Past events have illustrated the importance of manufacturing with regard to the South African economy and, therefore, the coun- try has to “focus heavily” on this sector, Depart-ment of Trade and Industry deputy director-general Nimrod Zalk said at the recent Manufacturing Indaba.

He noted, in particular, the significant role manufacturing had played in stimulating growth and addressing unemployment.

But the country also had to learn from the past, with South Africa having historically invested in megaprojects in sectors such as the mining sector, leading to “mini booms” in manufacturing while the projects were under construction.

The country had failed, though, to sufficiently build the market to sustain autonomous sectors that could export their goods following the completion of the megaprojects, thus, causing a slump in local manufacturing once the mega-projects had been completed.

“We need to take this into account as we invest into the next set of mega infrastructure projects,” Zalk said.

Meanwhile, South African Institute for Entrepreneurship CEO Guy Harris stated that South Africa had to regain its position as leading manufacturer.

Chairing the panel discussion, he said South Africa had not fully made use of the benefits of its Brazil, Russia, India, China and South Africa (Brics) partnership and the size of the Southern Africa Development Community market.

“We now have a clear document guiding us going forward, in the form of the National Development Plan (NDP), [but] now we need to ensure that the NDP [is implemented],” he said.

Also speaking as part of the panel, Barclays markets principal Peter Worthington said there had to be a significant push from the top – government and big businesses – to bring manufacturing to Africa. He also noted that the South African manufacturing sector was facing numerous challenges.

These included currency volatility and an uncertain operating environment, specifically in terms of energy security and labour relations issues.

Worthington said the country needed a better labour relations framework to avoid lose-lose situations as was currently being seen in the platinum industry, where the Association of Mineworkers and Construction Union had been striking since January 23.

Also speaking on the topic of stability, Zalk said there had to be a shift towards longer- term committed sets of investment and “deep entrepreneurship” in the manufacturing sector to achieve a more stable environment.

“We need people to commit for 10 to 15 years,” he noted.

Development consultant Dr Shawn Cunning-ham added that the risk of business failure was also significantly high, adding that something had to be done to address “risk issues”.

He pointed out that, in the past, few small businesses had invested in formal innovation and research and development, adding that this would be an important component of modernising the local manufacturing industry.

Meanwhile, also speaking as part of the panel, Deloitte risk advisory director Karthi Pillay said there was no shortage of understanding of the problems that the local manufacturing sector faced.

“But now, how do we get South Africa to focus on being competitive?” he asked, stating that he was not only referring to local competitiveness between manufacturers, but also the inter-national competitiveness of South African manufacturers.