FRIDAY, 8 JUNE 2001 __

                PROCEEDINGS OF THE NATIONAL ASSEMBLY
                                ____

The House met at 09:01.

The Deputy Speaker took the Chair and requested members to observe a moment of silence for prayers or meditation.

ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS - see col 000.

                          NOTICES OF MOTION

Rev A D GOOSEN: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ANC:

That the House -

(1) notes with pleasure the R14,5 million donated by the Italian government to assist this ANC-led Government in its tireless efforts to ensure access to institutions of higher learning for especially students in rural areas, black women, those struggling financially in historically black institutions and poor black students;

(2) notes that this donation is an example of the support that this Government enjoys because of its sterling efforts to level the playing fields and ensure quality learning for all people; and

(3) commends the Italian government and other European countries for their continuous support and vote of confidence in the South African Government’s efforts to transform our society and strengthen our economy.

[Applause.]

Mr A J BOTHA: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move:

That the House -

(1) takes note with alarm and concern of the imminent food shortages and possible starvation that could occur in Zimbabwe as a result of the anarchy unleashed by the government of Zimbabwe;

(2) urges the Minister for Agriculture and Land Affairs to put in place a contingency plan in South Africa to reserve sufficient grain stocks to meet this crisis facing our neighbours, because the deregulated grain market in South Africa is not capable of handling such a crisis without major disruption;

(3) accepts that Zimbabwe will be unable to pay for such food; and

(4) requests the South African Government to negotiate with donor countries to pay for the food relief, as South Africa cannot afford to do so.

Mr A M MPONTSHANE: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the IFP:

That the House - (1) empathises with hungry children in the Kleinvlei area in Cape Town who are scavenging for rotten food illegally dumped near their homes;

(2) notes that this plight has led to these children developing sores on their faces and bodies; and

(3) calls upon the Cape Town Unicity to take action against the truck that illegally dumps waste on a daily basis in the Amsterdam informal settlement, so that the lives of the community and children can be protected.

Prof B TUROK: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ANC:

That the House -

(1) notes that the DA in the Cape Town Council has back-tracked on its much publicised policy of political appointments after immense public pressure;

(2) welcomes the abandonment of ``jobs-for-party-hacks’’ policy by the DA;

(3) believes that the DA’s about-turn comes too late because the City has lost out on competence, confidence and continuity …

[Interjections.] Would the hon member mind speaking or shouting up? [Laughter.]

(4) concurs with the ANC in the Western Cape that the DA is ``lurching from crisis to crisis’’; and

(5) calls on the DA to develop proper policies before grandstanding them in the media.

[Applause.]

Mnr I J PRETORIUS: Mevrou die Speaker, ek gee hiermee kennis dat ek op die volgende sittingsdag namens die VF sal voorstel:

Dat die Huis -

(1) met ontsteltenis kennis neem van die tientalle plaaslike owerhede wat ernstige finansiële probleme ondervind en nie hulle verpligtinge kan nakom nie in die lig van die volgende:

   (a)  die uitstaande dienstegelde en munisipale belasting het op 31
       Desember 2000 reeds R11,7 miljard beloop;


   (b)  bogenoemde uitstaande bedrag is meer as die begrote bedrag van
       31 staatsdepartemente vir die huidige boekjaar; en


   (c)  die skuld beloop meer as dubbeld die begroting van die
       Departement van Provinsiale en Plaaslike Regering; en

(2) die Minister vir Provinsiale en Plaaslike Regering versoek om dringend ‘n ondersoek te gelas na die landwye krisis met die oog daarop om ‘n kultuur van betaling aan te moedig. (Translation of Afrikaans notice of motion follows.)

[Mr I J PRETORIUS: Madam Speaker, I hereby give notice that on the next sitting day I shall move on behalf of the FF:

That the House -

(1) notes with alarm that dozens of local authorities are experiencing serious financial problems and cannot meet their obligations in the light of the following:

   (a)  on 31 December 2000 the outstanding service fees and municipal
       taxes already amounted to R11,7 billion;


   (b)  the abovementioned outstanding amount is more than the amount
       budgeted for 31 state departments in the current financial year;
       and


   (c)  the debt amounts to more than double the budget of the
       Department of Provincial and Local Government; and

(2) requests the Minister for Provincial and Local Government urgently to order an investigation into this countrywide crisis with a view to fostering a culture of payment.]

Dr G W KOORNHOF: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the UDM:

That the House -

(1) notes -

   (a)  with alarm that many African countries are not on track to meet
       set poverty reduction targets, and this raises fears about how
       effective the countries will be in selling the Millennium
       African Recovery Programme, Marp, to developed countries; and


   (b)  that one in twelve African countries are now reporting worsening
       conditions; and

(2) challenges the Minister of Foreign Affairs and the Minister of Finance to meet the United Nations Millennium Summit proposals of debt cancellation, improved market access, enhanced official development access, increased flows of foreign direct investment, transfer of technology and more broadly, bringing Africa into the mainstream of the world economy.

Mrs M M MALUMISE: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ANC:

That the House -

(1) notes that the Department of Trade and Industry launched an investigation into how credit bureaux treat customers;

(2) believes that -

   (a)  the operations of unregulated credit bureaux have caused a
       number of problems for the public and particularly lower income
       people; and


   (b)  there is an urgent need to establish an appropriate regulatory
       framework to govern the operations of credit bureaux;   (3) welcomes the investigation into the functioning of credit bureax; and

(4) calls on the people to make submissions to the investigation to enable the department to develop measures to regulate the functioning of credit bureaux.

[Applause.]

Mr P H K DITSHETELO: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the UCDP:

That the House -

(1) notes -

   (a)  that the misunderstanding between Metrorail and the Johannesburg
       Traders Association representing station hawkers is a cause for
       concern, as the hawkers representatives claim that they have
       been given a grace period of 14 days to continue trading on the
       platform and there is a counter-denial by Metrorial to this deal
       or agreement; and


   (b)  last month's events, when guards and hawkers were involved in an
       ugly confrontation and shots were fired, putting the safety of
       passengers at risk; and

(2) calls for -

   (a)  a debate on the safety of passengers at Metrorail stations; and


   (b)  the institution of a commission to investigate the rights of
       passengers, which should include the taxi industry.

Dr S E M PHEKO: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the PAC:

That the House -

(1) notes that there is a border dispute between Namibia and South Africa;

(2) notes that colonial boundaries have created serious problems in Africa, resulting in endless wars among African states, such as between Ethiopia and Somalia, Somalia and Kenya and Ethiopia and Eritrea;

(3) takes cognisance of the fact that the PAC, although believing that colonial boundaries must be negotiated, nevertheless goes along with the Charter of the Organisation of African Unity that African countries must accept colonial boundaries, unpalatable as they are, because their pursuit by military means can only destabilise the country;

(4) notes that Pan-Africanism is the solution to a number of problems Africa is facing, including border disputes, and urges the African Union to vigorously pursue the objectives of Pan Africanism which, inter alia, are Pan African unit …

[Time expired.]

Mr S T BELOT: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ANC:

That the House -

(1) notes that a provisional agreement was reached between the SA Local Government Association and the SA Municipal Workers Union to resolve the protracted wage dispute;

(2) believes that the stabilisation of labour relations in the local government sector is of paramount importance for service delivery in the communities; and

(3) welcomes the agreement reached between Salga and Samwu.

Mr R J HEINE: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the DP:

That the House - (1) notes that the draft R1,7 billion budget of the Nelson Mandela Unicity is R100 million short;

(2) is of the opinion that -

   (a)  this can largely be attributed to the growing levels of debt
       under the mismanagement of the ANC in the previous six years of
       the city; and


   (b)  this shortfall and rising debt of at least R600 million could
       result in the unicity not being able to provide basic services
       to its citizens;

(3) further notes that -

   (a)  the ANC Mayor, Nceba Faku, has upgraded his flying status from
       economy to business class;


   (b)  despite the dire financial straits of the municipality, the ANC-
       led council is planning to purchase a building for R2,5 million
       to house the members of the mayoral committee; and


   (c)  ratepayers are facing a 16% to 18% rates increase; and

(4) calls on the municipality to revoke any plans for lavish expenditure and focus on placing the municipality on a sound financial footing and delivering municipal services to all the people.

[Applause.]

Mr M F CASSIM: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the IFP:

That the House -

(1) notes that -

   (a)  South Africa is rightly proud of its beautiful and largely
       unspoilt beaches and marine reserves; and


   (b)  some South Africans utilise these God-given treasures as if
       tomorrow did not exist or that our children ought not to inherit
       the world in a state as good as we found it;

(2) welcomes the intention of the Minister of Environmental Affairs and Tourism to impound or confiscate vehicles driving on the beaches or boats sailing into certain restricted bays where whales are found; and

(3) calls on its members to put themselves squarely behind the Government’s tough stance to keep and preserve the environment in a pristine condition for its own intrinsic reasons as well as for the economic benefits that this promises.

[Applause.]

Mr M T GONIWE: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ANC:

That the House -

(1) notes that - (a) two men were arrested in Soweto for running a mandrax factory; and

   (b)  members of the police task force, crime intelligence and
       forensic units also found factory machines, and chemicals that
       are used to manufacture mandrax; and

(2) commends the police for this huge drug bust.

[Applause.]

Mr A Z A VAN JAARSVELD: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move:

That the House -

(1) notes that-

   (a)  Cosatu is once again threatening to engage in a programme of
       action that could include a two-day general strike to protest
       against privatisation and the corporatisation of Eskom; and


   (b)  this immature threat comes after the Portfolio Committee on
       Public Enterprises refused to rubberstamp their amendments to
       the Eskom Conversion Bill; and

(2) urges the Government to publicly reprimand its alliance partner, Cosatu, for the reckless and undemocratic manner in which they choose to try and impose their will on the people of South Africa.

Mr D G MKONO: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the UDM:

That the House -

(1) expresses its concern about the ongoing crisis in the Education department, which was highlighted by the Universities of Transkei, Fort Hare and Rhodes merger;

(2) questions this merger as the National Working Group for National Higher Education’s report has not been tabled yet; (3) notes with exceptional concern the distances between the campus and the illogical suggestion by the Department of Education to merge, as it posed practical obstacles with regard to administration and distances; and

(4) calls upon the Minister to clarify the matter urgently and constructively and to give direction.

Mrs M P COETZEE-KASPER: Madam Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ANC:

That the House -

(1) notes that the residents of Warrenton in the Northern Cape engaged in violent protests complaining about lack of service delivery;

(2) believes that the destruction of property and infrastructure will not accelerate service delivery; and

(3) calls upon the residents of Warrenton to desist from engaging in violent actions and engage the authorities constructively, and work with them in improving service to the community of Warrenton.

     CONGRATULATIONS TO SOUTH AFRICA ON HOSTING OF EARTH SUMMIT

                         (Draft Resolution)

Mrs R A NDZANGA: Madam Speaker, I move without notice:

That the House -

(1) congratulates South Africa on the fact that it will host the Earth Summit in September 2002;

(2) is of the view, given the deep significance of this summit to the planet and its people, that time could be set aside for a special debate on this question; and

(3) is further of the view that we, as South Africans, should do everything in our power to have a successful Earth Summit with the theme: “How sustainable development can alleviate poverty.”

Agreed to.

                         APPROPRIATION BILL

Debate on Vote No 31 - Trade and Industry:

The MINISTER OF TRADE AND INDUSTRY: Madam Speaker, hon members, ladies and gentlemen, I would like to thank you for, once again, having the opportunity to address the House on Vote 31 of the Department of Trade and Industry budget.

The director-general, Dr Ruiters, and his team have presented the Vote to the portfolio committee and the NCOP select committee responsible for trade and industry. I think we are very fortunate, as a department, to have such active committees under the leadership of Dr Rob Davies and Mr Mohseen Moosa, and I would like to thank them very much for their continued support and active interest in the success of our work.

When our President addressed this House at the opening of Parliament, he indicated our macroeconomic successes. He set out an integrated action plan and placed great emphasis on further microeconomic reform. The integrated action plan focuses on specific areas with the objectives of raising the growth rate and accelerating employment creation, reducing poverty and inequality and having a greater impact on small enterprise development and black economic empowerment.

We are of the view that there is no doubt that we have moved South Africa onto a sustainable growth path. Last year our country experienced a growth rate of 3,1%. It is also important to note that since the Asian and Russian crises of 1998, South Africa has experienced 10 consecutive quarters of economic growth.

Though the quarter-on-quarter growth rate figure for the first quarter of 2001 was a little disappointing at 2% - this was partly a result of climatic factors that led to a significant fall in agricultural production

• the transport, communications, finance, commerce and tourism sectors remain strong, while real estate sales continue to provide positive indicators. The progress towards our inflation target is good and we have stabilised producer prices. This certainly increases our macro policy flexibility.

On the trade front, our performance has been very strong this year. Exports have performed exceptionally well, rising to a total of R78,5 billion for the first four months of 2001. This is a 29% increase on the same four months in 2000. Imports have grown more slowly, leaving us with a positive balance of R14,1 billion for 2001 so far.

We do not expect the current account to continue to perform at such an exceptional level - exports will probably grow more slowly for the rest of the year due to a softening in world market conditions. Also imports are likely to grow a little faster as investment plans by Government and the private sector are implemented. But most economists are still confident that the worldwide slowdown will be relatively short and not too deep, and could turn around later this year or early next year.

We can now look back on the period since 1994 and assess our performance in the manufacturing sector. Overall, production in this sector is rising slowly, at a little over 1% per annum. This could be seen as weak, but in the light of the tremendous pressure we have put on the manufacturing sector to restructure through tariff reform and more effective competition policies, there is little doubt that it could have been worse. Certainly, most countries going through similar structural reforms as we have gone through, have seen manufacturing shrink in real terms. Ours is still growing.

When it comes to manufacturing exports, we have done very well. Between 1994 and the end of 2000, exports grew from 15% to 28% of total manufacturing production. Overall, manufactured exports grew at about 11% per year, in real terms. At the same time, the overall role of manufactured products in our export range has grown very substantially. The strongest growing subsectors have been transport equipment, electronic consumer products, electrical machinery and equipment. This shows that we do have the capacity to be competitive in sophisticated segments of the world economy.

At the same time, investment in manufacturing has generally been weak. Real gross investment in manufacturing has grown by only 2,8% per year since

1. Some sectors such as transport, equipment and petrochemicals have done better at 5% to 6%, but overall the levels remain too low. Clearly, therefore, one of the key objectives of the DTI must be to support and facilitate higher levels of investment in manufacturing.

As a result of the deep restructuring in manufacturing, formal employment growth is a problem area. The figures we have indicate that formal employment in the manufacturing sector has fallen by about 1,7% per annum since 1994. There is no doubt that some of this apparent fall derives from changes in the classification of workers, as manufacturing companies outsource more and more activities such as transport, cleaning, design, information technology and so on. Also, we suspect that the number of employees in the less formal part of the manufacturing sector has risen considerably.

However, the improvement in productivity levels in South Africa has been very impressive indeed. One South African banking economist recently wrote:

We are having a productivity revolution on a par with Australia in the 1980s, that is leaving the US standing still.

To be a little more precise, output per employee in manufacturing has grown on average at over 3% per year, every year since 1994. The only sector that has experienced some significant decline in labour productivity has been the clothing, textile and footwear sector. Another key contributor to improved manufacturing productivity must be the decline in person days lost due to strike activity since the improvement in the industrial relations environments since 1994.

A further indication of the very considerable progress we have made since 1994, is the trend in the registration of new companies. In 1993 the total number of registered companies and close corporations registered in one year, was 42 076. This number had been falling before 1993. By the beginning of 1996 we were registering 73 425 companies per year. The numbers continued to grow in 2000, reaching a total of 108 886 companies and close corporations registered in a single year - a record for the companies office. Also noteworthy is that since 1994, 1 200 foreign-owned companies have registered in South Africa.

The meaning of these company registration numbers is, firstly, that the rate of economic activity has clearly increased considerably; secondly, that optimism amongst entrepreneurs continues to grow; and thirdly and very importantly, that there is a very significant growth in the establishment of companies by historically disadvantaged persons. This could include, to some extent, the formalisation of previously informal firms.

The President has issued us with a challenge: To move beyond our macroeconomic stability, to implementing microeconomic reforms. Our task is to examine more closely the nature of competitiveness at the level of the enterprise or firm. This is the focus of the DTI’s recently released discussion document on an integrated industrial strategy. It asks the question: What determines a firm’s competitiveness? There are essentially two categories of factors: Firstly those that are internal to the firm and, secondly, those that are external to the firm.

The four primary external factors to ensure the competitiveness of South African firms are: Firstly, to lower our input costs, particularly to continue stabilising and lowering energy, telecommunications and transport costs, as this would have a very positive effect on the entire structure of the economy; secondly, to lower the regulatory burden for firms, which is essential and must be achieved through a more efficient and effective government, capable of managing a sophisticated regulatory regime; thirdly, we as Government sometimes in partnership, and often in partnership with the private sector, must continue to invest heavily in infrastructure such as roads, railways and ports; and fourthly there is a persistent difficulty, namely access to finance.

The internal factors that drive firm-level competitiveness are dealt with at length in our industrial strategy paper and we have made a booklet on this paper available to all members. The main thrust of the document is that South Africa’s firms must adapt to the fact that the world economy is rapidly becoming a knowledge-based economy. This means that the value embodied in products is increasingly derived from the knowledge embodied in those products, rather than the value of the materials incorporated. This is a result of the fact that information and communication technologies have changed the nature of products, the way in which they are made and the way in which they are sold.

Secondly, the rate of innovation and new product development is far faster today than at any time previously, and thirdly the relationship between suppliers and customers is changing in such a way that customers are able to demand, more and more, the exact type of product that they need at the time that they need it. The services that accompany the development, supply and support for the product contribute an increasingly significant part of the value of that product.

The old modes of competitiveness, therefore, are less and less important and useful in such an environment. The cost of raw materials, access to cheap labour, control over proprietary technologies and privileged access to markets are advantages that are of less and less value. This does not mean that we should abandon our traditional strengths in South Africa based on energy and raw materials, but rather that we should seek to further enhance the competitiveness of these areas by integrating the knowledge- intensive processes into those sectors. The success of the industrial strategy depends upon a complementary socioeconomic strategy that is able to counter the powerful tendencies towards inequality, uneven development and marginalisation that characterise the globalisation process. This strategy must address the challenges of black economic empowerment, the promotion of small business and the creation of sustainable and well-paid employment. This latter objective can only be achieved through widespread education training, and the DTI welcomes the framework provided by the integrated human resource development strategy. Extending the scope of our industrial strategies into areas such as tourism, health services and telecommunications will have an important impact on employment creation.

The integrated industrial strategy needs to be read in conjunction with other aspects of DTI policy strategies. We have given hon members the first copy of Sisebenza Sonke, the department’s new policy journal which will be released on a quarterly basis. In the first issue we carry the international economic strategy, among other articles, and this consists of exploiting preferential trade agreements and arrangements such as the African Growth and Opportunity Act, restructuring our foreign offices, improving the regulation of international trade, and providing export credit reinsurance.

Underpinning all of this is a regulatory system that establishes and enforces a set of rules that govern economic conduct. These rules ensure the effective functioning of markets, competition, innovation and access, as well as entry into the market. Increasingly, it is clear - and this is a very healthy sign - that citizens have expressed their public interest more forcefully. The DTI will be paying greater attention to areas such as the economic and social impact of gambling. We are once again planning to introduce new liquor legislation during the course of this year and we will continue our efforts to promote greater transparency and corporate governance through amendments to the Companies and Close Corporation Act.

Consumer protection is an area that I would admit my department has not yet been able to strengthen sufficiently. However, through the changes that are being made in the department and increased financial support for this area, the Deputy Minister will lead a process of reform and change in this area. On 8 May I did express my concern that the applications for lottery funds were a mere trickle. But I am pleased to say that since this time, there has been a very significant increase in applications to the distributing agencies.

In order to play the role that is envisaged for the department, it must play an integrating role. We require a connected Government. The department and other economic departments are managing our macroeconomic reform programme. This includes other levels of government and last year the department intensified its efforts to align economic policies through a process of corporative governance and our work with provinces and local governments.

These efforts have included the review of mandates and the consolidation of the various agencies and institutions that report to the department and that now comprise what is referred to as the DTI group. This brings into the department’s ambit assets to the value of R25 billion, to be managed in support of the department’s objectives. I am very pleased to see that the Chief Executive Officer of the Industrial Development Corporation is here with us today. This is one of our premier institutions. A greater capacity for co-ordination is being developed in the department through the establishment of a management unit that provides institutional and policy co-ordination to the department and the DTI group. This capacity is being extensively used to support the co-ordination of the economic departments at national and provincial level, and to assist the Presidency in the very exciting programme of Marp. We have also made available to hon members the basic outline of the Marp programme in a small pamphlet which has been included in their packs.

As a department, we have recognised the need to review our support measures to firms in terms of their effectiveness in enhancing competitiveness. This review has led us to introduce a number of new programmes, as well as continuing with those that have proved their effectiveness in the past. This review process will conclude with the consolidation of the department’s supply -side support measures and incentives, as well as the introduction of a more innovative marketing and delivery system, to reach out to economic citizens everywhere.

Linked to this, a new suite of investment incentives has been implemented to promote skills development, modern production methods and investment in critical economic infrastructure. I am pleased to announce that our technical negotiations with the national treasury have been finalised and we intend tabling a revenue amendment Bill next week, which is the new strategic investment incentive.

I am pleased to announce that, in total this year, we have set aside R1 billion to stimulate domestic investment in the South African economy in various ways. More importantly, one of the most significant functions that the department performs is to connect people to economic opportunities by providing information, guidance and direct assistance, and by connecting firms to markets, finance and other firms to promote learning. One step is that a cyber café and resource centre has been opened in the lobby of the department in Pretoria. We are planning a similar one for Cape Town. We are planning to introduce similar initiatives at the provincial level fairly soon.

When I addressed this House last year, I spoke about the changes we were introducing in the department. One year is a very short time in the lifespan of a large institution such as the department. However, we have had great success in this process. We are transforming the department into a thinking institution that keeps its fingers on our economic pulse, and should be able to respond to the diverse needs of stakeholders, workers, consumers, investors and entrepreneurs.

I am personally pleased and congratulate the Deputy Minister and the Director-General on the changes that we have introduced in the department. I sincerely hope that this is becoming increasingly visible as we improve the management of the department. The improvements are evident, especially in the physical environment, the reform of our procurement system, more effective budgeting and the monitoring of expenditure. I hope too that the information and documentation that we have made available to all members will be of assistance.

Finally, we as Government need to ensure that we know how well we are doing as quickly as possible, in order to respond timeously to changing circumstances. We need a more effective monitoring and evaluation system. A chief economist’s office is being established to develop key performance indicators for the department’s impact on the economy. It is in this way that the department will itself become a more competitive organisation capable of competing with the best institutions around the world.

I hope that the quality and range of information available in the documents I mentioned a moment ago, will be of interest to hon members. I hope that this information will also allow hon members to access the work and plans of our department, so that hon members of this House can more effectively interact with constituents to support the work of the department and the growth of this economy.

I would encourage hon members to interact with the department and constituents in a more structured way. I would like to invite hon members to look at our exhibit in the passages. Some of the very interesting and exciting work done by the very wide range of the department’s institutions, is visible there. The department’s home page has been improved considerably and I would like to refer hon members to the Department’s 1999-2000 report, which we tabled along with this budget presentation today.

This reflects a different department and I hope it looks different because it certainly feels different. It acts differently and will be a very different department. In the past year the department has embraced a very simple lesson, which is that its success depends on our ability to manage change effectively. It should be a changing department, a changing economy and an always changing world. We certainly are no longer afraid of change.

As an institution we are building our capacities, forging a common set of values for the department’s group and reaching out to our stakeholders, be they in this House, in the provinces or in the deepest of rural areas. It is precisely this approach that has given us confidence, and the more we share this confidence, the more we in this House will infuse others with confidence. A confident economy is a growing economy.

I would urge this House to support this very important Vote.

Mr N S BRUCE: Madam Speaker, preoccupation with the realities of a global economy and the adjustments needed to prosper from it, are likely to dominate diplomatic relations between trading nations in the first half of this century. They will not be as intense as the national concerns which dominated the first half of the last century culminating in two world wars and finally the cold war, but they will be important.

The conflict will not be in the trenches, but within the structures of international institutions, of which the World Trade Organisation is the most prominent. In the face of this, national trade policies need to be clear, unambiguous and backed by an appropriate industrial strategy.

The Government’s new industrial strategy proposals, in the main, have the potential to facilitate the adjustments this country will constantly be making to globalisation. They are aim at enhancing existing industrial strength and opening new opportunities that will add to manufacturing activities.

They recognise the superior efficiencies of a market economy and the need for rising productivity through increased competition, lower tariffs, more effective but less regulation and the importance of job creation in the service sector; they correctly emphasise the importance and centrality of the consumer and recognise the critical need for education and skills; and they provide - in theory, at least - a comprehensive and focused front when Government negotiates with other major trade blocs.

Critical to their success is how Government intends to intervene when markets are identified as having failed. If the interests of the consumer are paramount, then they are likely to clash with the social and political imposts, as well as with the continuation of Government monopolies.

If what is considered to be ``market failure’’ is addressed by removing impediments to entrepreneurial endeavour rather than pandering to politicians who believe they know better than the markets as to how to allocate resources, there will be adequate growth and robust job creation. If that is accompanied by labour law reforms and fewer race and gender equality imposts, the chances of sustainable growth and a rising number of jobs will improve. But they will have to be backed by a macroeconomic policy that keeps prices stable, gets capital costs down and improves the prospects for the currency.

The hon the Minister says that to achieve his ends, there needs to be greater co-operation among Government departments. That could prove to be his Archilles heel. Should his Cabinet colleagues prove to be as recalcitrant and recidivist over trade and industrial policy as they were over the implementation of Gear, his policy will be tickets. Had Gear proved to be of more substance, and had growth approximated its forecasts, there would be less anxiety among trade unionists now about the robust way in which the hon the Minister has reduced protective tariffs and forced productivity adjustments.

The reduction in this protection must keep pace with trends in the global market if this country’s fragile improvement in productivity is to be continued, and if domestic prices are to remain relatively stable. Our competitiveness must not continue to depend on a plunging rand. That is a route to Zimbabwean disaster.

An important part of the function of the DTI is to provide efficient regulation, to ensure fair competition and equal justice. There are no signs of a robust deregulation or increased departmental efficiencies, despite almost constant administrative reorganisation.

There is the vexatious situation of the state lottery monopoly. It is effectively taxing the poor, enriching the operating company, its foreign shareholders and empowerment rentiers, and failing to disburse funds in any reasonable quantity after a year of trading to the very charities it deprived of the ability to fund themselves. The hon Alec Erwin will go down in history as the Minister who robbed the poor to enrich the party favourites, a sort of Hood Robin. Mind you, he is not alone among the Hoods Robin in the Cabinet. That is, of course, what socialists do naturally. I suppose if he did not, the pigs from Animal Farm would get him - not the little, gentle, potbellied ones like our new ambassador to Greece, but the big, ugly ones with snouts like the hon Jeremy Cronin and the hon Tony ``4x4’’. [Laughter.]

The hon the Minister is one of those involved in the arms scandal, the cost of which, in dollars, appears to have doubled within a year. He is supporting, as an offset, the building of a steel plant at Coega, despite worldwide steel manufacturing overcapacity and against the advice of his expensive American consultants. Yet his portfolio committee has recommended cutting back estimates of jobs likely to be created by the industrial offset programme which forms part of the arms deal, from a fanciful 65 000 to less than 10 000. This department too needs to come to terms with its policies on black empowerment, which to the foreign investor appears to offer rents to a rapacious, unskilled and uncommitted shareholder constituency which is cavalier about corporate governance.

The chief executive officer of the Industrial Development Corporation, which is our largest industrial undertaking with a high profile abroad, has forgotten to pay a substantial personal debt to a client company. Well, really! But worse than that, he has an interest in Worldwide African Investment Holdings, which in turn has holdings in other companies that have received funding in some form or other from the IDC or manage investments for it. The fact that he disclosed these investments and recused himself from these funding decisions is neither here nor there.

I hope that if he is sitting in this House today, he is blushing. But I suspect, like all good ANC members, he will not be able to see it. The conflict of interest is real, and when the chips are down, in whose interest is he going to act? This situation, in a public utility, is untenable. The hon the Minister has seen fit to give the errant chief executive officer a limp slap on the wrist. He himself was tutored by Derek Keys. Has he, to misquote Talleyrand, ``learned nothing and forgotten everything?’’

I just want to reflect on one other matter. It is a great pity that the President, in choosing a Minister of Trade and Industry, did not choose Mr Tony Yengeni, who has a remarkable ability to be able to acquire capital goods at far below the market price. What is more, he can acquire them for his wife and his girlfriend as well. Just think: If the hon Mr Tony Yengeni could be persuaded … [Interjections.]

Mr A C NEL: Madam Speaker, I wish to rise on a point of order: I have been listening to Mr Bruce, and there are a number of issues which he has raised in his speech which I would like to raise points of order on. The first is his likening Mr Jannie Momberg to a pig, and the second is the reference that he has just made to the Chief Whip of the Majority Party. I think he should withdraw that.

HON MEMBERS: Shame!

The DEPUTY SPEAKER: Order! Hon Bruce, could you please withdraw those remarks of likening the hon Jannie Momberg to a pig, and also the reference to the hon Chief Whip of the Majority Party.

Mr N S BRUCE: Madam Speaker, may I carry on? [Interjections.]

The DEPUTY SPEAKER: Order! Please withdraw the remarks.

Mr N S BRUCE: Madam Speaker, a literacy illusion to being a communist upsets the hon member, then I withdraw unreservedly. [Interjections.]

The DEPUTY SPEAKER: Order! Hon Bruce, did you refer to the hon Momberg as a pig?

Mr N S BRUCE: Yes, Madam Speaker, I have referred to him as a gentle, potbellied Vietnamese pig. [Interjections.] [Laughter.]

The DEPUTY SPEAKER: Order! Hon Bruce, could you please withdraw that?

Mr N S BRUCE: I withdraw that, Madam Speaker.

The DEPUTY SPEAKER: Could you also please withdraw the remarks about the hon Yengeni and his girlfriend.

Mr N S BRUCE: I withdraw the remarks about the hon Yengeni and his girlfriend. [Interjections.]

Dr R H DAVIES: Madam Speaker, on a point of order: Could he also withdraw the remark about the hon Cronin and his snout. [Laughter.]

The DEPUTY SPEAKER: Order! Hon Bruce, please withdraw that.

Mr N S BRUCE: If the hon Cronin does not want to be characterised as a communist - which is the reference from Animal Farm - and is ashamed of being a communist, then I will withdraw that, Madam Speaker. [Interjections.]

Prof B TUROK: Madam Speaker, on a point of order: Could you ask the speaker to sit down while I raise my point of order. I think the hon Bruce’s defiance of yourself is the real offence to the dignity of the House, and I ask you to reprimand him for his disobedience and for his cynical comments in this House.

The DEPUTY SPEAKER: Order! Hon member, the hon member has withdrawn the remarks. Hon Bruce, of course, you will reflect on yourself with yourself when you are at home. Your time has expired. [Applause.]

Dr R H DAVIES: Madam Speaker, I think what we have just heard is the latest in the series of ideologically motivated and driven attacks on the Department of Trade and Industry, and interventions on trade and industry, issued by the spokesperson of the Official Opposition. [Interjections.]

I would like to remind hon members of some of the other ideologically driven interventions that Mr Bruce has made in recent weeks. A while ago, we heard him opposing a proposal to establish an export credit agency by giving the ANC a lecture on Trotsky and the perils of Soviet communism. We have just heard Mr Bruce speaking, as he has often done, on the National Lottery where he has taken a position, not just out of concern about administrative issues, but expressing reservations about whether there should be a national lottery at all.

Last September, we heard the hon Bruce arguing, during a debate in this House on the portfolio committee report on hearings on banks and SMME finance, that the problem did not lie with the banks but with rent-seeking demands by SMMEs to secure privileged access to capital. Just now, we have heard warnings about dire consequences of interventions in favour of the poor around what he called ``so-called market failures’’.

I think it is important that we must try to understand the ideology which is underpinning and driving these interventions. The line of thought, I would contend, that underlies all these interventions is clearly one that holds that the market will always deliver. And, it is a line of thought which tends to assume that on any particular issue the position of the powerful market player, rather than representing a particular vested interest, stands for the common good.

I believe that many of the positions that have been taken by the spokesperson for the Official Opposition are adopted against the weight of evidence and therefore, as I contend, they are ideologically driven. I think we can recognise this kind of ideology which has been espoused, just now and on other occasions, as a form of free-market fundamentalism of the type which emerged in various right-wing think tanks that sprang up during Margaret Thatcher’s rule in Britain.

I think we should understand that, clearly, there is nothing moderate about this. This is hard right conservatism with a definite colonial tinge. [Applause.] I want to ask the leadership of the DA whether what we have heard just now and on previous occasions, is what the DA stands for. The DA has cobbled together a somewhat disparate group of people ideologically on the basic of ethnic mobilisation. They have not resolved a number of ideological and policy contradictions.

I think that it is high time that we actually heard from the DA whether this is their economic philosophy. Is this kind of free-market fundamentalism what the DA stands for? If it is, then I think the inescapable conclusion that follows, as the President said in the debate last year, is that whether they know it or not, they are our own home-grown Tories. And as such, the inescapable conclusion is that they stand for the interests of the rich and the empowered against the interests of the poor and disempowered. [Applause.]

I want to address the issue that we should be discussing today, the Vote of the Department of Trade and Industry. The shift in the focus of Government economic policy beyond microeconomic stability to microeconomic reform has, in fact, placed the DTI even more firmly at the centre of efforts to promote economic growth and development in our country. There are very few former colonial and semicolonial countries that have achieved success in breaking out of underdevelopment and promoting industrialisation. Those few that have done so all have in common highly effective government departments performing the kind of tasks entrusted to the DTI.

The experience that stands out most clearly in this regard is that of the Southeast Asian, so-called, NICS. Intrinsic to this model, in the words of economist Ajit Singh, was a ``vigorous industrial policy, the basic purpose of which was to change the matrix of prices and incentives facing private enterprise in the direction preferred by planners’’. Of course, our own challenge is not, mindlessly, to imitate or import practices from other contexts, but rather to learn the fundamental lesson of the East Asian experience, that is, that central to efforts of promoting economic growth and development, must be the formulation and implementation of an industrial strategy tailored, of course, to our own circumstances and conscious of the context in which we find ourselves.

The context within which we have to formulate our industrial strategy is, of course, that of the process known as globalisation. In my view we need to recognise this as simultaneously a process that has significantly altered the mode of operation of global capitalism in ways that no single country can afford to ignore and, at the same time, a process that tends to maintain and even widen huge inequalities and unevennesses between and within countries.

I believe that the dialectic both/and is critical in this respect. The development of productive forces in particular ways and the tendency towards inequality and marginalisation are intrinsic features of what Manuel Castells has called the creation of ``Globaly networked capitalism’’. What this means is that one cannot have policies to adapt production structures to the new realities of globalisation, unless there are simultaneously in place strategies to counter the tendency towards inequality and marginalisation inherent in the process.

Two years ago, the DTI embarked on a major restructuring exercise. This was a far-sighted, courageous and, to some extent, a risky decision. Between 1994 and 2000, the DTI had undergone moderate transformation and had a number of achievements to its credit. It could have continued along the same path without any major crisis. The decision to undertake the restructuring exercise was taken because the Minister and the leadership of the department recognised that moderate transformation and some progress would not deliver the kind of growth and development that we needed to achieve.

I am pleased to be able to report that, in the opinion of most of the committee, at least, that decision is beginning to pay off. The committee’s report on Vote No 31, which was published in the ATC’s some weeks ago, notes that the DTI, which previously had problems of underspending roll- overs, has now largely overcome these problems. In the last financial year, the department spent almost all its budget.

Our report notes that there is a greater alignment between activities and the budget and a noticeable improvement in financial management and control. Many of the new divisions, as the Minister indicated, are now up and running, and beginning to achieve results. There is now a young vibrant leadership in the hands of an energetic team of highly skilled people who are also highly committed. Most of them come from previously disadvantaged communities who would not even have been able to contribute in this way in the past.

The committee played an active role in monitoring the process and gave strong support to the objectives and the restructuring exercise. We will now want to continue to monitor the results. We have been engaged in regular quality time interactions with the department for some time. Our report notes that we now have a set of quantified indicators against which we can measure progress in this regard.

The Minister indicated that the DTI has recently released a discussion document on integrated industrial policy. The document seeks to conceptualise major new challenges facing us in developing an integrated industrial strategy and reviews previous industrial policy measures.

A number of other documents on aspects related to industrial policy will be released shortly and the portfolio committee, together with our colleagues in the NCOP, have indicated that we will be holding hearings on industrial policy after the winter recess. The Driving Competitiveness document points out that old ways and means of promoting competitiveness are no longer sufficient, and calls for new efforts to raise knowledge intensity, promote innovation, research and development, customisation, and move beyond existing departmental boundaries, and promote joined up government.

We hope that the public hearings will help contribute towards concretising what needs to be done in this regard and also to reflect on existing and other possible measures to promote industrial development and economic activities that can contribute to economic growth development and job creation. My own view is that there are, in our own experience, a number of lessons we need to build on in developing more effective industrial strategies. For example, the Motor Industry Development Programme highlights the importance of sectoral or value chain strategies formulated with the involvement of stakeholders. The strategic development initiatives show the importance of Government-led infrastructure development programmes.

Some of the bigger investments of recent years, that have drawn in foreign investors, show the vital role that a body like the Industrial Development Corporation can play. The IDC’s mission statement commits it to ``identifying and supporting opportunities not yet addressed by the market’’. We hope that our hearings will be able to address ways in which we can enhance these experiences and generalise them to other sectors.

While we welcome the progress that has been made in restructuring, the majority on the committee continue to be impatient - and rightly so in my view - to see faster progress in SMME promotion, black economic empowerment and employment creation. These are all stated priorities both of Government in general and of the DTI in particular. My colleagues will speak in more detail on these issues later.

I just want to say that, as a committee, we will continue to press for the earliest possible release of the promised new strategy documents on SMME and BEE. We will also request a comprehensive report on how the departmental restructuring will improve capacity to deliver services to SMMEs and promote BEE and employment.

The department has said that its efforts to promote SMMEs and black economic empowerment will no longer be confined to particular agencies, but will be priorities of the department as a whole. We welcome this, but we will need to engage further on how the different divisions in the DTI are contributing to promoting these objectives and how these efforts are being co-ordinated within the department.

Let me, finally, briefly comment on an issue which was raised earlier in a notice of motion by Ms Malumise. Clearly, there is now a growing public interest and concern in the operation of credit bureau. Individuals, particularly from poorer communities, who have their names placed on lists by these bodies have their life chances considerably affected. There is grave concern about the power which is exercised by these credit bureau. The activities of some of these credit bureau have been referred to the Consumer Affairs committee, and the DTI has indicated that it wants to engage with the public on this issue.

Let me express the hope that this issue will receive serious attention by the department and that there will be sufficient opportunities for members of the public to express their concerns. The committee will have to find time in its busy programme also to take up this issue and to receive a report, perhaps hold public hearings on this matter.

The ANC will support this Vote. [Applause.]

Mr M D MSOMI: Madam Speaker, hon Minister and colleagues, clearly, the combination of the previous experiences of the hon the Minister, who is a former lecturer in economics, the former Minister of Finance in the first democratically elected Government and now the Minister of Trade and Industry, have all rubbed off on this well-resourced department in a very positive way. As a shareholder Minister in the state financing institutions, I would like to make a very passionate and special appeal to the hon the Minister that something extraordinary has to happen to stimulate the microeconomy, especially the small and medium enterprises, and that is the immediate, swift removal of the entry barriers confronting emerging entrepreneurs. It is becoming far more urgent than we realise that we should avoid, by taking such an extraordinary measure, a situation similar to the one in emerging economies like the Far East, where there was a social upheaval before certain things could be corrected.

Knowing the Minister to be a caring person - I am saying this from personal experience - who has spent hours and hours with the black business gatherings, the honest identification of and the empathy with which the black business sector has been received, clearly indicates that the Ministry will be far more serious in removing those entry barriers.

Key aspects of the industrial policy need to be reviewed. The financing and the mentoring - I repeat, the mentoring - of the small and medium enterprises are critical. It is one thing to just resource them, but another thing to really take them by the hand and ensure that they succeed. With the greatest of respect to the hon the Minister, my research differs with the Minister’s statistics. But I agree that a lot has happened in the three years since 1998.

The IFP’s approach to the trade and industry budget is guided by five basic principles based on the big five drivers of our economy in terms of their contribution to the South African GDP, ie manufacturing, which is 18,9%, financial and business services, 18,4%, direct Government services, 17,3%, mining, 6,6%, and agriculture at 4%.

In total the big five comprise 65,2% of the entire South African economy and the remaining 34,8% is made up of wholesale, retail, motor trade, transport, communication and other industries as at the end of 1998. That is why I say, with the greatest of respect, that a lot must have happened in three years.

Our principles are that the economy of South Africa will, for a long time, survive on, firstly, harnessing creative talent of manufacturing, skills development and direct investment by the Government in the community’s ability to become self-reliant.

Secondly, the exploitation of our natural resources should be our primary goal of stimulating growth in a market-driven economy by creating capacity amongst all the people of our land, especially those in the rural areas, to explore to the maximum their natural resources as a means of waging a fight against abject poverty. I cannot overemphasise this more.

Thirdly, our financial services sector should be deregulated to create private-public partnerships which distribute economic opportunities and create linkages that allow a transfer of skills to the historically disadvantaged, to stimulate economic activity across the spectrum of our society, to spread wealth equitably. Fourthly, the buying powers of the Government - and this is critical - should be harnessed as a building block for regional economic development strategies through the mechanism of the private-public partnership principle as evidenced in the industrial developmemt zones, the spatial development zones and the development of airports and sea ports. The Minister should create a budget allocation to build capacity in the communities’ ability to engage the development zones as stakeholders, to secure their sustainable economic benefits. We should reverse the situation where communities become mere recipients of job creation and enable them to bargain for a piece of the economic cake in such spatial and industrial development zones. Fifthly, it should create globally competitive legislative, administrative and financial conditions to attract inward investment in the form of foreign exchange, human talent, information technology and technological transfers.

An amount of R2,214 billion is to be voted for the Department of Trade and Industry in the budget for 2001-02. This amount is R98 million or 4,6% more than the R2,116 billion in the 2000-01 budget. The Trade and Industry budget is divided into five programmes, which are administration, international trade and economic development, enterprise and industry development, enterprise organisation, and trade and investments in South Africa.

The IFP policy framework for the Trade and Industry portfolio is not at variance with the department’s strategic objectives, which are to provide an environment conducive to promoting higher investment levels for foreign direct and domestic investment, to increase access to international markets for South African products and to create a marketplace in South Africa for domestic and foreign business consumers.

The IFP has evaluated this budget’s medium to long-term impact on our economy and whether it meets the criteria of achieving each of these stated objectives. The budget allocation to Trade and Investment South Africa decreases by R74,71 million or 22,3%, and it does not create the environment which the department aims to create. The 11% decrease in the investment promotion and international marketing subprogramme, as well as the 40,5% decrease in the trade facilitation subprogramme are not in line with the objectives of attracting more foreign direct investment. It is a serious weakness in the chain.

The department’s objective to increase access to international markets for South African products and to maintain trade relations and agreements with other countries has been met by the increased allocation of R13,67 million, from R14,37 million to R28,04 million, which is an increase of 95,1% and this is welcomed.

The third objective of the Department Trade and Industry has been met by the increase of 20%, mostly as a result of a 11% increase in investment support and a 34% increase in export incentives. Again, this is a positive sign. South Africa’s manufacturing industry, being the largest contributor to our gross domestic product, has declined - and that is where the hon the Minister’s and my research differ - from 21,1% in 1993 to 18,9% in 1998.

The IFP observes, with great concern, that the Trade and Industry budget allocation to assist the competitiveness of the manufacturing industry actually decreased by 5,5% in the current financial year. We would request the hon the Minister to explain the probable impact of this decrease in the budget on our economy.

The IFP feels that two of the three departmental objectives have been met and that the 2001-02 budget is deserving of our support. We, therefore, will support this budget.

Mrs B M NTULI: Madam Speaker, hon Minister, friends and colleagues, I would like to express my appreciation for being afforded the opportunity to present my speech during this year’s budget debate. Let me start by complimenting the Department of Trade and Industry and its Ministry for all their hard work under tremendously difficult conditions during the restructuring process.

In my speech I will be looking at the Trade and Industry Vote within the context of the South African society that is currently unfolding. The newly democratically elected Government of South Africa, which is based on the ideals stipulated in our Constitution, realised that true political emancipation cannot be achieved if genuine economic transformation has not taken place. The transformation process should add value to the economy and also empower those people who had previously been in a disadvantaged position.

I want to quote the Minister of Finance from his Budget Speech this year when he truly said that ``South Africa is a growing tree bearing fruit’’. He said that when we enjoy eating the sweet fruit of liberty, we are removing the thorns of neglect and inhumanity and we are restoring the pride and dignity to our country and to our people.

I fully endorse these sentiments, because they are things that I believe in and which we fought for. These sentiments constitute the moral underpinning of a budget. They reflect the choices and decisions, and sometimes hard decisions, that Ministers have to make.

Our ultimate objective is and will continue to be the restoration of humanity and the creation of a caring country. This is the core of what we believe in. This is at the core of this Government’s policies and programmes. This is at the epicentre of our Government’s focus: a nation at work for a better life for all. This message is simple and readily understood.

We, as elected representatives, need to make this budget a living reality for our people. It is not just about checks and balances, trade surpluses or growing GDPs, etc. We should not only see numbers in the budget. We should see people, people like farm dwellers, the unemployed, the rural masses, eSiyabuswa, KwaNongoma, people in Gugulethu and kwaLanga, people like women and the youth. It is for those people that this budget must become a living reality.

The budget is especially about people like farmworkers who are treated without any dignity. It is for them that this budget must become a reality. The budget is about people; it is the nuts and bolts of a vision; a path to the true future of a better life for all; a more humane life. The budget is our ammunition; let us arm ourselves.

Our President, in his state of the nation address, captured the spirit, vision and aspirations of our country. He also highlighted the achievements, constraints and strategic priorities facing us as a nation. It is now our responsibility as South Africans to unpack and give meaning to this vision. This budget becomes the instrument through which our vision is made a living reality. The state must not only develop policies, but also ensure that those policies are implemented. Institutions aimed at black economic empowerment must be revamped. The state must ensure that the previously disadvantaged people benefit from state procurement.

In last year’s budget, the year 2000 budget, the department stated that their vision was to facilitate access to sustainable economic activity and employment for all South Africans. In order to achieve this vision, the department must attract higher level of domestic and foreign investment, increase market access for South African products domestically and internationally, and achieve a fair, efficient and competitive marketplace for domestic and foreign business and consumers.

The DTI identified new ways of growing the economy by growing industries, growing exports and investments, building jobs through investment, and empowering SMME development. The Department of Trade and Industry mentioned three areas of priority in the SMME programmes. They are going to embark on a quality development programme for SMMEs. This is also going to be a model that will follow a holistic approach to quality focus on critical factors, such as successful businesses, and assist SMMEs in the manufacturing sector.

Yes, there are successful stories in the urban areas, particularly in towns. But I am afraid that the rural people have not yet tasted the sweet fruits of liberty. I want to urge the Minister to look more seriously into SMMEs, especially at the review process. At a presentation in January 2000 Mr Rafiq said the department’s aim was to have offices in all provinces to dramatically increase the direct delivery of services to entrepreneurs of all sizes, at all stages of development, and in all sectors, and to give advice to start-up entrepreneurs.

Sicela ukuthi lokhu kwenziwe masinyane. Bayahlupheka abantu emakhaya. Kungenzeki emadolobheni kuphela, abantu bebe bengalutholi usizo emakhaya. [We ask if this could be done urgently. People in the rural areas are experiencing hardships. This should not be done in the urban areas only, while the rural people are not getting any assistance.]

Is the neglect of rural areas the result of the falling of fixed investments from 24% in 1984 to 15% in 1999, while the rate for successful, newly industrialised countries is more than 30%? It is always the very poor that still suffer, and we need to ask ourselves the following questions: What is it that we must focus on? What are the priorities in the Trade and Industry portfolio committee?

I believe that we can answer these questions if we concentrate on the basic needs that exist in this country. For example, we need to raise the wealth and living standards of the very poor; we need to create a lot of jobs; we need to reduce the inequalities that still exist in gender, in race and in the rural areas; and we need to contribute to the process of integrated development. Both the President’s state of the nation address and the Finance Minister’s Budget Speech indicated that these are the types of issues that we need to address during the course of this year, and it is important that our activities involve public participation.

There are a few priority areas in the department’s programmes, namely growth in the GDP, an increase in the provision of basic infrastructure, the trade surplus, the declining inflation rate and the increase of business confidence, linked to higher private-sector capital investment, microeconomic stability, international competitiveness, energy, transport, communication and, finally, financial aid to SMMEs. There are still challenges facing us as a country, amongst other things, low savings and investment rates, high levels of poverty, lack of access to finance for SMMEs, high levels of unemployment, and the underdevelopment of rural areas, especially amongst women, youth and the disabled people of this country.

The department has done little in terms of promoting black economic empowerment. The institutions that were established to drive this concept are nonfunctional, eg Khula, Ntsika and LBSCs. They are not visible. As a member of the Trade and Industry committee, what is it that I want to see that will guide my action in the work, as laid out for me? As a member of the ANC, I am guided by what the President said. As a woman I want to say that approximately 33% of the 2,8 million people of Mpumalanga are unemployed, of which the highest percentage is women.

Omama eMatsulu, eKwagga, eVezubuhle, eNkomazi. [Women in Matsulu, Kwagga, Vezubuhle and Nkomazi.]

Our objective is to move the country onto a higher growth path, increase competitiveness, raise employment level and reduce poverty and persistent inequality. My action, like yours, should be guided by our conviction to make these objectives a living reality for those voices that continue to be stifled, the vulnerable and the down-trodden in our society. Abantu bakithi baphume ebugqilini benhlupheko. [Our people should be liberated from the tyranny of poverty.]

I strongly believe that if any development can be taken seriously, jobs will be created and poverty will be a thing of the past.

I would like to say that there are three types of people in this country: clever people who discuss ideas, average-minded people who discuss events and simple and foolish-minded people who discuss people. There are political people and there are political buffoons. So hon members should judge for themselves, who those people are.

We, in the ANC, have … [Time expired.] [Applause.]

Mnr F J VAN DEVENTER: Mevrou die Speaker, ek kry soms die indruk dat wanneer ons na die begrotingsposte in hierdie Huis kyk, ons eintlik die geleentheid gebruik om so ‘n bietjie ``pro/bragging’’ te doen in plaas van om regtig na die situasie en die omstandighede te kyk waarmee ons te kampe het. Dit is vir my besonder interessant om te sien hoe elke departement optree, en ook die agb Minister van Handel en Nywerheid, vir wie ek persoonlik groot agting en respek het oor die manier waarop hy sy departement hanteer.

Wanneer dit kom by die aankope van wapens, dan is die verskoning vir die verhoogde besteding die verswakking van die rand teenoor die internasionale geldeenhede. Wanneer ons hier kom praat van verhoogde uitvoere, word dit gerieflikheidshalwe verswyg dat ‘n groot deel van die groter inkomste die gevolg is van die rand se verswakking teen buitelandse eenhede.

In die tweede plek is dit ewe geldig om te vra, as daar so ‘n fenomenale groei in die ekonomie van Suid-Afrika is, waarom daar dan so ‘n skerp afname oor die afgelope aantal jare in bestaande werkgeleenthede was? Is dit as gevolg van meganisering of is dit as gevolg daarvan dat die kapasiteit van entrepreneurskap wat werkgeleenthede geskep het, eenvoudig in Suid-Afrika gekrimp het? [Tussenwerpsels.]

Ek rig nie ‘n beskuldiging nie, ek vra die vraag, want ek dink dit is belangrik, wanneer ons wil kyk na die heropbou van Suid-Afrika en die skep van geleenthede, dat ons oor hierdie aangeleenthede baie, baie eerlik met mekaar moet wees en mekaar en die wêreld nie moet probeer bluf nie. Ek wil my tot ‘n ander situasie wend, en dit is die rol wat hierdie departement het om te speel in die ontluiking, nie alleen van Suid-Afrika as ‘n land wat werkgeleenthede en ontwikkelingsgeleenthede aan sy mense bied nie, maar ook ten opsigte van Suider-Afrika en Afrika in die algemeen. Hier kan ek aansluit by die President se siening van ‘n Afrika-renaissance.

Ek dink ons moet dit in die een of ander stadium vir mekaar sê, en miskien is vanoggend die geleentheid om dit te doen: daar is ‘n geneigdheid in Afrika, en ook by ons in Suid-Afrika, dat wanneer ons nie werklik die simpatie kry in die hoeveelhede wat ons dit graag van die wêreld wil hê nie, ons ons vingers begin rondswaai oor kolonialisme, apartheid, onderdrukking, die wegneem van ons bates, ens.

Feit is, baie van hierdie dinge het tot ‘n einde gekom in Afrika, maar daar is ‘n paar dinge wat in Afrika agtergebly het wat eie is aan Afrika. En as ons dit nie wil aanpak en dit nie wil teenstaan nie, gaan ons nie slaag in die Afrika-eeu wat die President in die vooruitsig stel nie. Afrika is steeds die slagveld van magsbehepte mense wat nie omgee om oorlog te maak, mense uit te moor, ens nie. Afrika is oor die algemeen bekend as ‘n vasteland waar korrupsie hoogty vier. Afrika is oor die algemeen bekend as ‘n vasteland wat nie baie vriendelik is teenoor beleggers van buite nie.

Dit het niks met kolonialisme te doen nie. Dit het niks met apartheid te doen nie. [Tussenwerpsels.] Dit is ‘n kultuur wat in Afrika ingebed is wat ons as Afrikane eenvoudig sal moet verander. As ons nie bereid is om dit te doen nie, sal ons aan die agterspeen van die wêreldekonomie bly drink tot nadeel van daardie mense na wie die vorige spreker verwys het as ``the poorest of the poor’’, en dan sal ons die probleem van armoede, werkloosheid en agteruitgang in Afrika nie stuit nie. Ek wil ‘n beroep doen dat ons in Suid-Afrika die suksesstorie en katalisator word van ‘n suksesvolle Afrika in 2001. [Tussenwerpsels.] (Translation of Afrikaans speech follows.)

[Mr F J VAN DEVENTER: Madam Speaker, I sometimes get the impression, when we look at the Votes in this House, that we actually take the opportunity to do a little ``pro/bragging’’ instead of really looking at the situation and conditions with which we are struggling. I find it exceptionally interesting to note how each department conducts itself, including the Minister of Trade and Industry, for whom I personally have great respect because of the manner in which he handles his department.

When it comes to the purchase of weapons, the excuse for the increased expenditure is the weakening of the rand against international currencies. When we talk here about increased exports, it is conveniently suppressed that a large proportion of the higher revenue was owing to the weakening of the rand in contrast with foreign currencies.

Secondly it is valid to ask, if there is such phenomenal growth in South Africa’s economy, why there has been such a sharp decline in existing job opportunities during the past few years. Is this owing to mechanisation or a consequence of the fact that capacity of entrepreneurship that created job opportunities, has simply shrunk in South Africa? [Interjections.]

I am not levelling accusations, I am asking a question, because I think it is important, when we want to look at the reconstruction of South Africa and the creation of opportunities, that we should be very, very honest with one another about these issues and that we should not try to bluff one another and the world. I want to address another issue, and that is the role that this department has to play in development, not only of South Africa as a country with job and development opportunities for its people, but also in respect of Southern Africa and Africa in general. Here I can associate myself with the President’s vision of an African Renaissance.

I think that we should say this to one another at some stage or other, and perhaps this morning is the time to do so: There is a tendency in Africa and also among us in South Africa, when we do not really get the sympathy from the world that we would like to get to start pointing fingers about colonialism, apartheid, oppression, the seizure of our assets, etc.

The fact of the matter is that many of these things have come to an end in Africa, but there are things that remained in Africa, things that are unique to Africa. And if we do not want to tackle that and oppose it, we will not succeed in achieving the African century that the President envisages. Africa is still the battlefield of people obsessed with power, people who do not mind making war, massacring people, etc. In general Africa is known as a continent where corruption is rampant. Africa is generally known as the continent that is not very friendly to investors from outside.

This has nothing to do with colonialism. This has nothing to do with apartheid. [Interjections.] This is a culture that is embedded in Africa that we as Africans will simply have to change. If we are not prepared to do this we will always draw the short straw as regards the world economy, to the detriment of those people to whom the previous speaker referred as ``the poorest of the poor’’, and then we will be unable to halt the problem of poverty, unemployment and degeneration in Africa. My plea is that we in South Africa should become the success story and catalyst of a successful Africa in 2001. [Interjections.]]

Mr D LOCKEY: Madam Speaker, I wish to address issues regarding black economic empowerment, employment and, finally, dwell on an instance where the Competitions Act is violated.

One of the most striking features of our continent is that it is well endowed with so many natural resources, and yet it is the poorest continent in the world. Many reasons can be advanced for the sad state of affairs in which we find ourselves, and the previous speaker has endeavoured to do so. However, I would submit this morning that one of the most compelling reasons why we are in the state that we find ourselves in, is that the wealth on the African continent does not belong to and is not controlled by Africans.

Despite political freedom on this continent, we have largely remained economically dependent on former colonial entities. The economic exploitation of Africans, therefore, did not cease after liberation. We can never allow such a state of affairs to be repeated in South Africa. We, in the ANC, believe that economic liberation should be an integral part of our transformation, and it is against this background that I wish to approach this debate today.

It is an irrefutable fact that South Africa has achieved the most stable macroeconomic conditions over the last seven years, under the leadership of the ANC-led Government. We have laid the foundation to now proceed to address the microeconomic challenges that face our country.

The empowerment of the majority of our people, to become part of the mainstream of the South African economy, is vital in the process of achieving high levels of economic growth and addressing the legacy of the past. The Black Economic Empowerment Commission has made many useful proposals to achieve this objective.

According to Business Map 2001, empowerment companies’ share of the market capitalisation of the JSE fell from 6% in August 2000, to 4,8% in February

1. Experience, with regard to black economic empowerment over the last few years, has shown that this cannot simply be left to the market forces. It requires targets to be set by Government. Furthermore, it requires certain control measures, to ensure that these targets are met.

Some of these measures must include the following: We must set certain procurement targets for BEE companies, both in the public and in the private sector. An example is the 25% that was set by the Department of Minerals and Energy for oil companies, over the next 10 years. We need to see more of these examples in other sectors of the economy.

We must strive towards greater ownership by blacks in the mainstream of the economy. We need to strive for greater representation of black people in the management of the economy. We need to see greater landownership by black people and we need to assist black entrepreneurs to obtain venture capital. As part of the overall black economic empowerment strategy, we must also focus on trends in the formal sector of the economy, particularly as it relates to employment.

If we look at the signs in the economy since 1994, the output of the manufacturing sector that was exported increased from 15% to 28%. This is a remarkable achievement. Labour productivity increased by 30% since 1994, but enumerated employment in the formal sector declined by more than 500 000 jobs in 1994. In the manufacturing sector, employment declined by 11,5%.

I would like to tell the hon Mr Van Deventer that the most compelling reason for this decline is as follows: There are higher levels of capital investment in order to compete on a global scale. Furthermore, there is the incorporation of information technologies in the production processes, and this has accounted for many of the problems with regard to employment. But there are also low economic growth rates, and this aspect needs to be addressed by both the Minister and the Department of Finance. We need to increase economic growth far higher than the levels that we currently have, and we need about a 6% to 9% economic growth rate.

Unless we are able to do this, we will see a continued decline in the labour absorption capacity of our economy. An estimated 57% of our population lives below the poverty line. Inequality and poverty are primarily caused by a lack of wage income. The only real solution is to create conditions that are conducive to the creation of jobs in the formal sector. The Government must take the initiative to invest in new strategic industries that will create jobs, assist with the formation of a new generation of entrepreneurs and simultaneously assist South Africa to carve a niche in the global economy.

In a developing country such as ours, Government has an inescapable obligation to nurture and build new growth industries. This implies actively participating in the establishment of such industries. The Board on Tarrifs and Trade has as one of its objectives the development of new sources of competitive advantage in South Africa. This objective could be achieved through a system of rebates to key industrial initiatives.

In addition to this, funds must be made available to fund new initiatives. There are funds available: the Minister of Finance announced in this year’s Budget a R3 billion strategic investment scheme for industrial projects. We have R2 billion available in the national empowerment fund and R1 billion is available in the Umsobomvu Fund.

These funds should be utilised for the following: We need to create new investment in capital infrastructure, we need to invest more in research and development of new industries and provide seed capital for new business ventures. We must also identify mentors amongst the country’s leading entrepreneurs that can lead initiatives that are so vital for our success.

I would like to propose one or two ventures that need to be considered by the Minister. There is a worldwide demand for platinum jewellery. South Africa is the number one producer of platinum. Such a new industry can involve a wide variety of our people, including rural women and the youth. This project can be tackled as a joint venture between Government and the platinum mining industry.

According to the Financial Times, the three platinum mining houses in South Africa are churning out cash so fast that they are forced to embark on a special dividend to shareholders, unless they can find new acquisitions. To give the House an idea of the kind of money that is generated by these mining houses, the smallest of these three has made a R2 billion profit in the last six months. These are very lucrative businesses. They have an obligation to assist Government to address the issues of mass unemployment. This should be part of the social responsibility initiative to create a safer and more prosperous South Africa.

It is not good enough simply to co-opt a handful of black people under the guise of empowerment. Throughout the world, corporate businesses are getting more involved in social, economic and environmental challenges that face those countries. Another area that requires serious consideration is the biotechnology industry. South Africa is home to one of the largest biodiversities in the world. We are well-endowed with many indigenous technologies. There is a fast-growing industry in the world for herbal remedies. What is required is to further develop and refine these indigenous technologies into mass products. This process should carve a niche in the global market.

These are just a few ideas. I am sure there are hundreds of ideas that exist amongst our people. In the absence of these investments, we must calculate the opportunity cost to the country. The alternative to these is high levels of crime, violence, poverty and degradation, which in turn would require greater spending on health, welfare, safety and security and correctional services.

In conclusion, I wish to bring to the Minister’s attention a violation of the Competitions Act. In terms of section 8(d)(3) of this Act, a business may not engage in an exclusionary act, unless it can show technological efficiency and competitive gains that outweigh such uncompetitive act. A business may not sell goods or services on condition that the buyer purchases separate goods or services unrelated to the object of the contract. Ster-Kinekor compels its patrons to only consume refreshments that are purchased on their premises. The prices of these refreshments are at least 100% higher than normal retail prices. [Time expired.]

Mr C T FROLICK: Chairperson, hon members, there is general agreement that the Government has achieved a stable, predictable macroeconomic policy. The Minister of Trade and Industry, as leader of the Cabinet cluster for investment and employment, is the steward of a growth programme to jumpstart growth rates. The hon the Minister, in a briefing earlier this year, stated that his Cabinet cluster’s success will be measured by increased growth rates, jobs, strides in local economic empowerment and boosting the small and medium enterprise sectors.

The Department of Trade and Industry’s role in realising these objectives is crucial. The importance of the department’s activities and responsibilities must never be underestimated. Neither must we underestimate the magnitude of the department’s objectives, such as creating an environment conducive to investment and increasing access to international markets, as well as creating a fair, competitive and efficient marketplace.

One of the key policy developments in the department is the need for the department to review its interface with the public and the opening of offices in strategically placed centres. Although the department perceives this to apply especially to its foreign offices, in order to render a better service to potential investors and exporters, it should not be restricted to these areas only. Of critical importance is to increase the interface of the department with ordinary citizens in South Africa who have previously been denied access to operating businesses.

To achieve this, the department has been restructured to increase productivity. Higher-growth economic sectors to promote exports in agriprocessing, mineral beneficiation, automobiles and components, as well as clothing and textiles, have been identified.

We must ask ourselves whether this department, and this budget, succeeds in attaining these ambitious goals. The truth is that, despite commendable work in many areas, a lot of hard work still needs to be done. It is of particular concern to us that unemployment remains a harsh reality for millions of South Africans. The solution remains enterprise development as confirmed by most economists, business leaders and policy analysts. The success of the department in the past few years with regard to SMMEs has not been that effective.

Black economic empowerment, which will only grow significantly and sustainably through SMMEs, lags behind our expectations. Many of the biggest and most recognisable names in BEE today cut their teeth in SMMEs. The talent and the will are out there, but this department must accelerate efforts to create an environment conducive to SMMEs. Measured against the potential out there, Khula and Ntsika have been failures. Let us take note of Leslie Boyd’s comments along the lines that long-term solutions to unemployment will not happen through the Anglos of South Africa.

We note that the department has undergone - and is still undergoing - significant and far-reaching restructuring internally. We commend these efforts in as much as they begin to address some of the above concerns.

In the regulatory environment we note a disturbing trend that continues unchecked. I am referring to the unacceptable practice of using black people and companies as fronts to channel contracts towards a small group of companies who refuse to transform, who reject the right of all South Africans to do business. This practice undermines all serious efforts of BEE and must be eradicated.

In conclusion, we must note that nothing in this world is perfect. We note that the department operates in difficult environments and has nonetheless begun to move in the right direction with most of its activities. As long as this remains the case, we will support the Minister and his department.

The UDM supports the Vote. [Applause.]

The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, hon Minister, hon members, a warm welcome to the DG and his staff from the EMU, and to the CEOs and chairpersons of our DTI family of institutions. Allow me to express my sincere thanks and appreciation to the parliamentary committees responsible for Trade and Industry, for their support, vigilance, frankness and preparedness to engage the Minister and I. Their contributions have significantly improved the quality and quantity of the work generated by the DTI. Today the Minister and I make these presentations on our budget to this House against the backdrop of a rapidly changing world. Indeed, the central question is no longer if and when we should respond to these changes, but rather the tactics and strategies that we as a nation adopt to engage constructively with what we have come to know as globalisation.

Globalisation is not fundamentally new. Economic, social and political interaction within the world economy has intensified over the course of human history. But for most of that history, the pace of interaction was so glacial that is was not easily recognisable as a phenomenon that we now recognise as globalisation. Moreover, it was cyclical in nature. What makes this particular cycle different is its rate of acceleration and degree of integration.

The integration of global financial, technological, service and commodity markets has intensified and changed the nature of international competition. On the other hand many countries, particularly those in sub- Saharan Africa, are being increasingly marginalised from these processes that are integrating the global economy. Consequently, promoting development and reversing marginalisation must be at the centre of our approach. Our destiny is deeply intertwined with that of our regional neighbours and the African continent. We cannot act alone.

The Department of Trade and Industry has identified a number of instruments to engage this process of globalisation. We represent only one of many governments that have recognised the need to strengthen and reform mechanisms of global economic governance, through multilateral policy making. Multilateralism represents the institutional response to globalisation. In particular, the establishment of the World Trade Organisation, despite its imbalances and deficiencies, reduces the scope for unilateral trade measures and aims to ensure that economic interactions, including the resolution of trade disputes, are governed by a system of rules and not solely by economic power. Developing countries clearly have an interest in strengthening this system in a manner that promotes their development.

The need to build alliances with other developing countries that comprise the G-South, such as India, Brazil and Nigeria, is a key element of South Africa’s preparations for the forthcoming ministerials of the WTO. As a department, it is important to work with our social partners through Nedlac, in order to develop a common position that recognises our diverse interests. As before, we will again be relying extensively on the participation of members of the committees of Parliament to support us in formulating our position when we participate in the forthcoming WTO ministerials. In this regard we would like to congratulate the committees on taking the initiative of travelling to the WTO headquarters in Geneva to acquaint themselves with the WTO processes.

In recognition of the need to co-operate and strengthen the position of developing economies in engaging issues of market access, South Africa has been working extensively to assist with technical expertise for the African, Carribean and Pacific countries as they prepare for their forthcoming negotiations with the European Union. In April this year, we hosted an ACP ministerial trade committee. It was the first time that this committee ever sat in South Africa. During this workshop, we assisted and took them through our own experiences, knowledge and pitfalls. They found this interaction very valuable. They have requested that we provide them with a permanent expert to assist them with this function. This support is critical as 31 of the least developed countries in Africa are members of the ACP, including five countries that are also members of SADC. In this era of globalisation, SADC takes on a new significance. We must strengthen interregional trade through harnessing regional synergies to reduce costs, build infrastructure, promote economies of scale and build a regionally integrated production platform. In this regard the department has worked and will continue to work with our Southern African partners to develop SADC as an effective instrument for mitigating the marginalising effects of globalisation.

Through our participation in various fora, we have worked towards the development and adoption of the Millennium African Recovery Programme. The department has worked closely with other national departments and the Presidency in establishing technical working groups to deal with the implementation of Marp. The department will, in particular, over the next year, work with its counterparts in Africa in two areas of Marp. The first will be the diversification of Africa’s production and the exports and the second will be market access issues.

Allow me to express my sincere appreciation to the President of this country for his vision, together with Presidents Bouteflika of Algeria and Obasanjo of Nigeria, in this initiative. Through participation in these processes, the department has gained valuable insight into the workings of and challenges facing economies of other African countries.

Is the department ready to respond to the challenges of globalisation? The ability of the state to counter the tendencies towards uneven development, inequality and marginalisation, depends on its capacity to analyse and understand these tendencies and implement effective responses. We believe that these responses must include enterprise development support and targeted programmes directed at socio-economic empowerment. South Africa is faced with a dual challenge. Not only must we overcome the inequalities generated by apartheid, but we must also do so in the context of global trends that tend to further entrench such disparities.

In recognition of this the department has initiated a number of interventions that specifically seek to address issues of marginalisation and promote development and equity in the South African economy. These responses include the establishment of the SA Entrepreneurs Network, which we hope to launch later this year. We believe that it is important to create a platform for women to exchange views on how to strengthen the role of women in the South African economy, not just as consumers and low- skilled labourers, but as entrepreneurs, business owners, investors and exporters.

In the past year the highlight of our work in this regard has been the hosting of the global economic summit of women in 2000, and in March this year we also hosted a workshop for Ministers and officials from the LDCs on mainstreaming gender issues. The outcome of the workshop was the Cape Town declaration, which constituted one of the core inputs into the LDC submission to the EU in support of the efforts to tear down not only trade barriers, but also gender barriers.

The other intervention that I wish to mention here is the allocation of R30 million to Technology for Women in Business, to support women using technology to grow their enterprises. [Applause.] Khula, a member of the department’s group of agencies, has increased its support for women from 50% last year to 88,1% this year.

As part of the department’s work on consumer protection, the regulations governing microlending have been tightened up to better safeguard borrowers. We all know that it is often poor women who make use of these microlenders to feed, clothe and house their families. I can proudly say that on 17 May this year, we initiated an investigation, as other hon members have already stated, into the practices of credit bureau. We have taken note of the hon member who said that the process should be open to the public and that there should be a public debate on these credit bureau. [Applause.]

Our objective is to create greater transparency in markets and balance the interests of workers and owners, as well as the consumers of their products. With regard to the SMMEs, this issue has been raised time and again. I would contend that much more needs to be done in this regard. As a department, we are looking honestly at the lessons learnt since 1994 in small enterprise development, and we will be releasing a small business policy document that updates the White Paper on National Small Business Development in the second half of this year.

At an institutional level, the DTI has taken the necessary steps to ensure its accessibility and responsiveness to the needs of marginalised groups. We have established, in response to this, a new chief directorate for economic empowerment, which will be responsible for developing strategies and implementing action plans to empower black people and women entrepreneurs in particular.

We have initiated a fundamental transformation of the DTI, in order to boost the accessibility of the department and its services to economic citizens, especially those that have been kept at arm’s length from institutions of Government. As hon members said here, we did promise these and, indeed, we are going to open offices in each province which will help us to deliver our services, reach out and interface with the public. This will help us to be more accessible and have a presence.

As the Minister has said, it is not that we have no product. We have a lot of projects and programmes. What is lacking is that they have not been reaching the people that they were designed for. We have significantly increased the financial resources to support black economic empowerment, small enterprise development and other programmes, to address the challenges posed by globalisation.

For the current financial year, we have shifted funds to make available R557 million for the above-mentioned programmes. Of this, 58% is specifically allocated for small business development. As hon members heard, we no longer consider small business as an area for the small business centre. Each directorate in the DTI is aiming and engaging, in the core function in its everyday work, to identify those areas that grow small business.

This is the path we have chosen. It is a path we are all committed to. I know it is a course we all believe in. By supporting Vote No 31, this House is supporting the efforts of a department that is determined to compromise neither competitiveness nor equity in the development of South Africa.

The issue that was raised by the speaker before me is that in regulating the environment, whilst we are promoting black economic empowerment, we should also ensure that blacks are the real people that get empowered. I think the Minister will deal with the issue of fronting, because we are seriously considering measures to actually prevent this or to punish both those who are fronting and those whom they are fronting for. [Applause.]

Ms C DUDLEY: Mr Chairperson, the ACDP is on record as having opposed the National Lottery and Gambling Act. We believe that gambling is destructive and cannot contribute to building this nation, and this is becoming more evident daily. Even the hon the Minister of Welfare has had to admit that it is his budget that is funding the gambling culture in South Africa as the poor get poorer, and the desperate are continuously enticed by illusions.

The idea that gambling creates jobs is false. The lottery does not create wealth, rather it consumes it. If people do not spend money on gambling, they would spend it on something else, creating more useful jobs in other sectors. The ACDP calls for a radical clamping down on licences. Where there is a will, there is a way.

As the Liquor Bill will soon be on the agenda again, it is worth considering that it is estimated that South Africans consume more than 6 million litres of alcohol beverages every year - close to 10 litres of pure alcohol per adult per year - placing us amongst the highest alcohol- consuming countries in the world. A large portion of the population does not drink. Therefore, per capita consumption and risky drinking, particularly over weekends, is very high among those who do.

Studies show that a repeated link is made by commissioners between crime and substance abuse, particularly alcohol. And the road accident rate in relation to drunken driving and drunken walking in South Africa is staggering. Having said all these, it is clearly not unbiblical to drink or even serve alcohol. However, drunkenness is seriously warned against.

The question is: What is the state’s responsibility in this matter? For me, the state does have the responsibility to protect the people from abuse. Obviously, overliberal access to alcohol would mean enhanced capacity to abuse alcohol. Therefore, access should be controlled. Licensing of shebeens, bottle stores and liquor outlets has been of major concern to the ACDP. These are mushrooming in every community. Our youth are vulnerable, and communities have very little to say. The ACDP is therefore pleased that Government is trying to address this issue. The ACDP would like to see liquor kept out of residential areas altogether, and is therefore not in favour of supermarkets supplying spirits and beer.

The ACDP acknowledges that the strategic objectives of the DTI are commendable, and efforts to develop small, medium and macro-enterprises are encouraging. We will vote in favour of the budget. [Time expired.] [Applause.]

Ms F HAJAIG: Mr Chairperson, hon Minister, Deputy Minister, the director- general, other personnel and colleagues, I rise to support this Vote.

Programme 2, that is, International Trade and Economic Development, promotes and maintains South Africa’s trade relations and agreements with other countries in order to stimulate internal growth and empowerment, as well as maximise earnings through policy and strategy development, programme development, monitoring and evaluation, negotiations and relationship building. The programme consists of international economic development, and focuses on South African economic integration and international trade administration.

The 2001-02 budget is R28,04 million. Membership fees to international institutions also increased from R3,1 million to R13,1 million in 2003-04. I would like to limit my presentation to trade policy, recent national thinking and South African repositioning.

Rapid technological development continues to establish new dynamics for trade and investment. These present new challenges for the trading system in developing nations in particular. The uneven consequences of globalisation require a further strengthening of global economic governance.

In terms of the Millennium African Recovery Programme, South Africa has a clear interest in strengthening the international system in a manner that promotes development. If multilateral rules need to be redesigned and corrected, then so be it, as long as it becomes responsive to the trade and development interests of developing countries.

We do not stand alone on this issue. There is a lot at stake for both developed and developing countries. We need to find each other, and not talk at cross purposes. South Africa and other developing countries prepared themselves on a range of issues for the Seattle Round of the World Trade Organisation - issues ranging from services, agriculture, industrial tariffs, subsidies, protection, investments, competition, government procurement, trade facilitation, e-commerce, and the list goes on. Our interests will only be furthered if we present a united front at these multilateral institutions - if we speak with one voice, each reinforcing the interests of the other. Our strength lies in our unity and preparedness.

What are we working towards? We want to increase the share of global production for developing countries, thereby moving away from reliance on the export of low-value primary commodities whose prices continue to fall. We want to level the playing field and address any imbalances that may exist in multilateral agreements. More thought needs to be given to differential interaction between countries. One size does not fit all.

The Seattle Round provided us with many lessons and a number of concerns continue to exist. These include, amongst others, the internal governance of the World Trade Organisation - principles of democracy, effectiveness, efficiency, and others - the strengthening of antidumping instruments, and uneven subsidies which are utilised by the industrialised countries and are harmful to the interests of developing countries.

I believe that an amount of US$340 billion goes to the protection of EU agricultural products. According to the UN Commission on Trade and Development, the export earnings of developing countries could rise by US$700 billion a year - which is 14 times the amount of aid that developing countries receive annually - if rich developed countries open their markets. Furthermore, the Trips agreement must ensure that the benefits of intellectual property are suitably shared between innovators and consumers

• the industrialised North and the developing South.

A recent criticism has been the increased introduction of nontrade-related obstacles by developed countries onto the exports of developing countries. Several rounds of trade negotiations over the years have seen the liberalisation of trade, but let us remember that many distortions continue to exist. We call for the reform of World Trade Organisation structures, rules and decision-making procedures in order to create an institution which is capable of preparing, taking, implementing and monitoring decisions about the future direction of world trade.

There is an advantage in securing mutually beneficial agreements in the negotiations on agriculture, services and even industrial tariffs. Change is needed but we must also identify existing spaces that allow us to further our objectives as a developing African bloc. Who are our friends?

It is important for us to promote trade between developing countries. A lot of work needs to be done in this regard. South Africa must increase access to developing countries’ markets for other developing countries’ exporters. The department must ensure that any international interaction should be on terms that benefit the region as a whole. We need to strengthen the regional countervailing forces, like SADC, the African Union, Unctad, etc.

Our overall regional strategy should be to create a sustainable environment that ensures equitable gains for all members of the regional economy. It is not only about regional integration. Development integration goes beyond tariff reduction and addresses infrastructure and production capacity constraints. We, as members of this House, recognise the different levels of development of our partners. Integration must secure mutual benefit and interdependence.

Let us remember, and I cannot overemphasise this, that the products of greatest export interest to the least developed countries, like agriculture, clothing and other labour-intensive goods are among the most heavily protected in the markets of the developed countries. This undeniable fact was again presented in a recent WTO special study report. No wonder the world’s poorest countries have seen their share of world trade decline by more than 40% since 1980.

The recent Unctad Trade and Development Report for 2001 calls for bolder policies from all major economies if we are to stop the global economic situation from deteriorating. I quote:

Excessive financial liberalisation has created a world where international private financial flows have broken free from multilateral supervision and regulation. Systemic instability and recurrent crises have followed. But so far, effective answers have not been found at the international level.

We ask ourselves: How will developing countries manage a global slowdown? And who will be the big losers? The Unctad report also voices its concern about the present financial architecture and inadequacies. I believe that this report reinforces the objectives of developing countries and provides us with a credible and visible voice whose momentum we must not lose.

There is still work to be done. How has the DTI responded to the changing and challenging international environment that poses presents both opportunities and constraints for industrial policy and the local economy? The new industrial strategy of the DTI is an integrated industrial strategy. We must see the industrial strategy as part of the international policy environment. The strengthening of our international position reinforces our domestic economy.

In conclusion, we hope that the next WTO ministerial council, in Qatar in November will, in terms of increasing globalisation of the economy, make it necessary to further develop multilateral rules which enable all nations to benefit from the development of trade, whilst respecting the diverse nature and resources of the developing countries so that a balance is struck between the interests of rich and poor countries.

We appeal to upon the WTO that a major focus of any new round of multilateral trade negotiations must be the removal of barriers that are blocking access to developed countries’ markets for products where developing countries either have a competitive advantage or could acquire one, including tariff peaks and escalations and nontariff barriers.

Finally, I would like to thank the Minister and the department for their sterling work. [Applause.]

Miss S RAJBALLY: Mr Chairperson, the Minister, Deputy Minister, the MF welcomes the Trade and Industry Vote as it has a major impact on the economy of our country. The aim of the DTI is to facilitate access to sustainable economic activity and employment for all South Africans.

The MF is not satisfied with the reduced budget allocation of R100 million for 2000-01. However, the MF welcomes the increase of R23,5 million for 2000-02, which allows for inflation and other external adjustments.

The MF compliments the Government for its budget allocations towards the implementation of five programmes, namely, Administration, International Trade and Economic Development, Enterprise, Commerce and Industry Development, Enterprise Organisation and, Trade and Investment South Africa.

The MF supports the DTI’s industrial strategy, and we agree that a good manufacturing strategy promotes investments and that there is a need for the Government to strive for a balance between policy flexibility and predictability.

Although South Africa has improved in its position on the world competitiveness ratings, it still has among the lowest ratings as regards human resources and skills development. However, the MF compliments the Government on attempting to improve these ratings through leadership programmes in an attempt to replace and broaden the older apprenticeship system.

The introduction of the Skills Development Act is an important contribution towards business development and adult education. The MF recommends a need to further promote black economic empowerment as it is inherent and coherent to the socioeconomic progress. This would assist to redress the imbalances of the past and improve the quality of life of the poor majority by achieving sustainable development, growth and stability.

The MF also recommends gender equality in the business sector. For far too long women have been marginalised and discriminated against. Women have been given stereotypical positions like being a secretary, sales assistant, etc. They have been accused of not being intelligent enough to handle positions reserved for men only.

The MF recommends that companies be more sensitive towards the needs of women and acknowledge potential women leaders in the business sector. The MF also recommends that it is pertinent to start with the education of the youth, not only on skills development but also on HIV/Aids. The business sector is losing far too many skilled employees to this epidemic due to insufficient education and awareness. This in turn is creating a negative impact on our economy.

The MF agrees that we do have many challenges to overcome before we are on a par with the global market trends, but we can only achieve that through empowerment towards effective leadership and delivery.

The MF support the Vote No 31 - Trade and Industry.

Mrs N R SHOPE: Mr Chairperson, hon Minister and Deputy Minister, members, distinguished guests, friends and colleagues, I am grateful for being allowed this opportunity to give an input into this year’s budget debate.

I wish to start off by complimenting the DTI and its Ministry for their will to succeed in making this country a shining jewel of success in the world of business both domestically and globally. I would like to thank them for making us focus on global matters without losing cognisance of our history and the previously disadvantaged persons of our country. For that reason, I would like to express myself in a little bit of Xitsonga.

Emutini wa Muchacani na nsati, a ku ri na vana va nkombo. Vambirhi va vona a va ri na matimba. Hi ku tirhisa tindlela to ka ti nga sasekangi, lavambirhi va kumekile va dya swakudya leswi a swi ri kona, va avelana tihomu ta tata wa vona, va tsona lavan’wana va ntlhanu. Leswi ndzi ringeta ku endla xifaniso xa xiyimo xa rifuwo ra tiko laha Afrika Dzonga. Ku sukela loko ku vile na ku tekiwa ka tiko, ri endliwa Kholoni ya matiko ya le handle, ku ya fika eka malembe ya Xihlawuhlawu, lava a va ri na swibamu va tiva no tsala, va kumeke va tiavela vona na vamakwavo hi xuma xa tiko leri ra hina.

Maendlelo lawa hi wona ya nga vanga leswaku vakulukumba va khale, endzhaku ka tinyimpi ta kholoniyali, va vone leswaku swa antswa vanhu va maAfrika va hlangana va lwa kun’we nyimpi leyi. Loku hi kona ku vumbiwa ka ANC. Nhlangano lowu wa hina wu lwile hi magenge yo hambana-hambana, hi minkarhi yo hambana-hambana, ku fikela laha hi tikumaka hinkwerhu hi tshamile hinkwerhu laha Endlwini leyi yo hlonopheka, ku ri hava nyangwa wa valungu na xinyangwana xavantima hala ndzhaku. Eku fumeni ka ANC ku sukela hi 1994, hi kume leswo ku na swilaveko swo tala leswi faneleke ku lulamisiwa swo fana na ku tsariwa ka Vumbiwa, na ku cinca ka milawu ya xihlawuhlawu, na ku tsala yin’wanyana milawu leyintshwa. Kambe mhaka leyikulu leyi ndzi lavaka ku yi vula, hi leyi funghaka ku sungula ka ANC, i mhaka ya vusiwana lebyikulu lebyi ANC yi nga kuma byi ri kona kwala xikarhi ka vanhu vantima. ANC, tani hi Hulumende, u fanele a vona leswo loko vana va yena va ri karhi va dya swakudya hinkwavo, ku fanele ku engeteleriwa xixevonyana eka n’wana loyi wo ondza leswaku a ta dya swinene a nuhela a fana ni lava ku nga khale va nuherile, hikokwalaho ka makolo ya vona. Maendlelo lawa, hi ya vula Black Economic Empowerment. Handle ka ku nyika vanhu vantima tixere kumbe swiave eka tikhamphani, ku languteriwa leswaku tikhamphani ti thlela ti dyondzisa vanhu vuswikoti - swikili. Sweswo i goza lerikulu eka Black Economic Empowerment.

Trade and Industry yi na ntirho wo tika wa ku ta na milawu na tikomiti leti nga ta tirhisana na tin’wana Tindzawulo ku hluvukisa tiko. Loko hi lulamisa milawu ya ku lawula mabindzu, vanhu va swi kota ku sungula mabindzu ya tinxaka-nxaka ku kota vurimi, switolo, tifoni, tourism na swin’wana ni swin’wana. Pulani leyi nga ta hi pfuna hi ku hatlisa, ku ri hi hatla hi vona mbuyelo wa leswi hi swi endlaka, i ku languta leswi, xosungula, hi endla yini hi mabindzu lamakulu ku pfuneta Black Economic Empowerment? Xavumbirhi, hi endla yini hi mabindlu lamakulunyana? Xavunharhu, hi endla yini hi mabindzu lamantsongo? Hinkwaswo leswi, hi swi hlanganisa njhani na ntirho wa ku hluvukisa tindhawu ta le makaya Sustainable Rural Development Strategy? Naswona, hi kambela njhani leswaku swilo leswi hi swi lavaka swa endleka?

Mpimanyeto lowu wu seketeriwa hi ANC hikuva wu sungula ku komba ndlela leyi a hi lava yona leyi nga ta lwa na vusiwana lebyi nga kula lero byi hi vangela ni mavabyi. Maendlelo lama nga kona eka Ndzawulo ya penda xifaniso xo saseka xo komba leswo swilo swi nga tirheka. (Translation of Tsonga paragraphs follows.)

[Mukhachani and his wife had seven children. Two of his children were very powerful. These two children took all the inheritance by making use of bad tricks; they shared their father’s cattle and deprived the other five children of the privilege of sharing in their father’s wealth. I am trying to illustrate the economic situation of South Africa. From the time our country was taken over to be colonised by foreign countries, up to the period of apartheid, those who were in possession of guns and were able to write, shared our country’s wealth among themselves.

This type of practice caused our forefathers to decide to unite Africans after the Colonial Wars in order to fight against colonialism. That gave rise to the establishment of the ANC. Our organisation fought by using different strategies at different times, until we all found ourselves seated in this hon House, without any separate doors for whites only and inferior back entrances for blacks.

Since the ANC came into power in 1994, we realised that there were a lot of needs which needed to be redressed, such as the drafting of the Constitution, and the amending of apartheid laws, and the writing down of new laws. However, the most important issue which I would like to point out is the one in regard to the significance of the establishment of the ANC, and it concerns the great poverty that the ANC was faced with among the blacks. The ANC as the government, should see to it that all people should receive an equal share, those who have very little to live on should be assisted in order to get the same share as those who had enough in the past and managed to succeed through treacherous means. This kind of practice is called black economic empowerment. Apart from giving blacks a share in companies, companies are also expected to train people in skills. That is a giant step in black economic empowerment.

Trade and Industry has a very great responsibility in the applying of laws and committees that are working hand in hand with the departments in order to enable our country to develop. If we improve laws that are used to govern our businesses, people would be able to start different kinds of businesses, such as farming, shops, telephones, tourism, etc. The most convenient plan, which could enable us to achieve results fast in what we are doing, is to look into the following: Firstly, what do we do with the big businesses in order to assist black economic empowerment? Secondly, what do we do with our medium-size businesses? Thirdly, what do we do with our small businesses? How do we integrate all these with the Sustainable Rural Development Strategy? And how do we assess all these in order to ascertain whether what we want could be achieved?

The ANC supports this budget because it has started to show the way which we always anticipated in order to fight poverty which is a leading cause of diseases. Methods applied by the department show a fine picture of how things can be achieved.]

The restructuring process is aimed at analysing its core competencies in order to create a leaner, more focused, competitive organisation. The process resulted in the implementation of a new structure to ensure a cut in overhead costs, improvement of efficiency and achievement of future value-added benefits for the South African economy and the region in general.

In addition to this, other significant changes introduced were a complete restructuring of the leadership, rightsizing of the corporate office, focusing on the regrouping of operating divisions in line with core competencies and capabilities. The strategy fosters and cultivates a culture of shared value that will enhance the transformation process of our country and position the Department of Trade and Industry as a respected institution in both national and international spheres of the economy.

The results of the implementation of the transformation process have already become tangible. The demographics of the department, especially at the level of management, are increasingly reflective of the demographics of the country. But these aspect must be speeded up. In order to accelerate change, the department has called for numerous amendments to legislation consistent with the Constitution and international protocols and conventions to which South Africa is a signatory. As a member of Parliament, I am bound by the Constitution to sell my country to the best of my ability. The Constitution is very clear and makes it imperative to ensure transparency and accountable governance at all times.

My speech is focused on looking at the Vote of the Department of Trade and Industry within the framework of our commitment to a truly nonracial, nonsexist, democratic South Africa where our people can take their rightful place in the mainstream of the economy of the world. We need an integrated strategy to avoid an explosion that can be detrimental to the development of the ideals that we envisaged when we democratised the country.

Transformation and progress are taking place within the very complex environment of our political and economic circumstances. The transformation process is aimed at the empowerment of our people who were not part of the mainstream economy at large. The objectives of transformation processes are focused on job creation, managing the resources of the department more objectively and efficiently, developing and strengthening partnerships with business, labour, civil society and communities and encouraging co- operative governance.

The initiatives taken by the Government may not necessarily be sufficient to address all the issues, but remain vital to the development of this country. We must ensure that these initiatives focus on the most critical areas that we envisaged, namely the development of small, medium and micro enterprises, the implementation of a successful black economic empowerment programme, job creation and a spacial development initiative corridors.

Small business development is an important component of the economic empowerment of economically excluded groups. However, organisations representing black-owned business have an extremely weak financial base. They are hardly able to attract and keep any meaningful number of small businesses as members. Black businesses are still at the periphery of the economy.

Opportunities to enhance black economic empowerment have been created and support has been provided for black entrepreneurs and workers through strategies aimed at promoting small, medium and micro enterprises, workplace equity and labour standards. Since 1990 the private sector has embarked on a range of BEE initiatives, including ownership strategies and proposals to stimulate economic growth. In 1993 Sanlam sold 10% of its stake in Metropolitan Life to Methold, a black empowerment consortium. However, in 2000 black controlled companies accounted for only 1,7% of the JSC market capitalisation. [Time expired.] [Applause.]

Mrs B N SONO: Mr Chairperson, hon Minister, Deputy Minister and hon members, the development of SMMEs has been generally, recognised as crucial to job creation. If successfully implemented, it can lead to sustainable employment, black economic empowerment, growth and expansion of the economy, whilst the RDP remains the basic policy framework to achieve black empowerment and a better life for all.

With regard to Gear as the associated macroeconomic strategy, there has been a disturbing relationship, ie that of massive job losses, less inflows of foreign direct investment and low levels of economic performance. In response to the weak performance of the economy, Trade and Industry released a draft copy of their industrial strategy to provide a specific operational policy framework, as well as insight into the overall approach to economic policy. A wide selection of supply-side policies remain, covering major areas of the economy. Examples are manufacturing, restructuring of state agencies within the DTI, and agriculture.

The DA would seriously advocate that DTI give equal attention to the role of demand pressures in the economy. At a wider economic level, strong demands would fuel growth. Manufacturing output performance, for example, is reliant on demand for its output. The DP advocates that the DTI combine some of their supply-side measures with direct and indirect demand stimulation. A case in point is the motor industry development programme - its vehicle and component manufacturers must produce productively and more efficiently. Though lower tariffs did help to boost vehicle demands, policies like the motor industry development programme force a double adjustment to programmes and economic decline.

It should be remembered that vehicles are basically only assembled in South Africa, not manufactured. Components and original equipment are imported. In terms of the MIDP, these locally assembled vehicles are regarded as locally manufactured goods, allowing the firms to claim duty-free allowance benefits. Because the duty-free allowance serves as a subsidy, it tends to spare the supply of vehicles, profits and exports, without innovative development of the related component manufacturing industries, along the very belt of the assembly plants. This area could prove to be a niche for SMME manufacturer development.

Agriculture issued a new policy document. Its emphasis is on the need to launch small-scale farming along a more output-orientated and productive path. However, the policy focuses on efficiency and international competitiveness, trade and trust in the purported ability of the private market to allocate resources efficiently. This holds serious implications for the development of small-scale farming ventures. With globalisation, IT and financial trading systems become critical. Again, SMME traders can help bridge the gap.

In conclusion, massive infrastructure development holds the key to spreading economic growth. Policy shifts towards SMME development will go a long way in solving the economic woes of our country. [Applause.]

Ms C C SEPTEMBER: Chairperson, I do not think it would be wise to dwell much on the doom and gloom that we have heard here from the hon Bruce. I think we must understand that the doom and gloom he projects at this podium all the time is testimony to the fact that for three quarters of the time at our meetings in Trade and Industry he was fast asleep, and only listened a quarter of the time. [Laughter.] [Applause.] I would rather ask the Chairperson to listen to the voice of reason here today.

One of the major challenges that we face in South Africa to overcome the legacy of apartheid is, indeed, to overcome the levels of poverty and inequality in our economy. One such innovative initiative that was taken at the 1998 Presidential Jobs Summit was the agreement and commitment by the constituency partners of Nedlac, labour, business, Government and the community organisations on the establishment of the Proudly South African campaign.

The Proudly South African campaign seeks to raise awareness of our high quality in South Africa and, more than that, the diverse nature of our South African products, brands that proudly speak of the significance of our local content, our fair labour standards and our environment. The Proudly South African campaign draws our attention towards placing our country’s potential and its achievements first. It focuses on building our pride, on raising and protecting our brands, from our flowers and our clothing to our agriculture, and, more importantly, on our music and our artists in this country.

South Africa hails its unique political settlement, so too this campaign has the potential to awaken us to celebrate our uniqueness, from our art and artists, the marula tree, the protea flower and, of course, to our African attire. There are many more examples I can give. The difficult negotiations that we have seen at the EU are testimony to the fact that many of the goods and services we have in South Africa are quite important.

A survey conducted by Nedlac reveals that 75% of the respondents felt that they would rather favour a South African product if it would create more jobs. This indicates the potential of the campaign to contribute to our much-needed nation-building - a common agenda.

Indeed, consumers are always looking for the cheapest garment, quality food, affordable furniture, the best jewellery and the best shoes. However, we cannot confine ourselves to these narrow ideas only. As individuals and collectively we can turn our attention towards our own intervention into the economy through the concept of the Proudly South African campaign.

In this House the process of the Proudly South African campaign started in 1994, in particular, when the ANC came to this Parliament. Every year one can see the beauty of Africa and the beautiful African outfits that are shown at the opening of Parliament in February. We ask that this proudness be extended to an every day basis.

I must commend the Department of Trade and Industry for starting their own proudness of South Africa and South African workers by having a T-shirt made by Comfort Clothing and called ``DTI connecting’’, showing what the Proudly South African campaign is about. [Applause.] The meaning, obviously, is that of connecting to the rest of the country and to the world with our beautiful new logo, not that old one that we used to have that meant apartheid.

As our economy has globalised and goods are moving faster, we should act consciously in a manner that enhances our industries, our potential and our businesses in order to have a very regional bias towards development. When we launched the peace campaign a couple of years ago, there was a clear choice that our people made. They made a choice in favour of peace, and many of them bought the beautiful blue and white T-shirts. That was their way of asking that there be peace in South Africa and demonstrating that they were very proud of that T-shirt being made in South Africa by South African workers. That choice, as a collective effort, is still being felt today by the peace that we have in South Africa and the song that was then sung: ``South Africa, we love you.’’

So, too, as we roll out this campaign, we do so to close the gap between the North and South on our globe, the developed and the developing countries. Again, research was commissioned by Nedlac constitituencies through the Fund for Research into Industrial Development, Growth and Equity, and conducted by international strategy consultants Kaiser Associates. The benchmarking aspect of the study considered that lessons could be learned from the Australian Made'',Made in USA’’, Butan, Malaysia'',Buy Thai’’, Buy New Zealand-Made'',Indian Brand Equity Fund’’ and ``Made in Italy’’ campaigns.

In Australia, research found that there was a 90% recognition rate of an Australian-made logo, with the brand having been built since 1980. The campaign was revived by a relaunch as a nonprofit organisation in September 1999, and products carrying the campaign logo now represent the equivalent of over R25,6 billion in turnover. Its success is underpinned by a binding code of practice, effective complaints and enforcement measures. The campaign makes use of a single logo with a range of messages, including You have made it in Australia'',Made by Australians for Australians’’ and ``Buy your Kids a Job’’. The Buy New Zealand campaign also had some innovative ideas, such as the kiwi-pride festivals and celebrity endorsements.

The success that these countries have had can also be enjoyed in South Africa. Our Proudly South African campaign can also be successful and, of course, have that impact on the economy, both for individuals and collectively for ourselves. Very notably, both labour and business created their own funds for job creation, and I am very happy to say, particularly to the members on my right-hand side - but not politically - that the fund they have created from their day’s salary now stands at R83 million. They have made a difference towards the youth in this country, the projects in the rural areas, the HIV campaign and, of course, our women.

I can but make a call that the campaign take a Proudly South African form, starting with parliamentarians. We should maybe ask comrade … Sorry, that was terrible - he is not a comrade! We should maybe ask the hon Bruce, when Parliament opens next time, to put on African attire. [Laughter.] [Applause.]

The MINISTER OF TRADE AND INDUSTRY: Mr Chairperson, as I understand it, the hon Bruce regards communists as pigs. So if he wanted to be a comrade in that sense, I might be supportive.

I think, generally speaking, there has been support for our budget, and I would like to thank the speakers for that. I would like to comment on some of the matters raised, because I think they are important. [Interjections.]

The DEPUTY CHAIRPERSON OF COMMITTEES: Order!

The MINISTER: Firstly, I think the hon member Ntuli and the hon member Shope both raised a very fundamental issue and that is the ability to help develop the rural areas. I think this is a very crucial challenge. The issue is, what role can we play, as the Department of Trade and Industry, in doing that?

Well, I think there is a lot that we can and are doing, in many ways. However, I think we would have to accept that our abilities can only be effective, at this point, in fairly limited areas. In the main, what we focused on is the development of the SDIs in particular rural areas, and here the hon member Msomi asked whether we have capacity funds for assisting people to get involved in these projects.

What we have realised is that this is a very important aspect. We have begun to hold more road shows and we do have capacity funds to try and explain to people in those areas that this is what the SDIs … [Interjections.]

The DEPUTY CHAIRPERSON OF COMMITTEES: Order, hon members!

The MINISTER: this is what the SDIs are doing and these are the projects that are possible. Our target would be to support those areas with more information technology systems, so people could do that. It is not easy, but we must do it. We support the call to get into the rural areas.

My appeal would be that the members in this House must themselves try to actively play a role in the rural areas. I know there are many colleagues and comrades in this House who are trying to do that. The main problem, I think, that exists in the rural areas is that of people getting information and knowledge about what can be done to pull people together.

If we take tourism - and this is a project that we are working on with the Ministry of Tourism - one sees very few bed-and-breakfast type of facilities in many of the rural areas that are predominantly black. We need to work to change that. I think these are possibilities. We can change these things. We can use the rural areas for far more agricultural and tourism activities.

A point was made by the hon Van Deventer about exchange rates. Both he and the hon Bruce were wrong on the exchange rates: there has not been a precipitate decline in the exchange rates. In fact, the exchange rate of the South African rand has very much paralleled that of other emerging markets. And over the period we are looking at, the depreciation of our currency is in line, largely, with the inflation differentials.

So as far as we are concerned, the depreciation of the currency has never, at any time, been used as an excuse for the erroneous facts put out by the opposition on the cost of the arms. But it is, without any doubt, a positive factor for our exports. This is plain economics - there is nothing different or complex about it.

On the question that the hon Lockey raised about whether we can do many things to benefit the situation, let me just inform the hon member that I think, as regards platinum jewellery, that this is one of the most exciting growth sectors in the South African economy. What is important in jewellery

• and the Deputy Minister and I stressed this - is that we have to have excellent design. But, more than that, we have to have extremely efficient, logistical delivery systems.

If hon members want to see what a modern jewellery manufacturer looks like, there are some in South Africa that are emerging; but if one really wants to go and see some of the advanced shops, there are some in Hong Kong and elsewhere, including China. The challenge for us in using platinum in jewellery is not to make the jewellery as such, but to develop very sophisticated logistical and sales systems. This is what we are working on.

We are working with the jewellery cluster. Platinum jewellery already is and will continue to be a very important export for South Africa. As hon members know, platinum has been exported and South Africa now accounts for somewhere close to 10% of world catalytic converter production, and that figure is rising.

So yes, beneficiation is very important and we will be looking at it. Let me tell the hon member - and this I would say to everybody - that one of the problems is that we, ourselves, are not often familiar with how much we have achieved in this country. If, as the hon member is indicating, he has a problem with competition, people must use the competition commission. Our commissioner, Adv Simelane, is here. We have a very advanced form of competition law.

In terms of restrictive or anticompetitive practices, it is up to the economic citizens to use those facilities. Most of the attention, thus far, is focused on the merger dimensions, but we must remember that the anticompetitive practices are there to be used. They cannot be used by Government alone: they have to be used by the economic citizens.

Let me also thank the hon Hajaig for an excellent account of the WTO issues. She is correct, the WTO round is fundamentally important. I know that she is going to Geneva, but I would make an appeal to all members of this House to interact with our colleagues in Africa. We need to win the debate as to how important it is that we, as developing countries, do exactly as the hon member said. We have to work together to force upon the WTO a developmental round.

Let me say again in this House, what I said yesterday in the World Economic Forum: Do not underestimate the dangers of not having a round. If we do not have a round, we will have a breakup of the world trade system and get back to ``the strong are right and the weak are weak’’.

This is a very dangerous time in the world trade system. We must overcome what, we argue is an incorrect analysis, viz that it is in the interest of the developing countries to stay out of a round. It is not. We are going to be isolated, we are going to be marginalised and, regrettably - I must say this very openly and frankly - South Africa would also move immediately to open more regional agreements. We cannot afford to be left out of these openings of markets, precisely because this economy is extremely competitive and our future here and in Africa, lies in increasing the levels of trade with our neighbours. So we really would urge the House to support this move. We must move towards getting a round that is led by the developing countries, and not reacted to by those developing countries.

To the DA I wish to say that they should sort out their economic policies. The first thing they should probably do is to get a fairly respectable and sensible spokesperson on that. Secondly, I also think they should make a decision whether they want to support the supply side or the demand side. They should think this through.

The hon Sono was not told by her advisers how the MIDP works. It is not correct to say that we are merely an assembler in South Africa. She should go and look at the plants. The fundamental change in the South African automobile industry is that we succeeded in 1994 in transforming the production process in this industry, precisely because we are capable of supplying higher quality international components to these industries. That is why, for the first time, we now export built-up units and not only components. Members should go and have a look at these things.

I would also like to say that I find it distasteful that we make rather absurd allegations against people. It seems to me that there is, persistently, an underlying racial trend to this from the DA. What people forget - and no one ever raises the point, particularly Mr Bruce - is that on the industrial development board there are white members who also have major interests supported by the IDC. Has that ever been raised in a question to me in this Parliament? Never. The only question that has ever come from Nigel Bruce, who made no contribution whatsoever to democracy in this country, is on the black leadership of my department and the IDC. [Applause.] In the interest of his party, I think they should adjust their spokesperson.

Another point that I should stress, is that if one takes the programmes of this Government that have been implemented on empowerment, one finds that these are very considerable indeed. The taxi recapitalisation programme which will proceed is another step in creating empowerment.

I also thank the member September for raising the Proudly South African campaign. This is an important and interesting campaign that most of us - I believe all of us - should take as a matter of pride for us.

Finally, I would like to thank my team. As Rob Davies and others pointed out, it is a young team of South Africans of all races and sexes. I am particularly proud of the fact that my department has many people in it that worked there prior to 1994 and are still working hard. They are very committed to this economy. I am extremely proud of the work of my team, including my Deputy Minister. We are showing people what a real new South Africa is. [Applause.]

Debate concluded.

                       PATENTS AMENDMENT BILL

                       (Second Reading debate)

Order disposed without debate.

Bill read a second time.

The House adjourned at 11:42. ____

            ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS

ANNOUNCEMENTS:

National Assembly and National Council of Provinces:

1. The Speaker and the Chairperson:

 (1)    The Minister of Transport on 5 June 2001 submitted a draft of
     the National Land Transport Transition Amendment Bill, 2001, as
     well as the memorandum explaining the objects of the proposed
     legislation, to the Speaker and the Chairperson in terms of Joint
     Rule 159. The draft has been referred to the Portfolio Committee
     on Transport and the Select Committee on Public Services by the
     Speaker and the Chairperson, respectively, in accordance with
     Joint Rule 159(2).


 (2)    The following Bill was introduced by the Minister of Arts,
     Culture, Science and Technology in the National Assembly on 8 June
     2001 and referred to the Joint Tagging Mechanism (JTM) for
     classification in terms of Joint Rule 160:


     (i)     "Woordeboek van die Afrikaanse Taal" Act Repeal Bill [B 30
          - 2001] (National Assembly - sec 75) [Explanatory summary of
          Bill and prior notice of its introduction published in
          Government Gazette No 22367 of 8 June 2001.]


     The Bill has also been referred to the Portfolio Committee on
     Arts, Culture, Science and Technology of the National Assembly.


 (3)    The following Bill was introduced by the Minister of Trade and
     Industry in the National Assembly on 8 June 2001 and referred to
     the Joint Tagging Mechanism (JTM) for classification in terms of
     Joint Rule 160:


     (i)     Close Corporations Amendment Bill [B 31 - 2001] (National
          Assembly - sec 75) [Explanatory summary of Bill and prior
          notice of its introduction published in Government Gazette No
          22249 of 24 April 2001.]


     The Bill has also been referred to the Portfolio Committee on
     Trade and Industry of the National Assembly.


 (4)    The Joint Tagging Mechanism (JTM) on 8 June 2001 in terms of
     Joint Rule 160(3), classified the following Bill as a section 76
     Bill:


     (i)     Marketing of Agricultural Products Amendment Bill [B 26 -
          2001] (National Assembly - sec 76).


     [NOTE: The Bill was introduced as a section 75 Bill.]

National Assembly:

1. The Speaker:

 Message from National Council of Provinces to National Assembly:


 Bill, subject to proposed amendments, passed by National Council of
 Provinces on 8 June 2001 and transmitted for consideration of Council's
 proposed amendments:


 (i)    South African Boxing Bill [B 13B - 2001] (National Assembly -
     sec 75) (for proposed amendments, see Announcements, Tablings,
     Committee Reports p 479).


     The Bill has been referred to the Portfolio Committee on Sport and
     Recreation for a report on the amendments proposed by the Council.

TABLINGS:

National Assembly and National Council of Provinces:

Papers:

1. The Speaker and the Chairperson:

   Report of the Auditor-General on the Financial Statements of Vote No 26 - Public Service Commission for 1999-2000 [RP 135-2000].

 Referred to the Standing Committee on Public Accounts for consideration
 and report. Referred also to the Portfolio Committee on Public Service
 and Administration and to the Select Committee on Local Government and
 Administration.

1. The Minister of Education:

 (1)    Government Notice No 50 published in Government Gazette No 21996
     dated 2 February 2001, Regulations relating to the provisioning of
     educator posts within a provincial department of education and its
     institutions and departments' offices, made in terms of the
     Employment of Educators Act, 1998 (Act No 76 of 1998).


 (2)    Government Notice No 106 published in Government Gazette No
     22001 dated 2 February 2001, Approval for the extension of the
     experimental status of the pilot programme, health and community
     care in technical colleges, made in terms of the National
     Education Policy Act, 1996 (Act No 27 of 1996).


 (3)    Government Notice No 107 published in Government Gazette No
     22001 dated 2 February 2001, Approval for the extension of the
     experimental status of the pilot programme, hospitality studies in
     schools and technical colleges, made in terms of the National
     Education Policy Act, 1996 (Act No 27 of 1996).


 (4)    Government Notice No 259 published in Government Gazette No
     22154 dated 20 March 2001, Call for nomination to fill two
     vacancies, made in terms of the South African Qualifications
     Authority Act, 1995 (Act No 58 of 1995).


 (5)    Government Notice No 415 published in Government Gazette No
     22154 dated 20 March 2001, National Policy regarding Further
     Education and Training Programme: Approval of adjustments to the
     Economic Higher and Standard Grade Core Syllabi for Grade 12, made
     in terms of the National Education Policy Act, 1996 (Act No 27 of
     1996).


 (6)    Government Notice No 416 published in Government Gazette No
     22154 dated 20 March 2001, Approval of an amendment to the
     aggregate for Senior Certificate candidates offering technical
     college instructional offerings as part of the programmes, made in
     terms of the National Education Policy Act, 1996 (Act No 27 of
     1996).


 (7)    Government Notice No 417 published in Government Gazette No
     22154 dated 20 March 2001, National Policy regarding Further
     Education and Training Programmes: Approval of the drafting and
     documentation of the National Education Policy regarding the
     Gauteng Youth College Programme, made in terms of the National
     Education Policy Act, 1996 (Act No 27 of 1996).

1. The Minister of Health:

 (1)    Government Notice No R.127 published in Government Gazette No
     22052 dated 12 February 2001, Regulations in terms of the Allied
     Health Professions Act, 1982, made in terms of section 38 of the
     Allied Health Professions Act, 1982 (Act No 63 of 1982).


 (2)    Government Notice No R.266 published in Government Gazette No
     22157 dated 26 March 2001, Correction to the Government Notice No
     R.127 of 12 February 2001, made in terms of the Allied Health
     Professions Act, 1982 (Act No 63 of 1982).


 (3)    Government Notice No R.44 published in Government Gazette No
     21983 dated 19 January 2001, Regulations relating to registration
     as a dental technician and related matters: Amendment, made in
     terms of section 50 of the Dental Technicians Act, 1979 (Act No 19
     of 1979).


 (4)    Government Notice No R.156 published in Government Gazette No
     22076 dated 23 February 2001, Regulations regarding the
     registration and training of Student Dental Technicians and
     Student Dental Technologists, made in terms of section 50 of the
     Dental Technicians Act, 1979 (Act No 19 of 1979).


 (5)    Government Notice No R.253 published in Government Gazette No
     22148 dated 23 March 2001, Regulations relating to registration as
     a Dental Technician and related matters: Amendment, made in terms
     of section 50 of the Dental Technicians Act, 1979 (Act No 19 of
     1979).


 (6)    Government Notice No R.43 published in Government Gazette No
     21983 dated 19 January 2001, Regulations regarding processed
     foodstuffs, made in terms of section 15(1) of the Foodstuffs,
     Cosmetics and Disinfectants Act, 1972 (Act No 54 of 1972).


 (7)    Government Notice No R.239 published in Government Gazette No
     22133 dated 19 January 2001, Regulations relating to salt, made in
     terms of section 15(1) of the Foodstuffs, Cosmetics and
     Disinfectants Act, 1972 (Act No 54 of 1972).


 (8)    Government Notice No R.366 published in Government Gazette No
     22258 dated 4 May 2001, Regulations governing the labelling of
     foodstuffs obtained through certain techniques of genetic
     modification, made in terms of section 15(1) of the Foodstuffs,
     Cosmetics and Disinfectants Act, 1972 (Act No 54 of 1972).


 (9)    Government Notice No R.228 published in Government Gazette No
     22133 dated 16 March 2001, Regulations defining the scope of the
     Profession of Optometry, made in terms of section 33(1) of the
     Health Professions Act, 1974 (Act No 56 of 1974).


 (10)Government Notice No R.229 published in Government Gazette No 22133
     dated 16 March 2001, List of approved health facilities for the
     purposes of performing community service by dentists in the year
     2001-2002, made in terms of Regulation 5.1 of the Regulations
     relating to Performance of Community Service by the profession of
     dentists.


 (11)Government Notice No R.237 published in Government Gazette No 22133
     dated 16 March 2001, Regulations relating to qualifications for
     registration of assistant clinical technologists and registration
     of persons qualified outside the Republic, made in terms of
     section 61(1), read with sections 24 and 25 of the Health
     Professions Act, 1974 (Act No 56 of 1974).


 (12)Government Notice No R.251 published in Government Gazette No 22148
     dated 23 March 2001, Regulations relating to qualifications for
     registration of clinical technologists and registration of persons
     qualified outside the Republic, made in terms of section 61(1),
     read with sections 24 and 25 of the Health Professions Act, 1974
     (Act No 56 of 1974).


 (13)Government Notice No R.394 published in Government Gazette No 22284
     dated 18 May 2001, List of approved facilities for the purposes of
     performing community service by medical practitioners in the year
     2002, made in terms of Regulation 5.1 of the Regulations relating
     to Performance of Community Service by persons registering in
     terms of the Health Professions Act, 1974 (Act No 56 of 1974).


 (14)Government Notice No 407 published in Government Gazette No 22291
     dated 14 May 2001, Nominations for representatives to serve on the
     Board of the National Health Laboratory Service (NHLS), made in
     terms of section 8(2) of the National Health Laboratory Service
     Act, 2000 (Act No 37 of 2000).


 (15)Government Notice No R.395 published in Government Gazette No 22284
     dated 18 May 2001, List of approved facilities for the purposes of
     performing community service by pharmacists in the year 2002, made
     in terms of Regulation 3 of the Regulations relating to
     Performance of Pharmaceutical Community Services.


 (16)Proclamation No R.16 published in Government Gazette No 22052 dated
     12 February 2001, Commencement of the Chiropractors, Homeopaths
     and Allied Health Service Professions Second Amendment Act, 2000
     (Act No 50 of 2000) from 12 February 2001.


 (17)Proclamation No 30 published in Government Gazette No 22287 dated
     11 May 2001, Commencement of certain sections of the National
     Health Laboratory Service Act, 2000 (Act No 37 of 2000) from 10
     May 2001.


 (18)Government Notice No 414 published in Government Gazette No 22293
     dated 14 May 2001, Publication of Explanatory Summary of the
     National Laboratory Service Amendment Bill, 2001.