1. Presentation to the Portfolio Committee on Water Affairs and Forestry 11 March 2008 Masizakhe Zimela Chief Director: Resource Based Industries Industrial Policy Action Plan for Forestry, Timber, Pulp and Paper

2. The National Industrial Policy Framework (NIPF) was approved by cabinet in Jan 07 with a directive to develop an implementation plan NIPF Vision –Diversification, more labour absorbing industrial path, intensification of SA’s industrialisation and movement towards a knowledge economy The NIPF commits to planning and implementing industrial policy actions (IPAP) on an ongoing basis focusing on sectoral and cross-cutting issues Background

3. Forestry, Timber, Pulp and Paper and Furniture identified in IPAP as one of the four lead sectors based on its potential for growth and employment creation especially in poor rural areas through increase in new plantations thereby stimulating growth in downstream processing industry. Strategic Framework for the forestry, timber (excluding furniture), pulp and paper industries approved by the dti in 2006 Process to develop a furniture strategy has commenced Background

4. IPAP developed to address sector constraints and to position the industry to capitalise on identified opportunities. Thus, the key action plans in Forestry and Timber seek to address the following: –Increase supply of raw materials –Increase downstream beneficiation activities –Increase participation of SME’s and BEE including in higher value-added activities –Competitiveness Industrial Policy Action Plan

5. Increase downstream beneficiation activities –Move towards higher value added activities Downstream activities in –Saw milling Lower capital requirements –Wood chips –Furniture –Wood Waste Will help in dealing with environmental impacts Industrial Policy Action Plan

6. Increase raw material supply and ease supply constraints ProjectsOutcomeProgress Facilitation of water license acquisition by communities ( Pilot in EC) Increase in the number of licences acquired by communities for new afforestation in the EC & KZN Working with stakeholders on measures to accelerate the process of licence acquisitions Sourcing of timber from neighbouring countries Reduced supply constraints for the small players in forestry based industries. Development of a framework of cooperation in consultation with the other stakeholders.

7. Increase downstream beneficiation activities ProjectsOutcomeProgress Charcoal plant in OR Tambo & Sisonke District Municipalities Improved capacity of the charcoal enterprise Developing a feasibility study, business and implementation plans for the project. Investigation of alternative fibre beneficiation options for rural communities Fibre industrial hub Develop a project proposal, feasibility study and business plan with the CSIR

8. Increase participation of SME’s ProjectOutputProgress to date Establishment of the furniture incubator in Mthatha in the EC Increase in number of furniture manufacturers Process of renovating the building has started. Incubator to be operational by September 2008 Furniture sector development strategy Expansion of the furniture industry First draft furniture strategy completed. Further research is being conducted to gather additional information to finalise the document.

9. Competitiveness Project/KPAOutputProgress to date Develop a programme for skills transfer and technological upgrade for small- scale saw milling industry Improved competitiveness of the saw milling industry. Report developed on skills transfer and technology upgrading In the process of gathering information regarding the geographical position, capacity, skills and raw material supply requirements of the saw milling industry Chris Hani Wood Cluster Cooperative Improved capacity and productivity of the saw mill Developing an implementation plan

10. KZN Forestry Development Initiative ProjectOutputsProcesses to achieve outputs Stakeholder departments Accelerated forestry and timber industries development initiative in KZN Forestry and timber industries strategic plan with projects and programmes developed Developing a strategic plan for forestry and timber industries DTI, DWAF, Forestry SA, DEAT

11. Thank you for your attention