KwaZulu-Natal MEC for Economic Development, Tourism and Environmental Affairs, Sihle Zikalala, speaks to exhibitors at a previous Manufacturing Indaba in Durban.
DURBAN -  The Manufacturing Indaba KwaZulu-Natal (KZN) to be held in Durban at the Inkosi Albert Luthuli International Convention Centre on 14 and 15 August will highlight emerging trends in the manufacturing arena and how it can improve the lives of KZN residents.   

As manufacturing is the largest single sector in the KZN regional economy with a 15.9% share, what happens in manufacturing is important for KZN businesses and consumers. In 2017, KZN manufacturing value added slipped by 0.3%, but it should have recovered in 2018, as at a national level, manufacturing grew by 1.0%. The KZN manufacturing data will be released in March 2020 as it takes considerable time and effort to compile the regional economic data sets.

KZN’s manufacturing sector is geared for export due to its geographic position. It borders on three of our neighbours and had access to the Indian Ocean, which allowed Durban and Richards Bay to be among the busiest ports in Africa. Nearly a third of South Africa’s manufactured exports are made in KZN.

Its diversified nature makes it robust as a downturn in once sector tends to be compensated by an upturn in another sector. That is why manufacturing is so important in KZN’s structure and it generates around a fifth of provincial employment.

At the Manufacturing Indada the aim is to get industry leaders to impart their expert knowledge to participants on how to proactively manage the Fourth Industrial Revolution. This disruptive technological revolution has led to concerns about job losses and the Manufacturing Indaba intends to address and appease heightened concerns of industry players relating to their job-security and career paths in the event of adopting progressive manufacturing methodolgies. 

Manufacturing experts will discuss how adopting innovation can positively impact job creation through establishing new career alternatives and economic diversification opportunities. Robotic Process Automation (RPA) will create more jobs in South Africa than it destroys according to Lenore Kerrigan, the Country Sales Director for UiPath in South Africa.

The Manufacturing Indaba will help enlighten delegates by hosting informative dialogues led by industry visionaries who will reveal how the government and private sector plan to collaborate to review policies concerning the core training of employees by both up-skilling and re-skilling the workforce to fully capitalise on impending technological innovations. In addition, some manufacturers will share their expertise on opportunity development and management of imminent threats facing the province, whilst proactively implementing strategies to safeguard its competitive advantage and boost provincial profits through the digitalisation of manufacturing technologies.

Trade and Industry and Economic Development, Deputy Minister Fikile Slovo Majola said in Parliament on July 11  that KZN was blessed with a vibrant manufacturing sector and the government aimed to leverage this sector by creating Special Economic Zones (SEZs). 

He highlighted the opportunities that the recent ratification of the African Continental Free Trade Area (AfCFTA) would bring to South African exporters as it created a market with more than 1.2 billion people with a purchasing power of $3.3 trillion. All member states are required to submit their initial tariff offers by September 2019 and the effective date of implementation of the AfCFTA is July 2020.  

“There is no doubt that the establishment of the AfCFTA can be a game-changer for the local economy, providing a massive market for SA goods and services. South Africa is the largest contributor to intra-Africa trade, accounting for approximately 23% of intra-Africa trade in 2018 with a value of R515.5 billion up from R478.8 billion in 2017,” Majola said.

“Our goal is to replicate the Maputo Development Corridor model which was jointly championed by the Governments of South Africa and the Republic of Mozambique. Since the beginning of its implementation in 1998 to date, the Maputo Development Corridor continues to attract more investment, stimulate two-way trade and create jobs for the benefit of the two countries. This project must benefit citizens of Manguzi and Magude on both sides of the border,” he said.

“Government will focus on the strategic sectors of manufacturing, agriculture, oceans economy and other sectors to strategically position the province as a lead investment destination and make the province a trade gateway within the Southern African region and the rest of the continent,” he added. 

“We are also pleased to announce that the Richards Bay Industrial Development Zone (RBIDZ) in the province of KwaZulu-Natal will soon be paving the way for the construction of a R1.3 billion Palm Oil Refinery, which we strongly believe will benefit the communities of Richards Bay, Empangeni and UMhlathuze,” he noted.  

The National Association of Automobile Manufacturers of South Africa expects the South African domestic new vehicle production to increase by 8.9% to 657650 units in 2019. This optimistic forecast seems to be justified as new vehicle exports grew by 19.6% year-on-year (y/y) to 182860 in the first half of 2019.

The expansion of capacity at the Umkomaas dissolving wood pulp mill this year should boost the wood and wood products, paper, publishing and printing division, while base effects will lead to increased production of the food and beverages division, as the listeria outbreak in the first quarter 2018 falls out of the y/y comparison.  

The recovery in KZN’s manufacturing sector is also reflected in the ports data with full containers exported from Durban increasing by 4.9% y/y in the second quarter to 200,332.

This growth rate is expected to continue for the rest of the year as KZN benefits from the new road link to Maputo. The Maputo-Katembe bridge is part of the African Union’s aim of making it easier to travel across Africa so promoting tourism and commerce. Construction work began in 2014 and the bridge officially opened on November 10, 2018. It reduces the travelling time from the Kosi Bay border post in KZN to Maputo to 90 minutes from six hours and Intercape will next month introduce a new bus service on this route. 

This will enhance cross-border trade as it will make it easier for informal traders to move across the border with minimal expense and time wasted.

BUSINESS REPORT