Factors influencing the sustainable implementation of the industrial policy action plan

M.A. (Public Management and Governance)Abstract: In South Africa, 23 years of democracy have yielded minimal changes to the structure and ownership of industrial development, which has led to direct (political) calls for greater state intervention in order to achieve the broader objective of industrial development. The 2007 launch of the National Industrial Policy Framework (NIPF) and the Industrial Policy Action Plan (IPAP) could not have anticipated the impact that the global financial crisis of 2008/2009 and subsequent recession would wreak on South Africa’s industrialisation. With its strong focus on the manufacturing sector as a key driver of balanced development, the NIPF set a framework and an implementation mechanism in the form of IPAP for addressing cross-cutting and sector-specific constraints (and optimising opportunities) to place South Africa on a stronger growth path. As it turned out, it also assisted in strengthening the South African industrial sector against the worst effects of the recession, particularly through support for industrial upgrading, local procurement designations, and export facilitation. This study thus sets out to investigate the factors that influence the sustainable implementation of IPAP. This study shows that industrial policy plays an important role in shaping the way a country’s industrial fundamentals are translated into specific patterns of industrial development. The character of industrial development that emerges has direct implications for the magnitude and type of employment opportunities that are created. Industrial policy therefore envisages the manufacturing sector as a key growth and employment driver, but the sector is no longer a major source of employment creation. This study pays specific attention to the manufacturing sector by identifying the problems that weaken the effectiveness of the manufacturing sector. The study also focuses on the limitations of IPAP as a current industrial policy and proposes various measures that policymakers can put in place to achieve maximum industrial development. The study also shows the alignment IPAP has with other related policy initiatives to improve the industrialisation level in the country