Black Business Council rejects funding deal for industrialists

Published Jul 27, 2017

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Cape Town

- The Black Business Council (BBC) on Thursday dismissed the Department of Trade

and Industry (dti), and First National Bank (FNB) partnership aimed to improve

access to funding for black industrialists (BI), saying is nothing more than a

public relations exercise.

This follows a pledge that was signed on Tuesday at the unveiling

of the Black Industrialist Scheme by the DTI Minister, Rob Davies together with

FNB CEO for Public Sector Banking, Kgosi Ledimo.

The funding for BI is aimed to roll out 100 programmes by

March 2018.The partnership would facilitate information-sharing

regarding the department’s incentive programmes.

BBC secretary-general George Sebulela said “the way the

agreement has been entered into, it sounds like an agreement to utilise FNB for

access to information rather than finance".

Read also:  Black industrialists get a finance pledge

The BBC said that it would have preferred to see an agreement

about funding at a discounted rate rather than an agreement about information

sharing.

"The statement does not detail access to finance. What

finance options are black industrialists being offered that makes FNB

different?"

Sebulela said the black industrialists programme was one of

the major policy instruments that could be used to achieve radical economic

transformation, for which the BBC has long made a call.

This comes as the manufacturing sector has been under

pressure, with the Manufacturing

Circle calling for a strategy to reverse the

decline of the industry and for the creation of 1-million new jobs. In May,

manufacturing production fell 0.8%, compared with May 2016.

The Absa purchasing managers index (PMI) fell below the

neutral 50-mark in June to 46.7 index points, indicating a contraction in the

sector.

Manufacturing Circle executive director Philippa Rodseth

said the numbers and the PMI both indicated that the sector was contracting,

but she remained upbeat that manufacturing was the key in turning around the

economy.

Manufacturing Circle chairman André de Ruyter said the

Treasury and the Manufacturing

Circle had a shared "priority to grow

manufacturing and to re-industrialise the economy, as an important step in

reversing recent ratings downgrades and boosting investment, economic growth

and employment".

So far, the black industrialists programme has approved 52

projects with an estimated value of R4.5bn and created 9 000 jobs. Versions of

the programme are being mirrored in other industries, based on the success in

the manufacturing sector.

The Black Industrialist Scheme was an important step in

reindustrialisation, said Trade and Industry Minister Rob Davies. The scheme

was set up as an incentive programme to help black entrepreneur’s access

finance and markets, to beef up skills development and standards, and quality

and productivity improvement.

“Getting into the value-added space [of manufacturing] is

imperative. The challenge is to promote industrialisation generally but also

greater inclusivity in the manufacturing sector.

“It was important for the department to supply skills

development and not just ownership deals,” Davies said.

BUSINESS REPORT ONLINE 

 

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