Staff Reporter
The Free State Department of Economic, Small Business, Tourism and Environmental Affairs (DESTEA) says it is in the process of developing an economic recovery plan to rescue the province from the current downslide.
MEC Makalo Mohale said in his supplementary budget vote speech Tuesday that the recovery plan will, among other things, force government departments to give a significant stake of major projects to small, medium and micro enterprises (SMMEs).
“The department is in the process of developing an economic recovery plan underpinned by focus on value chains in strategic sectors of the economy,” he said.
“. . . our vision is to lead a revitalisation and growth process in the province, through targeted economic interventions.”
Mohale said special emphasis will be placed, among others, on youth development and employment, correcting structural imbalances in the local economy, incentivising local and foreign investment, industrialisation and value stream development in various priority sectors.
“One of government’s interventions in the drive to create a conducive procurement environment is the Public Procurement Bill which will compel government departments to sub-contract a minimum of 30 percent of all contracts above R30 million to SMMEs,” he said.
“We have made submissions as a department . . . to ensure that government is compelled to procure from those enterprises.”
At the centre of this programme, according to Mohale, will be sector-focused master plans providing details on opportunities available in the value chain within each sector.
This year, the Free State economy is projected to contract by 3.7 percent.
The mining sector is expected to contract by 10.4 percent and construction will be 8.4 percent weaker while manufacturing will drop by 4.2 percent.
Finance and trade will contract by 3.4 percent and 2.9 percent respectively.
Agriculture is the only sector expected to grow by 8.1 percent in 2020.
“. . . there is no reason whatsoever why we cannot throw an economic lifeline to our SMMEs,” Mohale said.
“In this province we have 23 local municipalities and one metro made up of 82 towns and 10 provincial departments as well as 28 national departments with a footprint in the province.”
Provincial departments and municipalities in the Free State have a total budget of R8 billion per annum available for goods and services.