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BUDGET SPEECH SUPPLEMENTARY 2019/ 2020

30 JULY 2019

Department: Economic Development, Tourism and Environmental Affairs- PROVINCE OF KWAZULU NATAL:  BUDGET SPEECH SUPPLEMENTARY 2019/ 2020

To date, 104 cooperatives have been trained in carpentry, baking, crop farming, stock farming, hand and machine sewing technical skills, and 45 in business management skills.

Invasive Alien Species Programme (IASP): The programme has been able to achieve and exceed all targets that were set for the 2018 /2019 financial year. The main programme has been able to achieve a total expenditure of R 35 970 164.60. A total of 2 357 people were employed in the programme in ten district municipalities during 2018 /19 financial year.

Strategic Major Events and Partnerships: We have hosted a number of high profile events, individually and in partnership, such as the BRICS Business Council, Fourth Industrial Revolution, Forbes Africa Women Leadership Summit, Tourism Africa lndaba and International Congress and Conventions Association (ICCA). These events elevated the profile of the Province and Durban to such an extent that our hotel occupancy rate has been above national average during the fourth quarter of the last financial year.

Through Tourism KwaZulu Natal we have partnered with a number of airlines and tourism trade to promote affordable travel into the Province in order to encourage a culture among a majority of South Africans who view travel as unaffordable. International tourist arrivals into KwaZulu Natal grew from 812 513 in 2017 to 817 388 in 2018.

Liquor Authority: The entity currently has approximately 6900 active liquor licensed traders in the Province. Each license issued translates to a conservative average of 2 jobs per license Hence we have an estimated 13 800 jobs indirectly created through the licensed outlets. In line with our effort to digitize our operations, KZN Liquor Authority has launched a new liquor licensing system which allows for the automation of the liquor licence application processes with the aim to rollout an online application facility in a near future.

WHO IS NOMUSA DUBE NCUBE?

Honourable, Nomusa Dube Ncube is the Member of the Executive Council responsible for Economic Development, Tourism and Environmental Affairs; having served as a Member of the Executive Council for Cooperative Governance and Traditional Affairs for 2 terms since 2009.

She holds a Master’s degree in Public Administration from the University of KwaZulu Natal and is currently studying towards her PhD. She serves as a Member of the KwaZulu Natal Climate Change Council and also as a Board Member for the 911 Fund a New York based Non- Revenue Organisation, established by former US President Barack Obama in the wake of one of the most devastating disasters in modern history and human development, the aerial attack on the landmark Twin Towers in New York in 2001.

Apart from providing strategic policy direction for the department as its political head in this portfolio, Honourable Dube - Ncube has also assumed the critical position of being the Leader of Government Business within the Provincial Government of KwaZulu Natal. In this position she will oversee the day to day running of the provincial government as it discharges its constitutional mandate. More critically, in EDTEA, Honourable Dube - Ncube is charged with ensuring that the province's economic growth is sustained from SMMEs to big business and industries. Also that as the prime destination for tourism, KwaZulu Natal retains its pole position while striving for way to create more products.

Also topping her agenda is the issue of environment; its sustainability of the ecosystem as well as the wild life. She has already demonstrated her passion for the environment in her previous deployment where utilised every platform she got to highlight the negative impact of climate change on the environment and communities. She has been piloting policies that emphasise the radical shift from unsustainable economic practices to eco-friendly business operations. Her previous tenure was that of Chief Whip of the ruling African National Congress ANC in the KwaZulu Natal Provincial Parliament.

She has also served South Africa as its Ambassador to the Czech Republic. Honourable Dube -  Ncube is also a former Mayor and Speaker of South Africa's second largest city and economic hub Durban. She is a seasoned local government practitioner and policy maker.

KWAZULU NATAL POISED TO TAKE ADVANTAGE OF THE BOOMING CANNABIS MARKET: There has been a great interest and excitement over cannabis cultivation naturally sparked by a 2018 Constitutional Court ruling that legalised the growing of the plant for, inter alia medicinal purposes. EDTEA MEC Nomusa Dube - Ncube is equally excited by this as it brings immense economic opportunities and prospects for SMMEs and small scale growers who grow authentic cannabis in many parts of the province.

You may be aware also that the province has an ideal climate for the cultivation of cannabis and many KZN farmers would benefit from licenced cannabis cultivation. On the backdrop of this excitement the department will use every opportunity to assist those growers with a capacity to cultivate and produce cannabis using legal means. We are also helping our farmers with a cultivation licence and to some extent an extraction licenced for those with a capacity to produce bi products.

Just this week KwaZulu Natal EDTEA MEC Dube - Ncube received and hosted investors from King Kong Organics KKOG from abroad who are looking into investing in the Dube Trade Port AgriZone. The $5 million R70 million investment has the potential to create not only jobs but a huge value chain in the industry that will also help the already existing small growers with a market. However, more emphasis is on the local growers, production and market. According to the United Nations South Africa produces around 2,500 tons of cannabis per year and a significant portion of that is grown in KZN.

In the last financial year, EDTEA finalized the provincial Coastal Management Policy and Coastal Management Programme implementation plan. The plan provides for the development of coastal management lines which indicate the relative risk exposure along the coastal zone in relation to sea level rise and coastal storm surges.

The plan will serve as a guide for future development of projects along the KZN coast. The oceans economy is key to our success as a province. A large number of jobs can be created from the ocean through fishing, aquaculture, coastal management, cruise tourism, ship building and repair. In 2019 20, we are planning to create 1 057 jobs through our interventions in the blue economy.

 In this regard, the following specific interventions will be implemented: Aquaculture Development Zone Amatigulu establishment: Environmental Impact Assessment study; establishment of a fish processing facility as a means to add value to the aquaculture and fishing industry in the Province thus creating 700 jobs; a designated area for boat builders and suppliers to be located and operate leverage economies of scale 1 feasibility study; Support of 31 Small Scale Fishing Communities along the coast of KZN to commercial fishing thus creating 155 jobs: working tools provision; Oil Refinery establishment: feasibility study is currently underway by a private investor Gas Hub development which will create 200 jobs.

 SPECIAL ECONOMIC ZONES SEZs AND INDUSTRIALISATION: KwaZulu Natal has two Special Economic Zones; namely Dube Tradeport in Durban and the Richards Bay Industrial Development Zone in King Cetshwayo. These are two highly developed precincts which continue to attract billions in investment for the province.

During industrialisation we are targeting to create 4 284 jobs with a prime focus on increasing localization. Our interventions in this area will yield R10.6 billion worth of investments. We are indebted to the following institutions that will help us achieve these goals: DTPC will create 2,384 permanent industrial jobs and R8.3 billion worth of investments over the MTEF across all of its precincts. This includes the R1.3bn Mara Phone investment with an estimated 1500 jobs over 5 years in two phases. Mara Phone is the first African designed and manufactured smart phone. Manufacturing will commence in September this year.

RBIDZ will create 1500 jobs and R2.2 billion worth of investments in manufacturing through Palm Oil Refinery and Chemical Production Plant. The strategy around proposed oil and gas hub in Richards Bay is progressing well targeting oil and gas supply.

Ithala Development Finance Corporation will create 300 jobs and R40 million worth of investments in manufacturing through industrial parks and Gambling Board will create 100 jobs and R100 million worth of investments manufacturing of gambling equipment.

ECONOMIC PLANS TO RE IGNITE THE KZN ECONOMY: In the next five years, EDTEA will be embarking on radical measures to encourage investments to our province. Our key focus areas will be in the opportunities in the ICT sector as presented by the Fourth Industrial Revolution, green economy, manufacturing and buying local to stimulate industrial sustainability, we will attend to the township and rural economic landscape, support the empowerment of SMMEs and Cooperatives especially in townships and rural areas. EDTEA has plans to position the province of KwaZulu Natal as a technological hub in order to harness the fourth industrial revolution. identifying ICT and technology in general as a sunrise sector, it does not mean that we should completely shift our focus from other sectors around which the provincial economy is anchored.

WHAT DID WE DO IN THE PREVIOUS FINANCIAL YEAR?

Radical Economic Transformation Summit EDTEA held the Radical Economic Transformation Summit on 28 29 March 2019 attended by representatives of government all spheres, private sector, civil society and business forums. Flowing from the summit, we are taking decisive action to deal with the issues of site invasions and business disruptions that have become rampant in the province.

Investment Conference:  We convened this conference on 12 October 2018. The KZN event provided a platform to handover the KZN Investment Opportunities handbook to the Presidential Envoy on Investment.

The handbook contains an estimated US$19,1billion approx. R260 billion investment opportunities that have the potential to create in excess of 800 000 construction jobs and 415 000 permanent job opportunities once committed. Funding for Black Industrialists We have tasked the KZN Growth Fund to be the leading Development Finance Institution to work with the Department of Economic Development in the identification and co funding projects promoted by Black Industrialists. To date, both parties have co funded projects with a combined project value of R790 million within the Province to date. In total, the projects have created about 1 200 job opportunities.

Business Retention and Expansion: Through our interventions aimed at business retention and expansion, we envisage that 3 170 jobs and R2.1 Billion worth of investments will be retained created in the Province. These jobs will be created mainly through the following institutions: Trade and Investment KwaZulu Natal TIKZN will retain investments and jobs to the value of R1 billion and 2500 respectively;

Ithala Development Finance Corporation IDFC will retain investments and jobs to the value of R0.5 billion and 240 respectively; and Maritime KZN Sharks Board entered into an MOU with Mediterranean Shipping Company to train 3 500 cadets.

Enterprise Development: In line with our commitment to support SMMEs and Cooperatives: Ithala Development Finance Corporation IDFC disbursed loans to the value of R379.85m in 2018 19 to these enterprises. This funding was provided to 750 entities and has enabled facilitation of 3 457 job opportunities.

FUN TVET Colleges to Train Cooperatives: EDTEA is pleased to report that EDTEA entered into a contract with all KZN TVET Colleges to train cooperatives in technical and business management skills in all eleven district Investment Attraction We aim to attract collective investments to the value of R4.1 billion thus creating 7 000 jobs in all the districts throughout the province. These jobs and investments will be created mainly through the following institutions: TIKZN will attract investment to the value of R2.2 billion thus creating 3000 jobs KZN Growth Fund will finance investment to the value of R200 million thus creating 500 jobs These investments will be attracted to all the districts of our province. However, the lion share of investments in 2019/ 20 financial year will be going towards the following districts: eThekwini, uMgungundlovu, iLembe, King Cetshwayo, uGu and Amajuba. Film Industry: The KZN Film Commission will create 300 temporary jobs through KZN Film Fund of R1 m through leveraging additional funding to four times the value. Furthermore, 10 films are being developed and produced through our collaboration with Nigeria, Kenya and the minorities in the UK through co-productions to the value of R63.7m.

Export Promotion: Through our intensive export promotion interventions and programmes we intend to facilitate the export of R384 million goods and services thereby creating retaining 2 240 jobs.

OPENING THE DOORS OF RADICAL ECONOMIC TRANSFORMATION: Operation Vula in the coming weeks, the Department will launch its much awaited Operation Vula Fund.

The following interventions from the Operation Vula implementation plan will be implemented during this financial year and it is estimated that 800 jobs will be created as a result: Penetrating clothing and textile value chain opportunities with potential to create 300 jobs; Revitalization of townships & rural businesses: Digital business, Franchise, Waste Management. Operation Vula bakeries projects thus creating 200 jobs Supporting furniture manufacturing projects thus creating 200 jobs.

Youth placement technical training program various sectors: Women in construction and engineering thus creating 100 jobs Operation Vula is implemented throughout the Province. The main beneficiaries will be youth, women, local entrepreneurs, cooperatives and SMMEs. We are spending R27 Million from the fiscus.

Radical Agrarian Socio Economic Transformation RASET The RASET model is aimed at opening up opportunities along food production value chain including farm produce supply by under privileged farmers and emerging agro businesses. It also seeks to create an alternative value chain in order to bypass structural barriers associated with the existing value chain.

The following interventions from the RASET implementation plan will be implemented during this financial year and it is estimated that 680 jobs will be created as a result of investing in the following assets: 2.7 ton Refrigerated Truck delivery X6 1.7 Mesh wired truck X 3 4X4 Toyota bakkies 1.ton with trailers X6 Pack house agro processing facilities We will source products from 300 historically disadvantaged farmers 1 500 hectares of land will be planted.

OUR MARCH INTO A DITIGALLY INSPIRED FUTURE: We are marching full steam ahead into a digitally inspired future. Research has shown that South Africa and by extension our province has one of the highest cell phone penetrations rates in the world which means that technology is, indeed, a part of an everyday experience for our people. We no longer imagine a past without market transfer enablers such as e wallet, cash send.

The advent of the 4IR has meant that jobs especially in the financial sectors like banking have been affected. Banks are retrenching due to the advancement in financial services technology. More than ever, we hardly have a choice, we have to bring our people on board and to connectivity. This will include vendors selling data, handset repairs, APPs development.

We are also building a high speed broadband to lower power wide area network to connect all things We are also enhancing the Dube Trade port cloud computing facility to host the new applications and systems that will be built by our people;

OUR BUDGET AT A GLANCE PROGRAMME 2019 /2020:  R'000 Administration R305 476 Integrated Economic Development Services R442 746 Trade & Sector Development 945 705 Business Regulation & Governance 176 463 Economic Planning R43 366 Tourism Development R288 997 Environmental Management R1 045 385.