3.5: The Department of Trade and Industry

The Department of Trade and Industry believes that a modern, well-functioning economy requires that the Government plays an active leadership role. Therefore, the Government should ensure that there is policy certainty and stability, and that regulatory services are efficient and transparent. In addition, the Government should promote functioning markets for goods and services provide incentives to overcome market failures, encourage efficient platforms for competitiveness, and promote greater levels of equity in access to information and opportunities for all citizens In pursuing these aims, there are a number of critical policy challenges confronting the Department over the medium term, including targeting support towards the Second Economy (emerging enterprises and the informal sector).
It should also continue to promote the alignment of economic role-players in the different spheres of government, in agencies and parastatals, and in the private sector, in line with government’s Vision 2014. This Vision is targeted towards an adaptive economy, characterised by growth, employment and equity, and is built on the full potential of all persons, communities and geographic areas.

The Department will be focusing on seven key objectives between 2004/05 and 2006/07:

• To increase the contribution of small enterprises, in particular, to the economy promote Broad-Based Black Economic Empowerment (BEE)
• To increase the level of direct investment in the manufacturing and service sectors
• To increase market access opportunities for, and the export of, South African goods and services
• To contribute towards building skills, technology and infrastructure platforms from which enterprises can benefit
• To reposition the economy in the higher value-added segments of manufacturing and services
• To contribute towards providing accessible, transparent and efficient access to redress for economic citizens such as consumers.

To develop enterprises, The Department of Trade and Industry will focus on promoting entrepreneurship and small business development, and developing sector specific support programmes for small and medium size enterprises (SME).

Targeting support towards the Second Economy will involve the establishment of the microcredit Apex Fund, the development of a comprehensive co-operative support programme and programmes aimed at the economic empowerment of women.

Industry development
The Department’s Enterprise and Industry Development Division (EIDD) moves trade and industrial policy in South Africa towards an internationally competitive status, capitalizing on the country’s competitive and comparative advantages
During 2003/04, considerable policy and advocacy work was carried out by the EIDD, particularly in support of the MRS and the IMS. This included research on the identification of critical skill shortages in the economy, the identification of bottlenecks in the national logistics systems, and interventions to address these.
Government’s industrial policy strives to achieve a balance between greater openness
and improvement in local competitiveness. South Africa has made great strides in opening the domestic economy to international competition.

One of South Africa’s key industrial policies remains its commitment to fostering sustainable industrial development in areas where poverty and unemployment are at their highest. This objective is implemented through the Spatial Development Initiatives (SDI’s), which focus high-level support on areas where socio-economic conditions require concentrated government assistance, and where inherent economic potential exists.

The Enterprise Organisation
The Enterprise Organisation of the Department of Trade and Industry provides incentives to stimulate investment in infrastructure, HRD, integrated manufacturing and related activities, small business development, specific regions, and technology and innovation.