South African Business 2016 edition

SPECIAL FEATURE owes its

SPECIAL FEATURE owes its existence to the minerals that make up the converters, and one of the central planks of the South African government’s economic policy is to ensure that value is added to the country’s mineral resources. The country already has many steel mills and aluminium smelters, but many thousands of tons of raw materials are exported in their raw state. A number of Industrial Development Zones and Special Economic Zones have been set up and promulgated in order to attract investment as well as to increase local manufacturing capacity. The automotive industry is one of South Africa’s most important sectors and accounts for about 12% of South Africa’s manufacturing exports, with many of the major multinationals using South Africa to source components and assemble vehicles for both local and international markets. Energy The country has been through a challenging period during which there have been serious energy constraints. These have proved to be SOUTH AFRICAN BUSINESS 2016 14

SPECIAL FEATURE beginning with a plan for improved maintenance of existing Eskom power stations, enhancing the electricity generation capacity and managing the electricity demand. The long-term plan involves finalising South Africa’s long-term energy security master plan. “As a priority we are going to stabilise Eskom’s finances to enable the utility to manage the current period,” said Zuma, adding that government was supporting Eskom with R23-billion for the 2016 fiscal year. Agriculture Agriculture is a catalyst for growth and food security and there is a strong public-private sector drive to develop an Agricultural Policy Action Plan aimed at bringing one million hectares of under-utilised land into full production over the next three years. “Among key interventions this year, we will promote the establishment of agri-parks or cooperatives and clusters in each of the 27 poorest district municipalities to transform rural economies,” said Zuma. An initial funding of R2-billion was made available for the agri-park initiative, while the country’s agro-processing exports are attracting positive interest in new markets through Africa and China for the export of South African maize and apples to China. Apple exports alone are projected to yield R500-million in foreign exchange over the next three years. an impediment to economic growth and a major inconvenience to everyone in the country. Overcoming the challenge was uppermost in government’s programme. “Government is doing everything within its power to deal with the problem of energy shortage in the country. We are quite aware of the fact that this is indeed a difficult period, but it shall pass because we do have strategies in place to deal with this matter,” Zuma said. Government has developed a sustainable plan that involves short-, medium- and longterm capacity and infrastructure development, Infrastructure The National Infrastructure Development programme continues to be a key job driver and catalyst for economic growth. Major projects include the Umzimvubu Water Project in the Eastern Cape, Jozini Dam in Umkhanyakude in KwaZulu-Natal and projects in Bushbuckridge in Mpumalanga and phase one of the Mokolo Crocodile Water Augmentation in Limpopo. Progress to improve the water supply to areas affected by shortages are underway, but the war 15 SOUTH AFRICAN BUSINESS 2016