As South Africa responds to COVID-19 and aims to stimulate the economy and job creation post lockdown, an opportunity should not be missed to consider investing in new product markets which could increase the size and dynamism of the manufacturing sector. Such a package could contribute to arresting the current trend of deindustrialisation and shift the trajectory of the industrial base into new, sustainable growth areas and value chains. This would result in new factories, new downstream demand for primary and intermediate inputs, new export products, increased foreign exchange earnings, and importantly new direct and indirect long-term jobs.
Using the idea of “business unusual” TIPS economists put together a Post COVID-19 recovery programme in South Africa that could provide the impetus to arrest the current trend of deindustrialisation and herald in the beginning of a new generation of industrial activity. The study comprises a main consolidated report and the seven initial projects that have been identified.
Main consolidated report: Industrial development projects
Project one: Borehole drilling rigs
This project looks at the production of 100% local content borehole drilling rigs specifically engineered for small and medium enterprise drillers to service increased investment in groundwater access in South Africa and the African export market.
Project two: Industrial hemp
This project looks at commercial scale cultivation and production of de-hulled (possibly organic) hemp seeds for human consumption for the export market.
Project three: Polylactic acid (bioplastics)
This project looks at supporting the sugar industry through the domestic production of polylactic acid for export and downstream domestic value addition.
Project four: Containerised short sea shipping service
This project looks at creating a short sea shipping service to increase containerise intra-regional trade between South Africa, Mozambique, Tanzania, Kenya and their hinterlands.
Project five: Alternative fuel
This project looks at establishing a co-processing facility at a cement plant as a means to catalyse a broader waste beneficiation industry in South Africa.
Project six: Furfural and furfuryl alcohol plant (biochemicals)
This project looks at the commercial scale production of furfural and furfural alcohol from sugarcane bagasse for the local foundry industry and broader export market.
Project seven: Motocycle components
This project looks the production of Class A motorcycle components (only) for export to the African assembly and after-sales markets.