REMARKS BY MINISTER STELLA NDABENI-ABRAHAMS NATIONAL ASSEMBLY DEBATE: TRANSFORM THE ECONOMY TO SERVE THE PEOPLE

 

Monday 19 FEBRUARY 2019

 MEDIA RELEASE

For Immediate Release

Thomas Pikkety says “When inequality gets too extreme it becomes useless for growth and can even become bad because it tends to lead to high perpetuation of inequality over time and low mobility”. This translates to stagnation or slow growth in the economy especially in an economy that lacks inclusivity as is the case in South Africa today.

Our economy was historically defined in and around the minerals-energy complex which has led to South Africa having an economic growth path characterised by a monopolistic market structure and highly racialised patterns of ownership.

It is this legacy of apartheid colonialism that has resulted in the concentration of wealth in the hands of a few as well as high levels of inequality, unemployment and poverty for the majority. Inequality is a burden borne by black people in the main and this inequality has made it difficult and near impossible for citizens and young black entrepreneurs who have no collateral, to access funding.

It is important for Honourable Members to understand that network industries such as electricity, water and telecommunications infrastructure in this country were designed to serve a minority that believes that it is better than everyone. In 1994 only 19 million plus citizens had access to electricity out of a population of 38 million people under a system of legalized exclusion. What we have today to serve all South Africans has been extended to accommodate and service those that were not serviced in the past. Having inherited a bankrupt state, it would always have been difficult to balance all priorities on an equal basis over a 25 year period.

These are the fundamental problems that the ANC-government has sought to confront and resolve since its ascendance to power. We have since 1994 initiated a number of interventions aimed at a fundamental change in the structure, institutions, patterns of ownership, management and control of the economy in favour of all South Africans.

We have driven a comprehensive programme to broaden access to key infrastructure including electricity, water and the communications infrastructure. We have further introduced various Industry Transformation Charters, empowerment funding institutions such as the National Empowerment Fund, SMME funding and support initiatives and the Black Industrialist programme; that is there to enhance manufacturing to the black people that you have deprived.

We have made some progress but the fundamental challenge of the monopolistic market structure and racialized ownership patterns remain persistent. It is this understanding that underpins our approach to the Fourth Industrial Revolution and the Digital Economy that we seek to build.

Our approach seeks to place people at the heart of the 4IR conversation in-line with our historical call to “Transform the Economy to Serve the People.” This will only be realised when we all strive to build a capable 4IR Army.

In order for this army to be effective, there is a need to change legislation and regulatory frameworks which were previously voice-oriented. We will therefore put in place legislative and policy frameworks that respond to the data-centric environment.

With the reconfiguration of the Ministry, it has become imperative for us to reposition the departments to play a significant role in increasing the sector’s contribution to the GDP. We therefore need to invest in technology, skills, manufacturing capacity and create an environment for innovation to thrive.

Honourable Speaker, a people centred response to 4IR speaks to jobs, skills and broad economic participation, it speaks to deconcentrating, improved competiveness and transformed ownership patterns. In short, it has to be an inclusive digital economy.

This is fundamental to our 4IR response, hence our 2019 election manifesto commits us to “ensuring that more women, rural people and the youth will be drawn into the economy through expanding access to digital skills training, developing tech and digital start-ups and a more concerted effort on SMMEs, co-ops and village enterprises.”

Honourable Members,

Most people talk about the Fourth Industrial Revolution in a sceptical manner as it has been projected as this animal that will swallow their jobs. Ours is to demonstrate that the benefits far exceed the magnified negative impact as Naom Chomsky says of some technological advancements over the past few decades, “the internet could be a very positive step towards education, organisation and participation in a meaningful society.”

Going through a study by Accenture (2018), one discovered that South Africa can unlock more than R5 trillion in value over the next decade through the use of digital technologies in key industry sectors, such as agriculture, mining, financial services and manufacturing.

The study further argues that “Digital transformation of government services is likely to create the highest value for society through its impact on economic activity, productivity and service delivery; and that the digitisation of public infrastructure maintenance, public administration and healthcare alone can add over R1,2 trillion over the next decade.”

The biggest task facing us as a nation is how to build a capable 4IR Army that is required by the new industries and technologies.

At the centre of our response therefore is a massive skills development programme. Our education system from primary school must begin to include these critical technology skills, our universities and TVET colleges must prioritise the development of these skills. Through our rollout programmes such as the broadband infrastructure programme, we are enabling skills and technology transfers to SMMEs.

Honourable Members, Since announcing our noble ambition of training one million young people on various technology skills by 2030, as the sector we have trained over 20 000 young people. These training interventions are focused on programs such as coding, robotics, Internet of Things, amongst many others.

Achieving this vision is no small task; it requires coordination of efforts by government, public sector, private companies and civil society. President Ramaphosa further affirmed this view in the SONA that, “in line with our Framework for Skills for a Changing World, we are expanding the training of both educators and learners to respond to emerging technologies...”

The collaboration with the Department of Basic Education as started in 2013 has resulted in public schools in rural and underserviced areas receiving fully equipped ICT-labs through an amendment of license obligations for mobile operators. This was taken further by Minister Angie Motshekga who announced the phasing-in of a comprehensive Information and Communication Technology programme.

It is in this regard that NEMISA will be transformed into a key digital skills academy for both public servants and our communities.

Honourable Members, South Africa suffers from the Big Four syndrome where almost every industry or market is dominated by four big players. As we seek to grow the economy and unlock opportunities presented by the digital economy, it is imperative for the market to be opened up for SMMEs and to break down existing barriers to entry.

As the president mentioned in his State of the Nation Address, we will soon issue a policy directive to enable ICASA to license high demand spectrum. This directive will provide a legal framework for the allocation of the spectrum to the private sector and other industry players. Plans to fast track digital migration are at an advanced stage.

Noting the impact of high data costs, the ANC-government through ICASA is in a process of finalising the End-User and Subscriber Charter Amendment Regulations. These regulations will amongst others compel operators to provide consumers with an option to opt-in or out of, out-of-bundle data billing. Data subscribers are now also receiving usage depletion notifications. Oko kuthetha ukuba umaMfene uzakukwazi ukuthumela i-data kwintombi yakhe esesikolweni.

Honourable Members, South Africa currently has different 4IR elements spread across government departments, state entities and the private sector. However, there is no coordination and collaboration for effective execution.

To address the above challenge, President Ramaphosa established the Presidential Commission on 4IR. This commission will therefore serve as a national overarching advisory mechanism on digital transformation.

In collaboration with the private sector and academia, we will also host a digital economy summit in March 2019. The Summit seeks to develop a coordinated country strategy and execution plan for the 4IR.

Honourable Members, There is always fear of the unknown and unchartered grounds. It is a human response. But what we are blessed with as the human race is the power to think and plan. The human power to come together and achieve unimaginable goals. The government leads and serves the people but the most functioning government serves and works hand in hand with the people in building a better world.

In building, we have tools provided. No man works alone. No government works alone. We collaborate as a people, support each other and share skills. We even learn and discover what we can do together.

We use all our platforms, our resources to co-ordinate and build our country. Starting with the youth. When that is done the execution will go smoothly.

Honourable Chairperson, I thank you.


Ends

Enquiries:

Milisa Kentane, 0640756 0260, kentanem@sentech.co.za