Hon Chairperson, hon members of this august House, hon Ministers present, Minister Davies and Minister Patel and their Deputy Ministers, hon MECs present, Cllr Mafefe, DGs and HODs of various departments, distinguished delegates, and ladies and gentlemen, I rise to confirm not only the correctness of the two Budget Vote speeches but also their relevance and, more importantly, their ability to respond to the socioeconomic challenges faced by our province and similar, predominantly rural, provinces. We therefore want to heartily thank hon Ministers Patel and Davies respectively, as well as the entire collective, for steering the macro and micro policies of this country in the right direction.
Our considered view is that we have to take the changing international conditions into account, particularly the ongoing global financial crisis and the reality of a new global economic recession. Their impact on our domestic economy, through a slowdown in production, potential job losses and rising prices, cannot be ignored.
Both the Economic Development and the Trade and Industry Budget Vote speeches raise a number of obligations which rest on all three spheres of government and their social partners. Allow me to single out a few economic directives and how we as a province are responding to them.
The Mpumalanga provincial government has customised the national New Growth Path framework for the province. That process resulted in the crafting and subsequent adoption of the Mpumalanga Economic Growth and Development Path by the provincial executive in November 2011, after a laborious and tedious process of stakeholder consultation.
Our growth path focuses on five strategic sectors, namely the agriculture and forestry value chain; mining and mineral beneficiation; manufacturing and value-added activities; tourism and cultural industries; and the two emerging sectors of information and communications technology, and the green economy.
Over the last six months we have been focusing on developing a comprehensive programme of action for the implementation of our growth path, which spells out our implementation priorities and guides stakeholders in working together.
Regarding employment, the provincial economy did reverse the trend of job losses. In the fourth quarter of 2009-10, the province experienced a net loss of 34 000 jobs. However, in the fourth quarter of 2010-11 the province experienced a net gain of 47 000 jobs, which translates to just over 3 900 jobs gained every month. This represents a 5,4% increase in the number of people employed from the previous year. This represents the highest rise in employment over the past year of all the nine provinces in percentage terms, although not in absolute terms. The Minister provided the absolute ranking figures earlier.
The official statistics show that Mpumalanga's regional gross domestic product grew by 2,5% in 2010, reversing the negative performance of 2009, when it shrank by 1,7%. Independent projections by IHS Global Insight predict stronger growth, to the level of 2,8%, in 2012. This comes in the wake of the modest recovery by the global economy, as well as the slowdown in growth in China and most Organisation for Economic Co-operation and Development countries.
We need to appreciate Mpumalanga's heavy dependence on the international economic environment. The major sectors of our economy that contribute to gross domestic product per region, GDPR, for example mining and manufacturing, are primarily dependent on global consumption by the developed nations in industries that are linked to metals, energy and petrochemicals. It is in this light that Mpumalanga's economy is even more vulnerable to global turbulence when compared to other provinces. For these reasons we are focusing on value-added beneficiation and industrialisation.
Regarding critical milestones towards job creation, as I said, we will be finalising our Mpumalanga Economic Growth and Development Path, MEGDP, programme of action in due course. The intention is to develop a business case for each proposed project, for purposes of mobilising the necessary resources from across the board. Secondly, we are engaging with the municipalities to ensure better integration and better alignment with the LED plan, containing the IDP, to enhance alignment with the provincial growth path.
In 2010, we merged three of our economic state-owned enterprises and the mandates of these agencies were reconfigured to focus on the implementation of the growth path in regard to skills transfer, training and mentoring of co-operatives and small enterprises. We are convinced that the SMMEs and co- operatives in Mpumalanga constitute the bedrock of our provincial economic growth.
We appreciate the launch of the ambitious infrastructure plan by Cabinet. It couldn't have come at a better time. As a province we will complete our provincial infrastructure master plan this year. The plan will most certainly be aligned with the National Infrastructure Plan. We hope our plan will transform the economic landscape of our province and the country, create a significant number of new jobs, strengthen the delivery of basic services and support regional and subregional economies.
For us in Mpumalanga, if we are to contribute to the national effort, we will need to invest heavily in rail and road connectivity, and in optic fibre and ICT infrastructure. We will also need water and skills on our doorstep to do business more cheaply and efficiently.
Last year the province conducted two outbound missions, namely to Indonesia and Oman, and follow-up engagements are in progress in relation to a number of projects that we wish to package for investment commitment and roll-out. A feasibility study is currently being undertaken for the establishment of a fresh produce market in the province. This is intended, among others, to serve as a gateway to the Middle East market and to support the development of both small-scale and large-scale commercial farmers in the Mpumalanga, Limpopo, Swaziland and Mozambique nexus.
I must also hasten to add that on the tourism front we have already signed a trilateral agreement with Mozambique and Swaziland, aimed at ensuring that these countries become tourism destinations of choice in Africa and the diaspora. What remains critical in the successful integration of our province with our neighbours is a spatial development plan that works, which connects us with Mozambique via rail, pipeline and optic fibre, and even through the human elements of cultural and educational exchange and interaction.
We have adopted a comprehensive rural development programme. This is the province's flagship programme for responding to the plight of the rural poor masses in seven of our marginal municipalities. We will do so by focusing on development and support of co-operatives and SMMEs. We will use this programme to unlock the economic potential of these rural areas and hope to connect these rural and second economies to the first economy.
Notwithstanding what other members have said here before me, practical assistance has been given to 184 co-operatives in agriculture, manufacturing, construction, and so forth. As a result, during the last financial year we created 13 000 jobs in the seven marginal municipalities and youth have been skilled in various trades in these CRDP areas. We did not stop at only encouraging the formation of cooperatives, but we also facilitated their access to markets. The provincial government was the first customer for all these co-operatives. In the previous financial year we spent R1,7 billion in these seven municipalities. In this financial year we are hoping to ramp this up to over R2 billion. To this end the province has developed a provincial procurement policy for government, aimed at giving further meaning to localised procurement when sourcing goods and services.
The province has had a close working relationship with Seda and has until recently contributed to its funding on an annual basis. We have had close working ties with the SA Micro-Finance Apex Fund, Khula and the IDC, as well as with some of their agencies in the province, and we have invited them to our planning session.
Once again, we welcome the formation of Sefa. We hope its formation will give impetus to our ability to reduce duplication. Hopefully we will improve efficiencies in servicing the business community at local and provincial level. At the centre of our SMME development and support in the province is the creation of one-stop centres for business support all around.
In the green economy space, it is very true indeed that one of the greatest challenges of our time is climate change. If unmitigated, it has the potential to undo or undermine positive advances made in our socioeconomic landscape. This will make the transition from carbon-intensive industrial development to a low-carbon economy a key precondition for the sustained rolling out of the growth path.
For starters, in the run-up to the 17th Conference of the Parties last year, the province hosted its environment and climate change summit, which served as a build-up to the main event in Durban. At our summit we identified the potential of the green economy within the context of sustainable development. For us, the green economy means an integrated cargo and freight plan that balances road, rail and airlift transportation. The green economy also means coal-fired power stations that are mitigated by small-scale hydro energy and solar energy for communities off the national grid. The green economy means making money out of waste products and by simply igniting the recycling revolution. The green economy also means continuously finding the means to achieve sustainable consumption and targets that yield more growth with fewer natural resources.
In conclusion, in addition to these big ideas, we have continued with our awareness programmes, such as our unique provincial Climate Change Literacy Manual for schools. The last time I checked, it was the only one in the country!
In line with what President Zuma articulated, as a province we commit ourselves to managing the provincial economy in a manner that ensures that South Africa continues to grow, that all our people benefit from growth, and that we create decent jobs and decent work for the unemployed, workers, young persons, women and the rural poor.
We want to thank the NCOP for making this debate possible. More importantly, we thank Minister Patel and Minister Davies for the support and guidance provided to the provinces. [Applause.]