of R14.3bn. In the manufacturing investment programme about R400m had been disbursed under the programme and 26.030 jobs had been supported.
Within Special Economic Zones (SEZs) and industrial Hubs, Davies said R4.9bn had been allocated for industrial infrastructure projects over the next three years, these would help to expand economic opportunities in underdeveloped areas, some of the benefits received by corporations within SEZs include a reduced corporate income tax rate and employment tax incentives. Some of the highlights of SEZs have been the achievement of the Chinese company, Yangtze Optics Cable and its black economic empowerment partner, Mustek, which has invested R150m in a modern optical fibre cable manufacturing plant at Dube TradePort. While Saldana Bay has a pipeline of 34 investments worth R34bn and OR Tambo had attracted R260m in new investments that cover horticulture and metal refining.