Latest IPAP to focus on manufacturing

"IPAP 2013 focuses on value added production, with state support centred on nurturing and defending industrial development," Davies said at the launch of IPAP 2013/14 - 15/16 on Thursday.

The policy would still be based on the need for sustainable long-term development that is underpinned by higher growth, exports and labour-intensive, value economic activity in the production sectors led by manufacturing.

IPAP 2 was first introduced in 2010, and it was announced then that it would become a rolling three-year plan corresponding to the financial year. At the time, Davies had projected the creation of 129?000 jobs - 43 000 direct and 86 000 indirect.

Since then, government has launched its New Growth Path (NGP) economic strategy, which envisages creating five million jobs by 2020.

On Thursday, Davies said that IPAP 2013/14 - 15/16 was the fifth iteration of the three-year rolling action plan, and covered the last full financial year in the term of the current administration. The latest version is also linked to the country's National Development Plan but still forms one of the principal pillars of the NGP.

Speaking at the launch in Johannesburg, Davies emphasised that if South Africa was to grow its employment, it needed to pay attention to the productive sectors of the economy.

South Africa's economy is said to be import intensive, especially with respect to value-added goods. Stronger domestic growth, particularly in the manufacturing sector, was needed to boost employment.

Officials say the goal of IPAP is to prevent industrial decline and support the growth of South Africa's manufacturing sector.

Davies said since the launch of the first IPAP, government had ensured that policy interventions supported deep localisation of procurement to support local industries and job creation.

"These interventions include growing our manufacturing, boosting exports, and beefing up our competition policies. We think despite the challenges that we are experiencing in our economy, we think that we can highlight a number of achievements in the implementation of our IPAP in the past few years."

The Department of Trade and Industry has so far designated eight sectors that would focus mainly on supporting local procurement of goods and services.

The launch was also attended by Economic Development Minister Ibrahim Patel, officials from the Industrial Development Cooperation as well as representatives of the business sector.

Earlier Patel, whose department spearheads the NGP, said IPAP was regarded as the most important job driver as envisaged in the NGP.

"It is about strengthening industrial policy ...Industrial policy is back on the agenda globally. There is a growing appetite both in South Africa and the continent to industrialise and reclaim our domestic market and to expand our capacity to export to new markets," Patel said.

He said industrialisation was central to creating sustainable jobs not only in manufacturing but other supporting sectors such as agriculture and mining.

Emerging markets such as Brazil, Russia, India and China represented an important market for manufactured goods from South Africa. These countries are also part of a political bloc Brics, which includes South Africa.