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15 October 2004

Programme Director
The Honourable Premier of Limpopo, Mr Sello Moloto
His Lordship the Mayor of Waterberg District, Mr Godfrey Molekwa
Members of the Executive Council here present
The Leadership and Members of the Provincial Legislature
Mayors and councillors
Traditional Leaders of our people
Representatives of private sector organisations
Representatives of our institutions of higher learning
Ladies and Gentlemen

The Growth and Development Summit takes place two days after the World Economic Forum (WEF) published its report on the 2004 competitive rankings. Ours is one of the 104 national economies featuring in those Growth Competitive Index (GCI) rankings. As delegates to this summit will recall, in 1994, we inherited an economy mired in a prolonged recession. According to this report, in the short period of ten years, our economy has produced a level of performance which places it in the pole position within the region, and, at 41 in the global rankings.

This verdict constitutes a useful feedback on the effectiveness of the measures our government has undertaken since at least 1996, in order to achieve stability in the face of continued macro-economic turmoil. More importantly, it provides us with insights into areas where further progress is called for, in order to improve the environment for improved economic activity, and generate sustainable growth.

The provincial summit builds on the laudable results of the National Growth and Development Summit which took place in Midrand in June 2003. The national summit laid a good foundation for growth-promoting cooperative relations between spheres of government, the public sector and the private sector, the labour movement, and community-based organisations. Accordingly, the usefulness of your decisions will be determined by the value they add to the national effort at enhancing the ability of our economy to grow.

Programme Director,

The factors which place a brake on growth and development are well known to all of us. It is universally acknowledged that in the context of the changed world economy, an unskilled labour force has become a competitive liability. It is also true that no economy can break out of productive inefficiency if it continues to experience stagnant investment. No economy can grow and develop sustainably in the absence of serious investment in the creation and maintenance of social and economic infrastructure. It is only when we pay collective and systematic attention to these matters, that we shall be able to place our economy on a higher growth trajectory.

In the 2004-05 financial year, there has been a significant growth in the equitable share of the provincial government sphere. This increase in the provincial share of nationally raised revenue communicates a message which says that in our estimation, provinces are key component of the development state. They are expected to move decisively towards playing a developmental role rather than only dispense painkillers to those who are placed at the lower end of the market.

This province must be commended for being one of the five provinces that have completed the drafting of a Provincial Growth and Development Strategy. We are agreed that the development of provincial strategies is one of the tasks that must be given priority attention. The strategies must indicate the various developmental potentialities of the composite district areas, the province’s proposed growth trajectory, and, indicate the areas of comparative advantage for investment.

It is also understood that our country’s economic resurgence is inextricably bound up with the economic regeneration of the rest of the African continent. In this regard, Limpopo has endowments which can contribute immensely to the process of enhancing our regional and global positioning. The province shares international borders with three countries: Botswana to the west and north-west, Zimbabwe to the north, and Mozambique to the east. It also shares boundaries with Gauteng, a province which is home to the most industrialised metropole of the African continent. The N1 artery which connects Limpopo to the Gauteng metropole is the busiest overland route in Africa in terms of cross-border trade in raw materials and beneficiated goods.

All these factors place a special obligation on the policy makers, the intellectual community, corporate and individual citizens of this province. They tell us that there is a lot we need to do together in order to increase the productive efficiency of the province. In other words, we have to forge ourselves into a unified social framework for sustainable development.

The problems we have in this province are a microcosm of the national challenges. As Premier Moloto said earlier, we have a skills-constrained economy. In this province, only nine out of thirty-two municipalities have an employment rate which is greater than 35%. Even as it grows, our economy tends to create jobs for which we lack the requisite skills. We therefore face an ongoing challenge of ensuring that our education system becomes more responsive to the needs of our economy. It must make a contribution to the national goal of sustainable growth.

The problem of skills shortage also has a bearing on public institutions which are critical to the growth process. For instance, the Municipal Demarcation Board identified five municipalities in this province which are performing less than 30% of their assigned powers and functions. It is worth noting that the five municipalities are located within cross-boundary districts. Such municipalities will not be able to attract growth-stimulating investments. Their problem talks to the need for us to improve the quality of public institutions, and to transform them into entities that can reliably underpin the development process. Needless-to-say, this problem is not limited to the five municipalities.

Programme Director,

Although we have made significant progress overall, we must continue to strive for enhanced levels of performance. For its part, government continues to look for ways of improving the stock of public investment in the economy. We have recently introduced two instruments – the Municipal Infrastructure Grant and the Extended Public Works Programme – through which we seek to, stimulate economic growth, whilst we simultaneously create a platform for our people to enter into productive economic activity. We’ll also use these resources to remove all municipal infrastructure backlogs over the next ten years.

By realising our set goals within schedule, we shall have executed our national share of responsibility towards the Millennium Development Goals. Success in this regard depends on efficient implementation of local development plans and provincial development strategies which lend themselves to national co-ordination. It is for this reason that national government will be following the deliberations of this summit with keen interest.

I thank you.

Issued by: Ministry of Provincial and Local Government
15 October 2004