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15 September 2008

Deputy President Mrs Phumzile Mlambo-Ngcuka
Minister of Science and Technology Mr Mosibudi Mangena
Guests, ladies and gentlemen

We in Gauteng are privileged to be hosting this conference. We note with satisfaction that it is the first time that this conference comes to Africa and that we are the first province to host it.

The theme that you have chosen for conference that "The role of science of science parks in accelerating knowledge economy growth - contrasts between emerging and developed economies" accurately reflects the kinds of issues that we are grappling with at this stage of our country's development.

While our economy has historically been based on the extraction and export of primary products such as minerals and mining commodities, the tertiary sector has increasingly become predominant. According to Statistics SA, in the period 1996 to 2004, primary industries as a percentage of gross domestic products dropped from 4,6% to 2,3%. Tertiary industries, on the other hand, increased from 58,4% to 62,3% in the same period. Much of this was attributable to growth in finance, real estate and business services, which increased from 16,1% to 21,4%.

While I am sure many would argue that the market has played a role, these shifts in the Gauteng economy are at least in part attributable to government interventions in the economy. An important part of our strategy has been focused on public investment in strategic economic infrastructure to stimulate further private sector investment in key economic sectors, such as business tourism, logistics infrastructure, manufacturing and information and communicationss technology (ICT), with a particular focus on increasing the knowledge-intensity of the economy.

The Innovation Hub was launched as part of these interventions in April 2005. It is Africa's first science park aimed at nurturing and growing enterprises in the knowledge sector of the economy. There were 68 companies in the hub's Incubation Programme at the beginning of this, employing a total of 850 people. Seven companies have graduated from the Incubation Programme and are achieving a turnover of R43 million. Another 14 companies will graduate from the Incubation Programme this year.

In our efforts to build the knowledge base of our economy, we have given priority to achieving greater efficiencies and greater value in the services sector.

We have chosen to focus on the services sector due to its strategic nature in providing services to other economic sectors the agriculture and resource-based sector, manufacturing, the knowledge and innovation sector, and to the services sector itself. The broad services sector contributes 69% to South Africa's GDP, with services being consumed by business, households and government.

Inefficiencies and lack of innovation in the services sector can have an inhibiting effect on the growth of other sectors of the economy. Government as a provider of services is required to ensure efficiencies and innovation within its own ambit.

Measures to develop the efficiencies in and effectiveness of services can lubricate the engine of our emerging Gauteng global city region, enabling all sectors, including manufacturing, resources and knowledge-intensive sectors, to improve their performance.

We need more efficient services and new services that meet the needs of businesses and households. Both government and business need to rethink how we deliver services. We need to pay attention to giving customers the benefits of new technology and improved service quality, while maintaining affordability.

In addressing our social challenges, technologies and service quality must be significantly revitalised in order to ensure advances in the quality and long-term benefits of school level education, access to advanced healthcare for poor communities and means of finding solutions to poverty.

One of the most pressing challenges facing the Gauteng city region is the development of the necessary skills to drive economic growth and social transformation. We need to place Gauteng "at the cutting edge of knowledge production". We need to produce the skills and knowledge that can build new sectors of the economy and provide quality jobs in our province.

Your conference is therefore important to us because it provides us with an opportunity to further explore areas of growth we need to focus on to grow our economy, create jobs, and reducing poverty and underdevelopment.

I look to the outcome of your deliberations with keen interest. Welcome to Gauteng and I wish you a happy stay and fruitful engagements.

Thank you.

Issued by: Office of the Premier, Gauteng Provincial Government
15 September 2008