1. Gauteng Economic Indaba Commission 2 9 June 2016

2. A strong and growing manufacturing sector is of vital importance to South Africa because it: employs more than 1.6 million people; provides the base load and scale for key national infrastructure such as electricity, rail and municipal services; is among the top three multiplier sectors in terms of value addition, job creation, export earnings and revenue generation; is a driver of tertiary education and the absorption of people into the workforce; accounts for almost 12% of GDP; and provides the only viable means of beneficiating our own natural resources.

3. Yet, this positive contribution by South African manufacturing is under threat and declining: South African manufacturing jobs are being lost and manufacturing as a contribution to GDP is declining. Key factors contributing to this decline include reduced local and global demand, and challenging supply conditions to include electricity supply constraints, rapid increases in administered prices, labour instability and competition from unfairly incentivised products.

4. … indicates a challenging period for manufacturers marked by falling sales, rising unsold inventory levels and increasing costs. As a result, many manufacturers reflected a deterioration in sentiment. The weaker Rand against the US dollar has not as yet had a marked effect in influencing local competitiveness, but rather pushed imported costs higher…

5. Manufacturing categories

6. Sales Volumes

7. Input Cost Drivers

8. Efficiency a large focus

9. Many of these challenges can be addressed by our approach to economic policy development and implementation, as well as to how we govern and how we engage our trading partners to ensure a level playing field for our industries. We are committed to working with our policy makers and all other stakeholders to achieve these goals. For economic growth. For job creation. For the sake of a better life for all South Africans.

10. Three Goals to Grow Manufacturing ACHIEVE A COMPETITIVE MANUFACTURING ENVRONMENT Encourage coherent, coordinated and consistent economic policy, regulation and policy implementation Advocate efficient spending, cost recoupment and price regulation for public infrastructure and utility services that support manufacturing growth Support the development and maintenance of a skills pipeline Endorse environmental measures and legislation that support sustainable access to land, raw materials and beneficiation

11. Three Goals to Grow Manufacturing ATTAIN A SUPPORTIVE INTERNATIONAL TRADE POSITION Ensure fair trade through the effective use of tariff and non-tariff barriers, as well as other policy measures Develop trade and transport linkages within the African region and other key export markets ADVANCE THE REPUTATION OF SOUTH AFRICAN MANUFACTURED PRODUCTS Promote preferential procurement for locally manufactured and beneficiated products that are competitively priced Partner in an effective multi-faceted “Buy Local” campaign

12. www.manufacturingcircle.co.za philippa@manufacturingcircle.co.za