Johannesburg - Gauteng MEC for finance and economic affairs Paul Mashatile is concerned about the effect of rand strength on the country's booming automotive sector.
"At current levels, it is beginning to erode some of the gains of the automotive industry," said Mashatile.
"We are, however, confident that this trend will be reversed as soon as the exchange rate of our currency stabilises," he said at an Automotive Industry Development Centre workshop at the Auto Africa motor show yesterday.
Mashatile said the reality that small and medium enterprises (SMEs) were yet to benefit fully from progress made by the automotive industry was also of concern.
Lower-tier suppliers continued to find it difficult to progress to global standards. Many of them had no access to the lucrative international markets and continued to operate on the margins of the industry.
"Collectively, we have a responsibility to respond to this challenge. We must continue to make interventions that will ensure that the gains made by this industry are shared by all."
Mashatile said a programme had been launched at the workshop in partnership with the UN Industrial Development Organisation, the purpose of which was to ensure that more SMEs and black economic empowerment companies became part of the mainstream supply chain within the automotive industry.
"In many ways, this programme gives practical meaning to our commitment as government to the objectives of promoting SMEs and empowerment," he said.
"It seeks to spread the gains we have made in positioning the automotive sector on a competitive footing.
"This programme will contribute massively towards our strategic objective of creating an environment conducive to the development of more and successful enterprises owned by those who in the past were denied access to economic opportunities."
Mashatile added that the provincial government would soon establish an SME agency in Gauteng, which would strengthen interventions by the province aimed at developing the sector.
It would provide financial and non-financial assistance to SMEs. He applauded the launch of the market access coaching programme for SMEs and empowerment companies, which marked a critical intervention aimed at addressing market access, one of the major challenges facing these companies.
He urged SMEs and empowerment companies to use the programme to their benefit, adding that it would enhance their competitiveness and ability to access new and important markets, and would serve as a platform to build networks and source opportunities to grow in the components supply market.
He also confirmed that Blue IQ, the development arm of the Gauteng finance and economic affairs department, had decided to remain the majority shareholder in the multimillion-rand Automotive Supplier Park in Rosslyn, near Pretoria.
Mashatile said the park was a critical intervention to boost the automotive sector.
The department had decided to retain control of the park as it would assist the provincial government in strengthening the competitive advantage of a high-impact industry.
"The park is well on the way to sustainability and it is our intention to maintain this momentum."
Mashatile said the Rosslyn park had been an overwhelming success in attracting leading component manufacturers and creating almost 3 000 job opportunities in the past fiscal year.
He announced that another two significant players in the global automotive industry were to become tenants.
They are Fleetguard, a subsidiary of US diesel engine company Cummins, and Rieter Feltex, a joint venture between the local Feltex group and Swiss technology supplier Rieter Automotive.
Jochen Freese, the managing director of the park, said the success and effects on the province of the park had led Blue IQ to change its strategy and decide to retain majority control in the development.