Dunkeld Country Estate
Dullstroom
20 SEPTEMBER 2004
Programme director,
MEC Mabena and other MEC's present today
Your Excellencies, mayors and representatives of local government
Leaders and representatives of the business community, workers and broader
civil society
Distinguished guests
Ladies and gentlemen
It is a special pleasure for me to be here with you today, at the occasion of the Mpumalanga "Industrial" Summit.
This Summit is the outcome of extensive consultations and partnership between government and relevant stakeholders in our province.
It is truly a significant sign of what can be achieved through "forging partnerships" for the development of our province.
Indeed today Dullstroom is a symbol of hope and our unwavering commitment to
turning into a reality the people's contract to create work and fight poverty.
Upon the election of the Provincial Executive Council, we announced that we
would meet with our social partners in order to consolidate a common vision on
the promotion of rising levels of growth, investment, job creation and
people-centred development in the province.
Today, I am pleased to report that we have initiated and held various interactions with our social partners across the province. We have met with Sasol in Secunda, Eskom in Witbank, COSATU, organized business, and various community based groups, amongst others.
In all these engagements we have exchanged views and shared our understanding of what needs to be done to grow the provincial economy and to improve the lives of our people.
I am pleased to also report that preparations for the Provincial Growth and Development Summit are on course.
In line with our vision of the Summit and what it is supposed to achieve, various 'sectoral' Indabas, forums, and mini-Summits are being held to ensure that we are thorough in our preparations and to ensure that the Summit will be a success.
You will recall that since June, we have held a provincial Taxi Summit, a public sector service delivery Summit, and a Tourism Indaba. A provincial "Roads" Indaba is also planned for later this year.
Mpumalanga is a province that is generously endowed with natural resources. We have extensive deposits of coal, gold, chrome, magnesite, iron ore, vanadium, limestone, dolomite and silica, amongst others.
We are the 'energy' province in our country, producing more than half of our country's electricity needs through Eskom.
The unique combination of mining and energy capabilities in our province have over time given rise to substantial downstream activity in such sectors such as iron and steel, mineral beneficiation and heavy chemicals.
As the country's dominant forestry production area and source of many agricultural products, we have also contributed to the growth of manufacturing sub-sectors such as agro-processing, wood and wood products, and pulp and paper, among others.
Nevertheless, despite having the natural endowments and existing industrial capabilities that would be the envy of many, our province has not matched its potential.
As presented in the Mpumalanga Development Profile, prepared by the Development Bank of Southern Africa (DBSA), our provincial economy has grown slower than the national economy between 1990 and 2002.
Even as our growth accelerated, during the period 1996-2002, it has been slower than that of provinces such as Gauteng, Limpopo, and KwaZulu-Natal.
Challenges
The challenges facing our province, in particular and our country in general, are immense.
Many of our people are unemployed or find themselves in productive activities that utilize little of their abilities and offer limited rewards.
Many of our people are also poor and not only lack access to basic services such as housing, health, adequate education and nutrition, but also have high degrees of 'vulnerability' to events that they cannot control and are often marginalized from important local and national institutions.
As we enter the Second Decade of Freedom, we have committed ourselves to addressing these challenges by speeding up the creation of work and by further strengthening the fight against poverty.
We have said that a foundation has been laid by previous administrations in the province from which we can solidify the quantitative and qualitative gains that have been made in improving the well-being of our people.
We have consistently been mindful of the possible dramatic impacts that can be made by a concerted focus on the economic growth path of our region.
I am sure that we would all agree that a growing and sustainable provincial economy is the key to addressing many of the challenges that we face and for extending the scope of development and empowerment in the province.
This Industrial Summit is a reflection of our seriousness about growing the provincial economy
Intention
Our intention to host a Provincial Growth and Development Summit is testimony to our resolve that such a Summit should outline concrete plans and programmes for addressing the growth and development challenges that we face as a province.
Our engagements today and tomorrow should lay a solid foundation for a provincial Growth and Development Summit that will be inclusive, comprehensive and decisive in nature.
It will be inclusive in terms of participation by all relevant stakeholders in our province. It will be comprehensive with regards to the sectors of the economy that will be discussed such as agriculture, tourism, industry, and services. Finally, it will be decisive because it will deliver bold and meaningful outcomes that will open a new chapter for our province and improve the conditions faced by our people in their day to day experiences.
Therefore it is with much anticipation that we await your deliberations during the course of the “Industrial” Summit. We hope that you can, amongst other things, shed light on the reasons for our comparatively poor economic performance and the possible remedies or strategies that can improve the contribution of our industrial sectors to the overall development of our provincial economy.
We are aware that you will also discuss the state of our various industrial sectors and to assess the progress that has been made with regard to the industrial strategy that was adopted in 1995.
We look forward to engaging with you on possible areas for further interventions and suggestions for partnerships that can maximize this sectors contribution to the development of the province and to its ability to address the twin challenges of poverty and unemployment.
Maputo Development Corridor
Allow me to emphasize that your deliberations must include reference to the Maputo Development Corridor.
The significance of the Maputo Development Corridor to the success of Mpumalanga as a province, and to industrial development of our region and the country as a whole, cannot be overemphasized.
The Corridor is a testament to the co-operation of the people of Mozambique and South Africa both in their struggles against oppression and in the new struggle against poverty and destitution.
Therefore this Summit should elaborate on how we can maximize the economic advantages of the Maputo Development Corridor within the spirit of regional integration and the New Partnership for Africa’s Development (NEPAD).
I urge you to honestly assess how far we have fulfilled the objectives of the Corridor, as initially outlined in 1996.
This Summit should consider the necessary forward steps that can improve the Maputo Development Corridor’s impact on profitability and efficiency in the transport sector which, as we all know, can present further competitive advantages to the various sectors of our provincial economy, such as mining, energy, manufacturing, agriculture, and tourism.
I wish to further assure you that as the Mpumalanga Provincial Government we will take the outcome of your deliberations very seriously. We are committed to exploring issues around the longer-term management, co-ordination and promotion of the Corridor.
It will also be necessary that we engage in partnership with all relevant
stakeholders that have been involved in this work, in our own country and in
neighbouring Mozambique.
The challenge of “two” economies
A consensus has emerged that suggests that our country is to be best understood as being characterized by two parallel economies, the First and the Second.
As our President has indicated, the First Economy is modern, produces the bulk of our country's wealth and is integrated within the global economy.
On the other hand, the Second Economy is characterized by, amongst other things, underdevelopment, contributes little to GDP, is structurally disconnected from both the First and the global economy, and is incapable of self-generated growth and development.
I would like to suggest that our province epitomizes in concrete terms what our President has spoken about.
On the one hand we have large scale and world-class primary industry concerns processing and beneficiating the province's available natural resources. Yet on the other hand, we have thousands of our people seeking to develop livelihoods in situations of underdevelopment and lack of access to assets and markets.
As a provincial government, we are committed to supporting the growth and development of the "First Economy". Yet we all need to do more to respond to the challenges of the "Second economy".
We look forward to your deliberations and possible recommendations that you can make about how to develop and enhance linkages between the First and Second Economy in our province.
The theme of this Summit is "Forging partnerships for industrial development" and we are all here today because we agree that there are numerous challenges that are constraining the performance of our industries.
We agree that these challenges call for a unity of purpose and a genuine partnership, particularly between government and all relevant stakeholders.
We are all here today because we also recognize the role that industrial development can play in the development of our province.
Not only will the development of industry lead to the direct creation of incomes and jobs but it can generate the necessary resources that can facilitate empowerment, and most importantly, the transformation of the Second Economy.
The presence of viable and profitable industries in our province can also contribute directly to poverty eradication, as firms begin to take seriously their corporate social responsibilities and impact on the lives of those in communities wherein they are located.
For us corporate social responsibility goes beyond companies making a few donations here and there as part of their PR campaigns.
For us corporate social responsibility involves companies adhering to all
relevant labour, environment and other regulations. It is about respecting
rights in the workplace, particularly those that govern minimum standards,
equity, occupational health and safety, skills development and social security.
As the provincial government we have placed on record our commitment to "forging partnerships" to address the challenges facing our province.
We have put in place various initiatives in an effort to promote industrial development in the province. These have included the establishment of Local Business Service Centres, micro-credit outlets and village banks, the setting up of a jewellery school, support for research and development, technoparks and incubators, amongst others.
This obviously excludes the contribution of our provincial development agencies such as the Mpumalanga Investment Initiative (MII), and the Mpumalanga Empowerment Corporation (MEEC), which have been substantial but overshadowed unfairly by coverage on corporate governance challenges.
The role of the provincial government and its agencies in promoting industrial development is one that is constantly monitored and reviewed. We look forward to receiving your assessments and suggestions. We have long recognized that these days it is not only about the policies that are in place but also about the type of institutions that we have in place for implementation.
Let me take this opportunity again to thank you for taking part in what we hope will be another groundbreaking Summit in the Mpumalanga province.
It is my firm belief that through 'forging partnerships for industrial development’; we will contribute to a growing provincial economy and a better life for all our people.
Together we can fulfill the people's contract to create jobs and eradicate poverty.
May you have fruitful and meaningful deliberations during the rest of the Summit.
I thank you.