Programme Director
Members of the Executive Council present
NOCCI President, Mr Gert Klopper
CEO of NOCCI, Ms Sharon Steyn
Members of the media
Ladies and Gentlemen

It is a great honour for me to join you tonight; a day after we commemorated National Women’s day. As you may recall, sixty years ago 20 000 women of all races and ages marched to the Union Building in protest against the then pass laws. The march in itself has great significance for all South Africans. It was the day that women in particular said that we had enough of an unjust and inhumane system of racial segregation.

Tonight I stand here proudly before you in the district appropriately named after one of the stalwarts, Francis Baard, who led us on this historic road to emancipation. We are proud to have our roots deeply entrenched in the legacy of women of her calibre. I am deeply moved by her mantra as eloquently captured in her autobiography:
"My spirit is not banned – I still say I want freedom in my lifetime.

Ladies and gentlemen, the economy has recovered remarkably from being downgraded by three Global Rating Agencies. You are however aware that we will face another rating in December this year.  The implication of the country losing its investment grading would likely trigger capital outflows, rand weakness, higher inflation and interest rates and rising bond yields. This would impact on the public and private sectors alike as it would raise the cost of investment.

The informal economy, as you will all notice, thrives in the context of high unemployment, underemployment, poverty, gender inequality and insecure work. It is also relatively easy to enter as there are no educational requirements, skills or technology barriers. It is important to note however, that most people enter the informal economy not by choice, but out of a need to survive and have access to basic income-generating means.

StatsSA has indicated that during the first half of 2016, economic growth in the country decreased by 1, 2% and was driven by declines in the mining sector; which decreased by 18, 1% as a result of lower production of platinum group metals and iron ore. The agricultural sector also declined by 6, 5% whilst battling an on-going drought.

One of the more critical challenges facing the South African economy is the prevention of a sovereign rating downgrade to sub-investment grade. We know that a sovereign downgrade would have ripple effects that will reverberate throughout the economy and will be felt by businesses and households alike.

The ratings agencies have cited factors such as the shortage of electricity which is constraining growth, rising Government debt, weak business confidence, the challenging environment for doing business, and uncertainty caused by proposed policies not conducive to growth. In addition to the matters raised by ratings agencies, the South African economy is challenged by acrimonious labour relations, low consumer confidence, severe drought, and weak export performance, among others.

Many of these factors however are domestic and therefore within our control and therefore I want to assure you that each of them is receiving the full attention of the Northern Cape Provincial Government.

Ladies and gentlemen,

The Northern Cape economy grew by a record 2.8% during 2014, an impressive improvement from the 2.2% recorded in 2013 but slightly below the 3.2% recorded during 2012, which was propelled by growth in the tertiary and primary sectors. This 2.8% registered growth in 2014 is testimony to the resilience of our provincial economy. Another telling factor is that the provincial economy is mostly at the mercy of factors outside the realm of the economy. The provincial economic growth in 2014, was spurred on by mining (6, 7%), agriculture (4, 2%) and construction (3, 2%).

We acknowledge Statistics South Africa’s (StatsSA’s) latest Quarterly Labour Force Survey (QLFS), which indicates the unemployment rate stood at 27,4 % at the end of the second quarter of 2016. The Community Service sector continues to be the biggest employer in the provincial economy, employing roughly 84 000 people (27.8%). This is despite shedding over 7000 jobs in the first quarter of 2016.

The trade sector, managed to keep its second spot, through increasing its employment levels by almost 3 500 jobs in the first quarter of 2016. The Trade sector was responsible for almost 18% of all employed in the province.

I am particularly pleased to announce that we have managed to increase the number of employed youth in the Northern Cape. We have managed to employ 142 625 young people in 2016 as opposed to 125 786 in 2009. The statistics prove that as the Northern Cape Provincial Government we remain focused on developing and empowering young people. We have demonstrated our willingness to addressing the challenges faced by young people head on and we will continue to do so.

Ladies and gentlemen, economic growth prospects for the province, as reflected in this year’s Provincial Budget Statement has been amongst the lowest since 1994. This has cast doubt in terms of the Province’s capacity to address the most imminent challenges, amongst which job creation is central. This outlook will however assist us in charting the way forward in terms of government and private sector interventions on economic growth in the province.

In order to address the issue of unemployment in South Africa, the country would need to employ 2.2 million of the 4.4 million unemployed. This would require radical economic transformation. Small, medium and micro enterprise (SMME) development can and must be at the centre of this transformation, as its impact can be massive and this is why small business must be seen as big business in South Africa.

The support that the South African government provides for small, medium and micro enterprises (SMMEs) is widely acknowledged as the country’s effort towards economic restructuring and poverty alleviation.

We as government recognise the likely or potential impact the SMME sector can make in the creation of employment. In this regard the Department of Economic Development and Tourism has allocated approximately R 86 million, with a mandate to create an enabling environment, to create jobs and ensure greater diversification of economic activity.
Approximately 47% of this budget is in unlocking the potential of SMMEs and Cooperatives and Rural Enterprises, as mandated by the Nine Point Plan as a result 210 SMMEs and 91 Cooperatives were assisted through the provision of both financial and non-financial support services. This translates to the rendering of support to 112 existing SMMEs and 98 new SMMEs as well as 32 existing and 59 new cooperatives.

Small Business Development will focus on the “game changers” for both SMMEs and cooperatives as conceptualised in the Nine (9) Point Plan.

Our efforts to expand access to funding for small businesses across the Province will result in the establishment of an Enterprise Development Fund for the Province in partnership with the National Empowerment Fund (NEF). The Economic Growth and Development Fund (EGDF) policy is being reviewed to ensure a greater geographical spread of disbursement of the fund and an equal spread across the economic sectors in support of SMMEs.

This brings me to the point that Small businesses therefore needs to focus the manufacturing sectors that lend itself to value addition and the production of goods that are required in the economy. These sectors are those focused on in the National Development Plan and are amongst others renewable energy, mineral processing and agro-processing.

We would therefore like to encourage Businesses to conduct research regarding those products that are imported from other countries and focus on producing those products locally. This would enable us to export the products to those countries that require it as well.  This is especially lucrative in instances where the rand weakens against other currencies.

Businesses also need to look at opportunities for expansion and invest in infrastructure to increase its capacity and in so doing create much needed employment. As the Provincial Government, are in the process of collaborating with the Department of Trade and Industry to establish a Special Economic Zone in Upington. The Upington SEZ will have a primary focus on solar components manufacturing and maintenance.

Ladies and gentlemen, if opportunities for procurement are to be given to local entrepreneurs, it will reinforce the businesses sustainability and job security. Too often, opportunities go to service providers outside of the province such as the transportation of mineral ores that is given to companies outside of the Northern Cape while those that could provide the services locally get overlooked and enterprise development suffers as a result.

In our endeavour to radically transform the economy, we will be hosting three key summits in the forthcoming financial year. These summits will focus on resolving the energy challenge, advancing beneficiation or adding value to the mineral wealth and unlocking the potential of SMMEs, cooperatives, townships and rural enterprises which are three key components of the Nine Point Plan to radically transform the economy. The proposed structural measures, mentioned by the Rating Agencies, will also be addressed during these summits.

We regard the youth as one of the key change agents in transforming the economy. The Province has just hosted a Provincial Youth Summit to address the triple challenges of poverty, inequality and unemployment especially impacting the youth. One of the key outcomes of the summit includes is the finalisation of the Northern Cape Integrated Provincial Youth Development Strategy, guided by the National Youth Policy 2020, which seeks to create an environment that enables the young people of South Africa to reach their potential.

We are mindful of the economic challenges that affect South Africa and the Northern Cape, and as a result, the Northern Cape Integrated Provincial Youth Development Strategy which we resolved on must identify the mechanisms and interventions that will act as catalysts to help clear critical blockages and achieve this positive environment for young people to realize their potential by enhancing their capabilities to transform the economy and the country.

Important to note; is the fact that the success of the implementation of the creation of the developmental state, the Provincial Growth and Development Plan and the Provincial Economic Blueprint to address the quest for radical economic transformation depends on the active involvement of our delivery partners. Our approach to governance places strong emphasis on building a broad front for development that involves a strong relationship between government, labour, and business as well as civil society.

We understand that government alone cannot grow the economy, solve all the community problems or deliver all the services to bring about a better life for all our people. Government needs to work together with all social partners and involve everyone in the effort to develop our country and our Province.

In order to radically transform the economy of this Province we need to embrace “The People’s Contract”.  “The People’s Contract” is a phrase that sums up much of what we as government and business need to heed towards achieving. Government will work with all sectors in our society to build a better life for all.  We are in the process of developing an Economic Blueprint for the Province to increase investment and align it to the Provincial Growth and Development Plan (PGDP) which is currently being developed. This Economic Blueprint will be based upon the country’s Planning and Policy Framework.

To achieve radical economic transformation we need a capable and developmental state, a thriving private sector and strong civil society institutions with shared and complementary responsibilities. We will therefore during the course of this year forge a closer relationship with the Private Sector, Chambers of Business, State Owned Entities, Development Finance Institutions and other.

I wish to thank you once more for allowing me to share some thoughts with you this evening and wish you well with this second business expo that will enhance how we do business in the Northern. Working together we can grow business, create jobs and move this beautiful Province of ours forward.

I thank you