UMRABULO

SPECIAL EDITION

AFRICAN NATIONAL CONGRESS NGC DISCUSSION DOCUMENTS

NGC DISCUSSION DOCUMENT

ECONOMIC TRANSFORMATION FOR A NATIONAL DEMOCRATIC SOCIETY

INTRODUCTION

This year marks the 60th anniversary of the 1955 adoption of the Freedom Charter, a seminal moment for the mass democratic movement. This historic document is a commitment by the democratic forces to guarantee a better life for all South Africans. The Charter is eloquent in its appeals for freedom, economic justice and equality and it remains the cannon in our nation’s memory. Its powerful message must continue to inform our economic policy and our actions. [Paraphrasing a statement by the Economic Policy Institute, EPI]

This is a year, we recommit ourselves to accelerate economic upliftment for all South Africans. The exploitation of the country’s resources cannot flourish alongside starvation, poverty, unemployment and inequality. We want economic emancipation for all and with it, we will promote the responsibility that goes with equitable share to the wealth of the nation. In promoting the Charter’s message of freedom, we need to mobilise all our policies and institutions towards meeting the economic goals of the Freedom Charter. We want the vision contained in the Charter to be a commonplace in the daily experiences of South Africans.

At the core of the ANC’s economic mandate is the transformation of the economy for inclusive growth. At the heart of radical economic transformation is an effective state that is decisive in its pursuit of structural change.

In addition, transformation is about capability and action: the means and the end. Our policies must provide the most enabling conditions for the flourishing of the talents of all our people, to harness and develop their productive potential, to ensure that they play a leading role in the allocation of national resources and that they get their due in the country’s wealth.

Proceeding from this premise, in Mafikeng, we said “Economics is about people, their work, their ownership of productive assets or lack of it, their share of what they produce, what they buy and sell, their accommodation, their recreation, in fact every element which we describe as quality of life, flows from the structure and management of the economy”.

Our policy interventions must retain a hegemonic status in the face of their ability to resonate with improving day-to-day economic realities. Therefore, we recommit to a transformation of the economy in ways no less radical than the one demanded by the circumstances of our people.

The state must therefore play a key role in stimulating national development. This includes the infrastructure build programme, partnership with the private sector, targeted procurement and dealing with binding constraints such as weak energy supply.

Realising these ambitious goals of economic transformation requires moving forward in a number of areas such as ICT, transport, food and energy security, transforming ownership and control. These are the many interwoven dimensions of development.

1.1 THE NATIONAL DEVELOPMENT PLAN (NDP) 

The National Development Plan(NDP),adopted in 2012, is the visionary blueprint of government, business and society as collaborative partners; towards achieving the range of socio-economic growth and development targets by 2030. Giving effect to this long range plan is a series of Strategic Frameworks such as the NGP, IPAP, the National Infrastructure Plan, the MTSF’s that identify the critical actions to be prioritised towards NDP 2030.

The NDP is a long term vision which should be supported by the instruments such as above. Alliance partners:

- are agreed about the need for national long range planning;

- recognise the planning commission’s contribution in this context;

- agree that the NDP is a living document not cast in stone and needs to be adjusted where appropriate.

1.2 THE ESSENCE OF THE NGC

Within this context, the ANC tasks the NGC to review progress against conference resolutions in order to meet the challenges of transforming South Africa.

Through this process, we must:

- improve and assess our relevance, responsiveness, and effectiveness

- analyse lessons learned through the implementation of the resolutions, and

- assess the existing and emerging development challenges.

Non-implementation or inefficient implementation of our conference resolutions, are capable of subverting transformation.

While it is practically impossible to cover every detail of progress since our last conference, the NGC is an appropriate occasion for highlighting recent progress against the most important issues of the ANC to the transformation of South African Society.

2. MACRO-ECONOMIC OVERVIEW

2.1 Stagnant Global Economic Growth

The global economy remains mired in a low growth trajectory, and there is little evidence of a strong recovery despite the growth of 3.4% expected in 2015, which is still insufficient to reverse output and job losses in most economies. The fall in the oil price generates clear opportunities for oil importers like South Africa, but the combination of lower commodity prices, weaker global demand and higher interest rates could lead to weaker growth outcomes on the African continent.

A relatively subdued economic performance as reflected by the world GDP growth, is of concern as demand for South African produced goods and/or services could be adversely affected. Weak Eurozone demand for South African-manufactured exports and reduced demand for our mining and processed metal sector commodity exports from China’s slowing economy is expected to continue to impede South Africa’s economic growth.

The core structural weakness of South Africa’s economy is its continued incorporation into the global division of labour as producer and exporter of primary commoditites, and importer of value- added, manufactured products. This growth trajectory – typical of many colonised countries in Africa – constrains our ability to create jobs at an appropriate skill level and in sufficient numbers to address South Africa’s unemployment challenge, and bestows the benefits of local value-addition (jobs, company profits which can be re-invested in the economy, tax revenue and industrial deepening) on our trading partners.

Given the current and forecast subdued demand for South Africa’s key commodity exports and weak prices, our current growth trajectory cannot be sustained, nor has it proven to be supportive of inclusive growth.Very few countries have been able to achieve sustainable growth, job creation and declining inequality based on a commodity export growth path. It is consequently imperative that we act decisively to industrialise, add value to local and regionally available commodities, and grow the productive sectors of the economy.

The African continent has become a very important destination for locally manufactured products and its relative share is expected to expand further. Moreover, substantial investment in Africa’s infrastructure, rapid urbanisation, and a fast-growing and increasingly sophisticated consumer market all provide improved trade and investment opportunities for South African businesses.

It is therefore crucial for South Africa to improve the competitiveness of the domestic environment – including moderating administered price increases, reducing the anomalous port and freight subsidies for commodity exporters and better managing the level and volatility of the Rand – so as to grow the pool of industrialists exporting to their traditional markets while also finding alternative markets, primarily in the relatively faster growing African, Asian and Latin American economies. This improved growth outlook for Sub-Saharan Africa (over 5% in 2015) and the African continent should provide export opportunities for South Africa’s tradable good and services.

Continued infrastructure development, investor appetite for the region’s mineral and agricultural resource wealth, and strong domestic consumption spending should support these rates of expansion. Intra-African trade is unfortunately dismally low (around 10%) comparatively, with very slow progression and also quite imbalanced to the advantage of South Africa with no clear framework and firm commitment to enhance Intra-African trade.

Compared to its peers, in the graph below, South Africa is shown as a serious underperformer. Growing at rates that are out of sync with its peers.

Despite a low interest rate environment, private sector investment has fallen since the 2008 crisis and remains weak. Consumption-led and import-intensive growth has evaporated with dangerously rising household indebtedness and the emergence of a substantial current account deficit. In the past 3 years, prolonged strikes in the platinum and manufacturing sectors, and at the South African Post Office have severely disrupted economic growth.

In response, the following key interventions were adopted in an attempt to stimulate inclusive growth and investment in the domestic economy. While these interventions have prevented job losses, they have not shifted the economy onto a new sustained inclusive growth path.

- Counter-cyclical fiscal policy aimed at maintaining aggregate demand through continuing planned levels of government expenditure despite a slowdown in tax revenues. If a counter-cyclical fiscal stance had not been adopted, more jobs would have been lost and the growth rate would have been lower. Now, despite the fact that growth has not returned, the limits of counter-cyclical fiscal policy are being reached. Rising government debt and a wide current account deficit make South Africa vulnerable to global economic shocks.

- Public infrastructure investment driven by government and state owned enterprises. There has been a substantial increase in public investment and related jobs since the crisis. While infrastructure is an essential pre-requisite for increased investment and employment, such infrastructure comes at a cost and, in addition to putting pressure on the fiscus, is also putting upward pressure on the cost of living and the cost of doing business, an effect that is particularly amplified in a low growth environment.

- Active industrial and trade policy measures aimed at stimulating investment in industrial activity and promoting South African exports: Effective industrial policy requires cohesive interventions acros a range of sectors including mining, manufacturing, technology, agriculture, tourism and many others. However, in many cases, the Industrial Policy Action Plan (IPAP) has not gained traction across the relevant implementing agencies/departments.

Figure 1: The Growth of SA compared to its emerging markets peers

- Broad Based Black Economic Empowerment Act has been accelerated to transform ownership patterns. 

A review recent review will close a number of loopholes, and deal with firms who engage in ‘fronting’ to better align our B-BBEE imperatives with the need to promote industrialisation of the SA economy. To facilitate a more meaningful participation of black people in the mainstream economy government is now looking at various ways of developing and sustaining black industrialists, including a targeted incentive to support black entrepreneurs entering the industrial sector.

Despite these interventions, growth remains too low and job creation insufficient. A key constraint to achieving our industrial growth is the national electricity shortage. Our historical energy-intensive growth path will not be viable into the future and other comparative advantages need to be levered to promote industrial growth and job creation. Job creation is further impeded by high tariffs and the reliance on electricty for revenue by municpalieis that sometimes leads to excessive mark-ups.

External demand also remains low, as growth in many of South Africa’s overseas trading partners remains weak, retarding investment. The international markets are important for our growth as firms form investment decisions by considering the growth of the markets they serve.

The vision of the developmental state has not in general been backed by effective state capabilities. Weaknesses in the delivery of a wide range of public services, including, water supply, electricity supply, municipal services, postal services and education, health and security services, have been realities, which undermine the vision of the developmental state articulated through our national development plans (NDP and NGP), to provide policy guidance and promote future investment This situation is exacerbated by apparent lack of consensus on the programme from within the ruling Alliance.

The public sector must strengthen its planning capacity and project management skills. It will also be important that the state look to reduce wastage and corruption, while increasing the general efficiency of public spending. It will be most important to increase the focus on improving the outcomes that are achieved from the more limited resources available.

2.2 State-led investment for industrialisation 

The NDP envisages that over time annual public and private investment levels should be raised from the current 19% to 30% of GDP.

State-led economic transformation does not imply that the state can go it alone in driving development. Rather, successful state-led investment must serve as a catalyst for increased levels of private sector investment. Recently there have been claims of trust deficit between government and the business community. Such alleged trust deficit has to be closely scrutinised because the business community is not homogenous.

The state-led public investment programme provides a strong stimulus to growth and employment, but it can never be of sufficient magnitude to uplift the whole economy. At about 30% of total investment, public-sector investment, can only serve as a catalyst to facilitate, ‘crowd-in’ and increase private sector investment which contributes 70%.

Investment by state owned enterprises rose sharply from 2007 and continued to grow at a lower rate after 2008. General government investment (mainly construction of social infrastructre like hopsitals, schools and police stations) remained low during the recession, but is now growing strongly. However, private sector investment remains very weak.

Some, on the left, argue that low private sector investment proves that South African capital is unpatriotic, that it is on an investment strike and that it would be better if the state enlarged its role in order to advance economic transformation.

Others, on the right, argue that it is in fact the state that is retarding private investment, that if more state assets had been privatised and the state had reduced its role in the economy then growth and investment would have been higher.

Others argue that private businesses have not been able to identify and implement profit-making investment projects over the past few years, despite being relatively cash-flush as represented by their high levels of corporate savings.

None of these arguments grasp the fundamental issue that the inclusive reconstruction and development of South Africa requires a vibrant and dynamic mixed economy in which there is a synergistic and mutually re- enforcing relationship between the public and private sectors. Most crucial is to craft a balance between the contributions of public and private sectors in rolling out the economic transformation agenda.

The priority now is to identify and remove obstacles to increased levels of private sector investment, while sustaining the public sector’s contribution. Among others, the following items should be foremost on the agendas of public and private sector decision-makers aimed at increasing investment levels in South Africa:

- maximise localisation benefits from South Africa’s ongoing public infrastructure expansion, particularly in power and rail

- support black-owned industrial firms in particular to be part of South Africa’s infrastructure expansion

- leverage state rights (minerals, land, water, air, fisheries, etc.) to maximise economic growth and transformation

- leverage local demand to link into global market supply chains

- successfully implement the newly launched Special Economic Zones

- deepen trade and investment ties with other African countries and with other important growth regions

- raise mining investment, output and linkages into the economy

- unlock South Africa’s significant potential as an onshore and offshore gas producer, in an environmentally responsible manner

- accelerate land reform and grow the number of successful black farmers participating effectively in the agricultural economy

- improve telecommunication infrastructure and increase sector competition

- leverage our maritime position, including through ship-building and repairs, trans-shipment hubs and expanded ocean trade

- grow the tourism sector .

If consensus, and effective action, were to be achieved on issues such as those listed above, there is no doubt that investment levels in South Africa would rise towards the NDP’s investment target.

We recognise, however, that increased investment is unlikely to be sufficient, given the scale and historical damage wrought by South Africa’s structural unemployment problem. Redistributive activity, social security safety nets and public and community work projects run by the state will all be necessary for stability and social cohesion. The fiscal benefits arising from increased investment will provide the resources required to run our redistributive programmes, which are crucial to the wellbeing of so many South Africans.

An incisive and frank analysis of causes of the constant de-industrialisation and lacklustre progress on beneficiation and localisation drive is essential. These are some of the strategic opportunities to turn around the economic strain and create the much-needed jobs as well as opportunities to realise Broad-Based Black Economic Empowerment.

Figure 2: Investment trends: state owned enterprises, private sector and general government

3. ECONOMIC SECTORS

In the 53rd Conference, we resolved to “ensure long term stability and sustainable growth and development that bolster the growth of domestic industrial capacity and in making policy trade-offs will select those that favour productive sectors of the economy”. This means we have prioritised re-industrialisation and we will employ a battery of tools within our policy space to privilege productive sectors. The 53rd Conference also emphasises the NGP and the IPAP make up “the industrial policy action plan which guides the re- industrialisation of the South African economy”.

Production and employment in the

Figure 3:

Employment levels in the manufacturing sector have been falling since 2008

- Diversifying trade and investment particularly focusing on the African continent and countries of the South through the SADC Regional Industrial Development Strategy; the SACU Industrial Policy study and COMESA-EAC-SADC Tripartite negotiations. Progress has also been made on the BRICS initiative. However, little progress has been made towards regional economic integration and the poor state of regional trade infrastructure (logistics) constrains intra-regional trade. There is scope to further trade and investment through effective use of economic diplomacy.

- Reviewed and optimised our approach towards BBBEE: Interventions aimed at de-racialising ownership of economic assets, including enterprise development, should be intensified. Broadening ownership and participation by our people as part of democratising our economy, combating anti-competitive behaviour and overcoming entry barriers that inhibit SMME’s, co-operatives and Black people from breaking into the value- chains of our economy.

In de-racialising patterns of ownership, it is important that we put job creation and productive activity at the forefront and combat destructive BEE “fronting”. Our experiences require us to put controls and ensure that BEE initiatives are geared towards directly supporting Black entrepreneurs and producers and not agents for imports. We have adopted an integrated value chain approach towards policy implementation which requires significantly greater alignment and cooperation across different policy jurisdictions.

In this regard, emphasis in the coming period should also be placed on local value addition (and job creation) and Employee Share-ownership Schemes (ESOPs) so workers become genuine stakeholders in the enterprises where they are employed and BEE procurement conditions should be aligned (particularly the Mining Charter with the BB-BEE codes) and should reflect the BB-BEE portion of local value added in the product supplied to combat destructive BEE “fronting” for imports Combined with other elements of BB-BEE – which are currently being refined – these programmes would contribute to the enhancement of economic development and social cohesion.

In this connection, the role of the DFIs in supporting industrial investment has to be directly linked to support an industrial structure that has the previously disadvantaged at the centre. The key constraint to successfully implement the various components of IPAP is that many of the policy levers and instruments lie with diverse departments/agencies (see above).

- We have adopted a developmental state/industrial development approach but have often not reconciled this with its pre-existing commitments to GATT and the WTO. We need to find creative ways to get around those restrictions.

3.1 AGRICULTURE, FORESTRY AND FISHERIES “The state shall help the peasants with implements, seed, tractors and dams to save the soil and assist the tillers”.

(Freedom Charter)

Growing the agricultural and agri-processing sectors will improve national food security, increase agricultural income and support rural development. We have adopted policies that broaden and deepen linkages between agriculture and machinery and equipment industries, including:

- Food Security for all;

- Strategies to increase the contribution of Agriculture to economic growth; and

- Unlocking the sector’s ability to produce 1 million decent jobs by 2030.

One challenge here is that in recent times agricultural productivity has been linked to mechanisation whereas South Africa urgently needs the agricultural sector to be a source of employment as well.

Assessment of State Interventions

Commercial, smallholder and subsistence farmers currently receive less support from the state than their counterparts in most industrialised countries in the world.

From 2000 to 2014, employment in the agriculture sector fell from 1.4 million to a mere 600,000. During this period, average farm size increased through consolidation and became more mechanised, capital intensive and more reliant on chemical inputs.

While the sector is now more efficient both in its production outputs and net farm income, it has not been accompanied by concomitant increases in transformation nor employment, despite support programmes such as the Re-capitalisation of Land Reform, BBBEE charter, and various other programmes aimed at addressing transformation.

The State must therefore re-think the design and implementation effectiveness of its programmes to address the structural challenges of economic transformation, growing market dominance and increasing job losses within the sector.

Current Proposed Policy Interventions

A new Agricultural Policy known as the Integrated Growth and Development Policy (IGDP) with the Agricultural Policy Action Plan (APAP) serve as a programmatic response, identifying priority commodities with high growth potential, food security potential, and to contribute to GDP. The APAP could potentially become the IPAP for agriculture, a platform for sector organisations and other stakeholders to converge through joint planning.

Recommendations:

Broadening market participation: The liberalisation of agricultural and food markets have not, as expected, created a more competitive market with lower prices to consumers. Agriculture, Forestry and Fisheries sectors still exhibit high concentration and vertical integration by a few major firms with evidence of abuse of such dominant market concentration. Government incentive schemes could broaden market participation while forging stronger linkages between big corporates, receiving government support, and SMMEs across the value chain of key commodities.

TARGET: A condition must be added to all incentive programmes funded by the state, that 5-10% of produce procured by manufacturers and commercial farmers must come from SMMEs and smallholder producers in the sector. This would require a state registry of all farmers.

Promoting Youth in Agriculture, Forestry and Fisheries: It is an imperative that Agriculture, Forestry and Fisheries addresses youth unemployed with most residing in rural areas. Grant funding programmes must demonstrate commitment to addressing youth unemployment.

TARGET: we must dedicate a significant percentage of resources (ideally 40%) to unemployed youth graduates in Agriculture, Forestry and Fisheries.

Promoting local food economies: A large and increasing share of the consumer food-spend goes through supermarket chains who favour large-scale commercial producers to the exclusion of smallholder producers, and with increasing food prices. There is scope for promoting local food economies as a means of creating market efficiencies, lowering food prices paid by consumers, and stimulating local production where it is viable.

TARGET: All supermarkets must procure 5% of its fresh produce and processed food products locally and from smallholder farmers.

Reducing dependence on industrial and imported inputs: South African agriculture uses large amounts of industrial inputs such as diesel, chemical fertilisers, and chemical pesticides. A significant portion of these inputs are priced at import parity levels by both domestic manufacturers and importers. Non- exporting farmers are thus vulnerable to international price and exchange-rate fluctuations. High input costs, high marketing unit costs and inefficiencies in input distribution are major factors why smaller farmers in particular struggle to break even.

Reducing overall dependence on industrial and imported inputs and eliminating import parity pricing will address these challenges. South African Agriculture must adopt practices with less reliance on increasing input costs, and must thus begin to promote climate smart agriculture.

TARGET: Incentive programme for Climate Smart Agriculture / Score Card.

Promoting import substitution and export expansion and regional integration through concerted value chain strategies: South Africa imports large amounts of poultry, red meat, wheat and soya cake from outside the agriculture resource-rich Southern African region.

TARGET: An Agricultural Import Substitution Strategy and Trade Strategy, coupled with an integrated regional strategy for agriculture and agri-processing is urgently needed which aims to decrease imports of agricultural commodities and/or preferentially import from the region. There is more scope to do this in agriculture because of what other countries are doing, but again there needs to be some recognition that world trade rules limit our import substitution options.

3.1.1 RURAL DEVELOPMENT, LAND REFORM AND AGRARIAN TRANSFORMATION

“THE LAND SHALL BE SHARED AMONG THOSE WHO

WORK IT!” (Freedom Charter)

In the 53rd Conference, we affirmed rural development and land reform as a priority. In giving expression to this urgency, we placed rural development as one of the five priorities in our 2014 Elections Manifesto. Progress towards conference resolutions is recorded below:

- Redistribution of economic assets in ensuring the majority are included: The pace of land reform is accelerating; Since 1994 7.4 million hectares have been delivered, 5.3m between 1994-2009 and 2.1m over the past 5 years;

- The audit of state land be urgently completed:

The state land audit was completed in July 2013;

- Finalisation of the Spatial Planning and Land Use Bill: Completed in August 2013: the Spatial Planning and Land Use Management Act (Act 16) 2013;

- Replacing Willing Buyer-Willing Seller with Just and Equitable Compensation: The Property Valuation Act (Act 17)2014 was enacted in July 2014. The Valuer General is being appointed and the modalities for establishing the Office of the Valuer General are being finalised;

- Expediting the Promulgation of the Expropriation Act: the Expropriation Bill is at an advanced stage of legislation development and is being led by the Department of Public Works;

- Freehold with Limited Extent: The Agricultural Land Holdings Policy has undergone a Regulatory Impact Assessment from which policy improvement and the legislation development approach will be considered;

- Expedite tenure security policy: The Extension of Security of Amendment Bill is at an advanced stage of development and is awaiting a Regulatory Impact Assessment;

- No land by foreign nationals as a principle and covert ownership to long term lease as well as establishment of a Land management Commissions are two resolution’s covered in the proposed “Regulations of Land Holdings Bill” which is being taken through a Regulatory Impact Assessment; and

- Communal Tenure with institutional land rights: a policy has been developed a draft Bill is in place; a Socio-Economic Impact Assessment is also being undertaken. This policy was discussed extensively at the National land Tenure Summit in September 2014 and there is a firm basis to proceed from and consult on.

Our Rural Development Framework is now firmly rooted in the approach to rural development we formulated in the 53rd Conference. It saw the introduction of the agrarian transformation system, which is comprehensive and inclusive in approach and defined as rapid and fundamental change in the relations (systems and patterns of ownership and control) of land, livestock, cropping and community. The strategic pillars of land reform (land redistribution, restitution, development and land tenure) continue to form part of this comprehensive and inclusive approach to rural development and land reform.

The next phase of this approach is the Rural Economy Transformation Model (RETM), firmly aligned to Vision 2030. Our strategy of ‘agrarian transformation’ promotes labour-intensive technology, relies on decentralised patterns of local control and takes seriously the input of ordinary citizens into decision- making processes, especially in areas dominated by communal landholdings and patrimonial authority.

The re-opening of the Restitution land claims process, linked to the establishment of an improved land valuation system (office of the Valuer-General), along with the increased recapitalisation of state farms and farms purchased via land reform grants is crucial to the success of the RETM. While the slow-pace of land reform can be largely attributed to budgetary challenges and the restrictive willing-buyer-willing seller model, other models such as share equity and joint venture schemes, based on mutually acceptable terms and conditions need to be pursued.

In addition, the expedition of the enactment of the Expropriation Bill and the policy on just and equitable compensation may reduce the transaction costs of land acquisition. We are on course to now further catalyse and deepen rural development through farmer-controlled Agri- Parks that are to be established in the 27 priority districts, in partnership with black farmers, agri- businesses and government. This approach would be cooperatives based and supported through, a strong rural cooperative bank and development financing facility. The coordinated support to small producers in primary production and through value chain entry will be facilitated.

Strategic imperatives would be to ensure community and household mobilisation, engagement on various land needs and tenure security challenges; establishment of community coordination institutions; address basic human needs including basic social and economic infrastructure; district and/or regional commodity targeting; marketing support; incubation, training and technical support; facilities and logistics; extension services and coordination of public and private processing enterprises in the surrounding areas.

These initiatives. stakeholder mobilisation and framed support to small enterprise development backed by sound cooperation amongst the different spheres of government will be the basis to attract added investment to rural areas, creating sustainable employment through the maintenance of rural infrastructure, monitoring of the environmental footprint of agricultural activity, maintenance of a national irrigation scheme, establishment of co- operative centres and farmers markets, where rural products can be marketed, sold and value realised.

Figure 4: Number of employees in the agricultural sector has fallen by 20% between 2008 and 2014

3.2 MINING AND MINERALS

“THE MINERAL WEALTH BENEATH THE SOIL …SHALL BE TRANSFERRED TO THE OWNERSHIP OF THE PEOPLE AS A WHOLE”. (Freedom Charter)

In line with our 53rd conference resolutions, we need to elaborate concrete forms in which the state should maintain a strategic, interventionist role in key sectors, to ensure that all our natural resources are exploited to effectively maximise the growth and employment potential embedded in such assets, and not purely for profit. In this regard we subscribe to the aims of the AU “Africa Mining Vision” (AMV) and the Country Mining Vision (CMV) Guidelines.:

“The ANCs policy as per the 53rd conference resolution is based on the following elements:

- Minerals for manufacturing: Steel (iron ore), polymers (coal or oil/gas), base metals (copper, zinc, nickel), Platinum group metals, chromium, vanadium, manganese, alumina-silicates.

- Minerals for energy: coal, uranium (also limestone for washing emissions), natural gas, including shale gas and coal-bed methane gas.

- Minerals for agriculture: NPK – nitrogen (gas), phosphates, potassium, conditioners (sulphur, limestone).

- Minerals for Infrastructure: Steel (iron ore) cement (limestone, gypsum), copper.

State intervention with a focus on beneficiation for industrialisation is urgently required. Instruments are required to support beneficiation and competitive pricing of these strategic resources include the use of targeted management of exports of minerals. In addition, SA’s share of some resources offers possible producer power which could be used to facilitate backward and forward mineral economic linkages.”

3.2.1 Downstream beneficiation

Government has completed downstream mineral value chain strategies on ferrous minerals (iron, manganese and chromium), the PGMs (platinum & palladium), polymers (from coal or gas) and titanium. These strategies have been incorporated into the 2014/5 IPAP. The key areas for intervention include:

- The MPRDA amendment bill to include mineral feedstock pricing conditions on the strategic mineral feedstocks, such as steel, polymers, copper, coal/gas, cement and NPK fertilisers, into key sectors of the economy, identified by the Mangaung Conference Economic Transformation Resolution (MCETR) namely, manufacturing, infrastructure, energy and agriculture. “In addition, SA’s share of some resources offers possible producer power which could be used to facilitate backward and forward mineral economic linkages” (MCETR ).The rights of the state on marketing such minerals to facilitate downstream industries need to be incorporated into the MPRDA amendments.

- The MPRDA amendment bill must also incorporate targets on all mineral rights for local content (and BB-BEE purchases), beneficiation, local skills formation spend and local technology development (RDI ) spend in order to ensure that the depletion of the people’s finite natural resources catalyses the maximum amount of national growth, development and job creation;

- A Resource Rent Tax (RRT) to “capture an equitable share of mineral resource rents” (MCETR) needs to be introduced both to strengthen the fiscus and to be used as an up- and downstream value addition incentive (through RRT- local content and beneficiation offsets). Treasury has tasked the Davis Tax Committee with assessing a RRT.

- Mineral Export Tax on strategic minerals to enhance local value addition. The state is engaging with the Davis Tax Committee on this issue, but such a strategy is substantially compromised by the recent Trade, Development and Cooperation Agreement (TDCA) with the EU which exempts or dilutes export taxes to the EU for 12 years.

- State Tariffs to favour value addition: This is under consideration by TNPA (port tariffs), but needs to be expanded to rail (Transnet), road (SANRAL), energy (Eskom) and finance (IDC). Progress on this is slow and requires an inter-ministerial strategy (DTI, EDD, DMR, DPE, NDOT).

3.2.2 Upstream Beneficiation (backward linkages)

The NDP directs that “more attention will be devoted to stimulating backward linkages or supplier industries (such as capital equipment, chemicals, engineering services), especially as demand is certain, there is an opportunity for specialised product development, and the product complement is diverse. They are also more labour absorbing than typical downstream projects. Such products have the potential for servicing mining projects globally” (NDP, 2011, p. 125).

Accordingly, the MPRDA Amendment Bill should cater for a minimum local content procurement spend, a minimum local STEM skills development spend and a minimum local RDI spend. The DTI is engaging with the DMR on this.

Accordingly, the MPRDA Amendment Bill should cater for a minimum local content procurement spend, a minimum local STEM skills development spend and a minimum local RDI spend. The DTI is engaging with the DMR on this.

In respect to our adopted policy to “expand investment in research and development that contributes towards innovation that supports beneficiation” (MCR 2012), the DTI is engaging with both the DTI and the DST to rebuild national mining technology development (RDI) capabilities, since the demise of COMRO/Miningtek, to support the growth of the upstream minerals sector.

3.2.3 Strategic Minerals

The MCETR identifies key feedstocks into manufacturing, infrastructure, energy and agriculture as being “strategic” (steel, polymers, copper, cement, coal/gas, NPK, et al) and requiring state intervention on domestic pricing. The MCETR also identifies as strategic minerals that offer “producer power which could be used to facilitate backward and forward mineral economic linkages” (MCETR 2012).The key interventions in this regard include:

- The MPRDA amendment bill to include a method for designating strategic mineral feedstocks and for their domestic developmental pricing.

- The MPRDA amendment bill to include state control over the marketing of select minerals to realise potential producer power to enhance their economic linkages in SA.

- The MPRDA amendment bill to include the public tender of all known unencumbered mineral assets, against the fulfilment of the state’s developmental goals (developmental pricing, local content, beneficiation, transformation, STEM skilling, technology development, et al)

3.2.4 State Mining Company (SMC)

The state has established a nascent SMC (African Exploration Mining and Finance Corporation – AEMFC) under CEF to “capture a share of mineral resource rents and equity” and support “vertically integrated value chains” (MCETR 2012). However, most of the state mineral holdings are held by the IDC. Key interventions in this regard include:

- Consolidation of the state’s mineral holdings. The Department of Minerals is considering fulfilling this ANC policy commitment by drafting and enacting a State Mining Company Act. Such a process may be the way to go in the long term, but it will take considerable time because, if such an act is to be truly effective, it will inevitably be heavily contested by domestic vested interests (including private black mining capitalists) and global mining companies.

Therefore there needs to be some interim measures which provide the foundation of support for state mining companies. The most immediate opportunity is in the hands of policymakers in the impending passing of the MPRDA bill. The task team should prioritise appropriate supportive clauses which advantage state mining above other mining interests and which are to be included in the current amendments. Failure to do this will result in delaying any effective fulfilment of ANC policy for at least 2 more years.

- The MPRDA amendment bill to cater the reservation of select strategic mineral properties for development by the SMC to supply downstream industries at developmental prices. This is still to be effected.

Social and Labour Plans

The recent disruptions in the mining sector and the deeply disturbing Marikana incident have underlined the importance of the corporate social and labour obligations. “Government should urgently conduct a comprehensive review of whether mining companies are meeting their obligations regarding social and labour plans, including those stipulated by the Mining Charter and MPRDA” (MCETR 2012).

Reviewal of the MPRDA Bill

The MPRDA Bill has been sent back because it did not pass constitutional muster and it was therefore required by the constitution to refer it back to the National Assembly for reconsideration.

The minerals and petroleum industries have uneven levels of maturity in South Africa. Mining is a mature industry in South Africa and the country has been producing and selling minerals since 1871. In contrast, commercial quantities of oil and gas were only discovered in the 1970/80s and commercially produced in the 1990s. It behoves that the separation of the bill to cater for mineral resources, on one hand, oil and gas on the other hand be expedited as part of the reviewal of the bill.

3.2.5 Metals/Commodities Exchange Mechanism Establishment of a Metals/Commodities Exchange Mechanism should be explored given that South Africa

In its favour South Africa has a legal infrastructure

that can support an exchange, well established and functioning credit systems, good financial regulation, sufficient financial resources and banking skills and, in the Rand Refinery, a world-class gold depository.

There are two distinct benefits from having a local futures exchange viz.:

- Improved price discovery for local market;

- A better correlation between the local cash market and the price of exchange derivatives, which could assist accurate revenue collection (SARS).

Further benefits include the enhancement of the host country’s financial infrastructure, better standards of financial regulation, knock-on benefits for the economy from both of these, a direct economic benefit from the exchange providing employment and investment, and, finally, prestige for the host country and city.

The prognosis for a South African commodity futures exchange has prospects of improving only once a cash or physical market for the commodities has evolved locally. While these commodities are exported to the exclusion of the local market, as is currently the case, a physical or cash market will have enough difficulty establishing itself let alone providing the grounding for the evolution of a viable futures market.

Figure 5:

Volume of Mining

Production: Since 2009, the production index for mining has not recovered to the levels seen in 2005

3.3 OIL AND GAS

Oil and gas resources are emerging as another potential game changer in South Africa. It is critical that the movement understands the political- economy of the entire oil and gas industry, to ensure an appropriate political response is provided to shape its development in the interest of our people just as is aptly articulated in Norway’s “10 Oil Commandments” policy.

Acceleration of oil and gas exploration including shale gas exploration and coal-bed methane (CBM) can only be successful through a comprehensive approach the upstream sector in the oil and gas sector.

- Focus on optimal development of the oil and gas regulatory framework (including the free carry) to facilitate development, up- and downstream beneficiation particularly on offshore have to be attended as a matter of urgency.

- With regards to shale gas,over and above enabling supply of energy, there is potential of further developing petro-chemical industries, enabling industrial expansion and also ensure competitive supply of chemical feedstock for which currently Sasol is a dominant monopoly.

- We need to develop an enabling local content policy for the sector (upstream beneficiation), to which we will integrate other transformational industrialisation initiatives such as the development of Black industrialists. The DTI’s formulation of a Resources Capital Goods Development Plan (RCGDP), should optimise synergies with the upstream oil & gas sector;

- We also need to develop an enabling downstream beneficiation policy for the sector that ensures that strategic products such as fertilisers, polymers and energy are supplied to our domestic industries at developmental prices;

- Strong and public focused support on state- owned entities and companies such as PetroSA (particularly), Central Energy Fund, SANEDI, Strategic Fuel Funds whilst drawing lessons on successful models and experiences from other countries is essential, as they should form the basis of the States participation in the sector. We should draw lessons from the weaknesses in the mining industry where the interests being served are for foreign owners. It should be noted that we have borrowed, with minor tweaking, a structure and focus on the energy-related SOC’s, designed for objectives of an isolated South Africa during apartheid that are different to the developmental and industrial objectives of a South Africa with the international relations of today.

- In this instance, we should review of the organisation, focus and approach of the oil & gas-related SOC’s. This review to take account of the need for a strong energy group that will take responsibility for the State’s participation in upstream oil & gas (National Oil Company activities), pipelines for gas whether from shale gas developments or from offshore fields, catalyst

& partner for petro-chemical developments, security of supply including strategic storage and participation in renewable energy. Our recommendations on Mining & Minerals (above) should be incorporated into our Oil & Gas policies, where appropriate.

It is intended that all the above issues will be addressed by revising all legislative instruments related to the oil and gas sector and incorporating these into a stand- alone Oil and Gas Act.This sector is currently regulated through the MPRDA, which deals with both onshore hard rock mining as well as onshore and offshore oil and gas.

Considering the time that it will take to enact new legislation, there is a need for clarity on how the oil and gas sector will be regulated in the interim.

3.4 TOURISM

Another sector which holds great potential for job creation, especially in rural areas, is tourism. However, barriers to entry into the value-chains of the sector that are faced by SMME’s, Black-owned enterprises, particularly the youth and co-operatives need attention. We need to draw lessons on how to improve the integration of Black people, women, the youth, SMME’s and co-operatives into the tourism value- chain.

Advancing transformation in the tourism sector is paramount. The National Department of Tourism must continue to invest in skills training and entrepreneurship development, support the development of catalytic infrastructure in communities (including through its EPWP projects and incentives programme),and further leverage the sector’s BBBEE codes of good practice.

In 2012, the tourism sector represented 3% of our GDP and over 617 000 jobs. In addition, the tourism sector has exceptionally strong linkages to the rest of the economy, for example food and beverage production, financial services, printing and publishing, security services, and many others. If we add up all the indirect impacts, tourism generated 9.7% of South Africa’s GDP in 2013 – and supports more than 1.4 million jobs in the country.

There is also potential to unlock greater value by investing more in nurturing a culture of domestic tourism. By increasing government investment in tourism marketing, we could create meaningful new job opportunities and economic growth. Tourism represents a labour-intensive sector with a supply chain that cascades deep into the broader economy, and the multiplier for its contribution to GDP and job creation outstrips that of most other economic sectors.

3.5 TECHNOLOGY AND RESEARCH, DEVELOPMENT AND INNOVATION (RDI)

Building an economy requires quality and accessible research development and innovation (RDI) and persistent technological advancement, as well as appropriate support institutions. RDI has the potential to enable the economy to leapfrog over certain development hurdles in line with the spirit of Operation Phakisa.

In line with our historical resolutions, there is a need for assertiveness to ensure that government attains the target RDI expenditure of 1.5% of GDP. This requires better systems for allocating public funds for RDI. That includes a realistic assessment of which R&D activities are likely to produce economic benefits, rather than expending resources on increasing all possible categories of ‘research’. Focusing on a carefully selected high-impact areas that align with our industrialisation, beneficiation and modernisation policies, strategies and programmes. The lease of all state assets (e.g. minerals, EM spectrum, et al) should stipulate a minimum domestic annual RDI spend of at least 3% of value added. Likewise all major state procurement contracts should seek to strengthen our national RDI system.

Since 2009 the following have been done to accelerate RDI:

- Science, technology and innovation (STI) have been included and identified as one of important contributors to socioeconomic development by the National Development Plan (NDP), New Growth Path (NGP), Industrial Policy Action Plan (IPAP);

- Identified new emerging industries led by RDI through Emerging Industrial Action Plan (EIAP). In this regard, progress is reported through government’s Outcome 4.

- Initiated technology localisation programme aimed at supporting industries in order to strengthen their technology capabilities, to find contracts from competitive supply demand programme (CSDP) and SOCs as well as export new products.

- Initiated sector innovation fund for RDI support to existing industries.

- There exist tax incentives for R&D though with limited success to dat.

- However, although we have made progress, much more needs to be done, particularly in ensuring that all of our RDI initiates are in sync with our economic development strategies and programmes.

South Africa needs to build new centres of excellence in RDI and enhance existing ones with the objective of producing original and potentially ground-breaking research and facilitating a growing community of scientists, engineers, technologists and industry experts, contributing to our Economic Transformation goals. Such development in RDI must be synergised with priority sectors of the economy.

The state should also upscale its support for RDI, and build partnerships with firms which have significant capacity to conduct in-house research and development of new technologies. This will require a review of existing institutions that make up the national innovation system, an assessment of the extent to which they are complementary, and an evaluation of their contribution towards supporting our development strategies under the NDP, the NGP and the IPAP.

All state-funded RDI projects must be interrogated to ensure that they fully align with and support our Economic Transformation policies and strategies. We must also identify critical gaps in our system of innovation where our economic programmes and goals do not have the requisite RDI components for success, such as the collapse of RDI in the crucial minerals upstream cluster (see above), and take urgent corrective action.

- Initiated technology localisation programme aimed at supporting industries in order to strengthen their technology capabilities, to find contracts from competitive supply demand programme (CSDP) and SOCs as well as export new products.

- Initiated sector innovation fund for RDI support to existing industries.

- However, although we have made progress, much more needs to be done, particularly in ensuring that all of our RDI initiates are in sync with our economic development strategies and programmes, especially IPAP.

3.6 SMME’S AND COOPERATIVES

We must continue to encourage the creation of new businesses, cooperatives and the expansion of small business, by reducing the costs of compliance with government regulations, making it easier for companies to ‘do business’ with government, making sure that government pays its invoices on time and strengthening the role of our development finance institutions.

Small and medium enterprises and co-operatives have a potential to create more job opportunities, particularly for the youth. The best way of taking investment opportunities to poor communities is by supporting SMME’s and Cooperatives in those communities. Once these SMME’s and cooperatives thrive, larger firms, such as banks, begin to open up services and economic activity improves. The strategy should be to promote SMME’s and Cooperatives in poor communities.

Greater empowerment and focused support to small business development and Cooperatives. In line with our commitment to place the economy at the centre stage and the deliberate decision to focus on small business and Cooperatives, government must unlock economic opportunities that will ensure inclusive economic growth and the creation of sustainable employment, particularly for women, youth and people with people with disabilities.

Our approach includes measures to reduce monopoly pricing and prevent collusion by dominant players in key product markets. Emphasis must be placed on easing regulatory burdens, support mechanisms which include; strengthening partnerships with stakeholders; access to finance, improving training and capacity building programmes, market access, and simplifying business registration processes. State procurement budgets will be leveraged to develop competitive local suppliers to ensure localisation.

A range of options may be considered, including non-procurement related policy tools that affect SMME’s and Cooperatives in more direct and transparent ways, to promote sustained growth and competitiveness. These include, for example, increased access to credit markets, input subsidies and/or technical and marketing support for finished products.

A big opportunity to make co-operatives work is for the state to adapt the procurement guidelines. The Preferential Procurement Policy Framework Policy (PPPFA) must be used and adapted to leverage the existing and future governmental spending, and support the development of local industries. Developing alternative value-chains that link co- operatives to school nutrition programme, hospitals, SOE’s and agencies should be amongst our flagship projects for empowering SMME’s and Cooperatives.

- Localisation strategy in procurement which includes review of PFMA, MFMA and laws governing leasing of state rights/assets, capacitation of local suppliers in particular through training by SETA’s for example,.

- Localise SMME’s and Cooperatives development priorities to municipalities and implement through LED programmes.

- Government and organised business to address and formulate role and status of foreign business in local business formations;

- Promotion of alternative finance and banking practices such as cooperative banks.

The ANC should mobilise for vibrant and dynamic cooperative movement that an integral part of the movement of radical economic transformation including demystification of distorted understanding of Cooperatives.

Therefore we need to do the following:

1. Issuing of Practice Notes by the National Treasury for effective implementation of set- asides across all spheres of government.

2. NEC needs to endorse 30 percent of public sector procurement from SMMEs and co-operatives. Consideration of a purchasing Act in the medium term.

3. Support more financial resources to be earmarked to develop infrastructure in neglected areas for the benefit of community enterprises.

4. Develop a policy to designate informal businesses for local enterprises.( retail, saloons and services, )

5. Resuscitate and develop township and rural economies.

3.7 OCEAN ECONOMY

Our ocean is a national asset. We are determined to ensure that this asset becomes a key component of sustainable growth, generating benefits for all our citizens.

Recognising the enormous potential of the ocean in contributing to economic growth, creating jobs and reducing poverty, key Government departments must cooperate in enhancing the ocean economy in four new growth focus areas, namely marine transport and manufacturing, offshore oil and gas exploration, aquaculture and marine protection services and ocean governance.

The ANC will support and monitor the implementation of the initiatives within the four focus areas of the ocean economy. We need to urgently develop governance and a funding regime, in order to promote the implementation of ports infrastructure that will enable growth in support of marine manufacturing, offshore oil and gas industry in particular to take advantage of job opportunities for boat building, ship repairs and maintenance of oil rigs.

We need to provide support and direction in the development of ocean legislation, including protection of ocean resources and marine spatial planning in order to designate special economic use zones.

3.8 MONOPOLIES AND COMPETITION POLICY 

The South African economy continues to be dominated by monopolies and oligopolies in strategic value-chains. Monopoly and cartel pricing directly undermines the growth of the economy by increasing prices of key products for downstream industry and those that are essential for low income consumers. In addition, tight knit insiders raise barriers to entry for new participants including black owned and managed firms, and lobby to protect their position through rules and regulations that favour incumbents. These have served to stifle the development of downstream, labour-intensive industries, small and medium-sized enterprises, cooperatives and Black-owned firms.

The genesis of the corruption that has become so endemic in our society in both public and private sectors presents itself in many forms including anti- competitive behaviour and collusion. Our people continue to suffer under the burden of high prices and our economy fails to adequately ensure equitable and broad based access to economic opportunities as a result of this anti-competitive and unscrupulous behaviour.

The competition authorities have identified such conduct but have not been equipped with enough powers to remedy such behaviour. Stronger steps need to be taken to address anti-competitive behaviour through competition enforcement, regulation and complementary policy measures. Regulators need to work much more closely with the competition authorities and consideration should be given to merging these institutions to increase their capacity as well as their powers.

In addition, other policy levers must be applied simultaneously to address excessive pricing by oligopolies supplying key industrial inputs. (See sections 3.2 and 4.)

The ANC must mobilise all progressive and patriotic businesspersons to disassociate themselves from acts of anti-competitive behaviour, collusion and corruption in pursuit of inclusive economic growth that benefits South Africans as a whole.

4. PROCUREMENT AND STATE CONCESSIONS/LEASES

“Tenders must be issued in an open and transparent manner that does not compromise our objectives”. (Resolution from the 53rd Conference)

Government should intensify the use of public procurement and state concessions as a policy tool for economic development. In this regard, the state needs to incorporate procurement (local content) targets/ conditions, skills formation targets, BBBEE, SMME and Co-operatives targets/preferences, technology development targets and value addition targets into all public procurement and leases (concessions) of public assets or rights such as: mineral rights, fishing rights, electro-magnetic (EM) spectrum (ICT) rights, state land rights, water rights, national conservancies and heritage sites (tourism leases), energy generation rights (IPPs), air (aviation) rights, maritime rights, exclusive marine economic zones, etc.

In achieving open and transparent tendering, South Africa should lead by subscribing to domestic and multi-lateral initiatives that enhance transparency, such as the Extractive Industries Transparency Initiative (EITI) and the Kimberly Process Certification (KPC). (See mineral rights section 3.2 above and IPAP section for progress report on local procurement designation of sectors and products).

5. INFRASTRUCTURE SECTORS

5.1 ENERGY

South Africa is confronted by a growing economy that is in need of ever more energy inputs. The need for investment in additional capacity to provide appropriate energy resources compels the exploration of various ways to secure the security of supply.

The ANC is committed to maximising access to energy for all, especially the rural poor as a key part of its fight against poverty. The ETC notes the following policy interventions being implemented and outlines areas which require greater emphasis and action:

5.1.1 ELECTRICITY GENERATION

- The 2013 Alliance Summit noted that the electricity generation and transmission programme was the largest single component of the infrastructure build and maintenance programme which accounted for about 175 000 jobs.

- We should acknowledge the success of the competitive bidding system under the Renewable Energy Independent Power Producer Procurement Programme, which has resulted in commitments by the private sector to investment renewable electricity projects of estimated value of R120billion and considerable associated job creation through local content conditions, deepening linkages and integration with the Green economy and Green industries.

- Similarly, the completion of the various private- sector projects which have been bid should also be closely tracked to ensure timeous completion.

- The competitive bidding system should immediately be extended to cover medium-term base load requirements, as outlined in the IRP2010 and in the draft IRP2014

- This success should be instructive and supportive of ANC policy commitments towards mineral resource rights (see 53rd Conference Resolutions and the Minerals section 3.2 above). Revenues from competitive bidding for South Africa’s known mineral resources could be the “game changer” in addressing the fiscal constraints to extending our counter-cyclical macro-economic policy into the future.

- The integrity of the evolving proactive Energy planning system should be improved through the finalisation of the 2014 Integrated Resource Plan (IRP2014) and the tabling of the Integrated Energy Plan (IEP), both of which should be subjected to more frequent and transparent reviews, given the rapidly shifting relative energy technology cost structures.

- Regional options for the procurement of clean and low-cost energy need to be assessed and developed, particularly the enormous hydropower and gas potential in other SADC states. In this regard mutually beneficial and equitable initiatives, such as the huge Inge hydropower project (DRC) and the PIC supported natural gas pipeline (Mozambique), need to be promoted.

- Government must commit to a full, transparent and thorough cost benefit analysis of nuclear power as part of the procurement process, and clarify the status of the update to the Integrated Resource Plan. Government must also announce publicly that nuclear energy can only be procured in line with the legal prescripts and after a thoroughgoing affordability assessment. However support for NECSA especially Pelindaba Enterprises, NNR and National Radioactive Waste Disposal Institute has to be improved as well.

- Urgent attention should be paid to strengthening Eskom’s depleted executive management leadership.

5.1.2 ELECTRICITY TRANSMISSION

- While major investments are being made in strengthening the transmission infrastructure, recent evidence suggests that these investments need to be more carefully planned and accelerated in order to accommodate the significant number of IPP power generation projects already committed to, with window 4 projects under threat for lack of transmission infrastructure.

- This matter will become more critical with the advent of larger base-load plants.

5.1.3 ELECTRICITY DISTRIBUTION

- Insufficient progress has been made in implementing Cabinet’s December 2012 Approach to Distribution Asset Management (ADAM) programme. In 2014, the Department of Performance Monitoring and Evaluation (DPME) reported that the Department of Energy was not likely to achieve the target to develop a funding and implementation plan and reduce the electricity distribution infrastructure maintenance backlogs of R27.4bn to R15bn by 2014. The recent MTBPS is silent on any fiscal allocation for distribution infrastructure rehabilitation, which was also not budgeted for in the DoE’s last MTEF budget between 2014 and 2017.

- Municipalities distribute electricity to a large number of small and medium industrial firms who supply the domestic and export markets. Municipalities are dependent on rents from electricity sales to cover overall annual expenditure and this forces them to effectively milk electricity users, providing poor supply reliability (through not maintaining the distribution infrastructure) and implementing exorbitant mark-ups which are used for other purposes, resulting in municipal electricity costs being significantly above those charged by Eskom to competing firms in Eskom supplied industrial areas. While large industrial user interests are catered for through the lobbying power of the Energy-Intensive User Group (EIUG), smaller firms are voiceless and vulnerable.

- An urgent sustainable resolution of this issue is required, which must involve National Treasury and its approach towards the use of electricity rents in local government financing, COGTA and the DTI. Otherwise it is likely that electricity distribution infrastructure collapse will be the next energy crisis that our country will face and municipal practices will accelerate de-industrialisation in municipal-supplied areas.

5.1.4 HYDROCARBON FUELS – REVIEW OF THE REGULATORY SYSTEM

Although the 53rd Conference resolutions are silent on liquid fuel issues, there are two urgent reasons for government to implement a review of the regulatory system that governs the hydrocarbon liquid and gas fuel value chain. This system effectively promotes every stage of the fuel value chain, from crude oil imports to retail service stations and has provided stability, predictability and certainty for all of the firms across the value chain. However, the system is now seemingly being abused by oligopolistic interests.

As is evident from the response of transnational- owned refining companies to fuel specification improvements that have long been part of our Energy Policy, the generous profits afforded by the regulated system have been channelled towards expatriated dividends rather than towards provisions for anticipated policy changes. These firms now seek to have liquid fuel consumers pay for the necessary refinery investments to meet upgraded Euro IV fuel specifications. Consequently, the Department of Energy appears to have deferred the introduction of improved fuel specifications to 2020. In the absence of any fuel regulation review, it is unlikely that the refining companies will behave differently in the run up to 2020.

The second reason for a review of fuel regulation is that the system was originally intended under apartheid to accommodate and support the Sasol oil- from-coal plants. The system continues to support the now privatised Sasol with some suggestions that it is more favourably oriented towards Sasol compared to crude oil refiners.

As evidenced from the recent fine imposed by the Competition Tribunal on Sasol for abusing its dominant position is supplying polymers to South Africa’s labour-intensive downstream chemical and plastics industry, Sasol has effectively leveraged the guaranteed returns provided by the liquid fuel regulatory system to boost its profits.

Furthermore, it has boosted profits on its chemicals businesses by practicing import-parity pricing and effectively undermined the competitiveness (and job- creation potential) downstream plastics industries. Given Sasol’s recently stated corporate objective of fleeing South Africa by investing the bulk of its returns in the USA over the next decade, a very clear and sharp policy response is required which of necessity must incorporate liquid fuel regulation.

The development of a national hydrocarbons pipelines grid needs to be pursued and the efficacy of permitting privately owned pipelines needs to be reassessed to ensure that they are not used to escalate prices.

5.1.5 LINKING NEW GREENFIELD REFINING INVESTMENT WITH PIECEMEAL INDIVIDUAL REFINERY UPGRADES

Existing refineries are increasingly encroached by dense human settlements, giving rise to environmental challenges. The investments necessary for each of these facilities to profitably achieve Euro IV fuel specifications would be more sustainably applied to a larger new greenfield refinery that is jointly owned by existing refiners, new entrants to the SACU market and by the National oil company. Such a refinery must be located in a more remote part of the country, such as at the site proposed for the Mthombo project. Rather than expanding the existing refineries, these should be refocused and downsized towards more specialised products and integrated with product streams from the larger greenfield refinery. This concept should be promoted as part of the proposed review of the fuel regulatory system.

5.1.6 ENERGY EFFICIENCY AND CONSERVATION

The various initiatives that are underway should be intensified. According to the International Energy Agency, improved energy efficiency in buildings, industrial processes and transportation could reduce the world’s energy needs in 2050 by one third, and help control global emissions of greenhouse gases.

5.2 TRANSPORT

Transport systems are closely related to socio- economic changes. The mobility of people and freight and levels of territorial accessibility are at the core of this relationship. Economic opportunities are likely to arise where transportation infrastructures are able to answer mobility needs and ensure access to markets and resources.

The ANC notes the following policy interventions being implemented in the freight logistics and public transport sectors and we outline areas which require greater emphasis and action:

5.2.1 FREIGHT RAIL

- We acknowledge that there is a massive freight rail investment programme being implemented by Transnet. This has been made possible through the strengthening of Transnet’s balance sheet through a number of interventions including the sale of major assets and the hiving off of loss- making public transport assets to create PRASA (see below).

- Transnet’s initial investment focus has been on growing its capacity to support primary commodity exports - iron ore,coal and manganese in particular

- While container rail freight is also targeted, recent statistics do not show any significant improvement in shifting container freight from road to rail - Perhaps this process needs more time to blossom.

- However there is some concern that Transnet Freight Rail (TFR) are taking decisions on freight tariffs (unregulated) and on investment priorities that are mainly in the interest of Transnet’s balance sheet. These are not necessarily in the interest of the national economy, particularly in respect to a tariff structure that appears to use rents from transporting high value manufactured goods to subsidise commodity transport logistics.

- We note that transport policy calls for independent regulation and that there is a plan to put in place a Transport regulator, covering road and rail freight.

- However, there is concern that this process may take several years and that it may be in the national interest to urgently put in place an interim freight rail regulator. This view draws on the recent impact that the recently created Port Regulator has had when it imposed an immediate tariff decision which prioritises manufactured goods exports over raw commodity exports.

5.2.2 DISUSED BRANCH LINES:

This has been a long-running issue since at least the National Freight Logistics Strategy was drafted in 2004. Does need to be resolved asap.

- We note that transport policy calls for the concessioning of disused branch lines owned by Transnet. These were closed as part of the process of strengthening Transnet’s balance sheet.

- We also not that little progress was made until 2012, when the DPE minister gave Transnet a mandate to enter into 3 concession agreements

- Since then, Transnet seems to have decided not to concession, but to rather fund the revitalisation of these lines using internally generated revenues (cross-subsidies from other Transnet activities)

- Given Transnet’s funding constraints, it is clear that the revitalisation of disused lines will obviously proceed more slowly and, while this may be optimal for Transnet’s balance sheet, it may not be the best option for radical and rapid economic transformation, particularly for those disused lines that might service localised rural agricultural and other economic activities.

- Consequently, the ANC supports a more urgent process which maps out the plan for revitalising all disused lines either by Transnet and/or through some competitive concessioning process.

5.2.3 PORTS

- We acknowledge the massive investment programme underway to upgrade South Africa’s ports.

- A key challenge is to improve port operational efficiencies.

- We also support the relatively young Port Regulator in its efforts to ensure that port users are not charged tariffs which are unrelated to port infrastructure expenditure.

5.2.4 COMMUTER TRANSPORT

Transport systems are closely related to socio- economic changes. The mobility of people and freight and levels of territorial accessibility are at the core of this relationship. Economic opportunities are likely to arise where transportation infrastructures are able to answer mobility needs and ensure access to markets and resources.

- The ETC notes the considerable progress made towards implementing the transport policy goal of seamless inter-modal public transport (commuter rail, bus, taxi). Bus Rapid Transport systems are being rolled out in 12 municipalities/metros, with associated incorporation of taxi feeder operations.

- Currently, one of the major challenges is for municipalities to renegotiate bus subsidy contracts in a manner that integrates the bus service being procured, together with minibus taxi and BRT operations within the respective municipal public transport plan – The DoT is supporting this process which should be rapidly accelerated.

- We also note the consolidation of municipal commuter rail functions under PRASA and the recapitalisation of PRASA’s metropolitan commuter rail services, integrally linked to localisation and job creation

- The current challenge is to sustain the existing metro commuter rail capital expenditure with an emerging challenge to finance the long-distance (Shosholoza Meyl) passenger rail function that has also been handed to PRASA.

5.3 INFORMATION AND COMMUNICATIONS TECHNOLOGY

The world has become more connected, networked, and interdependent. At the centre of this inter- connection is ICT. This sector is a key enabler of innovation and is a fundamental resource for a developing economy. It can open many avenues for growth and employment. There is a need for a comprehensive national approach to the deployment of the ICTs to modernize government, the economy and service delivery within the context of a national e-strategy and an integrated e-government policy. This approach must entail mobilizing all sectors of the South African society and in particular providing broad-based training to those segments of the population that require empowerment to connect to the new ICT environments.

The availability of high-speed broadband in rural and underserviced areas will serve as an important development strategy, serving the economic interests of rural populations.

We need to:

- Ensure that all ICT licenses maximise our developmental ICT targets through competitive market based principles for the allocation of the electro-magnetic spectrum alongside strategic spectrum set- asides for socio-economic development.

- Adopt domestication of innovation: expanding the R&D capabilities of indigenous firms with clear direct support for industrialisation,

- Promote the spread of broadband connectivity through affordable and reliable models to consumers in rural areas through shared services platforms or community centres and a connected postal network.

- Develop and nurture, through government adoption, practical and large- scale ICT and in particular mobile applications, taking advantage of the widespread penetration of mobile phones.

- Aggregate the demand and use of broadband at national, provincial and local government spheres in order to offer online e-government services of all the frontline service delivery departments.

- Ensure the security of networks, data, personal information and government data bases so as to instil confidence in the new ways of delivering services.

- Lower the price to communicate consistently and empower the regulator to protect consumers and enforce competition in the delivery of ICT services.

- Consolidate and implement a comprehensive industrial strategy for end-use equipment.

The ICT Policy Review Green Paper supports the realisation of universal access to affordable and quality high-speed infrastructure and services. Whilst the focus of universal service and access programmes in the past was telephony, attention is now shifting towards the internet and broadband. The advent of broadband provision as a recent focus area for universal service requires attention to backbone as well as access networks, relevant content and the availability of affordable terminal devices.

All three spheres of government must be encouraged to use the South African Post Office to deliver services. For its survival, the postal market must continue to expand infrastructure that will be used in the distribution network. The connected postal network that offers also online services is crucial for the survival of the Post Office. To this end, the South African Post Office must be supported to accelerate evolution and migration of traditional postal services to e-services using innovative technology platforms and electronic channels.

ICASA, as a regulator, needs to be strengthened with the necessary capacity to regulate the postal market. Strengthening ICASA as a regulator also has to address policy gaps to improve postal regulation efficiency and effectiveness in reserved and unreserved postal services. This includes courier services, courier brokers and extraterritorial offices of exchange. Extraterritorial offices of exchange refer to international mail houses sending mail either electronically or physically to entities in South Africa. Of concern are illegal operators and broader transformation issues in the sector.

Introduce policy guidelines to direct opportunities to the Post Bank as a bank of first choice of government and a primary platform for government and citizens’ transactions.

The South African Postbank Act was amended, to ensure that this framework serves as a guideline to expand the range of banking services and developing the Post Bank into a bank of first choice, in particular to the rural and lower income markets as well as communities that have little or no access to commercial banking services or facilities

5.4 PUBLIC WORKS

Our Manifesto commitment to expand comprehensive social security is being realised through:

- Increasing access to infrastructure at a price that will not undermine job creation;

- Improving the reliability of network infrastructure;

- Ensuring the security of supply through diversity of supply in electricity, water and sanitation;

- Meeting the renewable energy targets;

- Supporting economic growth and development through investment in social infrastructure;

- 76% of EPWP work opportunities were created in rural municipalities.

- Review of the CIDB. This will address challenges faced by the construction sector and emerging contractors, with particular focus on the National Contractor Programme which aims to support emerging contractors at lower grades of the CIDP database.

- The review of the mandate of the IDT(Independent Development Trust) and the finalisation of the IDT Business Case to establish IDT as a Government Component

- Revitalisation of small Harbours

In order to address the above matters and positively contribute to NDP outcomes towards a better future for all South Africans, the Department of Public Works has begun the process of establishing the PMTE (Property Management Trading Entity) as a Government Component. The PMTE will collaborate with various Government Departments on numerous projects to beautify schools nationwide, save water and energy on all state assets, revitalise small harbours and develop government precincts and satellite walk- in centres in inner cities and rural areas. We also aim to identify and develop black property agents and developers to effect capital improvements and market unutilised state properties (investment stock) to the private sector.

6. SOUTH AFRICAN REAL ESTATE

The are three issues that affect this sector. One is the concentration of ownership, leading to the problems of oligopoly. The second is demographic transformation of ownership. The third is access to finance. These point to the great divides in the racial distribution of land and property ownership, especially in the commercial and agricultural sectors as well as the property development field. Under the surface of the seemingly competitive South African property industry run fissures that a sudden jolt can tear open to reveal a crumbling unbalanced structure of ownership patterns. New strategy especially new foundations are needed to create not only a national edifice of ownership of property in South Africa but also a transformed industry.

Naturally, South African property industry is reflective of the oppressive past of the majority, in all its facets, development, management and ownership it’s reflective of our past power relations biased towards the oppressor. It is thus necessary in-line with the new democratic dispensation and the ruling of the majority under the revolutionary movement lead by the ANC that such patterns get altered to reflect the new order.

Property ownership cannot be explained outside of the land ownership and access to finance, notably the report by the department of rural development and land reform exposes the dire nature of South African land ownership patterns which are skewed towards white monopoly capital.

Over the years, we have seen a number of black- owned farmers enter into the large scale commercial sector, however, with the level of experience, capital and professional skills required to successfully operate a production farm, these numbers are not growing at the desired pace.

Further attention needs to be given to support plans for agricultural development from the handover of land through to final distribution, through preferential funding, procurement and distribution schemes. These will ensure that entry level farmers are well equipped for large scale farming and are exposed to commercial distribution. The Land Audit initiative and Land redistribution is an appositive starting point. However, additional initiatives could be:

- Release (lease) of land to black owned private business for commercial, agricultural development.

- Disposal to private black land owners (rural) for agricultural and commercial use.

- Incentivise rural development through:

o Preferential funding for commercial development;

o Preferential funding for agricultural development.

Due to the large amounts of funding required for major construction projects, large scale property developments in South Africa are mainly undertaken by big corporations backed by established institutions like pension funds and commercial banks. There are very few – and small – property developments which are undertaken by SMMEs and private individuals.

The National infrastructure Plan (NIP), adopted by Government in 2012, aims to transform the country’s economic landscape while simultaneously creating significant numbers of new jobs, and strengthening the delivery of services.

The ANC should enhance the newly established department of small business development and expand its mandate to consider mechanisms for easing entrance for SMMEs in the property development space.

The ANC should also consider aggressive mechanisms for easing access to finance for both SMMEs and private individuals with a deliberate intention to transform the property development industry. In addition:

1. Revision of procurement processes to prevent fraud and corruption.

2. Promote professional project management tools and skills.

3. Development and skilling of small black-owned construction companies through progressive monitoring and grading against allocated work.

There are barriers to entry for small players and thus there is a serious need for intervention from the ANC so as to transform the industry while also meeting its objectives of creating jobs and thereby meeting its contractual commitment with the people of South Africa for creation of new job opportunities and sustainability to the economic growth which has been stagnant lately.

In December 2014, the Property Sector Charter Council reported that out of 31 property management companies listed on the JSE, only 4 originate from wholly black-owned asset management companies. This statistic reveals the harsh realities of transformation in this field.

The ANC needs to introduce intervention mechanisms both from a policy perspective and to a legislative perspective to ease the barriers to entry and also improve the financing chances for new entrants into the industry.

Interventions both at policy and legislative levels need to be considered with an intention to transform the property industry both at commercial, residential and retail space. This will be consistent with the promises of the freedom charter on the transformation of the economy and change of ownership of financing means and ownership.

7. TRADE AND REGIONAL INTEGRATION

Our trade strategy must integrate economic diplomacy through advancing the African Agenda, expanding regional and bilateral relations and creating opportunities for South-South Cooperation, leveraging our significant global diplomatic stature and coverage. There is immense reciprocity and symbiosis between trade and the political aspects of diplomatic relations, with latter contributing towards the strategic approach.

Our economic development is dependent on achieving equitable regional integration and the creation of a regional economic market. The SADC market has grown substantially over the last decade and regional GGP is now over $1trillion.

The challenges include:

- Natural tendency of unregulated capitalist development which polarises growth in favour of larger more powerful countries, regions and vested sectoral interests.

- Poor and inefficient logistics infrastructure.

- Lack of integrated and mutually beneficial industrial, agricultural and infrastructure strategies.

- Failure to leverage public and private procurement expenditure to maximise intra-regional production and job creation.

Government should focus its engagement in SACU, SADC and in other bilateral and regional fora to address these challenges and to realise the advantages of equitable regional economic integration.

8. INCOME INEQUALITY

Widening disparities in income, wealth, and opportunities have risen to the top of our concerns. We have focused on confronting inequality of opportunity, focusing on access to education and health and inequality in human capital, however much still needs to be done. Inequality of income is also a function of the distribution of economic assets and their rates of return.

Private wealth is not dislocated from the success of the economic system as a whole, the economy should not be seen as an abstract experience that distributes rewards to a few. The extent to which private wealth accumulation is viewed as not linked to socioeconomic context is problematic and poses challenges of sustainability and long-term stability.

The role of economic policy should therefore be to serve broader needs, including the need to re- distribute and empower. Thus, economic interventions should be appraised in terms of how functional they are in relation to our goals of lifting up our communities from poverty. We must place our human goals at the centre of our thinking in terms of the decisions we make daily, including our drive to deliver goods and services to our communities.

In this context, a variety of public policies have been used to improve the distribution of income and reduce inequality.

These can be grouped into:

(i) public spending on education, health, and social services to enhance human capacity and enable everyone in society to participate in employment;

(ii) direct income transfers that redistribute income; and

(iii) governance and institutional reforms to level the playing field and enable everyone in society to participate in and benefit from development on an equitable basis. However, strong economic development will open more options to intervene to address these disparities.

At the centre of this subject is what leads to the better or worse use of resources and what can be done towards better utilization and sharing of resources. Here enters the role of activism which must be continually enhanced. In this regard, we must curb the proliferation of activities that condemn society to economic impotence and corruption. We must carry out this task propelled by the ideals of our role as bearers of people’s liberation.

This speaks of responsibility that we have for one another as members of society, this responsibility for one another means we must challenge the notion of individualism and connect ourselves to the responsibility to society. The South African resources must promote the dignity of each South African.

9. CAPACITY OF THE STATE

The capacity of the state is a macroeconomic issue because it influences the behaviour of the economy as a whole. It is therefore important that we re-emphasise the need to continuously improve the capacity of the state.

Our role is to transform the orientation of public services to delivery-orientated service, to allow society a greater say in the coverage and quality of services delivered. This is central to improving the prospects of the poor. Quality of public services, in turn, depends on the quality of skills we employ.

In the 53rd Conference, the ANC resolved to make our government a more capable and effective state, with the technical and political capacity to lead development and transform the economy. This implies “a proper balance between political leadership and a professional public service”.

The quality of public service is one of the central elements to the “social contract” between the state and its citizens. It contributes directly to the legitimacy of the relationship with all citizens. Patronage arrangements often affect the stability of state institutions and significantly affect the management capacity to deliver.

However, one of the key challenges of the South African Public Service is to develop and retain competent leaders, technical staff and managers. Experience has shown that during the time of political changes of government, there is normally a high level of movement that can be expected, and most senior managers have accepted this reality.

While turnover within departments is inevitable and can even be healthy, the impact of high rates of turnover is negative, cumulative, and throws off the equilibrium of delivery teams. We must confront the mantra that “the higher you rise the more vulnerable you could be. Sometimes it happens as“ a consolidation of control and power” for new political deployees. In situations like this, departments become unfocused, and the public sector loses productivity as morale suffers. At a minimum, it costs government departments and agencies at least six months’ worth of someone’s compensation when managers are terminated in ways unjustifiable in law.

Government departments and agencies need to be more effectively coordinated and aligned so that we are able to achieve integrated planning and implementation of programmes. We note that a number of interim co-ordinating bodies have emerged (2010 World Cup, the 2008 National Electricity Response Team, 2013 Operation Phakisa, 2014 electricity war room, et al). However, there is still a lack of a higher level co-ordination of state capacity around economic development which needs to be addressed through a Presidential driven institutional arrangement (as per PICC) as well as sectoral co-ordination where necessary.

The strategic role of the state should be accompanied by increasing the economic planning capacity of the state, restoring its long-term economic perspective, which should provide an anchor around which private sector investment decisions should be made. This will require that we build state capacity, establishing high standards of employment in the public service, raise the levels of professionalism, discipline and a commitment to serve. The public sector must strengthen its planning capacity and project management skills.

On state-owned companies (SOEs) we need to attend as a matter of urgency the following areas:

- Board and fiduciary duties.

- Clear roles and responsibilities for boards and executives.

- We need to appoint competent board members and executives.

- Develop a clear strategy for the management for the dual role that the state-owned entities have.

- Review factors that impact on the sustainability and effectiveness of the SOEs.

9.1 THE LABOUR MARKET

The human being should be at the centre of all development activities. Key areas to enhance human development are employment, education, skills development and training.

Currently, 95% of the unemployed do not have tertiary education, 62% have less than secondary education, and 60% have been unemployed for more than a year. Unemployment affects young people the most; 40% of the unemployed are new entrants to the labour market, which are most likely to be young people; 72% of the unemployed are young people. Tackling the unemployment challenge is to a large degree similar to tackling youth unemployment.

Our objective is to attain full employment – with adult South Africans either employed or in meaningful self-employment. By 2030, the unemployment rate, broadly-defined, should not exceed 6%. Ideally, the majority of these should be in decent jobs characterised by a living wage, decent conditions of employment and appropriate benefits.

Achieving this objective requires a combination of interventions straddling macroeconomic policy, industrial strategy, infrastructure development, skills development as well as special measures targeting rural areas and vulnerable groups such as youth and women.

The basic approach is to ensure that the country utilises its natural resources and comparative advantages to expand its industrial base including manufacturing, and gradually improves the sophistication of its production capacity and services industries.

Most of the interventions required are outlined in the National Development Plan, including the set of programmes in the New Growth Path, the National Industrial Policy Framework and its attendant Industrial Policy Action Plans, the Infrastructure Development Plan and the National Skills Development Strategy.

Furthermore, the ANC remains committed to investigating the modalities for the introduction of a national minimum wage,as one of the key mechanisms to reduce income inequality.

Special immediate measures to absorb the unemployed: Mass absorption of the unemployed, especially youth and women, as an immediate task, requires a raft of interventions. These are contained in the NEDLAC agreement, the NDP and the NYDA’s programmes. Among others, these are:

- job and business set-asides for youth and women;

- driver training for school leavers, and transport subsidies linked to job search;

- strengthening the placement sector to prepare Matrics and place them in jobs;

- incentives to reduce the initial cost of hiring new entrants;

- expanding learnerships, apprenticeships as well as vocational and further education and training;

- intensification and further expansion of access to public and community works programmes and other such initiatives, with appropriate emphasis on the production of community assets and services.

10. CONCLUSION

The overview of economic programmes and policies outlined in this report gives a clear indication of the extent and vibrancy of the interventions of the ANC- led government, informed by its vision of building a democratic developmental state in South Africa.

Much is being done, yet much remains to be done, and much can be done better, smarter and more effectively. It is through a constant review of our various programmes and our interventions that the ANC will most effectively calibrate its economic programme and will achieve it goal of radical economic transformation, a transformation that will have the effect of improving the lives of ordinary South Africans. The upcoming organisational discussions in the build up to the NGC, and at the NGC meeting itself, offer the ANC an important opportunity for reflection and renewal.

DISCUSSION QUESTIONS

- In what way should progress from the Mangaung Conference inspire the role of ANC activists in radical economic transformation? How do we also inspire resilience to lack of progress?

-How can we accelerate economic development as people who are committed to changing the material lives of South Africans?

- What behaviour should the public service personnel demonstrate in the discharge of their duties? How should they be resocialised to effectively drive radical economic transformation?

- Why has private sector investment failed to rise to the call despite the programme of investment in public infrastructure which aimed at stimulating private sector investment? What should be done to stimulate private sector investment

- What are the risks associated with rising government debt? Is it important to take steps to reduce government debt, even if this means controlling spending (including on public servant wages) and raising some taxes?

- How best can inequality of wealth and income be reduced? What strategies should be adopted to achieve the objectives of reduced wealth and income inequality?

- How can we best leverage the people’s assets (land, minerals, water, fisheries, EM? spectrum, etc.) to best catalyse economic development and transformation?

- What steps can be taken to improve service delivery and improve the quality of public services, such as, education, health care and municipal services?

- How best can small business and cooperatives be promoted intensively, and a culture of entrepreneurship be encouraged, in order to see an increased number of successful small enterprises and concommitant employment creation? What role and impact can mass economic partication have in this regard?

- What can be done to boost local manufacturing and raise employment levels in local manufacturing? How can we encourage the development of black-owned industrial firms?

- Why mining is output declining? What can be done to increase mining investment, mining output, economic linkages and inter-generational equity?

- What can be done to make a greater success of land reform? What policies are needed to see the emergence of a large number of successful black farmers and black-owned agro-industry?

- What can be done to build and strengthen South Africa’s tourism, property, ICT and defence industries in the context of radical economic transformation?

- What are the main objectives of our programme of radical economic transformation? How do we measure the success of our programmes? Do we prioritise ‘instruments’ or‘outcomes’?

- With regards to building the capacity of the (developmental) state:

o How do we build the state’s political capacity to mobilise the society on the radical economic transformation path?

o How do we build the state’s developmental capacity re-socialise the society towards an economically transformed society?

- How do we intensify our campaign for reform of the banking and financial services sector such that it improves its contribution to economic transformation?

Issued by the ANC, August 17 2015