Speech Delivered by the Deputy Minister of Trade And Industry, Ms Nomalungelo Gina at the Social Economy Green Paper Stakeholder Consultative Session in George on 29 October 2019

DDG Dr Molefe Pule.
Dr Geraldine Reymenants, representing Flanders Government in SA.
The leadership of the Municipality.
The representatives of stakeholder’s organisations.

Ladies and Gentleman.

It with great pleasure that we are here today to listen to you as part of a wider stakeholder consultation across the country on Social Economy Policy. As the Department we are consulting on this policy draft because we want to make decisive intervention on these types of the economic activities that are more often regarded as inferior and survivalist in nature.

Having sat and listened to the contributions made by stakeholders today, I have no doubt that the urgency of legislating around this economy is long overdue. We are pleased that you have set aside other engagements today, in order to make qualitative inputs to the drafting process that we are doing within the context of the green paper for Social Economy.

Social economy sounds like a new term in South Africa but these social economic survivalist activities have been with us, since time immemorial. Stokvels, burial societies and cooperatives  for an example, have been identical with the informal economy of the rural communities and townships. It is through these, that many of our families have been surviving, putting food on the table in the mist of poverty and sending their children to schools. Because of apartheid economic exclusion of the non-whites, it is by no accident that the Black Africans, Coloured and Indians survived through social economy. Black men were forced to Labour migratory system in the mines of Johannesburg and Sugarcane field industries of KwaZulu-Natal for pittance, whilst women were uniting themselves through Stokvels, Burial Societies, Agricultural group crop productions to survive with children.

In a liberated country that is led by a government whose ruling party was a mouthpiece of those that were oppressed, it stand to reason that such social economies must thrive and be supported by the state. A responsive government of the people cannot turn a blind eye in what sustains the people; a responsive government has to consolidate these social economies into sustainable economic benefits and unblock any regulatory obstacles to their growth and survival.

I am particularly excited by this policy intervention because it is the women in our villages who are going to benefit a great deal in the formalization, upgrading of, and including mechanisms to access finance, both in government and private financing institutions. Of interest to me, is that such economies are not of a high skilled demand, but accommodates those that are found in the fringes of privilege and formal enterprises.

As the dti, we are all-out in activating all economic sectors and economic nodal points in the country. We are putting a lot of our energies on the growth and attracting bigger investments into Special Economic Zones in strategic regions in all provinces. The SEZs, with their strategic business regimes designed to attract local and foreign direct investments are a surest catalytic economic outposts that will generate the required jobs of the modern economy whilst increasing the provincial GDP percentage share to our economy.

Related to the above, is our revitalization programme of the Industrial Parks that many of them had collapsed into the ghosts and shadows of their former selves. Industrial Parks were an important zonal concentration of firms and manufacturing companies, generating diverse products for the economy. These Parks had a concentration of high Labour force and because of that, small towns and settlements were born out of their existence.

If we are to ratchet up this economy; if we are to aspire to increase our 3-6 percent growth rate target as a country, and if we are to reverse the bugbear of unemployment we need to be deliberate in leveling all the playing fields whose outcomes will result in growth, employment and prosperity.

It is in the above context that Social Economy must be understood as part of these all-out interventions we are making. No sector or sub sector that plays a role in our economy must be left behind. Informal economy plays a crucial role and it is a contributor to the growth levels of the country despite being seen as playing outside of the defined formal accountable systems. I am happy that our team has dedicated a lot of time in studying international experiences in various countries, especially the third world countries who have a strong Social Economies in their backyard. Government in these countries have long put up policy frameworks as protective mechanisms for Social Economic sector. I want to thank international bodies like Flanders government, British Council and other bodies working with us in this regard.

The green paper we are consulting on cast the scope wide in an inclusive manner. I am hopeful that as we engage here, everyone will have his or her institutional type accommodated. Amongst these institutions we seek to include in the legislation are as follows:

  1. Cooperatives.
  2. Stokvels.
  3. Trade union owned enterprises [like Union cooperative banks].
  4. Community based enterprises.
  5. Non-profit organisations.
  6. Non-governmental Organisations.
  7. Foundations.
  8. Philanthropy organisations
  9. Social financing organisations.

And many more that are falling within the ambit of social economy definition.

We are hoping that by the end of 2020, this policy would have been signed into law by the President. This ambition presupposes our pace and urgency  as the Department in doing our work around this policy, so that a parliamentary process begin soon.

Thank you.

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