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Sat May 26 13:17:10 SAST 2012

Trade controls are cut from different cloth now

Deputy Minister of Trade and Industry Thandi Tobias, by e-mail | 09 September, 2010 00:18

Image by: Nigel Marple

Thandi Tobias: Jasson Urbach misrepresents the objectives of the South African government ("The great stitch-up" September 7) .

With the democratic breakthrough in 1994, South Africa moved from a capitalist economy to a mixed economy in which the state only regulates the market, but may also intervene in the economy by curbing uncompetitive behaviour - hence the establishment of the Competition Commission.

I remind Urbach that, in 2007, the government adopted a labour-intensive approach to industrial development with National Industrial Policy Framework which, with the investment targets put forward by the Industrial Policy Action Plan (Ipap), addresses the very challenges in the manufacturing sector to which he refers.

The government strengthens the productive side of the economy, not necessarily through quotas as he mentioned, but through leveraging public and private procurement to raise domestic production.

He alleges that the state decided to protect local manufacturers, but he fails to consider our competition policy, which clearly states that we need to address barriers to entry, and that the government protects the poor by strengthening regulations.

Furthermore, the South African Revenue Services is tightening custom controls by using indicative prices , especially in sensitive sectors such as clothing and textiles .

It is unfair to suggest that the tax imposed on clothing and textiles should be reduced: how then do we deal with protected imports? We need to lock out poor quality imports that undermine our production base.

The clothing and textile sector continued to lose jobs from 2000 to 2008, but there is an opportunity to recapture the domestic market share by improving competitiveness by focusing on product development, delivery efficiencies and harnessing the proximity of producers to local retailers.

The Department of Industry will support other departments such as science and technology, the CSIR, and so on. Lost jobs will be regained through this rigorous action plan if all stakeholders come to the party , and so the majority of South Africans stand to benefit from Ipap.

I call upon Urbach to engage with our department for clarity on this, and remind him that stakeholder consultation was made through Nedlac processes.

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