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THE NATIONAL INDUSTRIAL PARTICIPATION PROGRAMME PRESENTATION TO PORTFOLIO COMMITTTEE ON TRADE AND INDUSTRY 17 November 2006

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THE NATIONAL INDUSTRIAL PARTICIPATION PROGRAMME PRESENTATION TO PORTFOLIO COMMITTTEE ON TRADE AND INDUSTRY 17 November 2006. Background. NIPP is 10 years old this year First years dominated by the Telkom rollout Thereafter the SDP’s accounted for +/- 95 % of the total programme - PowerPoint PPT Presentation

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Page 1: Background

THE NATIONAL INDUSTRIALPARTICIPATION PROGRAMME

PRESENTATION TO PORTFOLIO COMMITTTEE ON TRADE AND INDUSTRY

17 November 2006

Page 2: Background

Background

• NIPP is 10 years old this year• First years dominated by the Telkom rollout• Thereafter the SDP’s accounted for +/- 95 %

of the total programme• Currently the purchases by SAA, ESKOM

and the PBMR are responsible for new obligations

• Future obligations are those from the infrastructure plans of DPE

Page 3: Background

Main Purpose

• To raise investment levels • and to increase international market

access for South African value-added goods and services

• by leveraging off government procurement.

Page 4: Background

Value of the NIPP

• Currently the total obligation accumulates to over US$ 15 billion, of which US$4 billion is for investments

• Added to this is pro-active, non obligated performance equating to almost US$ 1 billion

Page 5: Background

Current Obligations

• SDP• Other Defence Obligations

– GBADS awarded to Denel/Thales• Non Defence Obligations

– Tenders awarded by SAA, Eskom, Transnet and various Government Departments

Page 6: Background

New Obligations• Defence

– Hoefyster - Supply/delivery of new generation infantary combat vehicle products system

– Vistula - Logistic support vehicles– Cytoon – Tactical Intelligence System (battlefield

information)– Kingfisher - Upgrade of MILAN missile system (anti

tank)• Non Defence

– PBMR related tenders– ESKOM Power Stations– Motor Vehicle Tenders– Gautrain– SITA related tenders

Page 7: Background

Performance of Obligors

• Since inception over 150 projects approved and implemented

• Projects in various sectors and different regions– Including bio tech, aerospace, tourism and

BPO• These projects have generated

– Investment Credits in excess of US$2.2bn– Exports and Local Sales Credits of US$4.5bn– +/-12000 direct jobs

Page 8: Background

BAES/SAAB Performance

• 44 Active projects• More recent projects include the

Ferrochrome Smelter, Gemco and the SAAB/Denel Aerostructures deal.

• BAE/SAAB’s performance exceeds US$2.8 billion, of which +/- US$1 billion is for investments.

Page 9: Background

GSC (Ferrostaal)

• More than 11 Active projects• Most recent projects include SAMES

and Fabrication and Repair and Maintenance in the Oil and Gas Industry

• Ferrostaal’s performance exceeds €817 million, over €600 million of this for investments

Page 10: Background

GFC (ThyssenKrupp)

• 6 Active Projects• Most recent projects include

Manufacture of Wood Pellets for the energy sector, Alltube Expansion and the Mechatronics project

• Thyssenkrupp’s performance exceeds US$217 million

Page 11: Background

Thales

• 9 Active Projects• Most recent projects include the

SMME fund, Geratech Zirconium Beneficiation and Laroche South Africa

• Thales’s performance exceeds US$506 million (US$140 of this for investments)

Page 12: Background

Agusta

• 6 Active Projects• Most recent projects include Flexider

SA and Cenere 1948 • Agusta’s performance exceeds

US$246 million

Page 13: Background

AgustaWestland

• 7 Active Projects• Most recent projects include Bio fuels

project, Adept Airmotive and Worldfish SA

• AgustaWestland performance exceeds GBP 30 million (GBP 4.5 million for investments)

Page 14: Background

Denel

• Awarded the GBADS tender• Thales assisting with this obligation• Projects initiated include Qmuzik,

Pre-Stressed Bars and Greenhouse Farming.

Page 15: Background

Non Defence Related Obligations• SAA• PBMR• DEAT, SAPS, DOH, DHA and DoT• Petro SA, NPA, SAPO and Spoornet• Telkom• SITA

Page 16: Background

Problems Encountered

Not all projects have a happy ending – some have encountered severe problems:

• BAES/SAAB – Diesel Economizer• BAES/SAAB – SARM• Ferrostaal - Atlantis Training Centre

Page 17: Background

Obligations Achieved

Marpless • Obligation of US$31,82 • Won bid for an identification system

(HANIS) to the Department of Home Affairs

• IP projects related to a number of export promotion projects

• To date they have excess credits amounting to +/-US$56,79 million

Page 18: Background

Obligations Achieved

• Boeing• Obligation arose out out of 737-800

airplanes sold to SAA and the VIP Intercontinental transport Boeing Business Jet.

• Obligation amounted to US$237.5 Million.• Boeing came with work packages for

various SA companies.• Boeing has earned credits in excess of the

required obligation.

Page 19: Background

THE WAY FORWARD

• The SDP coming to a close• R370 Billion of infrastructure

development that may result in offset obligations; how are the objectives of DPE to be incorporated with those of the NIPP

• Denel, etc• Policy revision and amended NIP

guidelines