23 FEBRUARY 2017
Chairperson, Dr Vuyo Mahlati
Executive Directors of Ivili Textiles
Representatives from various organisations
Members of the Media
Ladies and Gentlemen
It is an honour and a privilege for me to address this prestigious occasion this evening. The establishment of Ivili Textile is a very important milestone in our efforts to transform the economic landscape in South Africa. It is the culmination of many years of hard work towards the establishment of this groundbreaking initiative in the textile industry.
The textile industry is one of the most strategic platforms through which we can bolster trade of South African products. I am told that the Ivili Loboya was first established in 2015, as a Wool Processing Hub at Ibika Village in Butterworth, rural Eastern Cape. We are gathered here this evening to officially launch what is regarded as Africa’s first cashmere fabric manufacturer.
I must declare from the onset, Chairperson, that I would have preferred that this occasion takes place in Butterworth, your industrial base. It might be logistically convenient to host this event in the economic hub that is Johannesburg, but I believe that it would have held a greater significance if it was held in the rural areas that need development the most. If we were in Butterworth — eGcuwa, for instance, we would not only be talking about the potential impact of this initiative in abstract terms, but we would be able to point out tangible outcomes and evidence of how this initiative impacts on ordinary people’s lives.
This evening, we witness the growth of this project as we launch the Ivili Blended Textiles under the brand Dedani Collection. These are quality niche wools sourced from different South African sheep breeds with local cotton and wild silk from the North West province. It is inspiring to note that the launch of this initiative will also mark the signing of an agency agreement with an Italian retailer, an initiative that will expand your markets to Europe.
I believe that a project of this nature has a great potential to contribute significantly both in the development of an inclusive economy as well as in employment creation. The manufacturing industry is an ideal model for sustainable entrepreneurship. It encourages productivity, hard work and self-reliance.
You do not need to win a tender in order to be successful in this industry. The growth of your business is dependent on your productivity. These are the kinds of initiatives that add meaningful value in changing the current socio-economic conditions of the people of South Africa.
- THE CURRENT SOCIO-ECONOMIC CLIMATE
South Africa is part of the global village and the economic environment internationally remains volatile. We have not fully recovered from the pangs of the 2008 global economic downturn and most recently, we narrowly survived credit ratings downgrade. We are well into our recovery trajectory, but for our economic standing to be stable we need growth in trade and investment.
In his budget speech yesterday, my cabinet colleague Pravin Gordhan, Minister of Finance, alluded to the challenges that we face as the nation: “Economic growth is slow, unemployment is far too high and many businesses and families are under stress.” These dire economic conditions should be a matter of concern to all of us.
The negative growth in our economy manifests itself in the triple challenges of poverty, unemployment and inequalities. Rural communities are particularly vulnerable to these conditions and are in desperate need for social, economic and political opportunities to overcome these perennial challenges in our society.
Since 1994, the main challenge for rural development has been marginalization of the poor. An initiative such as this one is a very important intervention in bolstering rural economies and addressing some of our national imperatives. This is even more so in the manufacturing industry, which has suffered major deficits in recent years. The closure of factories and manufacturing companies over the past few years has robbed many people of employment and economic opportunities.
Manufacturing as an overall share of GDP has declined from 21% in 1994 to 13% in 2016. Similarly, employment continues to decline with 2.1 million employed in the manufacturing sector in 2008, falling to 1.68 million people in 2016. While manufacturing remains critical for industrialisation and for export earnings, we have not built strong black ownership and consequently there are very few black industrialists and manufacturers.
These socio-economic conditions require renewed vigour from government, business, labour and civil society in order to overcome our challenges and build a strong industrial base in our economic landscape. A healthy cooperation between the key stakeholders in the economic sector is what can change the living conditions of the poor and propel us forward as a nation.
- NATIONAL DEVELOPMENT PLAN (NDP)
Ivili Textiles with its strategic focus of promoting women participation, improving productivity through agronomic and development skills, as well as promoting entrepreneurship, contributes directly to the objectives of the National Development Plan (NDP). The NDP identifies trade as one of the key interventions to enhance growth of a more dynamic and inclusive economy.
The NDP envisages a South Africa where rural communities have better opportunities to participate fully in the economic, social and political life of the country. Our Vision 2030 includes integration of the country’s rural areas, infrastructure development, job creation and poverty alleviation.
For these noble ambitions to be realized, we need increased agricultural development based on successful land reform, employment creation and strong environmental safeguards. Business ventures that are based in such areas deserve all the support that we can give.
It is against this backdrop that ivili must be commended for their remarkable endeavour. As a small business initiative, we should find means of making sure that this initiative prospers and becomes a significant player in the business world. As government, we have adopted clearly defined policies and procedures to ensure that we support SMME’s and give first preference to black-owned businesses. We encourage local industries to foster international trade and investment in order to boost our economy.
Some of the key strategic interventions identified in the NDP include raising exports, improving skills development and investing in competitive infrastructure, among others. I believe that ivili speaks directly to these objectives and it can serve as one of the most effective and dynamic vehicles to take us to our Vision 2030.
- RADICAL SOCIO-ECONOMIC TRANSFORMATION
Distinguished Guests, the current administration is left with only two years to implement its programmes. Our delivery targets are articulated in the Medium Term Strategic Framework (2014 – 2019) which identifies 14 priority outcomes . We have not attained many of the targets in the MTSF and this requires change of strategy.
We must step-up and accelerate the pace of service delivery in order to enhance transformation in society. In this year of Oliver Tambo, a patriot who selflessly dedicated his life to the struggle for the liberation in South Africa, we must engage in very bold steps to change the lives of the people of our country.
One of the most definitive documents that capture the aspirations of the people of South Africa is the Freedom Charter, which states: “All people shall have equal rights to trade where they choose, to manufacture and to enter all trades, crafts and professions.”
More than two decades since the dawn of freedom and democracy in South Africa, many of the injunctions of the Freedom Charter are still not realized. The economy of the country is still in the hands of those who benefited from our divided past. It was in view of the slow pace of transformation and lack of inclusivity in the economy that President Zuma introduced the Radical Socio-Economic Transformation.
It must be clear that when we speak of transformation we are not only referring to the replacement of a white executive with a black one. Transformation is much deeper and more complex than that. It must address the spatial differences that are prevalent in our society. We have entered a more rigorous phase in our journey towards building a better and more prosperous South Africa.
The Radical Socio-Economic-Transformation builds on the previous interventions that were aimed at transforming various aspects the South African socio-economic landscape. Our transformative programmes are aimed at redressing the legacy of our divided past, economic exclusion, and gross inequalities, as well as restructuring the economic landscape to give opportunities to the marginalized.
Transformation must be visible in the lives of the most disadvantaged South Africans through the creation of new employment opportunities. The emphasis here is on fundamental change in the structure, systems, institutions and patterns of ownership, management and control of the economy by the disenfranchised black people.
- CREATING STRATEGIC PARTNERSHIPS
The NDP makes it abundantly clear that the achievement of economic transformation and inclusive growth will not result from a single intervention – it needs a wide range of contributions from a variety of stakeholders across society. The NDP makes this injunction in the following words: “Only through effective partnerships across society can a virtuous cycle of rising confidence, rising investment, higher employment, rising productivity and incomes be generated.”
It is pleasing and highly inspirational to note that Ivili Business Linkages has established a mutually beneficial partnership with the Council for Scientific and Industrial Research (CSIR) in the establishment of the Natural Fibre Hub in Butterworth. A partnership of this nature ensures that you expand your horizons and engender new markets both locally and internationally. Such an endeavour would contribute enormously to employment creation and in the development of an inclusive economy.
It is through collaborative efforts and healthy cooperation in the business sector that we can attain the goals of the NDP by 2030. Our estimation is that the rate of investment to the GDP will rise from 17% to 30% by 2030. Each and every endeavour to grow business contributes towards the achievement of these ambitious targets. The more successful local businesses we have, the better the economic standing of South Africa in the world.
There is a pressing need to address the spatial imbalances in economic opportunities in the business sector. In order to achieve this, we need to speed up the rollout of Black Industrialists’ Programme and allocate realistic targets that we will be able to monitor on a regular basis. We must strengthen the enforcement of competition laws to open up manufacturing value chains to new players in the industry.
Special focus to enhance skills and capabilities of rural women entrepreneurs with access to land and finance. Ivili is one of the most pragmatic initiatives that contribute to the ideals espoused by the NDP Vision 2030. There should be more initiatives like Ivili that boldly challenge the big players in the manufacturing industry.
I would like to once again, commend Dr Mahlati for this brave initiative. I am confident that your dream of becoming the leading natural fibre with wool and cashmere beneficiation enterprise for woven and nonwoven textile products in the whole of Africa will become a reality.
I wish you more opportunities, growth and prosperity in this venture. Makwande!
Issued by:Department of Planning, Monitoring and Evaluation