SA to invest US$755 million into manufacturing

Rob_Davies_-_SA_TradeSA trade minister Rob Davies announced that financial support would make its way to manufacturing businesses across the country. (Image source: World Economic Forum/Eric Miller)

South Africa's government has announced plans to boost the country’s flagging manufacturing industry by investing R5.8 billion (US$755 million) into the sector over the next three years

Trade minister Rob Davies said that the Manufacturing Competitiveness Enhancement Programme would channel funds towards businesses that have struggled due to the global economic downturn, enabling them to upgrade their facilities, improve products, train staff and build industry networks.

Global economic uncertainty and volatile exchange rates have caused havoc to South Africa’s manufacturing sectors.

“The barrier to us trading among ourselves is infrastructure,” said Davies. “We don't have infrastructure that joins us – we only have infrastructure that takes raw materials to the port.”

In a statement, the Department for Trade and Industry said the funds would go towards “upgrading the competitiveness of relatively labour-intensive and value-adding manufacturing impacted by the currency, the global economic crisis and electricity cost escalations”.

The announcement formed part of the latest version of the Industrial Policy Action Plan (IPAP), which the department said would see the Industrial Development Corporation (IDC) investing a total of R102 billion (US$13.3 billion) in IPAP sectors over the next five years.

“Our experience in the implementation of the plan demonstrates that industrial policy works, provided it is well designed, adequately resourced and informed by robust and constructive stakeholder dialogue and partnerships – this has been demonstrated in a number of sectors,” remarked Davies at the launch of IPAP 2012/13.

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