as Chairman, presented the First Report of the Standing Select Committee on Environment Affairs, dated 11 August 1987, as follows:

Bill to be read a second time.

as Chairman, presented the Second Report of the Standing Select Committee on Environment Affairs, dated 11 August 1987, as follows:

Bill to be read a second time.

Mr Chairman, I move without notice:

Agreed to.

Mr Chairman, allow me first of all to congratulate the hon member for Constantia as well as the hon member Comdt Derby-Lewis upon their nominations as main speakers and Chairmen of their study groups. We look forward to co-operating with them. Allow me also to congratulate the hon members for East London City and Stilfontein upon their election as chairmen of the Standing Committee on Trade and Industry and the Standing Committee on Manpower, Mineral and Energy Affairs, respectively.

The two most senior officials in the Department of Trade and Industry are soon to retire from the public service and I want to make use of this opportunity to convey the Government’s sincere thanks to them for the many years of dedicated and unstinting service to the State, in particular to the departments to which they were attached. The first official is Mr C M Scheepers, Mr Frans Scheepers as we know him, the Deputy Director General: Trade, who served in a great diversity of posts since 1944, mainly in the Department of Trade and Industry. Towards the end of the year he will be retiring after nearly 44 years of service. It is a privilege for me to be able to confirm that Mr Scheepers performed his task with distinction during all these many years. He has a remarkable knowledge and insight into the department and all its operations. That applies to both the trade and the industry branches of the department. That knowledge and insight will be difficult to match.

The other official is Mr S J P du Plessis, or rather Mr Sarel du Plessis, our Director General, who entered the service of the Department of the Interior at the beginning of 1948. Afterwards he progressed to the position of Secretary of the Treasury in the Department of Finance. He occupied this position from 1 April 1979. When the regrading of the posts of departmental heads to Director General took place, Mr Du Plessis was appointed head of the Department of Mineral and Energy Affairs in April 1980. As from 1 July 1984 he was appointed Director General of the Department of Trade and Industry. As a result of his knowledge and experience he served on various committees and boards, inter alia as chairman of the Energy Policy Committee.

The State President’s award for meritorious service was awarded to him on 7 August 1987 for dedicated, unstinting service to the State in general and to the Department of Finance, the Department of Mineral and Energy Affairs as well as to the Department of Trade and Industry in particular. [Interjections.] I also want to take this opportunity to congratulate Mr Du Plessis very sincerely upon this special award the hon the State President presented to him for his remarkable achievements and service.

He will be retiring early in 1988, and I wish him as well as Mr Scheepers and their wives much joy and good health in the years which still lie ahead of them.

It is the first time that I have the privilege of speaking in the House of Assembly under the auspices of this portfolio of Economic Affairs and Technology. One of the responsible components is the Department of Trade and Industry. Allow me therefore to pay tribute to my predecessor, the hon member for Piketberg, Dr Dawie de Villiers. I find his imprint all over the department. In many cases it is a are deep imprint. Figuratively speaking I want to say that he has left his footprints in the economic sands of South Africa. It is my privilege to be following in those footsteps.

The Ministry of Economy Affairs and Technology came into existence on 1 December 1986. It is made up of the Departments of Trade and Industry and Mineral and Energy Affairs, and includes Tourism and Technology Planning. The two departments will continue to function separately under the respective Director Generals. It is not envisaged that the two departments will in due curse amalgamate completely and form only one department under one Director General. The fields of operation of the two institutions are to a certain extent to divergent for that.

I should like to add that the fundamental readjustment investigation, which was initiated by the Commission for Administration, has already been carried out in both departments. The recommendations arising from the investigation are at present being implemented. With the combining of the two departments under one ministry, an attempt was made to co-ordinate economic policy formulation and implementation in respect of certain facets of the real sector of the economy at an earlier stage of the policy process, in other words earlier than had been previously been the case. In particular it was also done with a view especially to the fact that the further beneficiation of our minerals will play an increasingly important role in future.

The overall co-ordination of economic policy measures must eventually prevent one sector of the economy unwittingly being developed at the expense of another sector. For example the Board of Trade and Industry is presently engaged in an enquiry into the effect of the exchange rate level of the rand as well as the exchange rate fluctuations on the industrial protection policy. In this enquiry the effect of tariff protection on the cost structure of various other sectors will also be considered.

We are all thoroughly aware of the fact that the short-term monetary and fiscal measures have implications for strategies in other fields. Those who pay special attention to the development of the real economy from time to time adopt standpoints on economic variables such as the exchange rate and the inflation rate, and that is quite understandable. There is also the opportunity and scope within the institutional policy framework of the Government to reconcile divergent standpoints.

The addition of technology to the Ministerial portfolio has resulted in technology acquiring an effective say at the highest level of decision-making. The Government acknowledges in this way, the importance of technology in pursuing the economic objectives of our country. The recently announced Advisory Council for Technology is already giving attention to the development and identification of particular projects for the establishment of technology. In practice adjustments have already been made to make research at scientific councils more market-orientated. Hon members have probably taken cognisance of the fact that the CSIR has made a fundamental change in its approach to the development of technology and that in this way a closer link-up with the needs of the industry is being striven for.

Provision is also being made for a national research and advisory committee system, on which the private sector will be afforded greater participation. Because of the magnitude of my task, and seen from a managerial point of view I have transferred certain functions according to departments to the two Deputy Ministers who were assigned to the Ministry. Deputy Minister Bartlett is mainly responsible for certain affairs which fall under the Department of Mineral and Energy Affairs, as well as the Sugar Act, which falls under the Department of Trade and Industry. Deputy Minister Dr Alant has powers over certain matters which fall within the ambit of the Department of Trade and Industry. I myself retain the responsibility with regard to matters relating to the Liquor Act, the Competition Board, the SABS, the CSIR, the IDC, the SBDC, Iscor, tourism and technology as well as the administration of South Africa’s trade relations and international trade treaty obligations as well as all other matters regarding the supply of energy as well as the Diamond Act.

†The task of the Ministry of Economic Affairs and Technology is aimed mainly at providing, within the framework of general economic policy, momentum to economic growth and employment creation in particular sections of the real sector of the economy. The instruments to give effect include, among others, semi-monetary measures, certain regulatory measures, specific supply strategies in particular as far as strategic energy supply is concerned, measures for protect the consumer and, in general, the physical provision of services to, for example, the export community and various other branches of the real sector.

Allow me briefly to explain a few of the Ministry’s policy approaches. The Government has repeatedly emphasised its constitutional commitment to the promotion of private initiative and effective competition in a market-oriented economic order. I identify myself with this objective. However, as the market system does not function perfectly under all circumstances, and as there is also from time to time a greater need for a more pro-active approach, this objective does not eliminate the Government’s overall responsibility to give guidance to certain elements of the market sector.

I want now to give a brief review of the economic state of affairs in a few branches of the economy which fall under the Ministry’s field of operation.

Secondary industry provides the largest contribution to the gross domestic product at current prices. In 1986 this sector’s contribution was equal to 21,5%, while work was provided for more than 1,3 million persons. This is equal to approximately 14% of the total economically active population, which also makes this sector the largest employer in the Republic.

As far as the present level of activity is concerned, divergent tendencies are discernible. In the motor industry improved business conditions are being experienced as a result of increased vehicle sales, while the revival in building activity benefits the manufacturers of building materials. The manufacturers of electrical machinery and apparatus, which includes electronics, are also experiencing improved conditions of demand.

At present production is expanding at lower rates than previously in sectors which are dependent on private consumption expenditure on semi-durable goods such as clothing, textiles and furniture, as well as in sectors dependent on exports, such as the paper and base metal products industries.

Approximately 250 000 persons are employed in one or other branch of the tourism industry. In 1986 South African inhabitants spent R2,883 billion on recreation, accommodation and meals. Higher levels of occupancy were experienced in all sectors of the domestic tourism industry during 1986. In the first five months of 1987 overseas visitors to the country increased by 10%. The Tourism Board is confident that the decline in the number of overseas tourists during the past two years will be offset sooner than had been expected.

During 1986 mining again made the second largest contribution to the gross domestic product at current prices, namely more than 16%, and provided employment for more than 750 000 persons. Mineral sales increased by 13,9% to R29,468 billion during 1986. Export receipts, which represented 85,4% of the total sales, showed an increase of 13,5%. This was attributable to substantially increased prices realised for gold and the platinum group of metals in particular. Sales on the local market increased by 15,8%.

*My personal vision of our economic future is based on an accountable role for the authorities; the optimal development of all our resources including capital, labour, raw materials and entrepreneurship; and in the main the productive broadening of our economic base. We shall only have long-term peace and prosperity if everyone in this country enjoys a productive share in the economy.

We may differ as to the way in which that share should be allocated; about the precise role the private sector and the State, respectively should play. I am convinced, however, that responsible South Africans of all population groups will agree with me that it cannot happen by adopting a course of total nationalisation as advocated in the “Freedom Charter”, which was again presented recently as the great solution by the UDF in a full-page advertisement published in some daily newspapers.

The greatest possible productive participation in the economy inevitably excludes nationalisation. A respected Minister of Finance of a free market oriented country in Africa once referred to experiments conducted on a centralised basis in certain African countries and said:

In view of this I should like to express my appreciation for the programmes which have been launched by the private sector to bring it home to workers that in reality they have a vested interest in the survival and profitability of the private business enterprise. I am referring to programmes such as participating management systems, the handling of problems at worker level, the effective planning of occupational progress for all workers, special training programmes in which workers are told of the advantages of the market oriented system and profit sharing schemes, for example in which farm labourers are allowed to cultivate certain lands for their own account or in which ordinary workers are encouraged to take up shares in the undertaking.

Hon members will agree with me that although a considerable amount has been done, a great deal still remains to be done. It is not solely the responsibility of the Government to ensure that everyone has a share in the economy. The private sector will have to make a purposeful effort, not only in respect of employees in the formal sector, but also in respect of the aspirations of the informal sector, to give greater substance and meaning to the effort which is at present being made to broaden the economy. In this process, vested interests and deregulation will have to be reconciled.

My scenario for certain aspects of the role of the authorities in the future economic development process is briefly as follows: The authorities can, through the performance of its role in the economy, inter alia by concentrating on the rules of the game, and by supporting human educational processes for example, facilitate entry to the economy and in so doing make a significant contribution to the broadening economic base.

As hon members know, expenditure on education is the largest single item of expenditure in the Budget. The Government is also endeavouring to bring the virtues of free enterprise home to all population groups and to broaden the opportunities for participation. The Government is also engaged in identifying and supporting structural growth factors in the economy by means of specific strategies. Up to and including the ’sixties the emphasis on import replacement resulted in phenomenal growth possibilities, especially in the industrial sector. Since the market circumstances in South Africa and other factors prevented indefinite concentration on this strategy, greater reliance was in due course placed on other growth factors such as export promotion. The role that exports as a growth factor played in the South African economy over the last few decades is general knowledge.

The Government is not blind to the world around us, and that is why we are not naively channelling all our energies and activities into one or two directions only. South Africa’s industrial development strategy, which was announced in 1985 in the form of a White Paper, advocated a balanced three-pronged approach, namely import replacement, coordinated with the promotion of exports and the further development of the local market. The process of deregulation opens the door for a process of internal industrialisation which not only constitutes an important facet of the productive development of the local market, but also develops a suction-force which attracts all groups into the economy and adds momentum to the entry of the informal sector.

In conjunction with this co-ordinated approach to industrial development the Board of Trade and Industry has been directed in co-operation with the private sector, to develop distinctive long-term strategies for the various industrial sectors. It is essential that the members of the relevant sectors commit themselves to the achievement of the objectives that have been set. In the process import replacement and export promotion will occur on an even more co-ordinated basis. I want to mention an example. Tariff protection has a cost-effect which has to be borne by the economy as a whole. That is why it is only fair that society can, in appropriate cases, expect a quid pro quo in the form of exports or increased exports from industries which apply for tariff protection or, are already receiving it at this stage.

In a similar vein, the present revision of the Government’s export incentives is aimed at linking the allocation of incentives to achievements in the export market. The board will therefore, with the Government’s objectives in mind, and in co-operation with industry, agree upon a strategic approach. It will serve as the basis for the recommendations concerning tariff protection and export incentives for every industry.

The Government’s role as initiator of massive projects is also prominent as an important element in the process of restoring confidence. Consequently I have much pleasure in making an announcement concerning the future development of the liquid fuel industry.

The liquid fuel industry in South Africa will be expanded considerably during the next few years. This includes the Mossel Bay project as well as installations such as those of AECI and Gencor. Such a development programme will place a heavy financial burden on the Central Energy Fund and therefore on the fuel consumer. In order to relieve this burden and to adapt to the privatisation policy of the Government, the policy of the CEF is to encourage maximum private sector participation in the synthetic fuel industry of South Africa. After a period of uncertainty as to the reaction of the private sector in becoming directly involved in the Mossel Bay project, I can announce today that I have received confirmation from various organisations in the private sector that would like to participate.

In order to facilitate the implementation of this facet of the privatisation policy the Cabinet has, at the request of and in consultation with the board of directors of the Industrial Development Corporation, given its approval to participation by the IDC, as a direct shareholder, in the envisaged synthetic fuel projects.

The IDC is a corporative body with the Government of South Africa as sole shareholder, and is today a financially strong organisation which has since the early fifties been independent of State funds for its normal activities. The IDC’s objectives are to make medium and long-term finance available for the development of viable secondary industries in South Africa, in addition to acting on a selective basis as underwriter of new industries and in that way implementing appropriate industrial strategies.

It was, and still is, Government policy that the IDC will only support projects possessing economic merit and will serve as a catalyst for private sector participation. The direct involvement of the IDC in the envisaged synthetic fuel projects will considerably reduce the extent of the private sector investor’s risk, and the Government trusts that this will definitely encourage private participation.

The various facets of the activities of the two departments and those of the associated institutions which fall under the Ministry will be discussed thoroughly in this debate. My speech was aimed at giving members a general idea of our approach and our policies.

I should like to make use of this opportunity of thanking the chairmen of the committees concerned again, although I did thank them at the beginning of the speech.

Mr Chairman, I request the privilege of the first half-hour.

I should like to begin by congratulating the hon the Minister on behalf of this side of the House on the fact that these two very important functions in our country have been consolidated under his leadership. I think that this decision is a tremendous compliment to the hon the Minister as far as his position is concerned.

I should also like to extend congratulations to the hon the Deputy Minister, Dr Alant, on his appointment. This is his first appearance in this House in his official capacity as far as this debate is concerned, and we wish to give both him and the hon the Minister the assurance that where our party policy and principles allow of it, he can expect the utmost co-operation from this side of the House.

I should also like to extend congratulations and best wishes from this side of the House to Mr Scheepers on his retirement. We wish him a very happy retirement and congratulate him on what he has done for South Africa.

Mr Du Plessis is also retiring. He has really had an illustrious career in the department and I certainly hope that although he is retiring, he will not be lost to the department, because I think he is the sort of person that one should hang on to for as long as possible.

In repeating my assurance to the hon the Minister that he can expect the utmost co-operation from this side of the House, I want to refer to a report by the Department of Trade and Industry covering the objectives and functions of the department. I believe it is quite clear from the opening paragraph of that report why we are prepared to support him. It states:

Although it is quite obvious from the report given by the hon the Minister that all is well with his department, I am sure the hon the Minister will be the first one to agree with me when I say that all is not well with our economy in South Africa. I think the economic malaise we are experiencing is caused by six factors, some of which are beyond the control of the hon the Minister and will therefore not receive much attention from me in this debate.

The first cause of our economic problems is overspending by the Government. The second factor I see as the resultant overborrowing by the Government. The third is the overconcentration in the economy, and the fourth factor is the printing of too much money. The fifth factor is overtaxation by the Government, and the sixth is the paying of too high wages without a concomitant increase in productivity.

I do not want to dwell too long on the factor of overspending because I do not think that the department controlled by the hon the Minister can be accused of overspending; in fact, I would like to see a lot more money spent, particularly as far as the Consumer Council is concerned. I think that that organisation, as one of the few organisations which really have the interests of the South African consumer at heart, should be given the funds to enable it to extend its area of activity; in other words, to give it more teeth. I think that the interests of the consumer need to receive a lot more attention than is presently the case.

On the question of overspending I also think in terms of the tremendous job being done by the Tourism Board. I do not intend dwelling upon this aspect—one of my colleagues will be covering this in more detail—but I must say that I sometimes wonder whether we should not replace the Department of Foreign Affairs with the Tourism Board, because that will certainly help to improve South Africa’s image overseas dramatically.

To get back to the factor of overspending I wish to say that I think it is quite apparent that we are overspending in South Africa. Unfortunately, most of the spending is devoted to non-productive items such as housing projects. Instead, factories should be built or we should help to generate employment at subsistence level in the national self-governing states, with particular emphasis on agriculture.

Secondly, concerning the question of overborrowing, I would like to point out that we saw the scenario develop in South Africa where exchange control was abolished at a time when the Reserve Bank in its wisdom decided to lumber South Africa with higher interest rates, supposedly in the interests of free enterprise to allow the movement of interest rates on a natural basis. As a result of the increase in local interest rates overseas money became a lot cheaper for South Africans generally and for businessmen in particular. The result was that there was a stampede to utilise all of this lovely lolly from overseas at low interest rates. Because of the fact that there was no control over the issue, South Africa found itself in a disastrous debt situation. I sometimes wonder whether the advocates of the conspiracy philosophy do not have a point when one thinks of how quickly South Africa found itself in a serious overseas debt situation because of the dangling carrot in the form of very low and favourable interest rates.

Subsequent to that we had overseas political pressure on South Africa, resulting in the Chase Manhattan Bank in particular pulling the rug out from under the feet of the borrowers in our country, thus forcing South Africa into a situation where overseas bankers could hold us to ransom in attempting to force us into making reforms that even we knew were against the interests of South Africa.

We therefore found ourselves in the situation where South Africa had to go cap-in-hand to the overseas bankers and actually beg them to take it easy on us when in fact we had no reason to do that, considering the whole structure and the wealth of this beautiful country of ours.

The third item I want to cover is the one of overconcentration, and I think this is an area to which the hon the Minister could give a lot more attention. I know that the Competition Board—according to their report—is and has been investigating for a number of years the situation regarding the concentration of power in the economic sector.

I recently attended a meeting of an executive forum which has very recently been set up by one of our prominent national dailies. The discussion went around the question of the concentration of power, and the two participants in this debate were very well-known people. The one was Mr Robin McGregor, whom we all know from his investigations into the real powers behind the financial and economic thrones in South Africa, and the other was the president of the Johannesburg Stock Exchange.

The debate centred upon whether there was, first of all, a concentration of power and, secondly, whether a concentration of power was in fact harmful to South Africa’s economy. When I quote from the addresses by these gentlemen, I think what I am getting at will become much clearer. Mr McGregor opens by saying the following:

and I wish he would repeat it every day of the week—

He goes on to say, and I quote:

I am going to have to refer to them again in order to illustrate the subject of my address today.

He further says, and I quote:

By far the majority of those 8 500 additional subsidiaries are the result of acquisition. There have been very few grassroot developments, and hence very few new jobs created.

As we all know there has been a considerable flurry lately on the JSE thanks to all the new listings, and the development capital market has done a great job in providing the capital for these.

This of course resulted in development capital becoming scarce as far as other developments were concerned. In other words, the development capital was being utilised to acquire size by the monopoly at the expense of the development of our economy.

Mr McGregor went on to say that the concentration of control had spawned monopolies, cartels, protectionist lobbying, and diseconomy of scale in that they encouraged a type of bureaucratic inefficiency. He is saying that although the private sector is always quick to criticise the public sector for its bureaucratic inefficiency, because of the monopolies now being created, these monopolies are becoming so big that they too have become guilty of so-called bureaucratic inefficiency.

According to Mr McGregor these cartels and monopolies exist in the following industries: Food, fertilizer, cement, animal feed, paper, fuel, chemical, pharmaceutical, insurance, sugar and brick. It is very serious to know that all these industries are involved in these cartels.

The Competition Board is investigating this but I want to say that the effect of these monopolies on the real cost of living in South Africa is not nearly reflected in the so-called inflation rate on which we base all our assessments. I am sure that if we investigate this we will find that the inflation rate is closer to 30% or even 40% than to the so-called 16%.

Mr McGregor went on to say:

He then looks at the concentrations and says that he studied the position over the past five years and found that 65% of the shares on the JSE were owned by only 1 200 shareholders, and that there were not more than 300 000 shareholders in total. I think hon members will agree with me that this is a very serious situation. In fact it is a far more serious situation than existed prior to the fall of both the Greek and the Roman Empires where the wealth was held in the hands of a very small percentage of the population. There is a far more serious situation in South Africa.

He went on to say that the same study led them to believe that not more than 10% to 15% of shares registered on the JSE were actually traded. Mr Norton, the president, had subsequently stated that he believed that trading of shares involved only 6% of the shares registered on the JSE.

He also had this to say:

Mr McGregor said further that they have two scenarios. The one is a highly inflationary public sector structure because of excessive State spending—this confirms what I have said—and intervention on the one hand, and concentration of control in the private sector on the other hand. He continued:

Mr Norton in his reply admitted that there was a concentration of power on the JSE but that in fact it was not dangerous. He did not agree that it was wrong in any way, nor did he suggest ways of breaking it down. He said:

This is now big business talking—

On complaints that the shareholding on the JSE was held by but a few, he said that broadening the base of share-ownership could be done in several ways. People could gain access to a large share of a government issue of equity through the privatisation of State concerns.

What Mr Norton is saying, is that there should be no breaking down of the existing monopolies. He encourages privatisation under the pretence that ‘the public’ will have more say in the running of the country through shareholdings. What he does not say is that ‘the public’ has not got a snowball’s chance of running or controlling anything in this country through share-ownership, given the tremendous cash resources available to big business. If privatised, State assets will be transferred to the Anglo monopoly.

Anglo already controls 60% of all of the companies on the Johannesburg Stock Exchange. It is this concentration that is also avoiding its tax obligations to South Africa.

Unless we want to exchange government by the people for government by big business, urgent action is needed in this regard. The Competition Board has been investigating this whole matter and maybe they need to engage Mr McGregor as a consultant for this purpose to help reach a speedy conclusion to what is a very serious matter.

I do not want to dwell on the question of the overprinting of money. Suffice to repeat a story which was told to me. It goes along the fines that in the 14th century there was a very good looking French king, Philip le Bel, who like our hon Minister of Finance was always short of cash. In order to raise funds for his wildcat schemes he devised a very ingenious scheme. In those days the currency consisted of silver coins, and Philip ordered every citizen to bring his silver coins to the Treasury. There he drilled a hole in the centre, returned the now centreless coins and used the silver to mint more centreless coins, thereby inflating the currency by approximately 25%.

Historians have openly scolded Philip Le Bel as a counterfeiter, a robber and the evil king of the Middle Ages, but his exploits pale into insignificance when compared to what the leftwing radical NP Government has done to our currency. [Interjections.] When the NP came to power in 1948 the rand was the equivalent of nine Swiss francs and two American dollars. When the hon the State President took control of the NP in 1979, the rand was equal to 1,3 dollars. Today the rand is equal to 1,25 Swiss francs and half a dollar. Of course, modern governments need not drill holes in coins any more; they simply switch on the printing press for paper money. This needs to be carefully limited and the hon the Minister will have to address his colleague, the hon the Minister of Finance, in this regard.

I do not think I need dwell on overtaxation. I think it is obvious that we are taxing the people in the top income brackets excessively and driving them out of the country, instead of encouraging them to become productive by reducing their tax base. We all know that Prof Owen Horwood considers the Government’s policy of the narrowing of the wage gap to be responsible for 50% of our inflation rate.

Before my time expires I would like to ask the hon the Minister whether he could request the Competition Board urgently to investigate the situation surrounding the bid for the acquisition of the controlling interest in the Putco bus company by the South African Black Taxi Owners’ Association. I have information—I have not been able to confirm it at this stage—that much of the money has been channelled to these people via the ANC. It places in the hands of relatively few people the power to disrupt our economy on the Witwalersrand absolutely merely by bringing those buses to a standstill. This is a dangerous situation which could be used to cripple our economy and was even strongly criticised by the Financial Mail.

There is another item that I would like to be investigated, and I actually indicated to the hon the Minister that I would be asking this question. There are many people who are suspicious of the whole attitude of the Small Business Development Corporation. They tell us that this organisation is designed only to provide small business opportunities for the other racial groups. They say Whites cannot possibly gain assistance, or experience extreme difficulty in obtaining assistance.

You are talking absolute nonsense!

I think that we need an answer to this question. I think we need to reassure people in this regard. I do not know whether this is true or false and I am not making accusations. However, I think the hon the Minister can clear the air by telling us how many White, Coloured, Indian and Black businessmen were assisted by, firstly, the Council for Small Business, and secondly, the Small Business Development Corporation for the year covered by the annual report of 1986. Furthermore we would like to know what the form was of the assistance rendered, and finally, what the cost involved was in the rendering of that assistance. Unfortunately, there is so little time available to discuss such an important Vote.

I would like to close by referring to a paragraph in the Competition Board’s report regarding newspapers and magazines. It is interesting to see from the report that they consider the independent opinion-forming media to be so much in the public interest and so important that they are prepared to overlook certain practices because they think it is in the public interest to maintain these independent opinion-forming media. I think the so-called independent opinion-forming media need also to be the subject of a very thorough investigation as to how they influence the people of South Africa towards their opinions and not towards independent opinions.

As a result of the shortage of time I am forced to end my speech. In closing I would just like to ask the hon the Minister a question on a point of information, referring to Vote 18: Trade and Industry. There is an increase of R433 million in the amount allocated for foreign trade relations and export promotion. I would appreciate it if the hon the Minister could give us more detailed information as to what this actually involves.

Mr Chairman, before I reply to certain aspects raised by the hon member Mr Derby-Lewis, I should like to begin, on behalf of this side of the Committee, by congratulating the hon the Minister and wishing him well on the addition of this important department to his portfolio. In the short time the hon the Minister has been at the helm, he has already put his stamp on this department. We look forward to the further developments he envisages. I also congratulate the hon the Deputy Ministers, Dr Alant and Mr Bartlett, on their appointments in the department concerned. The congratulations of this side of the Committee go to my predecessor, the hon member for Vasco, on his appointment as chairman of the Standing Committee on Finance. We should also like to associate ourselves with the hon the Minister’s congratulations and good wishes to Messrs Du Plessis and Scheepers on their retirement from the Public Service. We thank them for what they have done for South Africa during their long years of service.

In summing up the speech made by the hon member Mr Derby-Lewis, the words “superficial” and “contradictory” spring immediately to mind.

And meaningless.

The innuendo against the SBDC at the end of his speech showed him up, in my opinion, for what he is, a naked racist. [Interjections.] With relatively little effort, by reading one or two of the SBDC’s annual reports for example, the hon member could have obviated completely the question he asked. Such an attempt to cast suspicion in this way on a most fine and hard-working institution of this country was uncalled for.

For most of his speech the hon member ploughed with other people’s heifers. Naturally, it was interesting to see whose. The hon member, just like his leader, is a rara avis in many respects; more particularly on account of the fact that he came to Parliament as an indirectly elected member over the heads of quite a number of CP members, including two provincial leaders.

There are those who say that this is merely a transparent ploy to perused English speaking South Africans that there is room for them in the CP. The fact that there are so many English speaking members representing their constituencies on this side of the House shows this up as a farce. They will not fool anybody this way.

There are others who say that this is the pay-off the AWB had to get for the help they gave that party during the election.

What Vote are you discussing?

Order! The hon member for East London City must explain to me what Vote he is discussing.

Certainly, Mr Chairman. I am indicating the connection between that hon member and his party on the one hand and the AWB on the other, and the most interesting glimpse they have given us of that party’s economic thinking.

When one looks closely at the six points mentioned by the hon member and examines certain CP documents, one realises that their school of thought is in fact that of socialism rather than that of democracy and free enterprise.

Do you differ totally with the ANC’s Freedom Charter?

The hon member made enough of a racket a moment ago; now he may as well listen to what I have to say.

Order! The hon member Comdt Derby-Lewis has already made his speech. He has no occasion now to make another speech from his bench.

Mr Chairman, I do not blame him for wanting to try again, because he did not say very much the first time. [Interjections.]

The point is that in his speech the hon member made certain comments on a possible takeover by big business. Those comments in particular quite plainly embodied the sort of thing one encounters in the official documents of the AWB. I shall refer to merely two of that movement’s statements. One of the AWB demands is that the steadily increasing rate at which our basic industries are being controlled and taken over by foreign companies be opposed and that, when it is deemed to be in the interest of the people, they even be nationalised. Elsewhere this organisation says that the AWB believes in a people’s (volkseie) socialism. I should like to invite hon members of the CP participating in this debate later to tell us whether this school of thought, with which the hon member Mr Derby-Lewis has clearly aligned himself, is also part of their party’s policy.

Since they happen to be taking part in the debate, perhaps hon members of the CP could also tell us how they plan to apply their so-called partition policy in practice, particularly in view of the lavishness of their criticism regarding the so-called squandering of money by the Government and the extra money which the CP suggests had to be printed to compensate for that wastage. Their policy has nothing to do with genuine partition. It is not concern with naturally defined areas of land which are given to sovereign peoples. For them it concerns purely and simply the creation of artificial borders and the large-scale relocation—forced relocation—of thousands of people.

What Vote are you discussing now?'

Just listen; perhaps you will find out. [Interjections.]

Mr Chairman, I can understand the problem of the hon member for Barberton because, after listening to the hon member Mr Derby-Lewis, I do not know either whether what he said can be reconciled with what CP proclaims in its principles. The hon members of the CP are welcome to explain to us in the course of the debate how they intend to pay for their economic policy.

In the time remaining to me, I should merely like to broach certain main themes which will then be discussed in greater detail by other hon members on this side of the House.

It is generally accepted that, in order to realise its economic potential and make an acceptable standard of living possible for all its people, South Africa will have to achieve and maintain a growth rate of between 5% and 6%. For various reasons, that is considerably better than what has been attained in recent years.

To put it in perspective, it is important to bear in mind that the economic policy rests on three main pillars, namely monetary, fiscal and real economic policy. The latter comprises agriculture, mining, energy and industry, including imports and exports. Naturally there is close liaison and interaction among them. I concur with Dr McCrystal in regarding the third, that is the material economy, as the most important. When the real economy is not prosperous, one can do what one likes with the other two, but growth will not be promoted. There is no doubt that the monetary and fiscal policy of the authorities, especially over the past months, has been remarkably successful, as is clearly indicated by the successful achievements in the repayment of our international debt, the improvement in the balance of payments and the growth in reserves. However, it is now necessary for this policy to be applied to the real economy as well if the desired growth rate is to be achieved. The industrial sector will have to make a colossal contribution here.

If one examines the successes of the so-called wonder countries, particularly Japan, North Korea and Taiwan, one finds that their monetary and fiscal policies have always been sensitive to and directed towards their effect on the real economy and on the industrial sector in particular. Taiwan, for instance, has realised that its existence depends on the export of industrial products. As a result, their economic policy is focused on that alone. They did not allow other factors to disturb this purposefulness. The result was that there was such a degree of purposefulness in their approach that everyone in both the private and the public sectors knew precisely what they were striving for. Consequently, the private sector was able to undertake its planning with the full confidence that the government would support it and would do nothing to disadvantage the interests of the private sector if it always pursued this common goal.

This certainty concerning government actions naturally inspires confidence and makes investments in new capacity so much easier. In these countries, a production culture, as it were, came into existence, and the population as a whole was geared towards achieving the production of goods of the highest quality at the lowest prices.

By means of various measures, the authorities supported the private sector in this, and built up a firm understanding between the private sector and the authorities, so that the incentive measures intended to make the private sector internationally competitive would be maintained and continually adapted with that goal in mind. The entire planning of the sector was seen and expanded in this light.

Order! I regret to have to inform the hon member that his time has expired.

Mr Chairman, I am rising merely to afford the hon member an opportunity to complete his speech.

I thank the hon member for Brakpan.

If South Africa wishes to equal this achievement, the same will have to happen here. For their part, the authorities will have to look afresh at suitable and consistently applied incentive and aid measures for our industrialists. Industrialists will in turn have to realise that export does not simply comprise the sale of surplus capacity on the foreign market. Admittedly, new domestic markets will have to be exploited as far as possible, but capacity will have to be created and expanded with the specific purpose of achieving a steady flow to the international markets.

An important myth which South Africa must rid itself of is that our labour is cheap. Considering our working hours and the concomitant wage tariffs compared with those of the high performance countries, South Africa’s labour costs are just as high as and, in some cases, even higher than theirs. Increased productivity is therefore a sine qua non obviating this literally ascending problem and for our ability to be internationally competitive. In order to enter and exploit international markets successfully, we shall not only have to deliver the goods; we shall have to do so in such a way that we can compete in terms of both price and quality.

Exports are to a large degree the key to accelerated industrial growth. In this area, the refinement of raw materials prior to export presents great possibilities. If we are not geared in all appropriate sectors to processing raw materials produced here, thereby adding value before export, we shall not only be losing the opportunity of earning additional foreign exchange, but also squandering our most important assets, our raw materials. The maximal refinement of our raw materials before export is therefore necessary. In this regard, however, we must take care that such refinement processes do not irreparably disrupt the markets we now have for our raw materials.

It is a fact that various overseas industries which acquire some of our raw materials are vertically integrated. Should they not be able to acquire the raw material as such, but only the finished product, an entire component of their processing sector might collapse. Rather than allow that to happen, these countries would of course try to acquire raw materials elsewhere, even at higher prices. In many cases it would not be in our interests to disturb those markets to such an extent.

Refinement should therefore occur as much as possible, but it should be done after consultation and a balance must be maintained, especially when we are not the only supplier of the raw material.

Another sector which I think offers far more possibilities than we are currently realising, is that of tourism. The Tourism Board’s promotional slogan “South Africa—a world in one country” is a very appropriate one in view of the variety which our country offers the tourist. Much is already being done in this area by the authorities and the private sector. To realise the full potential, a far more purposeful strategy will have to be adopted. It is important to remember that tourism not only earns foreign exchange but also encourages goodwill and a better understanding of our country on the part of people who visit it.

Put briefly, if one looks at the tourism industry world wide, one finds that provided tourist attractions and amenities exist, and provided people are aware of them and can get to them, they will do so. Consequently there are three aspects which must be concentrated on. The natural and created amenities which there are must be developed fully, while further amenities must be created. By means of direct client-oriented programmes our natural tourist attractions and amenities must be actively promoted and marketed abroad. Thirdly, we must ensure that the tourists can get to and stay at the amenities as conveniently and cheaply as possible.

I believe, especially with regard to the creation of amenities, that the time may have come for us to give serious consideration to the creation of a tourism development corporation or a tourism bank, which could promote the financing and development of tourist facilities in a coordinated manner and on attractive terms.

Tourism is a priority in the national interest and should be dealt with and expanded in a similar manner to industrial development. I should therefore like to request the hon the Minister to give serious consideration to the establishment of such a financing institution—possibly on a level similar to the IDC.

Serious attention must also be given to ways of making it easier and cheaper for people to travel to our country. In consultation with the SAA and perhaps other airlines as well, reduced tariffs and suitable packages which would be internationally competitive must be considered. If necessary, financial assistance should perhaps be rendered by such a tourism bank in order to achieve this goal. The money spent by tourists in South Africa will more than compensate for any such financial assistance.

I should like to conclude with a few references to consumer protection. Despite the effect on the inflation rate of factors such as the protracted drought, the fluctuating gold price and exchange rate etc, South Africa has done relatively well in limiting it to what it is, but it is still too high. A high inflation rate has an inhibiting effect on exports. Most important, however, is that it hits the ordinary citizens hard, especially those in the lower and middle income groups, and has a negative effect on their standard of living.

The best counter to inflation has always been healthy competition. The Competition Board and the Board of Trade and Industries do much in* this regard. The consumer himself also has an important role to play by using his purchasing power with discretion. In view of our population structure, the purchasing power of our consumers will not have such an effect on prices as it has in other more sophisticated countries. Active measures by the authorities are therefore necessary. I am not advocating total price control, because that often promotes the evil it is meant to combat by artificially keeping down prices which, as soon as they are released from this artificial constraint, soar and bring about a complete disruption of the market. It must also be borne in mind that prices are influenced by factors outside the market over which neither the Government nor the private sector have any control. There is no easier or perfect solution, but counteraction is necessary.

While fiscal and monetary action is necessary at all times, more direct measures are also necessary, particularly to combat the rate of price increases. Such measures should preferably be taken by means of voluntary cooperation between the private and public sectors within a framework of set objectives. The Economic Advisory Council’s report on inflation is awaited with interest. Inflation remains enemy number one. If it is not brought within limits, all efforts to stimulate the economy will be defeated and it could virtually eliminate the advantages of a higher growth rate.

Mr Chairman, I should like to claim the privilege of the second half-hour.

I should like to join my hon colleagues in wishing the new hon Minister and his two hon Deputies well in the offices to which they have been appointed. I wish them success in the execution of their duties. I also want to congratulate the hon member for East London City upon his appointment as chief spokesman for his party on economic affairs and technology. In what he had to say today one could not find too much to quarrel with.

You are slipping!

It is unfortunate that the new hon Minister, to some extent, launched his new Ministry with the White Paper on Privatisation and Deregulation.

The hon member for Pinelands will give our detailed response to that White Paper. Suffice it for me to say that we consider it to be wishy-washy and disappointing in the circumstances, particularly insofar as it does not give a single example of a State entity to be privatized.

The major event in the economic environment over the past year, is the sanctions/dis-investment programme which has hit our economy and gathered steam. Who would have thought a year or two ago that giants such as Barclays, General Motors, Ford, IBM, Coca-Cola and Kodak would now be names of the past in this country? One can understand why this is happening. We do not agree with it, but one can understand that the cost-benefit balance has shifted for the directors and shareholders of these major companies. The harassment and the continual pressure that they are subjected to in their board and general meetings overseas, the threat of losing markets in their own countries and other major markets, the reducing returns from this market and from their investments here and the amount of time they have to devote to combating the effects of this propaganda campaign all come together to force them—in many cases for practical considerations—to take this step. It is lamentable, but it must be understood, even though the net effect is that it reduces their influence, and particularly the influence of the United States, in this part of the world as a result.

However, understanding that this has happened leaves a few major issues which still have to be responded to. There is the method of withdrawal. Obviously these firms can withdraw outright and completely cut off their involvement as Kodak did, or they can follow an exit strategy which involves a sell-out to local interests.

There is a world of difference between the two. The complete withdrawal approach causes unemployment, with the consequent potential racial friction, to arise. There is a declining range of available goods and services in South Africa and the rising cost of the replacement of those goods and services. There is the declining level in the overall economic activity and a loss of skilled manpower.

On the other hand a local buy-out keeps the assets and the operation—the business—here. It keeps the jobs, spreads the equity to local interests—often to the employees—and, as a consequence, in fact reconfirms and deepens the commitment of the firm to continue operating and existing in South Africa.

A rose by another name is no problem. In fact, there are benefits if the exit takes place along the lines of the Barclays, General Motors and IBM strategy. If a firm comes to the final conclusion that it is not in its interests to continue, I think we should accept the fact positively and work with them and encourage them to keep the business going in South Africa.

Against this background the PFP repeats its condemnation of the disinvestment and sanctions propaganda campaign. We reject it, because we believe that a growing economy is a force for dismantling apartheid. A growing economy has a liberating effect on Black people in particular. Economic power lends greater freedom to individuals and greater influence and greater access to the benefits such as education and other advantages.

We believe that the United States companies and other international firms that have withdrawn, have played a positive role in regard to those benefits while they have been here. We therefore repeat our willingness, in spite of the obstacles and the increasing difficulty of talking positively about anything to do with South Africa, to argue in any forum here and abroad against the proponents of this misguided and counterproductive sanctions strategy. Our only reservation is that we shall not do so on Government funding, because defending economic participation in South Africa is absolutely different from defending Government policies.

We therefore welcome the arrangements made for the buy-outs and takeovers that have taken place on a local basis. We also welcome the efforts of the Urban Foundation, which has impeccable credentials as far as social responsibility is concerned, to arrange what they call “exit strategies” for departing firms which leave South Africa and South Africans—the underprivileged in particular—with certain positive benefits in the process.

This leads me to the question of the Rev Leon Sullivan and his principles. I should like to take this opportunity to applaud the six principles that the Rev Sullivan laid down in March 1977. Up to 125 US companies endorsed those principles and worked towards applying them in the workplace in South Africa. In that period, over R460 million was spent on positive benefits in respect of Black education, Black housing, legal assistance, Black business development and training programmes. It was in my opinion a positive contribution to the general well-being of economic life in South Africa.

I lament the Rev Sullivan’s about face. He has now buckled under the propaganda onslaught and given up on what he originally stood for, which was a constructive alternative to withdrawal. Even if he has walked away from his own strategy and his own principles, however, I do not believe that South Africa should turn its back on them. In fact, I should like to go further. Let us adopt those principles for ourselves and make them official Government policy for organised business and industry in South Africa.

Let us remind ourselves of those six principles:

• Principle I: Non-segregation of the races in all eating, comfort and work facilities.
• Principle II: Equal and fair employment practices for all employees.
• Principle III: Equal pay for all employees doing equal or comparable work for the same period of time.
• Principle IV: Initiation of and development of training programmes that will prepare, in substantial numbers, Blacks and other nonWhites for supervisory, administrative, clerical and technical jobs.
• Principle V: Increasing the number of Blacks and other non-Whites in management and supervisory positions.
• Principle VI: Improving the quality of employees’ lives outside the work environment in such areas as housing, transportation, schooling, recreation and health facilities.

Who could quarrel with those principles? They have been applied positively and I believe that organised business and the Government should adopt and sign them formally as an alternative action charter for the future conduct of business in this country. If we were to do so and apply them on a wide scale, we would improve not only the socioeconomic circumstances of our Black people, but also South Africa’s international image and that of its business community, and help to ensure the survival of the free-enterprise system in South Africa.

While on the subject of upholding the future of the free-enterprise system and keeping the remaining international companies operating here in South Africa, I wish to appeal to the hon the Minister to use his influence with his colleagues to persuade them not to proceed with the Bill dealing with the recovery of Black rentals. There will be another occasion on which this can be debated, but I should like to say now that I cannot think of anything more akin to playing with fire or any piece of legislation more explosive than that Bill which foreign companies will not be able to live with at all.

I should also like to touch on some general matters. On 26 July a truck overturned on Majuba Pass. It was transporting 60 containers of a radioactive material called uranium oxide, otherwise known as “yellowcake”. Two or three of these containers broke open and their contents spilled right across the road. The situation was not properly addressed, and some 1 500 cars drove past the scene of this accident, picking up traces of this yellowcake as they went. A traffic officer directing traffic was reported to have been ankle deep in it. Only after some 1 500 cars had driven past was the pass eventually closed and the area cleaned up.

There are some issues that arise from this. What regulations are applicable to the packaging of radioactive material when transported in South Africa? They are obviously inadequate. If a truck overturning can cause the package to burst open something must be done about that packing. The instructions given to the driver and the other personnel attached to the transport firm and the instructions available to the fire officers and the traffic officers who had to attend to the accident are hopelessly inadequate. They did not know what to do and the fire chief of Pietermaritzburg says that he has tried to discover what the nature of that substance is and how it should be handled in an emergency, but the department will not tell him. His department is obviously one of the first on the scene of such an accident.

I would therefore like to know what emergency instructions and training apply for the transport of this material and others like it. Furthermore, that road was closed and the yellowcake was considered to be sufficiently dangerous for that road to have been swept clean and some of the top soil next to the road that had come into contact with the material removed. Yet, 1 500 cars, motorists and traffic officials have come into contact with it and spread it through South Africa. Are they in any danger? What is going to be done about those people to make sure that they are not in danger? I think the hon the Minister should break his silence on this matter and put us into the picture. [Interjections.]

I should like to deal now with the question of the rumoured new Liquor Act. We have for some time been hearing rumours that the Liquor Act is going to be amended and, regrettably, this has caused some confusion in the liquor industry, particularly among licensees. It has reached the stage where the Cape Times published a report on 31 July that the new Liquor Act was due to be in force by the end of this year. I do not think that is practically possible.

You should not believe that.

Then I think it would be helpful if the hon the Minister would clarify the matter, because at the moment the confusion is prejudicing licensees. They hear of amendments in the pipeline, but they cannot make plans on the basis of those rumours. It would be of assistance if the hon the Minister would clarify that point.

Finally I would like to welcome the crackdown warning which has been given in respect of those firms that are not observing the anti-collusion rules which were introduced last year. We support the phasing-in on a flexible basis of these rules. We note that some 91 applications for exemption have been received and not all have been approved, and at this stage we approve of what the department is doing in that regard.

Mr Chairman, I should like to convey my sincere congratulations to the hon member for Constantia on his evident designation as the PFP’s chief spokesman on this Vote. I believe he will make a good contribution to meaningful debating in future. I welcome the spirit of South Africanism that emanated from his speech today, especially in his references to the matters of disinvestment and boycotts. Despite the numerous political differences that exist between me and the hon member, this is a definite point of contact, and it is necessary for us to find points of contact if we want to survive in South Africa.

It will also be necessary for a number of other things to happen if we want to survive in this country. Whether democracy in this country is going to be maintained or developed and whether civilisation is going to be maintained, is not going to depend only on whether or not we make a constitutional breakthrough, because the constitutional deficiencies and our inhibited democracy are not our country’s greatest problems.

South Africa’s greatest challenge is to develop its potential for the prosperity of all its people. This must be brought within reach of everyone. Personal abilities, the will to achieve, and diligence and enthusiasm must be the only keys to this. It is easy to say this and to believe in it. It emerges spontaneously in any socially sensitive person.

The problem, however, is how this should be done. There are no simple answers; there is really only one answer, and that is that the economy has to grow so that more work can be created, so that more people can share in it, so that it can continue to grow so that even more people can share in it. That is the only way in which prosperity can be created and can spread. There is no other way; the economy has to grow. How must this be done, however?

Until recently South Africa’s prosperity was based on the export of agricultural products and the world sales of primary elements, such as minerals and metals, with which Providence has richly endowed us. Those days are passing, because during the course of time the industrial economies of the world have become dissociated from what can be typified as primary raw material economies, such as South Africa’s.

The advent of the technological era has caused industrial production to move away at an accelerated rate from heavy, raw-material intensive production processes. The world economy has, in fact, experienced a drastic change in structure. By the beginning of 1986 this had resulted in a drop in the price of raw materials in relation to that of manufactured goods and products, to the lowest level ever. This structural change in the world economy in itself, irrespective of other factors which I do not have time to discuss, necessitates a thorough structural change in the South African economy. It necessitates change which will not be less drastic than a change that is facing us in the political sphere, and which will have to take place concurrently with political change. Export promotion and the other side of the coin, import replacement, must remain important elements of the economic programme. In itself this will not be able to support the long-term strategy we need, however.

A third strategy of increasing importance is an obvious one, viz inward industrialisation. Briefly, this means that the most highly developed modern or formal sector of the economy should utilise the wonderful young augmenting potential of the large semi-formal and informal sectors, which are ready for development and growth.

This is where the greatest immediate growth potential for our economy lies. It must be developed, not only as a market for the formal sector, but also as a training and development sphere en route to full participation in the modern-sector activities.

What I am saying is not all that new anymore, but I say it again because I believe there are too many people who do not yet realise the seriousness of the situation and the necessity of a new economic development strategy.

I said South Africa’s prosperity potential should be developed for all its people. Who are the people I am talking about? They are inter alia the Blacks, who make up the greatest part of our backward communities. By the year 2000 at least 20 million Blacks will be living outside the independent states and the self-governing territories, whereas 15 million to 18 million, of whom more than 16 million will be living in the four large metropolitan areas, will be living in the urban areas. Let us be clear on one matter: This would have happened even if we had retained influx control. The rural areas and the national states simply do not have the ability to accommodate the growth in the Black population with a standard of living that is at least more or less satisfactory, not even with a relatively successful decentralisation programme. That is why Black urbanisation was and is inevitable, just as was and is the case with White urbanisation.

The projected total labour force at the turn of the century will amount to approximately 18 million. At present there is no known way in which all of them can possibly be accommodated in the modern sector. Even if we were to maintain an economic growth rate of 3,2% per annum, there would be room for only 10 million people in the labour market. Under very favourable conditions there will be 8 million potential work-seekers, therefore, people with families, who will not find conventional employment.

We can allow ourselves to be baffled by these and other statistics, for example that 1 000 employment opportunities will have to be created per day, or we can do something about the matter. If we want to do something about it, we shall have to be realistic, and we shall have to accept the unpleasant reality with all its facets.

Let us begin with what is obvious. Let us admit that we shall not be able to create the employment opportunities in the formal sector that are being forced upon us by the statistics. Let us admit once and for all that we are dealing with Africa, and let us accept the informal sector as a fact. Let us accept that that sector and the areas in which it is located will often seem untidy, disorderly, even unhygienic and unacceptable to us First World people. The sooner we do that and the sooner we deregulate the informal sector almost completely and stop concerning ourselves with it, the sooner we will make progress.

In the meantime the semi-formal or small business sector can and must be forcefully stimulated and permitted to develop by the provision of facilities and with a minimal degree of regulation. Those who participate in this must be able to progress to the modern sector as quickly as possible. They must make room for those who are ready to move upward out of the informal sector.

To try to enforce any regulation, apart from basic health measures, on the informal or, if one must use the term, the illegal sector and even to try to collect tax or licence fees there, is a waste of time. It is a frustrating exercise in futility.

The operation of the informal sector must be almost unimpeded, whereas the semi-formal sector should be promoted with a minimum degree of regulation and a maximum degree of assistance, both in a financial and in a counselling sense. This will result in normal growth and development. The strength of the economy will ensure this. In this way the general prosperity, standard of living and buying power of the whole community will increase, and South Africa’s own domestic market can be used entirely for industrial development.

In this way the capitalist free market system will gain credibility among the masses, and this will lay the foundation for a constitutional dispensation in which western norms and standards of civilisation will apply.

Mr Chairman, I do not think we shall ever succeed in solving South Africa’s economic problems in an afternoon. I want to talk about something quite different to what previous hon speakers have spoken about, viz the part local authorities can play in South Africa’s economic prosperity. It was my privilege to serve on the city council of Middelburg, in the constituency I represent, for 20 years. As a city council, we did certain things during that period which, in our opinion, stimulated the economy of our town and also helped to make Middelburg, which used to be a small rural town, one of the most progressive rural towns in the South Eastern Transvaal.

Apart from Bethal and Ermelo.

Yes, together we are the biggest three in the Transvaal. [Interjections.]

That’s the way! Now he is talking!

Mr Chairman, that hon members of my party should make interjections about this!

At a stage we as the city council decided to undertake our own town development, and we formed a team, which included a town engineer, who did the planning of the development for us. In addition to that we made use only of the services of a local surveyor to do the surveying for us. Our own town engineering section designed and installed the sewerage system. We ourselves were also responsible for the water works, we laid on our electricity ourselves, and the water purification system was designed and installed by our own people. In addition the reservoirs were designed and built by our own people. In that way we succeeded, in a struggling economy, to make residential plots available in a small rural town for what were relatively speaking, very low prices. I merely want to add that we did not develop only the White residential areas; we also planned and developed residential areas for the Indians and the Coloureds.

We also did a few other things, apart from acting as town developers and not permitting an outside organisation to make an unnecessary profit in Middelburg. We did certain interesting things as a city council. In this town development we also succeeded, by imposing a levy on the residential plots, in financing our rubbish dumps in Middelburg from this sale of plots. It also financed our park development.

We went a step further. Since Middelburg needed a school for a certain population group, we also imposed a levy on the sale of residential plots. We called it the Provincial Assistance Fund and after approximately 14 years, we were eventually able to establish an English-medium high school in Middelburg. We also used this accumulated fund to assist in establishing a special children’s section in our hospital. These are just a few ideas on how a rural constituency and a small town that became a large town, stimulated the economy in our town.

I have received the White Paper and I know that privatisation is the only topic discussed from morning till night. In all modesty, however, I want to say we should not be too hasty to privatise. I challenge any town developer to develop a town and make residential plots of 1 500 square metres available, with all services, at R12 500. I challenge any private developer to do that.

Mr chairman, the hon member for Middelburg made a very interesting speech here which basically revolved around his own town council. Naturally local authorities have an enormous part to play in the economy, but I want to tell the hon member that I think it is on local government level in particular that deregulation can be initiated. We often find that local authorities make unrealistically high demands as far as the establishment of business enterprises is concerned.

I want to associate myself with the hon member for Stellenbosch who advocated that we should at least, as far as these aspects on local government level are concerned, become used to varying standards in our communities. Certain standards are acceptable to certain parts of our communities, whereas they are not acceptable to others.

†I should like to refer to the hon member who is the chief spokesman on economic affairs of the Official Opposition, Comdt Derby-Lewis. I notice that for the past half hour he has not paid us the courtesy of being present in the Committee. However, he did list six reasons for the present economic situation. In dealing with these headings—they were his own—he came to the overspending of the Government. Here he mentioned one area where he differed and it concerned the overspending on housing which he called “unproductive”. Knowing that hon member and the party that he represents, he was obviously referring to Black housing.

I want to say to that hon member and his party that there is no better way for us to spend money than to spend it on housing because it gives more people a stake in the economy and in the real estate of South Africa. Urbanisation in itself is an economic generator. We have seen it in the past, we should encourage it and we should be aware of it.

*I should like to express my thanks and appreciation to the hon the Deputy Minister, who is the hon member for Pretoria East, for his recent visit to the Port Elizabeth-Uitenhage area. The purpose of the visit was to acquaint himself with the conditions there, but especially take a look at our motor and related industries. On various occasions he moved around on the factory floor to acquaint himself with our requirements and circumstances and to familiarise himself with our field in general. During this visit he had discussions with businessmen, mayors and also representatives from this side of the House on a number of occasions. It appeared from these discussions that a cautious spirit of optimism was prevailing in this region. Nevertheless there is still a lot of unutilised production capacity and an unacceptably high unemployment rate. After years of struggling, however, the EP is now ready to take its rightful place in the South African economy. The only thing necessary now is a spark to get this whole process going. [Interjections.] We are not even talking about the results of the rugby match two weeks ago.

The property industry is stabilising. Retail and wholesale trade are much more optimistic and it is common cause, especially now that the July figures have been made known, that the motor industry is giving us much reason for optimism. Sixty per cent of the economic activity in the EP comes from the motor industry, and that is very good news, therefore.

My expectation is that the spark that will get the whole process going in our area will be the engineering and manufacturing activities which will come from Mosgas. We are eagerly awaiting progress in this connection.

I should like to discuss with the hon the Deputy Minister a few specific matters resulting from his visit to that area. This will play a part in the rate at which the motor and related industries continue their recovery. Both the large motor companies in our area already have higher employment. They have also announced expansion and increases in production, because the motor industry has derived exceptional benefit from the Government’s export incentive measures of R4 per kilogramme which were announced in March 1985. These incentive measures are one of the most successful ways of stimulating exports and improving the poor market conditions, which is the specific reason for their introduction.

In this connection I want to say that there is a great need for long-term assurance from the Government that the industry will continue on the present level of export incentives. An assurance of this kind will stabilise the export share and increase it. Uncertainty, which is being felt at present, reduces confidence and exposes companies to considerable and potentially great export losses. Long-term planning is necessary for the export markets and in addition, there are long-term contractual agreements which have to be concluded. This planning and these agreements are impossible when the incentive measures are granted only on a year-to-year basis. I should like to ask the hon the Minister to see whether this assurance cannot be given over a period of three years, or at any rate a longer period than only one year.

Some of the companies continued their export planning despite the fact that there was uncertainty, and it would help a great deal if the hon the Minister could eliminate this uncertainty for us.

The importance of exports has been emphasised repeatedly. This was also mentioned here by the hon member for East London City today. In the weekend’s supplement to Rapport I saw that Dr McCrystal had written a very enlightening article about this aspect: “Uitvoer moet mikpunt wees”. I want to quote briefly from it:

He went on to say:

Naturally these are matters most of us agree with, and that is why I want to make a serious appeal to the hon the Minister to ensure that there is certainty in this connection as soon as possible. The exports were such a great success in the incentive package offered to us, that I want to make this appeal to the hon the Minister.

I want to broach another aspect as far as the motor industry specifically is concerned. That is the so-called 60% transport rebate on outgoing goods we receive. The problem, however, is that this rebate is determined according to a so-called “reference rate”, which is determined by the Government itself. The reference rate is less than the true cost and as a result we are not getting the transport rebate of 60% actually envisaged by the Government. I understand, of course that it is included in the “Railcar” arrangement, but I request that the hon the Minister will take a look at this and will help us, because it is much more expensive to convey vehicles by rail than by road and it is also far less labour-intensive. This is a matter which I should like to draw to the hon the Minister’s attention.

I conclude by asking him, if it is possible, to give us an indication in this debate of the Government’s standpoint on when the local content programme in respect of heavy commercial vehicles will be initiated. Ás hon members know—I have referred to this—there is a great deal of unutilised capacity in the Eastern Cape, and there are companies which would derive great benefit from this local content programme for heavy vehicles. We are eager to hear from the hon the Minister or the Government in this connection.

Mr Chairman, in following on the hon member for Uitenhage I would like to say that I support very sincerely his views on housing and the absolute necessity to be able to meet the needs of so many people, particularly resulting from increased urbanisation.

Thereafter he dealt largely with issues relating to his own constituency and I would like to deal with something completely different, viz the recently issued White Paper on Privatisation and Deregulation.

I believe that we have to look at this White Paper in the face of enormous problems resulting from population growth outstripping the growth in job opportunities. The formal economic sector cannot absorb this growth and surplus manpower is therefore being channelled into what has been called the informal economic sector. Projections that I have seen prepared by the Institute for Futures Research of the University of Stellenbosch estimate that by the year 2 000 this informal sector will represent something between 47% and 55% of the total labour supply. It is therefore of significant magnitude and must be taken into account.

In addition to political solutions we are going to desperately need economic solutions in order to survive. Privatisation and deregulation will contribute to these solutions by shifting the economic decisions from the political arena to the marketplace; by increasing efficiency through the competitive environment and the profit motive; by providing the Government with additional funds without increasing taxes; by encouraging small business growth, particularly in the informal sector; and by overall savings to the taxpayer. Past attempts to solve the unemployment problem by increasing employment in the public sector were at best a short-term solution—a partial redistribution of wealth without the prospect of significant further wealth creation.

Dr A D Wassenaar in his book Assault on Private Enterprise which was published in 1977, stated that it would not be unduly rash to estimate overemployment in the public service at about 30% to 35%. That was in 1977. He went on to say:

In commenting on this White Paper I believe we have to ask ourselves whether this attitude still persists, for the paper before us is completely devoid of any serious commitment in terms of privatisation. It represents an analysis of the problem against a historical background without clearly setting out any specific actions that can be taken. I believe this is not acceptable considering that the decision to privatise was taken some two and a half years ago.

It is useful to compare our situation with that which prevailed in the United Kingdom, where since 1979, which is some nine years ago, 15 major companies and a number of minor ones have already passed into private hands, realising some R40 billion for the State coffers. One in every two families in the United Kingdom today owns shares in companies compared to one in 10 a decade ago.

That sort of growth in privatisation has been phenomenal, and represents possibly an extreme but I view it against the lack of progress which we have in our country. I would therefore like to ask the hon the Minister why there is this tardiness in privatisation which is agreed by everyone to be a course of action which is urgently required. Why have we seen no State corporations up for sale? What of subsidiaries of the IDC, which were established some years ago, which are now profitable and, therefore, could presumably be disposed of to the private sector, for example Impala Platinum Mines? The true concept of the IDC was to help establish companies, but surely once they are up and running the IDC could withdraw by selling their shareholdings to the private sector. I believe that Government policy therefore is not clear in this regard and I believe that this should be spelt out unequivocally.

I would like to suggest three factors as to why we are having problems in privatisation. The first is the problem of investigation and disclosure. Any corporation which is subject to sale to the private sector would have to disclose full particulars relating to its operations, and such particulars would be subject to rigid scrutiny and audit, audit not only in the sense of verifying the accuracy of income and expenditure, but also of an in-depth evaluation of its actual operating efficiency and its financial viability as an operation. Such an audit would be vital to enable the potential purchasers to establish the corporation’s net worth. I believe that such investigation would be abhorrent to many people who have lived in a bureaucratic or public service structure and who have not had to justify their actions financially in the sort of terms that would be necessary in order to privatise an industry or an operation such as the State corporations that exist at present.

Secondly, I think we have to admit that privatisation could well have an impact on jobs in the public service, in the sense that by privatising an industry, one would look at greater operating efficiency, which could well result in fewer jobs actually required and therefore a reduction in personnel. There are examples in the private sector where this would obviously cause great difficulties. I think in this regard of an example such as local authorities. On the introduction of RSCs it was stated clearly that no local authority employees would lose their jobs as a result of that. Similarly, we know that on the scrapping of influx control some 1 100 personnel employed by the administration boards had to be taken on by the Department of Manpower which at the time had no jobs for them. So this will have to be handled ruthlessly. I think one would have to respect the impact that this would have on individuals and one would have to try to meet their expectations. One would have to be sensitive in dealing with this, because if we really mean what we say in terms of privatisation, it will definitely have to have an impact on employment in the public service, otherwise it will not be worth the effort.

I believe a third major stumbling block is the extremely generous pension systems that prevail and where privatisation is being delayed because such pensions will have to be funded by whoever may purchase the operation in question. The position is further aggravated by legislation which enables public servants to backbuy their pensions over many years, thereby increasing their wealth. In a situation where such an industry with such obligations to its staff is taken into the private sector, the impact of such pension fund commitments would be extremely vast and would have to be funded and taken into account.

I believe those three factors are retarding the movement towards privatization, and I could add another one: Possibly the level of salaries being paid could also be a factor. The hon the Minister of Constitutional Development and Planning recently disclosed that the top public servant in his department earns R170 000 per annum, plus perks. Many highly qualified top executives in the private sector do not earn as much as this.

The arguments for privatization and deregulation are compelling. We need to create additional jobs and we need to meet the enormous unemployment problem approaching us.

Our economy needs a morale booster. We can see from the Stock Exchange that investment funds are flooding onto the Johannesburg stock market, so why not into the State coffers in terms of purchasing State assets?

Mr Chairman, I want to tell the hon member for Pinelands that the matter which he raised here in fact falls under the Vote of the hon the Minister in the State President’s Office, a Vote that will be discussed in this House in a few week’s time. I get the impression that the hon member is anticipating that, amongst other things, they will put questions on the large salaries of the Directors-General and this also falls under the same hon Minister. The hon member will pardon me if I do not react any further to his argument as I do not think that it is appropriate to this debate.

I want to touch on a matter that is becoming increasingly important in my constituency, Primrose, and adjoining constituencies, namely the field of electronics, and in particular the construction and assembling of electronic systems. I have only the highest praise for the Board of Trade and Industries, which has done a great deal of work in this regard. I also want to pay tribute to the hon the Minister, who introduced the Advisory Council on Technology on 11 March 1987. This council will pay attention to all aspects of electronics and the related technology. As it is a branch of industry that is becoming more important by the day in the area that I represent here, due to the fact that an increasing number of industries in that area has something to do with electronics either as consumers or as people who want to enter that field as producers, I should like to focus on a few points with regard to electronics. I also want to ask the hon the Minister or the hon Deputy Minister, Dr Alant, a few questions on behalf of the people in this industry.

As we all know, the electronics industry is at present the fastest growing industry in the world. Expressed in economic terms it is the field of the future. I think it is quite right that South Africa will try to keep up to date in this field. I cannot foresee us developing a huge “silicon valley” in South Africa in the short term, but I should like to suggest that we do everything we can to keep up with developments in the electronics industry. There are basically two reasons for this. Firstly, the electronics industry can increase productivity dramatically, and how to increase productivity as quickly as possible is one of the most important problems in the South African economy.

The second reason is that the electronics industry creates tremendous opportunities for businesses to automate and to become competitive. I agree with the hon member for Stellenbosch who spoke before me when he says that labour, and everything that is connected to it, is one of the biggest problems in South Africa. That is why I am of the opinion that we should try as far as possible to steer labour in this new technological direction in order to make provision for people in this field.

I hope that this increase in productivity that is taking place these days will enable other industries in South Africa to continue to maintain the favourable balance of payments we have been maintaining over the past few years. A view prevalent in international circles at present is the country, factory or producer that manufactures electronic products at the lowest price is the most successful. It has even become so specialised that we have people who develop the systems and then we also have others who chiefly construct and manufacture the parts, known as chips, and everything associated with them.

I want to suggest that if we want to maintain our position in this country, we cannot continue merely to import these systems. For the sake of our balance of payment and the possibility of technology being withheld, we shall have to develop our own. I therefore want to express my thanks to the hon the Minister and the department who started working on this at an early stage so that we would be able to maintain our rightful position—that is what I am asking for. I hope that everyone will support the hon Minister and his department so that he will in fact be able to continue in this direction.

We shall have to enter this sphere and we cannot wait too long before we try to do so on a large scale. This branch of industry deserves stimulation for a great number of reasons and I hope that this does not mean that the only stimulation will be our always saying, “let us stop imports”. That is not the kind of stimulation I have in mind in this case. If it is necessary for it to be done on a very short-term basis, I shall support it, but purely to stop imports of technology and hardware will in my view not solve the problems. We shall have to undertake a detailed investigation to find out what stimulation we can use, and I hope that tomorrow it will be possible for the hon the Minister when he replies to the debate to try to tell me in broad outline what stimulation we can expect in this particular industrial sector with a view to developing it further.

That is why I am saying that the aim of all stimulation should in any case be to increase productivity. I should like to add that this stimulation will have to enable us to reach the stage where we can also compete with imports. However, before one can start exporting there is one very important condition that has to be met. Firstly we shall have to be able to develop the product, and secondly we shall have to be able to supply the local market. It is essential to develop the local market and to show people how electronics can help one in the local market. I think that by now everyone is aware of the fact that it can contribute greatly to reducing costs. I want to express my fullest confidence that the South African businessman has the expertise and entrepreneurial spirit to enter this field as well, regardless of the sanctions against South Africa. There are so many people who, when the sanctions were introduced, said that we would stagnate in the field of electronics, but I do not agree with that. I have enough confidence in the businessmen and entrepreneurs of South Africa to believe that in this situation, as in others, we shall find a solution and that we shall develop electronic systems and even start exporting.

It is essential that we strive for such internal industrialisation, but then we must be given the full support of private enterprise. I hope that there will be greater co-operation in this sphere and that one of the main tasks of the Advisory Council on Technology will finally be to bring together all the best brains in the country so that progress can be made in this sphere. I am thinking particularly of the development of technoparks, of which one already exists, at our universities. We shall purposefully have to continue developing the manpower in this sphere.

The attraction of the electronics industry is that the small businessman can involve himself in it. He can start his own small technology business and develop it into a big industry. It is one of the areas in which we can succeed in activating the small businessman and small business into developing into larger business firms and in so doing create job opportunities. We have seen this in countries overseas. One only has to look at the home computers that are obtainable today.

Many people started building them in garages, in backyards or unused little places where they developed their technology into the great technological companies that we find today. I believe that we in South Africa are in the same position; we can do it too. We have the will, we have the people with the intelligence who can make these systems work. If we could succeed in developing certain electronic systems for the Armaments Board, we should also be able to do so in normal economic practice.

Local research will have to be stimulated. As the universities are at present receiving less money from the Department of National Education, I want to ask the hon the Minister if deserving cases could not direct their applications to the Advisory Council for Technology, which would then investigate deserving cases which in practice—this is my condition—will result in a product or a system that can be used. My request is that the necessary financial support be given in those cases. [Time expired.]

Mr Chairman, this afternoon I want to use my time to touch on a few formal matters. I shall react to hon members’s speeches tomorrow.

To start with I want to thank the hon member Mr Derby-Lewis for his kind words, and the hon member for Constantia for his kind words and good wishes. I greatly appreciate this. I should also like to react tomorrow to what the hon member for Primrose said about the electronics industry.

Today I want to give attention to four topics. The first of these is what the Government is doing to protect the consumer and our view of this matter. It is alleged from time to time that the Government is not doing enough to protect consumers. Consequently I want to say a few words about the form consumer protection takes in South Africa. I am not suggesting that the Government is at all in a position to afford the consumer total protection. We must always see the matter in its correct perspective. Our economic system is market-orientated and has an increasing need for deregulation. The consumer therefore has a big responsibility to do everything in his power not to be exploited. One is sometimes astounded at how easily some people allow themselves to be misled, and that is why in our approach great emphasis is placed on the education of consumers.

Various organisations are involved in and responsible for the protection of the consumer in South Africa and I want to refer to them. In the first place there is the Department of Trade and Industries which administers no fewer than 15 Acts pertaining to consumer protection. These Acts include the Trade Practices Act, the Credit Agreements Act, the Alienation of Land Act, the Property Time-sharing Control Act, the Price Control Act and ten others.

Apart from the legal protection afforded by these Acts, consumer complaints in connection with the Price Control Act, Credit Agreement Act and Trade Practices Act are also investigated by the inspectors of the Directorate: Trade Inspections. This directorate is also responsible for the administration of the Trade Metrology Act of 1973. Inspectors use the inspection measuring standards to determine the correctness of measuring instruments used in the business sector, and the correctness of pre-packed goods which are sold by quantity or number. Such checking of pre-packed goods takes place on the premises of dealers and industrialists.

In 1986—hon members will be interested in this—a total of 65 841 inspections were carried out in terms of the various Acts to which I have referred. The large number of irregularities which are constantly found indicate that this service makes a valuable contribution with regard to the protection of the consumer.

†The South African Consumer Council has done much to assist the department in this very important task. It does not act as consumer watchdog only but also co-ordinates, educates and assists consumers in everyday consumer affairs. The problem with consumerism in South Africa does not lie only in the ordinary bread-and-butter issues, as in many other capitalistic countries. In this country it is chiefly founded, as I have already indicated, in the ignorance of South African consumers. The Consumer Council has the all-embracing task of developing consumer awareness among all races, creeds and colours.

Although the Consumer Council is funded mainly by the Government, its activities extend far beyond the monetary and material welfare of consumers. Consumers need to be made aware of their rights, consumer law and how to protect themselves from possible exploitation. The education of consumers in a heterogeneous society such as ours is a difficult task as a result of a lack of proper communication and a shortage of funds.

Other institutions directly or indirectly involved in the protection of consumers include—there is a substantial list—the SABS, in particular its effect on the determination and maintenance of safety and quality standards and specifications covering a vast range of products; the Competition Board, which is actively removing cartels and other forms of collusion from the economy and is now giving particular attention to the complex problem of economic concentration; the Estate Agents Board, which is entrusted with the responsibility, inter alia, of the proper control of estate agency business; the Trade Practices Advisory Committee, which was established to advise the Government on measures to prohibit or control undesirable trade practices; and the small claims court, from which the consumer has benefited substantially by either resorting to the court or merely threatening to do so.

Various regulations administered by local authorities also have an important bearing on consumer protection. I should also like to refer to the manufacturers’ and trade associations, the Advertising Standards Authority and, lastly, to the Newspaper Press Union of South Africa and the Media Council.

These institutions cover a fairly wide field and sight should also not be lost of the fact that the trading community renders an essential service to the consumer. Although profit is the prime motive, which in itself is no sin, trade is generally conducted on ethical grounds in South Africa.

*I also want to make certain remarks about the motor industry. The hon member for Uitenhage has had to leave us because his father is very ill and I shall react to his questions in greater detail tomorrow.

The Board of Trade and Industries is at present engaged in two important investigations into the motor industry. The so-called Phase V Programme for motor cars and light commercial vehicles as well as the local content programme for heavy commercial vehicles is being re-investigated.

Both these sectors of the motor industry have experienced difficult times during the past few years. As the hon the Minister quoted in his introductory speech today an improvement can be discerned in the sale of motor vehicles at present, and we are happy about the increase. But in the preceding period both sectors suffered big losses, and many employment opportunities were lost. As regards motor cars and light commercial vehicles, it appears that the investments which have to be made in order to put new models on the market, have increased tremendously. It is, however, not always possible to keep models on the market in South Africa for longer periods than is the case in the country of origin, because certain imported spares become unavailable.

Motor vehicle manufacturers are nevertheless endeavouring to increase the life span of models, and have achieved quite a bit of success in this connection. It remains the case, however, that the consumer is inclined to go after the new model at the expense of manufacturers who are still marketing old models in the country.

The board has now suggested to the industry that in future the local content should be calculated on the basis of value, rather than mass. The use of foreign exchange will serve as a basis for such a programme, the difference therefore between imports and exports. The board feels that such a programme will not only be easier to administer, but will also address many of the existing problems. Such a scheme will encourage manufacturers to purchase equipment in South Africa and to lengthen the life span of models.

A programme which addresses the use of foreign exchange should preferably be tackled on a company basis, and that is why the Board of Trade and Industries suggests that the same programme should also be investigated in respect of heavy commercial vehicles. Further investigations in this connection are at present being undertaken in co-operation with the motor industry.

I should also like to voice a few thoughts and give some information in connection with the television industry. With a view to the further development of the local television manufacturing industry and the electronical component industry in particular, it has been decided to offer a stimulus by means of an excise rebate in order to increase the volume of sales of television receiving sets and the development of a standardised television receiver chassis for colour and black and white sets. The economic viability of the manufacture of a picture tube for the set is being investigated at the same time.

The object of such a standardised chassis is to expand the use of local electronic components and the local manufacture of television receiving sets, to make the electronics industry less dependent on overseas technology and to free ourselves from restrictive licence agreements, and to activate an export programme. In this connection two committees have been appointed by the Board of Trade and Industries, namely a planning committee, to handle the overall planning of the project, and a technical project committee for the formulation of the necessary product and performance specifications to produce the receiving set.

Six manufacturers have been allowed to participate in the project, on the basis of approved manufacturing programmes. These manufacturers are entitled to a rebate on the excise duty and they each then pay R5,00 per television receiving set sold in support of the project. This money is paid into a fund to finance the development of and further investigations into this locally-produced chassis.

The intention is to have a final, tested product ready for marketing by the respective manufacturers by March 1989. A short-term consequence of the rebate on the excise duty is the fact that a decrease of between 14% and 18% is already discernible in prices of television receiving sets in the trade, and general sales have increased by approximately 30% since this rebate was announced.

I also want to give hon members a few statistics in connection with the companies office and its activities, as well as the number of companies and close corporations registered and deregistered recently. This is more for the information of hon members, but the object is also to put negative perceptions, which are sometimes formed owing to the drop in company registrations and the increase in liquidations, into perspective.

I want to refer first to the year 1984, because this was the year when close corporations became a reality. In 1984, being the year of reference, 11 601 new companies were incorporated. In 1985 only 5 848 new companies were incorporated, in other words approximately half the number, and in 1986 this dropped further to 5 235. From this one could deduce, as many people have done, that there has been a decline in economic activities in the country.

The Close Corporations Act came into effect on 1 January 1985, and since then many new close corporations have been incorporated. In 1984 no new close corporations were of course incorporated. In 1985 15 911 new close corporations were incorporated, while the figure for 1986 was 23 387. If the total number of entities, ie, companies plus close corporations incorporated in South Africa are taken into account, the following increases become obvious. In 1984 a total of 11 601 new companies were incorporated, in 1985 21 7539 new companies plus close corporations were incorporated—approximately double the number—and in 1986 28 622 new companies plus close corporations were incorporated, yet again a very big increase.

The total number of companies dissolved since 1984 is also of interest. In 1984 1 746 companies were dissolved; in 1985, 2 314; and in 1986, 2 927.

† Although it is disturbing that there was an increase in the number of companies which were placed under liquidation and ultimately dissolved, the number of new companies and close corporations which have been incorporated more than compensated for this decrease.

Mr Chairman, it is a special privilege to speak after the hon the Deputy Minister. As I listened to the hon the Minister’s important announcements and guidelines at the beginning of this debate, and now to the hon the Deputy Minister’s announcements as well, I could not help noticing to what extent the Government is in earnest about stimulating the economy and getting it going. That is why I want to thank the hon the Minister, his Deputy Ministers and the department for the special attention they are paying to this matter. As other hon members have said this afternoon, it is important that all the ingredients are now ready for us really to get the economy going. All that is needed now is to blend these ingredients.

Allow me to go back for just a moment to the hon member Comdt Derby-Lewis who, I notice, has not attended this debate for quite some time. Nevertheless, I am glad to see him back here again. The debate has proceeded calmly and peacefully and has been conducted at a very high level. The hon member was not present here last year or the year before, but I just want to tell him that the speech he made here this afternoon was made approximately 54 times last year by the former member for Sasolburg. The hon member’s writers or advisers did not tell him that they had made the same information available to the then member of Sasolburg. I want to suggest, therefore, that he go and read the Hansard so that he can see that the speech he made this afternoon was made many times last year.

After 55 times you still do not understand it!

It seems to me those hon members cannot listen; all they can do is talk. [Interjections.]

That brings me to a very important aspect of the growth we need in South Africa to get the economy going. I am referring to the creation of employment. Everyone will agree on this, and it was also raised in previous debates. The creation of employment will eventually lead to permanent and continued growth, combined with the productivity to which hon members for Stellenbosch and Primrose referred.

In my opinion, the hon the Minister referred to a very important sector in his introductory speech. Other sectors like the mining industry which, with its gold and so on, plays a very prominent part, are perhaps more glamorous. The hon the Minister referred, however, to the manufacturing industry in South Africa.

The gold mining industry is responsible for 16,5% of South Africa’s gross domestic product as opposed to the 21,5% for which the manufacturing and industrial sectors are responsible. I think, therefore—it is significant that the hon the Minister referred to this—that the textile industry is an exceedingly important sector of the economy and that it deserves its rightful place in the South African economy. As the hon the Minister said, this industry accommodated 1,3 million workers in 1986.

One wonders whether there are still ways in which the economy can be stimulated even further. Other possibilities for really getting it going have already been mentioned. I want to refer specifically to the industrial sector.

Hon members also referred to import replacement this afternoon. In this regard I want to thank the department for the brochure they compiled last year in order to make it possible for manufacturers to determine what can be replaced and what import replacement entails. I should like to know from the hon the Minister whether the response to this was adequate and whether it was very positive. I also want to know whether this brochure is going to be supplemented and updated on a continuous basis so that it always contains the latest information. In that way it can become something of a manual as far as import replacement is concerned.

Reference was also made to tariff protection, as a possible way of further stimulating the economy. I feel it is justified in cases where it does not try to protect inefficient businesses, but protects efficient businesses. Could we not also examine some of South Africa’s laws to see whether these laws are all taking into account and keeping pace with the Government’s policy of economic reform and stimulation or whether there are perhaps measures which could still be having a slightly inhibitive effect on the modern economy we have today? I think that falls under the duties of the hon the Deputy Minister, if my assessment of the division of labour is correct.

I should like to express my appreciation for the amounts of money that were made available for small business development. In addition to that we have had deregulation, which has made it possible for the informal sector to enter the market more easily so that the small and smaller business undertakings in the informal sector can also develop.

There is something that bothers me a little, and I just want to ask the hon the Minister whether we should not perhaps try to effect a balance between the very large amounts made available to the agricultural industry and the amounts made available to other industries. I think it is right that agriculture should be assisted when times are hard, but it is not only the agricultural industry which experiences difficulties in times of recession. There are also secondary industries and smaller enterprises which are experiencing great difficulties. Do we not sometimes overemphasise the agricultural industry? We should also pay attention to these other, smaller undertakings in Sunnyside, for example, or other areas. These undertakings also experience difficulties and can be assisted in times of recession. When it comes to the allocation of funds, I ask that attention also be given to other sectors experiencing difficulties and not only to the farming industry.

I merely want to refer briefly to the successes that have been achieved. These have been illustrated in the few remarks that other hon members and I have made about economic reform. I think it is a pity that the success of the Government’s reform policy is often measured only in terms of constitutional successes, whereas reforms are taking place over a wider spectrum—economic reform, for example …

It is utter chaos; those are not successes!

You will not understand it at all, so you need not tire yourself over it. [Interjections.]

Order! The hon member may not refer to another hon member as “you”.

In that case I just want to say that the hon member for Losberg will not understand these matters at all. I do not know whether it is possible for him to listen or whether it is only possible for him to talk. There are people who suffer from “verbal diarrhoea” (woorddiarree).

Mr Chairman, on a point of order: Is it permissible for an hon member to refer to another hon member as someone who suffers from “verbal diarrhoea”(monddiarree)?

He did not say monddiarree.

Order! I want to request the hon member to withdraw that word.

With all due respect, Mr Chairman, I did not say “mouth diarree”.

Order! What did the hon member say then?

I said “woorddiarree”.

Mr Chairman, on a point of order: I would ask you to rule that the hon member must withdraw that as well.

“Woordskittery”! [Interjections.]

Order! I order the hon member for Sunnyside to withdraw that.

I withdraw the words “woorddiarree”.

Mr Chairman, on a point of order: Did you hear what an hon member just said?

Order! Will the hon member for Brakpan please address me on the matter?

Mr Chairman, I would rather not repeat the hon member for Umfolozi’s words. He used another term for “woorddiarree”, the words used by the hon member for Sunnyside. I request you to ask him what he said and rule that he has to withdraw it. I request that you order him also to apologize for what he said.

Order! I shall investigate the matter. The hon member for Sunnyside may proceed.

What I was trying to say before the hon member interrupted me was that … [Interjections.] It seems my time has expired. It is because the hon members of the CP wasted my time. [Time expired.]

Mr Chairman, it is just one of those things that time catches up with one when one wants to talk about other things.

I should like to talk about tourism this afternoon. Tourism is probably one of the youngest branches for which the Department of Economic Affairs and Technology is responsible. It is probably one of the most dynamic departments in our Public Service. They did have a few setbacks in 1986 when the number of tourists, especially those from overseas, decreased a little. Revenue, too, was R400 million less than the previous year.

Fortunately the department concentrated on the overseas countries. Satour, in particular, evaluated the entire issue in October 1986 and then concentrated on promotions abroad. In particular they wanted to rid people of their preconceptions in respect of South Africa and to give the individual the opportunity to come to South Africa and judge for himself what was going on here. They also wanted to use what sympathetic support they had from overseas countries. They approached K N P Compton and, by making superb use of our animal kingdom, came up with something really special. The campaign was very successful, especially in the USA, the United Kingdom, West Germany, Switzerland, Austria, France and Italy. The response they got was overwhelming. There are many people overseas who are eager to come and see what things are like in South Africa. They want to form an opinion from their own observations here. There is also a nucleus of goodwill towards South Africa overseas. Within a period of two weeks 5 400 enquiries were received in the USA; and in those two weeks 120 people paid their deposits to come to South Africa. Within three days of the advertisements’ having appeared in magazines in Britain, an overwhelming number of enquiries were made. Enquiries streamed in from Germany—so much so that there are 5 500 possible tourists to South Africa at the moment. Not even Satour expected this overwhelming response. It seems, therefore, as the hon the Minister said, that there will be 10% more overseas tourists this year.

I want to say a few words about domestic tourism. I think accommodation for tourists is becoming a problem in South Africa, especially since we are so restricted by the seasons. Costs are high as well. The average family can no longer afford to spend a few weeks at sea, for example. That is why I also want to talk about agriculture and tourism. A symposium held in Bloemfontein recently was attended by approximately 300 people. In-depth discussions were held on tourism and farm life as possible tourist attractions. As a result of urbanisation there are many children today who do not even know where milk comes from. Many children want milk from the bottle; they do not even know that it actually comes from a cow. As a result of these discussions, the following guidelines were laid down after being evaluated: Guidelines for people who are interested in attracting tourists to farms; and a comprehensive plan that will affect many sectors of tourism. Certain farming activities are already tourist attractions, the Western Cape wine route for example. It is marvellous to get into the car on a Saturday morning and follow sections of this route. It is amazing how many people visit the wine cellars. According to the owners their sales have increased significantly …

Even clergymen do so!

Yes, even clergymen visit the wine cellars. Apart from the financial aspect one’s attention is captured afresh by the wealth of our cultural heritage when one follows the wine route.

Take the ostrich farms in Oudtshoorn, for example. Now there is a real tourist attraction. It is an eye-opener to see the ostriches’ “July runs”. Seeing this brings city people closer to nature. Then there is the Wool Route in the Overberg which also enjoys a lot of attention. We are told that many overseas tourists are eager visitors to these farms, and that it is the homogeneous tour groups in particular which visit these wool farmers. Trout farming in the Eastern Transvaal also attracts attention. It is very popular, especially during the summer months, when the scenery and the climate there are quite spectacular. That is why people are so keen to hire dams these days—weekend houses are built there and families camp out there over weekends so that they can catch a trout or two.

There is another special tourist attraction. The hon the Minister will probably agree with me that the game farms in the Transvaal, Natal, the OFS and the Eastern Cape are quite exceptional. Approximately 33% of the farms in certain districts have already been enclosed with game fences. Farmers are incurring high costs to keep the game inside the farm boundaries, but it is money well spent once they are there. What could be more enjoyable than spending a night in the Bushveld—the camp-fire burning, the lead-wood coals crackling, and the nocturnal noises of the animals and birds keeping one company? Few things can compare with this!

Order! Can the hon member just tell me how we can relate that fire to the Vote?

Tourism!

Who knows, perhaps in times to come we will have a maize route, a milk route and a meat route. I think they are all in the offing.

They say the maize route may be a CP route and not an NP route. It is true that the CP has proclaimed the maize area in the Transvaal as CP territory.

Then there are the advertisements in agricultural magazines in which city parents asked whether a compassionate farmer somewhere would not cater for their children during the holidays. I think our city children really need to get closer to the farms; and even if there is no maize route or milk route yet, I feel the farmers who specialise in this area should make a plan to accommodate these children. I think a child from the city would enjoy herding the cattle, working with the lambs and riding on a trailer behind a tractor …

And cracking the whip.

… and cracking the whip, because that is particularly enjoyable for a child. I think the time has come to generate extra funds for the farmers in this way. Look at the Alpine countries, for example. There, when it is winter and the snow covers the mountains and it is the skiing season, the farmers derive their income in this way—from tourism.

I think the motto of the Tourism Board and the Department of Tourism will always be: Market it and operate it. We wish them every success for the future.

Mr Chairman, I shall not react specifically to what the hon member for Witbank said, although I also want to talk about tourism today. I merely want to congratulate the hon member for Witbank and tell him that it is a long time since we heard such a moderate speech from that side. It was a pleasure to listen to it—a bit of moderation on the subject of tourism.

†“South Africa is standing on the threshold of a new leading industry in the country”, Mr Lomar Williams, a conference expert from the United States, told the “Conference on Conferences” held in Durban during October 1986.

The main object of South Africa’s first ever “Conference on Conferences”, organised by the Congress Division of the South African Tourism Board, was to create an awareness of the significance of conferences as a means of stimulating tourism.

According to Mr Nick Stathakis, head of the Congress Division, South Africa not only has the infrastructure and facilities to host international congresses, but also a wealth of opportunities for pre- and post-conference excursions. With the necessary know-how, determination and enthusiasm, he says, South Africa has the potential to become a major conference destination.

The publication, The South African Conference Guide 1987, contains the latest facts on the conference industry. The proprietor and publisher must be congratulated on an excellent publication.

Internationally, conferences are a booming business. It is currently estimated that international business meetings are worth about 4,5 billion US dollars annually. The Union of International Associations, which is based in Brussels, estimates that more than 6 000 international conferences are currently taking place annually, and that this involves more than 4 million people. South Africa is becoming more and more involved in this area, and it is generally agreed that this industry has passed the R40 million-a-year mark. This figure excludes travel and accommodation costs. It is expected that the market will grow by 25% a year. The conference industry is important to tourism, because it creates business in off-peak periods; it generates employment as a result of the substantial demand for services ancillary to tourism; it uses the country’s entire infrastructure; and it boosts tourism through precongress and postcongress tours.

Figures for November 1986 show an increase in the number of overseas visitors visiting South Africa. Mr Spencer Thomas, of the Tourism Board, attributed the upswing in the number of international visitors to South Africa to the decline in negative overseas publicity. In a strange way this helped the tourist industry. It created a strong awareness and curiosity about this country. He added that the SA Tourism Board’s overseas advertising campaign, launched at the end of last year, had been successful, and that domestic tourism had been stimulated by the publication of the Get up and go guide. I wish to congratulate the SA Tourism Board on these outstanding successes.

One city that has certainly taken up the challenges offered by this new industry is Durban. Durban is well-known as the holiday mecca of millions of visitors who every year flock to its subtropical climate in search of sea, sun and fun. However, there is much more to Durban than that.

Sweeping changes to the city’s infrastructure are transforming Durban into the best of both worlds. Apart from being an idyllic holiday city it now also has the infrastructure and facilities to make it the ideal destination for business gatherings, conferences, trade shows and exhibitions. This is the result of a planned structured strategy based on the city’s existing facilities and enormous potential.

Over the past three years R150 million has been spent by the City Council, augmented by R450 million from the private sector, to ensure that Durban remains in the forefront of progress and development. Bodies and associations concerned with the economic development of the region have pooled their resources while Durban’s tourist industry, central business district and commercial and industrial sectors have combined their talents and facilities. On a single day Durban is able to host up to 45 000 delegates providing accommodation, exhibition or conference facilities, the widest range of entertainment and leisure pursuits and a perfect climate all year round. With the Durban City Council providing the initial impetus the “funshine” city has been transformed into the ideal function city. The central business district and beachfront have both undergone major changes. The Durban Publicity Association has established an in-house bureau to assist organisers of conferences and exhibitions. A self-contained department within the Durban Publicity Association—the Convention and Exhibition Bureau—offers companies and associations up-to-date information on the city’s business oriented facilities as well as lists of conference and exhibition organisers, suppliers etc. It also issues a detailed brochure to interested parties on how to plan a successful conference.

The latest figures reveal that an average of 1,3 million holidaymakers visit Durban annually, generating a revenue of approximately R600 million. It is said that this, in turn, generates between R1,8 billion and R3 billion in potential what is called “tourist rand”, viz spin-offs as a result of spending by tourists.

According to the Sunday Tribune of 2 August 1987, about 300 000 twenty-minute videos of South Africa were released recently by the S A Tourism Board and are distributed to travellers leaving the country. This of course is a very laudable exercise. What, however, is disturbing to us Durbanites, is that the video has virtually totally ignored Durban which is acknowledged as the country’s foremost tourist mecca. Instead, it has concentrated on the Transvaal and more specifically on the Cape. According to the article, scenes shown of Natal include a brief flash of the Indian market, a less than 5-second clip of the Drakensberg and an indistinguishable shot of the city’s harbour. The words “Natal” and “Durban” are not mentioned at all. There is ample footage, however, of Cape Town, the wine route, Johannesburg and the Eastern Transvaal.

According to the article a spokesman for the Tourism Board said that the video had been made to overcome South Africa’s negative image abroad and to paint an overall picture of the country. It did not aim to concentrate specifically on tourist centres in South Africa. Certainly Durban is very much a part of the overall picture of the country and even more so in the light of the results of the recent election.

One thing that will certainly help Durban to attract international exhibitions and conferences is a free trading zone based on the Taiwan concept and designed specifically to boost our exports. I would appreciate it if this possibility can be investigated.

Mr Chairman, there is rather a tranquil atmosphere in this Committee.

Do something about it!

It is something to which I am not accustomed. Normally when I swim in Durban the waters are a little turbulent and the waves are quite strong.

And the sea is full of sharks!

As the hon member has pointed out, the sea is full of sharks. I was, however, pleased to hear from the hon member for Umbilo that there are people in Durban—they probably constitute the majority—who want us Transvalers there as well as our money and do not simply want our money alone, which is the impression that has been created among many of us. I welcome the fact that the hon member is now quite happy for us to bring the money to Durban rather than just sending it there.

I do not want to get too involved in the subject of tourism, but if the hon member for Umbilo really wants to do something for tourism in South Africa, he will persuade this hon Minister to approach the hon the Minister of Transport Affairs because one of the greatest hindrances to tourism in South Africa is the attitude which prevents the introduction of charter and other cheap flights to South Africa. This makes coming to South Africa prohibitively expensive in relation to going to other parts of Africa.

All over Europe one hears the comparison being made between going on what they call “safari” to central African countries and coming down to South Africa where they can visit game reserves where the facilities are better than, the game equal to and the scenic beauty as good as anywhere else. The only thing that is different is that it is more expensive to come here, despite the fact that the rand is at a low level. If that problem can be dealt with, quite a big problem in regard to tourism in South Africa will have been solved.

Allow me to deal with the important matters that I should like to bring to the hon the Minister’s attention.

The first is that the attitude of this Government towards the consumer is demonstrated by the fact that the word “consumer” is no longer even in the title of this hon Minister. Hardly any money is being voted for the protection of the consumer and there is now a new spirit abroad that the consumer must look after himself. There is inadequate attention and dedication to, and inadequate funds are being voted for the protection of those who need to be protected.

We believe that there should be proper competition in South Africa but, despite all the laws and boards, does it exist? One of the things that I find most remarkable—I suggest that the hon the Minister has his officials do a little analysis—is how it is that so many companies manage to increase their profits without increasing their turnover and when there is no improvement in efficiency in the organisations concerned.

I must tell hon members that there are many areas in South Africa where the consumer is not getting a fair break and where he is inadequately protected, and this shows that the Government is not doing its job.

An example is the trade practices legislation. This legislation exists and is strong and effective, but it is not used. There is hardly any action in terms of the Trade Practices Act in terms of which undesirable practices in South Africa could be done away with.

The general attitude to the consumer is demonstrated by the hon the Minister’s colleague in regard to the Granny Bonds. The reality is that the grannies and the grandfathers in South Africa do not have enough political muscle, whereas the business sector has. [Interjections.] The reality is that a scheme has been bungled and made a mess of and in the end, when inflation is allowed to run rampant in South Africa, the old people are left to look after themselves. [Interjections.]

Do hon members want to talk about inflation? Let us talk about it. We were mocked by the hon the Minister and his predecessor when we kept on pointing out our inflation rate needs to be considered in contrast to that of our trading partners. Now the hon the Minister has suddenly discovered that it is a reality and that one has to look at comparative inflation rates.

So let us look at some comparative inflation rates. I use the OECD countries as an example, which as a whole had an inflation rate of 2,6% last year. The major countries had an inflation rate of 2%. South Africa, however, had an inflation rate of 18,6%!

Let us look at another simple fact, namely the history of this Government. A 1950 rand is equal in purchasing power to nine cents today, in comparison to its value then. If hon members do not like 1950, let us take a significant year for the NP, namely 1981. The rand of today has exactly one half of the purchasing power it had in 1981. That is the success this Government has had in protecting the ordinary people of South Africa.

Let me turn to another matter. One of my colleagues has already referred to the White Paper on privatisation. The hon the Minister made an announcement today about the IDC participating in the Mossel Bay project. I want to ask some questions about the IDC. Is it actually the function of the IDC to have and continue to hold companies which are quoted on the Stock Exchange, which hold shares in other companies, which are not in need of assistance, but which in fact are companies that are flourishing? Is that the function of the IDC? Or is it the function of the IDC to help to encourage new industry and new projects in South Africa? May I ask the hon the Minister where the money will be found in order to invest in the liquid fuel project? Where will the IDC find that money? Will it sell investments and, if so, what investments? What cash resources does it have? I think this needs a little more clarification.

Lastly, I want to touch on a subject I have tried very often to involve in any economic debate. The hon the Minister referred to the Freedom Charter and nationalisation. I found that fascinating because, sitting in the Cabinet with the hon the Minister is another hon Minister who not only is not allowed to swim without permission but also believes in the nationalisation of the gold mines.

This hon the Minister has the audacity to criticise nationalisation here when, within his own Cabinet, he has a Cabinet Minister who advocates nationalisation of the gold mines. [Interjections.] What does he actually believe in? What is it in fact all about? I want to tell hon members what I think the reality is. Nationalisation is rejected; it is rejected by us in these benches.

What about the AWB?

I am not a member of the AWB. They do not sit in these benches. [Interjections.] Let us just get that clear. Whatever my politics are, they certainly are not AWB! [Interjections.]

However, let me put a very simple point to hon members. In England we have a situation where the Conservative Party has taken steps which have had the result that where once England was a nation of shopkeepers it is now becoming a nation of shareholders. The answer to nationalisation and the answer to the campaigns which are contained in the Freedom Charter and promoted by other people in favour of nationalisation does not lie in the ownership of the means of production vesting in the state but in fact in the people, and it should be in the hands of the people through shareholding.

This Government, contrary to what is done in the United Kingdom, places every obstacle one can think of in the way of share-incentive schemes for employees. Every tax obstacle one can think of is put in the way of the ordinary people in South Africa to prevent their becoming shareholders. Share-incentive schemes are taxed, share-option schemes are taxed and the man in the street is not given the opportunity that is given in other countries where in fact share ownership is encouraged. If there is one country in the world today where we should be encouraging share ownership in order to combat the concepts of socialism and communism, it is South Africa. We should do that here. We should in fact have a campaign that South Africans should own the means of production but own them through shareholding. I want to invite the hon the Minister to read the BAA prospectus and he will learn something. [Time expired.]

Mr Chairman, when one is a backbencher and it is ten to six in the evening I think having to speak after the leading speaker in the PFP is a hard act to follow. [Interjections.] As an amateur compared to the hon member who has just spoken I want to mention three issues with which I do not exactly agree.

Firstly the hon member complained about the way in which we treat our consumers in terms of legislation. However, three minutes later he himself said that there was already a great deal of machinery available. Surely we in this House should therefore not be responsible for creating more machinery. I therefore think the hon member answered his own question.

Use it then!

Secondly, the hon member said that Granny Bonds were a mess. I have to argue with that as I think it was a magnificent concept. I would like to say to the PFP that they should perhaps look at the Defence Bonds that pay 14%—1% less than the Granny Bonds—and they are still securely in place. Perhaps they were not as well advertised but they are still there and they definitely provide a hedge against inflation.

They have been reduced to 12%.

I did not know that. [Interjections.]

The third point that he raised is quite easy to answer from this side of the House. There was a complaint that the inflation rate has been terribly high and that from 1981 to now our rand has fallen to half its value. In the three months that I have been in this House, however, it has seemed to me that the party to my right is the one that always champions our Black population. Surely, however, it is the unproductive Black population that has resulted in the high inflation rate more than any other factor. [Interjections.]

Chris, what do you say to this?

We have to spend a mighty amount of money to educate those people so that they can become as productive as we are. [Interjections.]

Getting to my own subject—this is on the lighter side—I was …

Order! Hon members are conversing too loudly. We cannot allow hon members to converse so loudly.

Mr Chairman, a few years ago I was in an aeroplane on my way back from Canada with one of Dr Anton Rupert’s super salesmen. At that time I believe Canada was just about to allow the sale of marijuana and he had been looking at the market to see what he could market there. He told me a story about commerce and industry that I have always remembered.

According to him many years ago the Bata Shoe Company in Europe held a meeting. They were discussing selling shoes to African countries. One of the senior salesmen said that it was no good looking at that market, because nobody there wore shoes. One of the younger salesmen then said: “What an exquisite opportunity for a new market!” It is almost that attitude that I wish to talk about this afternoon.

Those who have read the Hansard of this debate last year will have read about the terrible condition this country was in. Last year’s debate was full of gloom. There was talk of the economy collapsing, a general depression, disinvestment and boycotts, and speculation about when this country was going to be brought to its knees. I know that, because I read Hansard. There was violence in the Black townships.

Now in 1987 we are in the position where our state of emergency over the year 1986-87 has brought some measure of security to our country. The people who trade and produce in this country can trade and produce in relative peace. Our foreign reserves are proof of that. They stand at record highs. Added to that, I think it is fair to say—even with the criticism that we have—that we are climbing or have climbed out of our recession. As Roosevelt said: “All we have to fear, is fear itself. ” Can our manufacturers ask for more in a country where many of the products which competed with theirs are now not allowed into the country because of boycotts and sanctions? There are opportunities for them to replace the products subject to boycotts and sanctions.

Added to that the rand is, as the opposition has said, at a very low level. With the rand at a low level we can afford to regard our export markets, as far as our factories are concerned, as the same as our import markets. That will give us long production runs on a scale where we can produce goods cheaply so that we can expand our factories inside this country of ours. Those foolish manufacturers who have disinvested and left our country have opened up new fields of manufacturing for our local manufacturers and businessmen.

The Government has provided industrialists in our country with an example of what can be done when people boycott and disinvest. I think Armscor is a wonderful example of what can be done when people refuse to supply us with goods. Not only do we provide the weapons for ourselves—we now manufacture the weapons we need—but I believe that we are also in a situation to export weapons to other countries.

I think when the oil boycott was enforced against this country it was the one thing that should have brought us to our knees immediately. This Government did not only turn that oil boycott into an opportunity but I think it is also going to build the economy of our future on the Mossel Bay project and the Sasol projects that we already have. We have numerous other examples in the country of how the Government has not allowed threats and boycotts to bring us to our knees.

The Government has extended, not only by example but also by practical help, opportunities to all our industrialists. From the 1925 Commission on Protective Tariffs right up to recent days, the Government has done as much as possible to protect our local industry by imposing tariffs upon goods that come from countries that compete with us. These tariffs are still our policy right up to today. Together with our weakened rand these tariffs should be enough to inject some life into our local manufacturers to get them started again. Not only does the Government impose tariffs on goods that come into our country, but we also have permanent representatives overseas in Bonn, Berlin, Milan and other cities to assist our own exporters and industrialists on a permanent basis to find fresh and new markets.

The Government is doing everything that is humanly possible to help our local people.

If one is an industrialist and wants to export, then one can borrow money at a cheap rate. Tax will be reduced and one will get help every step of the way. The time is ripe, the time is opportune for our local people to go ahead.

However, there are some things that stand in our way. Firstly, we have a small population and we do not seem to have the technical know-how. At the same time, however, the Government has provided us with technical know-how in the form of institutions such as the CSIR. The CSIR has studied many of the problems that we have and has solved many of our technical problems. It was very pleasing today to listen to the hon the Minister say that the CSIR and other institutions will in future be more market-oriented and less focused on the mere academic problems that face us. Perhaps the Government can do one more thing to help our local manufacturers.

Perhaps it is possible for all these nations that are boycotting us and applying sanctions against us and the firms leaving us and to lose the protection that our legal system gives to their patents and their copyrights. I for one do not see why I should respect the patents and copyrights of somebody who is waging economic war against us. Perhaps this is one of the finer protections that we can give to manufacturers in our own country.

I would like to go back to the story about the shoes. We stand on the threshold of one of the finest opportunities this country has ever had. This Government has given every assistance that it possibly can to our manufacturers to produce. I think it is time that they stopped criticising the system. If they really do not believe in it they can always leave like those who have gone to Perth. Those that stay here should realise that even if another Government takes over here that Government will protect them and look after them too. Our industries have the best chance of employing those people who are without jobs at the moment. [Time expired.]

So far I have found it very interesting to listen to the debate this afternoon. When one listens to the matters raised by the Official Opposition—in their own eyes they will be the Government after the 1989 election, as they put it—and as one takes cognisance of the way those hon members see the economic constraints we are struggling with at this time in South Africa, it is noticeable that this so-called alternative Government is not prepared to address South Africa’s problems. They want to want to escape from them by not even trying to address those matters.

Your power-sharing does not work!

The hon member speaks of power-sharing. That lies at the very basis of their inability to address the problems of South Africa. They know they can try to compartmentalise many things in South Africa and that they can delude people into thinking that they can succeed but they know very well that they cannot compartmentalise South Africa’s economy. They also know they cannot go and sell that matter to their own supporters in the areas they represent here.

That is the reason why the Official Opposition is running away because they know that the greatest oppression in South Africa falls to the lot of that part of the population which is poor and underprivileged. We shall inevitably have to look into the situation and the position of those people in this country in order to create a happy future for South Africa.

Business interrupted in accordance with Standing Order No 19.

House Resumed:

Progress reported and leave granted to sit again.