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Presentation to Parliamentary Committee Hearings 26 August 2011

SUBMISSION ON THE MINING CHARTER by the SA Capital Equipment Export Council and The Manufacturing Circle. Presentation to Parliamentary Committee Hearings 26 August 2011. Agenda. Who we are Need for transformation AND job creation in our country Benefits of supporting local manufacturers

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Presentation to Parliamentary Committee Hearings 26 August 2011

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  1. SUBMISSION ON THE MINING CHARTER by theSA Capital Equipment Export Council and The Manufacturing Circle Presentation to Parliamentary Committee Hearings 26 August 2011

  2. Agenda • Who we are • Need for transformation AND job creation in our country • Benefits of supporting local manufacturers • A suggested basis for adapting the Mining Charter • Contacts

  3. Who we are • SA Capital Equipment Export Council • Focus on assisting SA manufacturers of Capital Equipment expand globally • Public Private partnership with The dti • The Manufacturing Circle • Focus on issues of common interest across all manufacturing sectors • Members are companies across size and sub sector spectrum • Focus on stemming de-industrialisation, aligning micro and macro economic policy and preferential procurement • Regular interaction with The dti, EDD, Treasury, SARB, etc

  4. Need for transformation AND job creation in our country • We fully support the need to redress imbalances created by the past unjust system • However biggest current threats to our country are: • Unemployment • Poverty and • Inequality • Most jobs in our sector are not highly skilled as mainly labour intensive so direct relationship between job creation and poverty reduction; up skilling results in reducing inequality

  5. Benefits of supporting local manufacturers • Imported equipment use little or no SA materials, has not been designed in SA and are assembled using foreign labour and the profits go offshore • Locally manufactured equipment was probably designed using SA ingenuity, almost definitely is adding value to SA produced minerals and is fabricated and assembled using SA skills. • Besides the direct employment there are the additional benefits of indirect employment and the multipliers of local economic value add.

  6. Benefits of supporting local manufacturers (cont) • Bell takes steel at R10,000 per ton and transforms it into R90,000 per ton. We are labour intensive and have low levels of mechanisation (no robots) • Each additional ADT per week employs 40 more people directly and many more indirectly, through the local supply chain. • If economic multipliers and dependency ratios are factored in then probably 2000 people are able to move off grants and out of poverty • This mainly in Zululand where jobs are scarce

  7. A suggested basis for adapting the Mining Charter • Amend “sourcing locally” to “sourcing locally manufactured” • Give companies the ability to earn bonus points for buying locally manufactured • Penalise companies that buy imported when there are locally manufactured products available • Align with The dti BBBEE Codes as much as possible and with Treasury Preferential procurement policy

  8. Contact details • Happy to provide further information • Guy Harris • guyh@bell.co.za • 0825598755 • 0119289841 • Skype: guyharrissa • Please come and visit our plants and meet our people

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