Minister of Finance and Economic Opportunities, Mireille Wenger, tabled the 2023/24 budget for Vote 12, Department of Economic Opportunities and Tourism (DEDAT), in the Western Cape Provincial Parliament yesterday.
Opening her address, Minister Wenger said: “We are determined, with unbridled passion, to achieve a better future, full of hope, through real, decisive action. Under the leadership of this Department, we have formulated a new Economic Growth Strategy for the Western Cape – the Growth for Jobs Strategy. Its vision for the provincial economy is one that achieves break-out economic growth to achieve sufficient employment and opportunity, and which is inclusive, sustainable, resilient, diverse and thriving, generating confidence, hope and prosperity for all. It is a privilege for me to table before you Vote 12’s Budget for Growth and Jobs today, with over R1.5 billion allocated over the 2023 MTEF.”
The Strategy sets seven priority focus areas for the Western Cape Government to unlock and enable growth, with ambitious stretch-targets that push for rapid change. These focus areas are energy, investment, exports, water, infrastructure, technology, and access to opportunity.
Speaking on DEDAT’s role in building energy resilience in the Western Cape, Minister Wenger said: “In Premier Alan Winde State of the Province Address last month, he made it clear that while electricity provision is not a provincial government’s mandate, we will not neglect our duty to our citizens during this time of crisis. We will step up and step in to help keep the power on. Because you don’t need a Minister of Electricity if your head of government leads from the front to get the job done. And so R1.1 billion has been boldly set aside in the 2023 MTEF to give power back to the people.”
For DEDAT, this includes:
- R55.5 million for alternative energy support for Small Medium and Micro Enterprises (SMMEs) in the province, to support them in mitigating the devastating effects of load-shedding. This support will be critical to helping businesses, including in township and informal economies, to continue to trade;
- R24 million over the 2023 MTEF has been allocated to the Green Economy Municipal Energy Resilience Strategy to continue to build energy resilience in municipalities across the Western Cape;
- The Green Economy Ecosystem Support project will receive an allocation of R25.9 million over the 2023 MTEF to stimulate the development of green industries and to facilitate improved resource-efficiency and sustainability of businesses in the Western Cape; and
- R60 million has been allocated over this time to the Freeport Saldanha and Wesgro for the development of Green Hydrogen.
“To enable higher levels of economic growth, we need much higher levels of investment – both domestic and foreign. We must do as much as we can here in the Western Cape to ensure that we roll out the red carpet for investors and land the investment we need to grow the economy and create jobs.” Continued Minister Wenger.
To do this:
- R36.42 million is allocated to Wesgro for Investment Promotion in 2023/24 so that we can attract, facilitate and land job-creating investments in the Western Cape;
- R40.90 million will be allocated to the Atlantis Special Economic Zone for Green Technologies for this upcoming financial year. I am pleased to announce that this entity will start the financial year with the delivery of civil infrastructure that will enable new investments in the zone; and
- As part of our focus on attracting investment, R9.4 million will be allocated to Freeport Saldanha for a Project Preparation Facility on Port infrastructure at the Port of Saldanha.
Speaking on plans to boost exports from the Western Cape, Minister Wenger said: “Despite numerous shocks to the economy, both at home and abroad, there has been a shining success story for the Western Cape economy over the last decade – booming export growth. When something is growing this impressively, you unlock and enable it further so you can leverage its full potential, and so enabling export-led growth is a top priority for the Western Cape Government and for this vote.”
Funding for boosting exports includes:
- R32.85 million will be allocated in 2023/23 to Wesgro to enable its trade promotion activities. Between April and December last year, these activities allowed for R2.5 billion in trade declarations to be signed;
- R5 million will be allocated in 2023/24 to the Export Competitiveness Enhancement Programme which will support businesses that are export ready or working towards being export ready to meet international market requirements, as well as invest in their own capacity to access exciting export opportunities.
- An Ease of Doing Business project focused on Exports will be established, with an allocation of R1 million in 2023/24 to map the red tape constraints for the top export commodities in terms of legislation, systems, processes and people and, accordingly, generate proposals to address those challenges by advocating for appropriate reforms.
These efforts to boost exports will be undermined if we do not have efficient Ports that allow for the quick processing of goods, and which attracts shipping lines from across the world.
“We will accordingly strengthen our dedicated Port of Cape Town team, within the Department, with additional human resources, and allocate R1.5 million in 2023/24 to support its work. We will also continue to advocate for private sector participation at the Port, and for it to be added as an Operation Vulindlela priority.” said Minister Wenger.
Growing our tourism economy:
Turning to the importance of tourism to the provincial economy and step that will be taken to support the sector, Minister Wenger said: “Like with exports, it is the policy of this government to further unlock and enable the enormous potential of the tourism and hospitality sector in the Western Cape, because more tourism means more jobs in the Western Cape.”
To achieve this goal:
- R55.98 million will be allocated to Wesgro for tourism promotion over 2023/24 financial year. This will include leveraging our successful Cape Town Air Access collaboration, which secured four new air routes and three new airlines between November 2022 and March 2023, and the Cape Town Cruise partnership, which confirmed 75 cruise ship visits to our Ports, carrying more than 195 000 passengers.
- We will also focus on a key enabler of the tourism economy identified by the tourism and hospitality sector themselves: skills. With a R1.5 million allocation in 2023/24 we will look to revive a provincial tourism skills forum with the aim of coordinating skills investment; we will help train 100 frontline workers in customer care; and we will recognize and celebrate service excellence through our annual Lilizella event and competition.
- Finally, in line with our legislative mandate, we will allocate R1.15 million in 2023/24 for the registration, development and monitoring of the tourist guiding industry in the province.
“Strengthening our tourism economy will also require tourism development in the province. I am therefore pleased to announce that we will launch in 2023/24 a R5 million Tourism Challenge Fund in the Western Cape,” said Minister Wenger.
This Fund will provide co-funding to enhance high-volume tourism attractions through tourism infrastructure development, and/or initiatives of tourism organisations working with tourism enterprises to enable businesses to enhance and expand their tourism offerings in areas with high growth potential.
VISA reform advocacy:
There is one key enabler that stitches through every priority raised and that is VISAs.
Speaking on the broken VISA regime in South Africa, Minister Wenger said: “If we cannot secure the critical skills our economy needs to grow or make it easy for new travellers to visit our beautiful country, we will not be able to secure high levels of economic growth.”
To begin critical advocacy for job-creating VISA reform in South Africa, R1 million will be allocated in 2023/24.
“As the Minister in this portfolio, I have the great honour to meet with small and micro business owners across the province. They embody precisely what we mean when we talk about the need for action, and the fierce urgency of now, because they demonstrate it every day. Too often, the foundations that they need to succeed are lacking, from funding, to electricity, from infrastructure to having to confront endless red tape. This is felt even more so in our township and informal economies, where additional factors such as crime impedes potential to grow and succeed.” Continued Minister Wenger.
Minister Wenger announced that the SMME Booster Fund will be continuing in 2023 with an R8.18 million allocation and that R4.61 million has also been allocated for the continuation of the 2022/23 Booster Fund projects for the year ahead.
Further announcements included:
- The Department will be collaborating with the Johannesburg Stock Exchange on a Small and Medium Enterprises acceleration programme, that targets growth orienteered SMEs, and which includes incubation and acceleration support as well as access to finance and market contributions. The Department’s contribution to this project is R1 million; and
- R3.5 million has been allocated for a feasibility study to understand the potential for a Venture Capital Credit Enhancement Fund in the Western Cape, that could provide critical early support for potentially scalable businesses, especially in the tech sector. If we can support these companies to survive and thrive, we can drastically increase investment and create jobs in our Tech Capital of Africa.
Technology & Innovation:
Another key enabler identified in the Growth for Jobs Strategy is technology and innovation.
To help businesses, especially small businesses to embrace technology a Business Tech and Innovation Support Programme, with a budget of R3.5 million in the 2023/24 financial year. We will target 100 SMMEs through a voucher scheme to encourage digital transformation and innovation, such as through e-commerce, digital marketing, search engine optimization, and website enhancements, amongst others.
Making it easier to do business in the Western Cape:
In the Western Cape we are determined to cut up even more barriers to growth, especially for SMMEs in the province.
To assist with this objective, we have allocated R13.31 million for the Red Tape Reduction Unit in 2023/24, with R43.51 million over the 2023 MTEF.
The focus of this team will not only be on dealing with case-by-case incidents of red-tape, but also on systematically identifying initiatives that could make it easier to do business across the province. A particular focus will be on helping remove regulatory barriers for the informal economy.
Skills development and improved access to opportunities:
One of the most powerful ways to improve access to opportunities is through skills development.
DEADT will therefore allocate:
- R99.19 million towards the skills priority in the 2023/24 financial year;
- R66.5 million is allocated to our Experiential Learning and Employment programme in the Business Processing Outsourcing sector, providing accredited training and internships to 4000 unemployed youth, as well as providing 3000 full-time jobs post internships.
- The Artisan Development Programme also receives R7 million in 2023/24 and aims to support growth and employment opportunities in technical, artisanal, and logistical related occupations through skills development and experiential learning initiatives.
- And our Work and Skills Programme will aim to support job creation in export-related sectors, including but not limited to manufacturing, through skills development and experiential learning initiatives. R4.63 million is allocated for this programme.
Concluding her speech, Minister Wenger said: “Our focus on Growth for Jobs is the Western Cape’s bold step towards realising a better future. It is the action we are taking now, for the future. We know what the Western Cape, and South Africa is capable of, if we enable the private sector’s success. We know that we can have a future full of hope. Now let’s get it done!”