The outlook for the coming year is favourable, not only because of the likely growth in the economy overall, but particularly because of the high level of activity in telecommunications. After decades of neglect, telecoms in Africa is experiencing a massive spurt, as country after county seeks to open the sector to competition.
One result is that African cellular networks are expected to enjoy a growth rate of more than 100% - almost twice the international average - this year, with South African companies well placed to supply some of the demand for equipment.
Research company EMC predicts that South Africa itself, which currently claims about 70% of the continent's cellphone users, will achieve a subscriber base of 11 million by 2002 - from the current four million. Elsewhere in the continent, the economic multiplier effect of telecoms has been recognised by many governments which are now hastening to privatise moribund state-owned telecoms companies and to introduce competition, mainly in conjunction with foreign investors.
In addition, demand for higher data transfer speeds from both landline and wireless-based devices can be expected to fuel a period of very strong growth, which will be challenging for the industry in South Africa and which highlights the need for accelerated training programmes to provide the skilled human resources necessary to take advantage of these opportunities.
Other sub-sectors of the industry that are expected to see continuing strong demand this year are prepayment energy meters - in which South Africa has world-leading products - and security equipment.
The EIF has become deeply involved in two policy issues that can be expected to have important effects on the industry - skills development and export promotion.
The EIF has been a key player in the formation of a Skills and Education Training Authority (SETA) for the information technology, electronics and telecommunications technologies and a formal application and proposed constitution were lodged with the Department of Labour by due date.
Hand-in-hand with the SETA application is the need to establish a Standards Generation Body (SGB) in terms of the Skills Development Act. Work is well underway in drafting unit standards for the electronics sector and the EIF has begun the process of forming an SGB.
With the strong encouragement from the Department of Trade & Industries (DTI), the EIF took the lead last year in pursuing a proposal to form an export council for the electrotechnical industries. The electronics and electrical teams worked well together through a steering committee, though the IT sector, regret-tably, has evinced little interest so far. There is, nevertheless, an excellent chance that this project will get off the ground early in the year.
The significance of this lies in the fact that the DTI's future support to the private sector, whether in the form of export incentives or industrial innovation grants, is likely to be largely directed at qualifying companies within export councils.
The EIF can be contacted on (011) 315 1002.
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