New body to stimulate infrastructure localisation

25 April 2014

A new business association has been formally launched to link foreign suppliers of equipment to State-owned companies (SoCs) with large and small domestic companies in an effort to improve prospects for higher levels of local content in South Africa’s multibillion-rand infrastructure programme.

Known as the Industrialisation Supplier Development Association (ISDA), the organisation was unveiled in Sandton this week, hosted by SABC 2 and The New Age newspaper and addressed by Public Enterprises Minister Malusi Gigaba.

The initiative emerged following a supplier development summit in 2013 and Gigaba said it was designed to support government’s plan to use the ongoing infrastructure programme to stimulate industrial development and the creation of black industrialists.

South Africa planned to invest R827-billion on energy, transport, water and social infrastructure over the coming three years and higher levels of local content were already being stipulated in tenders being issued by SoCs such as Eskom and Transnet.

In addition, government had adjusted regulations associated with the Preferential Procurement Policy Framework Act to enable it to designate goods and services that must be produced locally to be considered for purchase by government and the SoCs.

“We will change the discourse on transformation when we no longer focus only on tenders and begin to put in place the framework for deeper and more meaningful [economic] transformation that helps build black and women industrialists,” Gigaba said.

ISDA chairperson Thabiso Taaka said the organisation had been structured in such a way as to ensure the inclusion of small businesses and to put both small and large South African manufacturers in contact with the original-equipment manufacturers (OEMs) looking to increase their domestic sourcing.

By: Terence Creamer
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