Premier of Limpopo, Cassel Mathale's provincial economic overview, at the Limpopo employment, growth and development plan media launch, Melrose Arch, Johannesburg
18 May 2010
First and foremost, I would like to express my sincere gratitude to all of you on behalf of the Limpopo provincial government for coming to attend this launch. It is indeed an honour to be with you on this day, the 23rd day before the kick-off of the 2010 FIFA Soccer World Cup. Thank you for heeding our call.
As we are now slowly emerging from the global recession, we have confidence that the economy is on the mend after five consecutive quarters of negative growth from 2008 to 2009. We now know that the fiscal discipline that our government adopted cushioned us against the adverse costs of the recession.
We lost many jobs faster than we expected, we did not have in place immediate mechanisms to offset the impact of the low sales in our companies and we now understand better than ever that the creation of a sustainable employment must be built on a more diverse economy.
We also understand that an economy that simply exports raw materials and provides services to local consumers is not diverse enough to support a shared and sustainable long term growth.
In March 2010 inflation was recorded at 5.7 percent, with the outlook for 2010 and 2011 projected to be under the current figure of 5.7 percent. This has allowed the South African Reserve Bank to cut interest rates by half a point, bringing our prime overdraft rate to 10 percent.
The recent bulletin published by the South African Reserve Bank indicates that over R120 billion net foreign investments flowed into South Africa in 2009. The purchasing managers index (PMI) which [indicates the demand for manufactured products] is now over 60 points.
However, we remain fully conscious of the sheer size of the economic and social challenges that face us in the Limpopo province. We believe that even as we are confronted with the harsh realities of the global economic crisis, there are encouraging signs that our economy's long-term growth potential is deepening and sustainable.
The policy perseverance exhibited over the last sixteen years has yielded tangible macro stabilisation successes and enhanced policy legitimacy.
However investments in the province were not at a desirable level for job creation, foreign direct investments (FDI) inflow disappointing and unfinished agenda of structural reforms left the province at a disadvantaged position within an increasing competitive global environment.
The provincial economic performance in terms of sustainable job creation, reduction of poverty and inequality has fallen far short of our expectations.
In this regard efforts that were devoted had enabled the provincial economy to grow at an average real annual growth rate of 3.8 percent between 1996 and 2007. This did not sufficiently address severe structural imbalances and constraints that impede the economy from developing to its full potential.
Seven months after the new provincial administration had come into office, stakeholders from all sectors in the provinces economy met at the provincial Growth and Development Summit where delegates agreed on the development of the Limpopo employment growth and development plan (LEGDP), a means of building an economy which is informed by the electoral mandate bestowed on the ruling party, the African National Congress (ANC).
The plan identifies areas that are able to sustain our economy and those that require immediate interventions. The Limpopo employment growth and development plan's primary objective is to move our economy into an industrialisation route that is responsive to the:
* Diversification of the provincial's industrialisation path and movement towards a knowledge economy
* Promotion of more labour absorbing industrial sectors, with an emphasis on tradable labour absorbing goods and services and economic linkages that catalyse productive employment creation
* Promotion of a broader based industrialisation path that is characterised by greater levels of participation of historically disadvantaged people, and marginalised regions in the mainstream of the industrial economy.
The plan has specific programmes that are designed to achieve structural changes in critical areas of the provincial economy. Accordingly, those programmes are intended to pull together in an effortless manner the great variety of actions that would constitute a successful delivery.
In essence, the plan provides a framework for the provincial government, municipalities, the private sector and all organs of civil society to make choices in pursuit of the strategic priorities as encapsulated in the medium term strategic framework (MTSF).
As the provincial government, we have made a firm commitment to the full implementation of this plan and we are determined to pursue all these programmes in an integral approach.
We know that in this regard, we have no choice other than to succeed; hence our integrated industrial development agenda enshrined in the plan is critically important if we are to change the developmental course that this province has been following since the advent of democracy in South Africa.
The plan provides a brief insight of the state of our economic growth and development in the province and it must be read and engaged with the hope of discovering the way forward together.
Limpopo possesses three greatest assets in the form mineral wealth, fertile soils and the widest biodiversity in the country. The province's diverse mining activities include diamonds, iron ore, coal, copper and phosphates.
We are proud to say that the world's largest reserves of platinum are found in our province and it is also rich with the mineral deposits of chrome, vanadium, nickel and titanium.
The Lephalale area in the Waterberg district accounts for 50 percent of South Africa's coal reserves and projects are already afoot to exploit these reserves with the building of the Medupi power station in Lephalale.
Limpopo is also host to Venetia Mine, situated just west of Musina, which is South Africa's largest diamond producer. It is also the world's largest producer of antimony, a strategic element used in the production of alloys and medicine.
Colleagues, our province is also the largest producer of vegetables and fruit in the country; however a lot still needs to be done in the agro-processing industry. The widest biodiversity in the country is found in Limpopo making it a major attraction for tourism.
We have been engaged in serious discussions with the Zimbabwe in order to give effect to the Trans-Limpopo development corridor. The possible new product in this regard, would give a potential tourist and inclusive package of all the icons and tourism attractions from Makhado to Victoria Falls.
This would include our world heritage site: Mapungubwe, Thulamela ruins and the Great Zimbabwe. We have always prided ourselves in the well renowned Kruger National Park which is 70 percent in our province.
The Waterberg region in the Southern part of the province is also emerging as one of the country's favourite eco-tourism destination boasting superb vistas, mountain gorges, clear streams and rolling bush-veld hills, all rich in indigenous species of plant and animal life, including the "Big Five".
With the blessing of all these assets and the strategic positioning our province as a gateway to the rest of Africa we are determined to make good of these possessions and therefore the Limpopo employment, growth and development plan is a tool that will be used in achieving our objectives of bettering the living conditions of our people.
As President Jacob Zuma emphasised, none of us can rest or sleep peacefully until every South African can say:
"I can see a better future. I can find a job. I can learn a skill. Hard work will enable me and my family to have shelter and food. If my children work hard at school and college, they will have a better future and a thousand opportunities".
I thank you.
Issued by: Limpopo Provincial Government
18 May 2010
Source: Limpopo Provincial Government (http://www.limpopo.gov.za/)
Issued by: Limpopo Provincial Government
18 May 2010
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