MOTOR and component manufacturers had given an "unequivocal vote of confidence" in South Africa by committing themselves to more than R15bn in investments in the country, Trade and Industry Minister Rob Davies said on Thursday.

His comments came in the wake of a strong call by the president and MD of General Motors in Africa, Mario Spangenberg, for government to tackle four areas — labour, administered prices, competitive suppliers and education — which he said were impediments to conducting business in South Africa.

According to Mr Spangenberg, the market for new vehicles in Africa would reach some 2-million units in 2016-17.

Mr Davies noted in a ministerial media briefing on infrastructure and job creation that next year component exports of R40bn were projected to rise 13% and vehicle exports of an estimated 280,000 units were projected to increase to 361,000 units.

Also assisting the industry was the approval by the Industrial Development Corporation (IDC) of a funding mechanism to promote the localisation of component manufacture.

Mr Davies said that the roll-out of the automotive investment scheme would support about 63,000 jobs over a three-year period. He said the department would shortly be publishing a road map for the introduction of electric cars into the South African market. This would involve both the setting up of infrastructure and a support programme for manufacturers.

Economic Development Minister Ebrahim Patel believed the weaker rand, if maintained, would provide motor vehicle exporters with an important competitive edge in their battle to win a share of African markets against their Asian and European rivals. He said the rand had moved into "a much more competitive range".

Mr Davies said that state assistance for the clothing, textiles, leather and footwear sector had brought some stability to an industry which was shedding thousands of jobs a few years ago. About R148m had been approved for 123 companies under the clothing textile competitiveness programme, which would support 49,888 jobs out of a total of about 101,000 in the sector. The IDC had approved an additional R501m, which was expected to create and save 2,400 jobs. Annual production in the footwear sector was expected to increase from 52-million shoes to 100-million over the next three years.

Mr Davies said that incentives valued at R736m had been disbursed by his department over three years to agro-processors, while R3.7bn had been facilitated in the food-processing sector. This supported the retention of 14,000 jobs and created 7,000 jobs. There was an investment pipeline of R942m in agro-processing.

 

Source : bdlive.co.za