Indaba gears up to revitalise the manufacturing industry

The Indaba is being held at at Emperor’s Palace on Tuesday and Wednesday (June 27 and 28) at Emperors Palace in Kempton Park.

As a precursor to the fourth annual Indaba, a Small Business Indaba was held yesterday (Monday, June 26), focusing on the growth opportunities for emerging entrepreneurs in the  manufacturing sector.

The Indaba is hosted in partnership with the Departments of Trade and Industry, Science and Technology and Public Enterprises, the National Cleaner Production Centre and the Manufacturing Circle that is made up of a number of South Africa’s leading medium to large manufacturing companies from a wide range of industries.

Key in the deliberations of the Indaba will include accelerating growth for manufacturing sectors such as automotive, construction, metals, forestry, packaging, aerospace and defence, amongst others.

Nkosindiphile Xhakaza

MMC Nkosindiphile Xhakaza said in his welcoming address at the start of the Manufacturing Indaba that it is hoped that the metro will benefit immensely from the insights that will be shared by the leaders in the manufacturing sector, in government, in research and development institutions and the investor community in general.

“The manufacturing sector in Ekurhuleni remains the largest contributing sector which accounts for 21.5 per cent of the total Gross Value Addition (GVA), followed by services sector at 20.7 per cent, and finance sector at 20.5 per cent,” said Xhakaza.

“The manufacturing sector in Ekurhuleni constitutes an average of 27.9 per cent to overall GVA in Gauteng.

“This accounts for 11.4 per cent of South Africa’s overall Gross Domestic Value Addition in the manufacturing sector. In this regard, it is clear that Ekurhuleni remains a manufacturing hub for both the province of Gauteng and South Africa in general.”

He said the manufacturing sector is a very critical pillar of Ekurhuleni’s overall economic life.

It has sustained the economy of our region over many decades. This sector has provided among the largest numbers of employment for the people of our region. Between 2002 and the 2008 Global Financial Crisis, the manufacturing sector provided employment to more than 150 thousand citizens of Ekurhuleni

“However, the dynamics of the global economy have had major negative effects for our domestic economy in recent times. These negative conditions escalated between 2008 and 2014 as the Global Financial Crisis intensified.

 

Essentially, global uncertainty and the fall in global demand have led to low levels of investment in our export sectors and particularly in manufacturing. There has been a troubling trend of a decline in export orders which has limited and sometimes pushed back production volumes which lead to a loss of jobs

“As an aggregate, the rate of employment in the manufacturing sector of Ekurhuleni has contracted by an average 13.7  per cent over the past 20 years.

“Although overall growth has started to pick up in the manufacturing and equipment clusters, employment creation has remained very low. This has been partly due to the fact that business confidence has remained quite lower than the required rate since the 2008 financial crisis.”

He said in the context of that high level of unemployment, we are faced with a pressing need to invest in economic sectors with high industrial capacity and a high rate of labour-absorption.

“Therefore, our regional economic imperatives are centred on strengthening our manufacturing industries as well as making strategic investments in the development of economic infrastructure such Township Industrial Estates, Township Industrial Parks, as well as reinforcing the culture of entrepreneurship by leveraging the municipality’s procurement spending to crowd-in investment and support local companies.”

He said the metro has committed R619 million over the next 3-year Medium Term Revenue and Expenditure Framework for bulk infrastructure rollout to support economic development.

  • Aerotropolis

“Our infrastructure investment programme is also linked to our Aerotropolis Masterplan which is our development strategy for building Ekurhuleni as an airport City that is a gateway to Africa and the world.

“We want to place Ekurhuleni as a strategic logistics centre for the entire South African economy; especially in providing beneficiation, storage and transportation of industrial products to external markets in the continent and the world.

“We have committed ourselves to increasing public sector investment in public and economic infrastructure as part of our contribution to making the costs of business cheaper.

“As already mentioned, our investments in capital projects are geared towards this end but we strongly need private sector investment in order to achieve the levels of growth that will create jobs and overall economic prosperity for our people.”

He called on business leaders to join the metro in its efforts to grow the economy.

  • Need for knowledge

“The manufacturing of more knowledge-intensive goods requires modern infrastructure, specialised and skilled employees, access to funding, access to new markets, advanced business acumen, advanced machinery and equipment, and a network of experts.

Our strategic efforts in this regard are going towards our campaign to have an Ekurhuleni University of Technology. A University of this nature will play an important role in skills development that serve the dynamic needs of a modernizing manufacturing sector.

“We want this future University to serve as the backbone of our regional research development and innovation that help improve our global competiveness by producing a large pool of skilled labour that will support private investment in manufacturing.

 

  AUTHOR
Riaan Engelbrecht
Editor

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