TRADE

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TRADE INVESTMENT SOUTH AFRICA

• TISA Work Plans 2001/2002
• Presentation to the Parliamentary standing
  committee on Trade and Industry

2
Presentation Overview

• The TISA Vision
• Overview of TISA Work Plan 2001/2002
• Business functions
• TISAS contribution to Presidents agenda
• Investment Promotion
• Export Promotion

3
Presentation Overview

• Cross-cutting work plans
• The building blocks of success
• Overview of TISAs work plan layout
• Budget Expenditure for 2000/2001
• Budget for 2001/2002
• Conclusion

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The TISA Statement

• We seek to move the economy onto a high growth
  path, increase its competitiveness and
  efficiency, raise employment levels and reduce
  poverty and persistent inequalities

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TISA Work Plan 2001/2
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Business Functions

• PRIMARY BUSINESS
• Investment Promotion
• Export Promotion

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Business Functions

• SECONDARY BUSINESS
• Logistics Development
• SME Development
• Sector specific Image Building

8
TISAS contribution to National Agenda

• Transport Airports, Sea Ports, Rail and Road
• - removing bottlenecks for exporters in key
  sectors
• - provide inputs to DPE on restructuring of
  SOEs
• Telecommunications E-commerce
• - improving trade efficiency utilizing an
  electronic trading system (Trade Net)
• 5 Priority growth sectors
• - promoting Investments and Exports
• Infrastructure
• - facilitating the development of IDZs through
  policy inputs marketing for investors

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Investments

• Overview
• FDI inflows
• Investment Objectives
• Key Deliverables
• FDI targets
• Promote FDI inflows into priority investment
  sectors
• Investment Pipeline Deliverables for 2001/2002
• Improved Investment environment
• High Performance Organisation

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Investments - Overview FDI Inflows
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Investments - Objective

• To increase FDI inflows to R3.2 billion by 31
  March 2002 in prioritised Investment sectors

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Investments Key DeliverablesFDI Targets
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Investments Key Deliverables

• Priority Investment Sectors
• Agro-processing
• Clothing and textiles
• Automotive industry
• Chemicals
• Metal based industries

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Investments Key DeliverablesInvestm
ent Pipeline Deliverables for 2001/2002
Sectors Outputs Pipiline (Rm) as at 31/03/02 Outputs Pipiline (Rm) as at 31/03/02 Outputs Pipiline (Rm) as at 31/03/02 Timeframes
Possible Probable Committed
Agro-processing 91 91 64 31 March 02
Clothing Textiles 274 274 192
Automotives 137 137 96
Chemicals 3886 3886 2720
Metals 183 183 128
TOTALS 4571 4571 3200
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Investments Key Deliverables

• Improved Investment Environment Summary
• Industrial Development Zones concept
• Establishment of one stop investor facilitation
  shop
• Provide inputs for more effective incentives

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Investments Key Deliverables

• Improved investment environment
• The Industrial Development Zone concept
• working with The Enterprise Organisation (TEO) to
  develop a viable IDZ strategy by 30 June 2001
• establishment of City Deep IDZ by 31 March 2002
• marketing of IDZ by TISA

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Investments Key Deliverables

• Establishment of a one-stop facilitation shop
  for Investors (in alignment with the IICs goal)

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Exports

• Overview
• Total Manufacturing Export Growth
• Investment Objectives
• Key Deliverables
• Export targets
• Promote exports in prioritised sectors
• Export Deliverables for 2001/2002
• Outward investments into Africa
• Export Sector Strategies
• Re-organised Export Councils
• Cutting edge incentives
• Tradenet

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Exports - Overview
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Exports - Objective

• To substantially increase South Africas
  export base by 31 March 2002

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Exports Key DeliverablesExport Targets
(Rbillion)
2000 Growth rate 2003 Growth Rate
Automotives 15.3 30 31.7 25
Agro-Processing
- grape wine 1.7 42 5.0 42
- fruit 4.1 -10 3.0 -10
- fruit juices 0.7 37 1.7 37
Clothing 0.1 64 3.6 64
Chemicals
- ethylene 0.3 55 1.0 55
- propylene 0.3 -26 0.1 -26
Total for Non-Auto 10.8 16 19.6 32
Total for 9 industries 26.1 24 51.2 28
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Exports Key Deliverables

• Prioritised sectors
• Agro-processing
• - grape wine
• - fruit juices
• - fruits
• Clothing Textiles
• - clothing
• Autos
• - automotive vehicles
• components

• Chemicals
• Metals

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Exports Key Deliverables
Sector Outputs Time Frame
Agro processing 4 National Pavilions December 01
Agro processing 1 Exhibitions October 2001
Agro processing 1 Outward missions December 2001
Agro processing 3 Inward missions November 2001
Clothing Textiles 2 National Pavilions January 2002
Clothing Textiles 1 Exhibitions August 2001
Clothing Textiles 2 Outward missions November 2001
Clothing Textiles 1 Inward missions April 2001
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Exports Key Deliverables
Sector Outputs Time Frame
Automotive Vehicles and Components 2 National Pavilions November 2001
Automotive Vehicles and Components 4 Outward missions November 2001
Automotive Vehicles and Components 4 Inward missions August 2001
Chemicals 3 National Pavilions November 01
Chemicals 1 Exhibitions November 2001
Chemicals 4 Outward missions October 2001
Chemicals 1 Inward missions August 2001
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Exports Key Deliverables

• Africa Strategy
• Intra-Africa Trade
• It constitutes a mere 10 of Africas total
  trade. There is a need to address trade
  imbalances.
• Unless African countries trade amongst
  themselves, no development will take place in the
  region Minister Alec Erwin

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Exports Key Deliverables

• Africa Strategy
• Outward Investment
• - To secure foreign markets
• - To use home-based SA technology to provide
  solutions to African problems
• - To use SA technical know-how on
  infrastructures, utilities and construction
  projects to address development requirements
• - To promote potential intra- and extra regional
  trade

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Exports Key Deliverables

• Reorganised Export Councils
• Broadening the export base. Councils will be
  required to achieve and secure membership of 30
  of la industries and 40 in small industries by
  30 June 2002
• Export Councils will be required to address
  bottlenecks in the export value chain (see
  Logistics section). Reports will be completed by
  30 June 2001 and fed back to TISA Facilitation
  Division and Councils for corrective action.
• In the promotion of BEE and women owned SMEs, a
  minimum requirement is that 10 of Export Council
  membership by 30 June 2002 should be represented
  by BEE/women owned enterprise

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Exports Key Deliverables

• TradeNet
• Based on Singapores experience where the turn
  around time for processing trade documentation
  decreased from 4 hrs to 5 minutes. This enhanced
  Singapores overall competitiveness.
• Develop a plan for electronic trade
  documentation. Needs to be driven by the
  Presidency. The first step is to bring Customs on
  board.
• Draft memorandum for Cabinet approval by 30 April
  2001. Will propose national co-ordination and
  implementation
• Implementation of pilot system by 30 December 2002

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Key Support Divisions

• Facilitation
• Logistics
• Corporate Communications

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Facilitation

• New Business
• Export Councils
• Team will ensure development of new policy and
  guidelines on funding Export Councils by 31 May
  2001.
• Team will ensure assistance with administration
  requirements.
• Will move in line with New Zealands experience
  ie. establishment of fully fledged councils and
  then formation of export networks

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Facilitation

• New Business
• Investor work permits
• TISA currently facilitating investor work permits
  with DHA but turn around time for work permits is
  1 month. Still not fast enough
• DHA is not investor client orientated no
  differentiation for investors
• During 1999 TISA facilitated R 866 million (13
  212 jobs) of DHA referrals
• TISA will be involved in drafting Cabinet
  legislation. Cabinet Memorandum by 30 April 2001
• Transformation of existing Call-centre into TISA
  Customer Care Centre by 30 June 2001

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Facilitation

• Existing Business
• Aftercare
• No aftercare strategy for exporters and
  investors.
• Build on-going relationship with 25 foreign
  chambers for investor aftercare. 2 meetings per
  year at CEO level with all chambers. 12 seminars
  during the year with chamber members.
• Export database complete (6 000 active
  exporters). Install IT based customer
  relationship management system by 31 July 2001
  for managing relationships with individual
  exporters and investors. On-going contact through
  e-mail information and publications.

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Facilitation

• Existing Business
• Technical Services
• Currently exporter and investor bottlenecks in
  supply chains, logistics, and provision of
  incentives.
• Establish a rapid response technical team to
  break bottlenecks. Team will be established by 30
  May 2001
• Bottlenecks include major port blockages,
  financial incentive blockages and marketing
  blockages. The team will interface with the
  Logistics Division and will be responsible for
  specific short term interventions

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Facilitation

• Existing Business
• Export Development
• Diverse and disparate SME export support
  programmes exist (TIDP, chamber programmes,
  international linkage programmes, private sector
  training institutions etc.). Intention is to
  ensure national co-ordination.
• Comprehensive training programme for 100 export
  ready SMEs in the export cycle and international
  marketing during 2002
• Facilitate backward linkages for 20 SMEs with
  foreign partners by December 2001

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Logistics

• Logistics
• Major supply chain issues/hindrances to and
  opportunities for improving competitiveness
  exist.
• Some of the supply chain problems relate to the
  following (see attached graph)
• Port delays and inefficiencies, especially
  Customs clearance
• High port charges
• High cost for road and rail transport compared to
  other African countries
• Inconsistent road and rail reliability
• High shipping charges
• Long distances from factory to ports
• Study will be complete by end of May 2001 which
  will quantify the above

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Logistics Supply Chain Issues Identified by
Export Councils
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Logistics

• Identify hindrances and opportunities within
  supply chains for improving export
  competitiveness in clothing and textiles,
  automotive vehicles and components, chemicals and
  agro-processing. Research review complete (phase
  1). Study will be complete by 30 May 2001.
  Detailed business cases will be developed along
  priority opportunities and implemented e.g.
  investments in collaborative technology for the
  wine industry.
• Facilitating improvements along the
  Gauteng-Durban corridor. TISA to assist with fast
  tracking this for implementation this year to
  improve speed of access to Durban. Improvements
  implemented by 31 November 2001

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Logistics

• Re-organisation of SOEs. TISA to make sure that
  the re-organisation impacts favourably with
  regard to competitiveness across industries.
• Singapore Hub Project. Create a hub at JIA
  through investments by Singapore in airport
  infrastructure and services. To be complete by 30
  June 2001.

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Corporate Communications

• Redress perception deficit of SA as a business
  destination as elicited through the GCIS 1998
  survey and frequent meetings with investors.
  Survey conducted in Germany, Sweden, UK, Japan,
  UAE, Singapore, France and US. 41 of respondents
  said that SA does not compare favourably as a
  competitive investment destination.
• TISA will facilitate with GCIS to do a follow-up
  survey in 2002 to measure the impact of various
  branding campaigns

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Corporate Communications

• Build confidence in SA as an investment
  destination and a source of exports via the
  following marketing communication tools
• 12 events
• 20 positive articles in prominent international
  business media
• participation in 5 special surveys in
  international publications
• 18 consistently imaged national pavilions,

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Corporate Communications

• 12 sector publications
• 2 generic investor publications
• 2 exporter magazines
• 10 tactical advertisements of SA success stories
  of investment, monthly media briefings)
• Create conditions for FERS and sector
  specialists to meet targeted potential customers

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The Building Blocks of Success

• Solid Investment Strategy
• Solid Export Strategy
• Solid Foreign Office Operation
• Solid Organization System
• Solid Image Building Strategy
• Team SA

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Team SA

• Whose help do we need?
• Provinces
• DTI - EIDD, TEO, ITID, CITA, CSIR, IDC,
• Broader Govt. - MHA, D Agrc, DME, DFA,
• Leadership - Presidents Office, Cabinet,
• Implement new framework for co-operation with the
  Provinces
• Undertake joint programmes with all the Provinces

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Conclusion

• How can the Parliamentary standing committee
  assist in increasing investment and exports??
• Skills development
• Better international image
• Competitive incentive packages
• Good regulatory environment