29 November 2016 Lionel October Director General _25112016.pdfthe new Maggi 2 Minute Noodles with real Morogo was successfully launched by Nestle SA, ... Project delayed by one month

29 November 2016

Lionel October Director General

PRESENTATION OUTLINE

Strategic Goals and objectives

Second Quarter: Key Achievements

Financial Performance

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STRATEGIC IMPERATIVES

1. To facilitate transformation of the

economy to promote industrial

development, investment, competitiveness

and employment creation

2. Build mutually beneficial regional and

global relations to advance South Africa’s

trade, industrial policy and economic

development objectives;

3. Facilitate broad-based economic

participation through targeted interventions

to achieve more inclusive growth;

4. Create a fair regulatory environment that

enables investment, trade and enterprise

development in an equitable and socially

responsible manner;

5. Promote a professional, ethical, dynamic,

competitive and customer-focused working

environment that ensures effective and

efficient service delivery.

Grow the manufacturing sector to

promote industrial development, job

creation, investment and exports

Improved conditions for consumers,

artistics and opening up of markets

for new patents players

Strengthened capacity to deliver on

the dti mandate

A dynamic industrial,

globally competitive

South African economy,

characterised by

inclusive growth and

development, decent

employment and

equity, built on the full

potential of all citizens.

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INDUSTRIAL DEVELOPMENT

SG 1: Facilitate transformation of the economy to promote industrial development,

investment, competitiveness and employment creation

South African defence industrial group Denel and China's Poly Technologies signed a partnership agreement at the Africa Aerospace and Defence exhibition. The partnership is based on localisation as much as possible and to maximize the maritime supply chain in South Africa.

Three year wage and conditions of employment contract in place between National Union of Metalworkers of South Africa (NUMSA) and Original Equipment Manufacturers (OEMs) averting a potential strike.

Established fora for Medical devices, Clothing and textiles, White goods and electro-technical, are progressing well.

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Paramount has broken ground on the factory for its Advanced High-Performance Reconnaissance Light Aircraft AHRLAC at Wonderboom airport outside Pretoria and is moving ahead with the construction of the factory which will manufacture 24 aircrafts per year.

The AHRLAC was developed to fulfil a wide range of missions from border patrol, internal security and defence to disaster management and environmental protection.

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Picture by defenceWeb



investment, competitiveness and employment creation 7

Denel Land Systems unveiled the lightest 7.62 mm General Purpose Machine Gun in the world at the Africa Aerospace and Defence 2016 exhibition. Denel company also unveiled longer ranged versions of its 60 mm Commando and 60 mm conventional mortars.




As part of Supplier Development Program, the new Maggi 2 Minute Noodles with real Morogo was successfully launched by Nestle SA, Council for Scientific and Industrial Research (CSIR) and the Agricultural Research Council (ARC) and was applauded by the Minister of Science and Technology Ms Naledi Pandor

Launched the Mantusini Dairy Trust which was handed over a state-of-the-art dairy parlour in collaboration with Department of Rural Development and Land Reform and other stakeholders in July 2016, in Port St Johns Eastern Cape.

LAUNCH

the dti has launched a R290 million composite Floating Dock held at the Dormac ship-repair facility at the Port of Durban. The project will create more than 300 jobs.




The Department of Energy procured solar water heaters from the local industry in line with the designation published in 2013.

the dti has facilitated for a local company, Cobham to supply a new

version of satellite antenna for Airbus A320 and A330 aircraft. This is a 10 year contract and is expected to create 35 new jobs with total export orders of US$3.5 million a year.

National Research Foundation’s Research Vessel tender to the value of R1.8 million was awarded to NautiTech a company in Port Elizabeth.

Bombardier Transportation launched their Propulsion and Control facility in Elandsfontein in July 2016.


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Creamer Media Engineering News



AVK Valves launched their new plant in

Benoni in partnership with Premier Valves in September 2016.




Approved Strategic Partnerships Programme (SPP) guidelines previously known as Incubator Support Programme (ISP).

Over R15 billion of private sector investment leveraged across all incentive; some of the approved projects are Titanium Dioxide project by Siyanda Chrome Smelting, Goodyear; Bell Equipment & Nokeng Fluorspar Mine.

Over 19 000 jobs are projected to be retained and 3 300 new jobs projected to be created through these approvals.

TRADE, INVESTMENT & EXPORTS

Intellectual Property Consultative Framework approved by Cabinet in July 2016.

The Inter-Ministerial Committee on IP convened for an inaugural meeting in September 2016 and international consultative workshops were held in September 2016.

Southern African Development Community-European Union (SADC-EU)Economic Partnership Agreement (EPA) was ratified by Parliament in August 2016 and the Instrument of Ratification was deposited with the European Union in September 2016. The EPA will come into effect in October 2016.

SG 2: Build mutually beneficial regional & global relations to advance South Africa’s

trade, industrial policy & economic development objective 12


Significant numbers of trade leads were generated through the Foreign

Economic Offices , Trade Missions and National Pavilions resulting in 335 leads disseminated to SA exporters.

Improved participation by export stakeholders (Provinces, SEDA and Municipalities) resulted in 868 companies participating in the GEPP training against a target of 475.

Facilitated the Business Fora for two State Visits - India and France. The RSA - India – CEO forum launched as a result thereof. Memoranda of Understanding MoUs signed between the DBSA and the Agence Francaise du Development (AFD).




the dti received the prize for 3rd Best Stand for the RSA National Pavilion at FACIM in Mozambique despite opting for the enhanced shell scheme as opposed to the customised stand due to cost containment.

Facilitated South African business participation at Tokyo International Conference on African Development (TICAD) – Two separate MoUs signed between: Mizuho Financial Group of Japan and Standard Bank of

South Africa Mizuho Financial Group of Japan and the Development

Bank of Southern Africa.




Facilitated export sales of R1. 226 billion against a target of R1.1 billion as follows: On the spot sales = R171 million Six months report = R1.05 billion Total Sales: R1.226 billion Current Cumulative sales: R3.84 billion

In September 2016, the First Session was successfully hosted of the

SA-Mauritius Joint Committee of Senior Officials to implement the MoU on Economic Cooperation was successfully hosted.

In collaboration with private sector, State Owned Entities (SOEs) has undertaken two infrastructure specific technical missions to Egypt and Guinea (Conakry) respectively.





trade, industrial policy & economic development objective





July 2016 UNCTAD presented investSA with global winner award for excellence in partnering for investment promotion

September 2016 cfi.co United Kingdom, a renowned international business journal recognised investSA for its work in attracting investments to South Africa




South Africa currently ranks 73 on the ease of doing business globally

investSA hosted two very successful workshops with stakeholder departments and agencies (Q1 & Q2 dates) impacting

on the ten criteria with the view of improving the country’s ratings in 2017

SG2: Build mutually beneficial regional & global relations to advance South Africa’s



investSA was tasked by the IMC on Investment to coordinate the Top 40

Investment projects across government and

implementing agencies

These high-impact investment projects are in

Agriculture and Agro-processing, Agri-parks, Energy, Infrastructure,

Beneficiation and Manufacturing subsectors.

Of these 40 projects, 10 have been assigned high-priority status and will be

fast-tracked and monitored by the Investment Inter-

Ministerial Committee (IMC).

Across the 40 projects, investSA is co-ordinating

the completion of feasibility studies, and the provision of

regulatory and incentive support. Strong

partnerships between government, labour and the private sector are necessary

to ensure the successful operationalisation of the

priority projects

Presented to Cabinet Lekgothla in August 2016




Various MoU’s were concluded with Investment Promotion Agency counterparts for collaboration on: • Mutual investment

promotion activities; • Exchange of business

delegations; • Capacity building

interventions – conferences; seminars; business match making etc.




Site and design approved for the National One-Stop Shop to

be launched in Quarter 3 at the dti.

Letters have been sent to Ministers Premiers and Agencies

on OSS approach and staff secondment.

Consultations have been undertaken with provinces

KwaZulu Natal; Western Cape & Gauteng.

Consultations have been undertaken with SARS, Department of Labour;

Department of Home Affairs; and CIPC.

A Terms of Reference was developed for the provincial

roll out

Project delayed by one month due to supply chain

management process



SEZ & ECONOMIC TRANSFORMATION

SG3: Facilitate broad-based economic participation through targeted interventions to

achieve more inclusive growth 23

Sod turning ceremony of BAIC Automobile SA, in Zone 1 Coega IDZ,

Eastern Cape in August 2016.



achieve more inclusive growth

The Black Industrialists and Trade Invest Africa units lead a Trade mission to Nigeria with six Black Industrialists, to seek trade and investment opportunities in September 2016.

Six adjudication meetings have been convened- 22 Black Industrialist supported with over R1.4 billion- more than 1000 jobs supported, mainly in Agro-processing, clothing and textile, Plastic, Automotive components, and pharmaceutical, Electro Equipment and Metals sectors.

Engagements to support Black Industrialists were held with:

Private sector: Massmart, Woolworth, SA Capital Equipment Export

Council, Tiger Brands, General Electric, and Bell Equipment; Ford Motor Company, Automotive Industry Development Centre (AIDC).

Provincial government: Limpopo, Free State and KZN Provincial Economic Development Departments

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Sites visits were conducted at IBM and Dell in July 2016 and August 2016 respectively. Following these visits, the multinationals were also afforded an opportunity to present their progress reports to the entire Committee meeting held on in September 2016.

The establishment of the B-BBEE Verification Professional Regulator is currently underway and the proposed Structures have been developed and accepted internally.

AgriBEE, Forestry, Financial Services, and ICT Sector Codes have been finalised and submitted to the Minister for approval.

Construction Sector Code has been approved by the Minister and it is being gazetted for 60-day commentary period.

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the dti hosted a Celebration of Service event at the Pretoria Secondary School on 23 August 2016 with partners including Tshepo500k program of the Premier’s Office, President Awards Unit, Basic Education, Correctional Service and BPW (Women’s Association).

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LEGISLATION AND REGULATION

Approval of the publication of the Gambling Amendment Bill and the Liquor Amendment Bill by Cabinet for public consultation.

Approval of the Final Liquor Policy and its publication.

Completion of the National Economic Development and Labour Council (Nedlac) consultation process on Copyright and Performers Protection Amendment Bills.

A consultation with internal stakeholders on the Companies Amendment Bill has been completed. Inputs received from stakeholders incorporated into the policy and drafting of the Bill has commenced.

SG 4: Create a fair regulatory environment that enables investment, trade and

enterprise development in an equitable and socially responsible manner 27

ADMINISTRATION & CO-ORDINATION

SG 5: Promote a professional, ethical, dynamic and competitive and customer–focused

working environment that ensures effective and efficient services delivery 28

Production of two new flagship publications which will be officially launched before the end of 2016: State of Manufacturing; publication and State of Investment publication.

Drafting and presentation of the dti led Nine Point Plan elements to the Economic Cluster Project Management Unit, DGs Economic Sectors, Employment and Infrastructure Development (ESEID) Cluster, FOSAD workshop and Ministers Cluster.

Top 40 investment projects publication produced for Cabinet Lekgotla and

BRICS summit.

ADMINISTRATION & CO-ORDINATION

SG 5: Promote a professional, ethical, dynamic and competitive and customer–focused

working environment that ensures effective and efficient services delivery

50% of women in senior

management

3.3% people with disability

Vacancy Rate at 2.3% against

Quarterly target of 5.2%

(SMS) Senior Management Service

All eligible creditor payments processed well within 30 days with

99% processed earlier within 15 days.

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As the department reaches a halfway mark into the 2016/17 financial year,

spending stood at R4.5 billion or 79.5 per cent of the YTD budget of R5.7 billion.

Of the R4.5 billion spent by the department, transfers to incentives were 52 per

cent, followed by other transfers at 33 per cent, and Compensation of

Employees as well as Goods and Services at 9 and 6 per cent respectively.

FINANCIAL PERFORMANCE – 30 SEPTEMBER 2016

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Transfers and subsidies - Incentives

In pursuit of the department’s mandate to facilitate the transformation of the economy to

promote industrial development, investment, competitiveness and employment creation, an

amount of R2.5 billion or 71% was disbursed to companies. The variance of 29% is mainly due

to:

• Outstanding claims for processing not yet received from various companies (i.e. for

Enterprise Investment Programme and Manufacturing Competitiveness Enhancement

Programme).

• Funds earmarked under the Automotive Production and Development programme could

not be disbursed as a due diligence process must first be conducted before claims are

processed for payment.

• Claims due for processing not yet received from applicants as well as outstanding

compliance documentation required from the applicants to finalise claims.

FINANCIAL PERFORMANCE CONT…

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Transfers and subsidies – other transfers

Included under other transfers are funds disbursed to public corporations,

departmental agencies, non-profit organisations as well as foreign governments

and international organisations. For the reporting period, an amount of R1.4

billion or 91% was disbursed, a lag in the projections is mainly due to the

outstanding compliance documentation required to finalise disbursements.

FINANCIAL PERFORMANCE …CONT

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The variance of 9% relates:

- to an amount of R118.3 million projected under IDC could not be disbursed due

to outstanding compliance documentation.

- funds projected under Centurion Aerospace Village could not be disbursed as

the Memoranda of Agreement was not being finalised.

- Payments were made in October 2016.

Compensation of employees

• Expenditure as at 30 September 2016 compared with the allocated budget of

R930.3 million is R454.2 million or 48.82%. However, when compared with the

YTD projections of R462.5 million, expenditure is R454.2 million or 98%.

Goods and services

• Expenditure as at 30 September 2016 compared with the allocated budget of R596 million is R274 million or 46.01%. However, when compared with the YTD projections of R301.9 million, expenditure is R274 million or 91%.

• The variance of 9% is due to funds that could not be disbursed as invoices for

services rendered were not yet received from the service providers.


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Table 1: Per programme

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Programme

Revised Budget 2016/17

Year-to-date (YTD)

Available budget

% budget available

YTD Cash flow

projections YTD

Expenditure

Variance (Budget less expenditure)

% variance

R’000 R’000

R’000

R’000

%

R’000

%

Administration 736,625 389,397 346,918 42,479 10.91% 389,707 52.90%

International Trade and Economic Development 126,383

53,999 49,358 4,641 8.59% 77,025 60.95%

Special Economic Zones and Economic Transformation 108,282 47,702 46,791 911 1.91% 61,491 56.79%

Industrial Development 1,735,679 1,202,329 1,065,621 136,708 11.37% 670,058 38.60%

Consumer and Corporate Regulation 313,525 203,011 193,694 9,317 4.59% 119,831 38.22%

Incentive Development Administration 6,922,407 3,540,164 2,526,285 1,013,879 28.64% 4,396,122 63.51%

Trade Export South Africa 336,539 253,767 291,633 (37,866) (14.92%) 44,906 13.34%

Investment South Africa 48,077 22,860 19,216 3,644 15.94% 28,861 60.03%

Total 10,327,517 5,713,229 4,539,516 1,173,713 20.54% 5,788,001 56.04%

FINANCIAL PERFORMANCE …CONT Table 2: Per economic classification

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KE YA LEBOGA

KE A LEBOHA

KE A LEBOGA

NGIYABONGA

NDIYABULELA

NGIYATHOKOZA

NGIYABONGA

INKOMU

NDI KHOU LIVHUHA

DANKIE

THANK YOU

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Documents

29 November 2016 Lionel October Director General _25112016.pdfthe new Maggi 2 Minute Noodles with real Morogo was successfully launched by Nestle SA, ... Project delayed by one month