Black industrialists set for major boost

THE government is confident it will meet its target of supporting 30 black industrialists in the first year of the roll out of the multibillion-rand programme, which kicked off at the beginning of the year.

So far 22 applications had been approved for investments of R1.4-billion, with the combined support of government and its entities valued at R700million, Department of Trade and Industry chief economist Stephen Hanival said.

The Industrial Development Corporation, the Land Bank and the Public Investment Corporation would take part in the project, which aims to speed up the growth of black industrialists involved in the productive sectors.

Grant funding only represented about R200-million of the support, with the rest of the package being made up of loan facilities at subsidised interest rates for working capital, Hanival said.

The aim of the black industrialists programme is to set up 100 black industrialists over the medium term: 30 this year, 30 next year and 40 in the third year. Four applications valued at R500m in the agro-processing, plastic, pharmaceuticals, electrical equipment and metals sectors were approved in the first three months of the current financial year. Science and Technology Minister Naledi Pandor, speaking on Tuesday at a media briefing on the work of the economic, employment and infrastructure development cluster of government departments, emphasised government’s determination to unlock the potential of small and mediumsized enterprises, co-operatives, townships and rural enterprises by expediting the full implementation of the 30% set-aside procurement policy.

This will set aside 30% of all government procurement, which totals about R500-billion each year, to these types of operations.

Department of Trade and Industry director-general Lionel October told the briefing that Treasury was busy finalising the regulations on the setasides.

Questioned as to how Treasury would limit price escalation in the 30% set-aside contracts, Brown said that acceptable prices would have to prevail. Concern about price escalation lay behind Treasury’s initial resistance to a set-aside scheme.

The draft regulations published in July proposed to make it compulsory to subcontract a minimum of 30% of the value of all contracts above R30-million to emerging suppliers, including businesses owned by black women. — BDlive