1. the Portfolio Committee on Trade and Industry
2005/6 Annual Report to
the Portfolio Committee on Trade and Industry 1
By: Director General, Tshediso Matona
November 2006

2. CONTENTS Economic Context dti Strategic objectives
2005/6 ANNUAL REPORT
Economic Context
dti Strategic objectives
Summary of Key Outputs 2005/06
Spending trends
Breakdown of the budget
Proposed interventions

3. ECONOMIC CONTEXT
Increased manufacturing confidence (BER report), underpinned by:
A increase in domestic investment
A increase in foreign investment
Strong performance in key industrial sectors:autos production up 11.6%
Conditions created for a more robust industrial policy
Economic/investment growth
GDP
4.9%
Investment 8% =
Growth in manufacturing 4.1%
Employment growth of in past year
Employment elasticity
Increase to 0.8% relative to GDP growth =
Challenge: Trade deficit : strong currency has resulted in widening trade deficit – challenge is to increase value added exports. 3

4. STRATEGIC OBJECTIVES 2006-2009
Promote co-coordinated implementation of accelerated & shared growth initiative
Raise the level of exports and promote equitable global trade
Promote direct investment and growth in the industrial and services economy, with particular focus on employment creation
Contribute towards the development and regional integration of the African Continent within the NEPAD Framework
Promote broader participation, equity and redress in the economy

5. KEY OUTPUTS IN 2005/06 2005/6 ANNUAL REPORT
This section will cover high level outputs in the following areas:
Enterprise & industry support & development which will encompass:-
Policy & Strategy
Financial support
International Trade & Economic Development
Legislation & Regulation
HR & Governance

6. ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT
KEY OUTPUTS IN 2005/06
2005/6 ANNUAL REPORT
ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT
Policy & Strategy
ASGISA – contributed to framework & leads key interventions eg. Sectors (BPO), Small Business, etc.
National Industrial Policy Framework – undertook consultations & research towards draft policy
Other Sector Policy initiatives - Clothing & Textiles, Chemicals, Metals, Agro-processing, automotives, Forestry & Wood, Pulp & Paper, Film and Services
Integrated Small Business Strategy & Co-ops strategy finalised & SEDA roll out launched
Regional Industrial Development Strategy - undertook consultations & research towards draft policy

7. ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT
KEY OUTPUTS IN 2005/06
2005/6 ANNUAL REPORT
ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT
Policy & Strategy
Broad Based Black Economic Empowerment – finalised phase 1 & launched phase 2 of codes
Import Parity Pricing policy finalised
Policy Reviews
Incentives, incl. IDZ’s
Competition Policy
Export & Investment Strategies
Draft strategic framework on Gender & Women’s Economic Empowerment completed

8. ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT
KEY OUTPUTS IN 2005/06
2005/6 ANNUAL REPORT
ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT
Financial support
9 Strategic Infrastructure Programs (SIP) approved with projected 778 direct & indirect jobs
10 new infrastructure projects (CIP) were approved with project investment of R8,5b
1 924 SMEDP incentives were approved with expected investment of R14,7b & the creation of jobs. R733m claims paid during the period.
Assisted 577 firms (900 applications) through the BBSDP scheme to the value of R29m
10 Film incentives were approved, productions of which will result in investment of R360m

9. ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT
KEY OUTPUTS IN 2005/06
2005/6 ANNUAL REPORT
ENTERPRISE & INDUSTRY SUPPORT & DEVELOPMENT
Financial support – cont.
EMIA assisted 267 companies to exhibit at foreign national pavilions, 547 firms (882 applied) for other export initiatives & 86 companies participated in local pavilions & 41 outward-bound trade missions to 23 countries, with expected export sales of R5,6b
NEF financed 66 deals with a total value of R467m
Khula approved R462m worth of transactions and disbursed R316m, whilst approving 334 business plans. 56% went to financing black businesses, 32% to women & 35% to poorer provinces
Co-operatives Support - Developed Incentives & obtained donor funding

10. INTERNATIONAL TRADE & ECONOMIC DEVELOPMENT
KEY OUTPUTS IN 2005/06
2005/6 ANNUAL REPORT
INTERNATIONAL TRADE & ECONOMIC DEVELOPMENT
Negotiations – WTO, EU, US, EFTA
Implementing – SACU, EU, Mercosur
Other Trade Initiatives – China, IBSA, Trade & Investment Protection Agreements
Africa/NEPAD – APRM, Trade & Technical Co-operation missions

11. LEGISLATION & REGULATIONS
KEY OUTPUTS IN 2005/06
2005/6 ANNUAL REPORT
LEGISLATION & REGULATIONS
Finalised Bills:
Co-operatives Bill
National Credit Bill
Close Corporations Amendment Bill
Patents Amendment Bill
Interim Companies Amendment Bill
Outstanding Bills
Consumer Protection Bill, Enterprise Development Bill, Intellectual Property Amendment Bills, Sugar Bill

12. HR & Governance TOTAL NO OF POSTS AS AT 1 APRIL 2006 1098
2005/6 ANNUAL REPORT
TOTAL NO OF POSTS AS AT
1 APRIL 2006
1098
VACANCIES AS AT
332
APPOINTMENTS
1 APRIL 2006 – 30 SEPTEMBER 2006 94
TERMINATIONS 31
VACANCIES AS AT
30 SEPTEMBER 2006
269

13. HR & Governance Appointment of Board of Directors Khula ECIC SEDA
Appointment of CEO’s and DG
IDC
NEF
CIPRO
Appointment of Board of Directors
Khula
ECIC
SEDA

14. HR & Governance Audits & Reports
Unqualified Audits for the dti & all COTII agencies except one
All COTII agencies tabled annual reports, incl. Programs such THRIP & NIPP

15. 7 YEAR EXPENDITURE TRENDS
2005/6 ANNUAL REPORT

16. ANALYSIS OF MTEF
2005/6 ANNUAL REPORT

17. BREAKDOWN OF BUDGET
2005/6 ANNUAL REPORT
On average the structure of the budget allocation over the MTEF period is:
40% to agencies of the dti
40% to incentive payments
13% to compensation after deduction to agencies (8% of total budget)
12% to goods & services, of which 8% is overhead commitments, leaving only 4% to fund projects/new initiatives
MTEF Preliminary Outcome
Requested additional R8b over MTEF period but got allocated R1,3b

18. CONCLUSION 2005/6 ANNUAL REPORT
Overall we have achieved our targets for the reporting period
Could do more with additional financial resources
Some challenges remain in respect of:
Institutional development
Skills & Training
Inter-departmental/cluster co-ordination

19. THANK YOU