Workshop Development Impact Evaluation in Finance and Private Sector Dakar February 2010 With generous support from Gender Action Plan South Africa Competitiveness promotion program Nonceba Mashalaba (the dti) Puleng Botlhole (the dti) Vusi Mweli (the dti)

 Pilot for new competitiveness promotion program of the Department of Trade and Industry (the dti)  Objective: help South African SMEs in implementing lean manufacturing practices and in attaining quality standards that will enable them access to new markets  Intervention: matching grant for technology upgrading or technology upgrading + certification provided randomly to two sets of firms INTERVENTION DESCRIPTION

EVALUATION QUESTIONS  Does access to upgraded technology by itself or combined with certification improve firm performance and firm capabilities?  Short-term outcome: sales growth, profits, cost of production per unit, productivity  Medium-term outcome: export growth  Does certification make a difference relative to technology upgrading by itself?  No gender in intervention but can look at impacts by gender

EVALUATION DESIGN  Randomly select 300 SMEs in chemicals/plastics sector to which information on the dti assistance will be provided in an information session – 300 is a hypothetical number to be determined by budget  At end of the session SMEs will indicate whether they are interested in applying to the program  All interested SMEs are promised some minimal assistance in order to keep all these SMEs willing to complete the baseline survey  Using a lottery draw 50% of the interested SMEs to be in treatment group that will receive full the dti assistance – half of the treated firms get technology upgrading and another half get technology upgrading + certification

SAMPLING AND DATA  Targeted universe: SMEs in chemicals/plastics (maybe with a regional focus?)  Using database on manufacturing firms draw a sample of 300 SMEs – SMEs defined based on revenue, number of employees, total assets  Maybe some stratification on small versus medium  Among interested SMEs (subset of the 300) 50% will be randomly selected  Baseline survey conducted before the dti assistance is provided  Mid-surveys to be conducted to monitor firm actions and time to procure technology (frequency to be decided)  End survey conducted after 1-2 years

TIMELINE FOR IMPACT EVALUATION  By April 2010: development of the dti assistance scheme (ongoing) + final decisions on pilot  By end-June 2010: sampling and baseline questionnaire design  By end-August 2010: mail information and invitation to the dti information session  September-October 2010: list of interested firms to conduct baseline survey – in principle to be conducted by internal capacity of the dti + lottery drawing of treatment firms  (minimal consultancy will be provided on demand – based on voucher expiring in 2010)  January 2011: start of the dti full assistance  June 2011: mid-survey  January 2012: endline survey (to inform policy decisions for next financial year)

IMPACT EVALUATION TEAM: STAFFING Design and all background work on pilot  Staff time from people in four teams: product development unit, incentives administration unit, business development unit, and sector desk division Implementation of intervention  Engineers – consultants for the dti

BUDGET  the dti team can try to find resources but getting World Bank financial assistance for some of the impact evaluation tasks would help to get the pilot done  For a dedicated consultant for sampling, questionnaire design, and coordination of all activities for 18 months  For baseline, mid and endline surveys