23 Jan 2015 15:37pm
SAPA PR--DTI THREATENS GREEN ECONOMY IN THE WESTERN CAPE
ISSUED BY: DEMOCRATIC ALLIANCE
ATTENTION: NEWS EDITORS
FOR IMMEDIATE RELEASE:
DTI THREATENS GREEN ECONOMY IN THE WESTERN CAPE
Democratic Alliance press statement
Beverley Schäfer MPP
Western Cape Spokesperson on Economic Opportunities, Tourism and Agriculture
DTI threatens green economy in the Western Cape
23 January 2015
The Standing Committee on Economic Opportunities, Tourism and Agriculture in the Western Cape Provincial Parliament will investigate the impact of industry killing red tape, on the Special Economic ?Zone (SEZ) in Atlantis.
The Western Cape Green Economy Strategic Framework has identified Atlantis as a central manufacturing zone. With Atlantis being the SEZ, it will be a key manufacturing hub for equipment needed to bolster the Western Cape green economy.
Over the last eighteen months, there have been continuous reports that the Department of Trade and Industry (DTI) has manufacturing requirements in place that may be detrimental to the Atlantis SEZ, this following the extent to which these requirements have already damaged the South African manufacturing industry at large.
DTI has made low-pressure solar water geysers a designated product. As such, local producers have begun manufacturing these geysers, which would have been utilised for Eskoms mass roll-out of its low-pressure solar water, for low cost houses. DTI stipulated that 70% of the tank and collector tubes in the geysers need to be made from local content. In so doing, DTI has made it impossible for local producers to manufacture the geysers according to the criteria. This follows the fact that there is no South African company that manufactures these parts.
Setting up factories in South Africa, that can produce the tanks and collector tubes would cost too much, as raw materials would have to be imported from China or Turkey. In addition, South Africa producers would not be able to compete with Chinese producers of these goods, as these producers manufacture these goods at a much cheaper rate and have the majority share of the market.
A solution to this issue may be to change the requirements set out by DTI. Overall, these geysers are 80% made of local contents. This raises questions on the relevance of these crippling requirements for the production of tanks and collector tubes, since local contents are utilised and well represented.
The Department remains unwilling to consider and accommodate the market reality, that the tank and collector tubes cannot affordably be made from local contents. Rather than bolstering the use of local contents, these requirements are choking the industry and costing our economy jobs. There have been 4 500 job losses thus far, as factories have been closed down.
South Africa is plagued by short-sighted and unnecessary regulations. The ANC led-National government is unwilling to accept that increasing red-tape makes it difficult for local producers to compete.
The Democratic Alliance will investigate this matter to ensure that job prospects for the people of Atlantis in the Western Cape and the manufacturing industry at large, are not ? brought to a standstill.
Beverley Schäfer MPP
DA Western Cape Spokesperson on Economic Opportunities, Tourism and Agriculture
083 598 3676