Minister of Trade, Industry and Competition, Parks Tau, delivered his department's Budget Vote in Parliament on Tuesday.
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Minister of Trade, Industry and Competition, Parks Tau, has reiterated that South Africa is “turning the corner” despite mounting global economic pressures, outlining an ambitious industrialisation and investment agenda aimed at boosting growth, localisation and export competitiveness.
Delivering his department's Budget Vote in Parliament on Tuesday, Tau said the country faced a highly challenging global environment shaped by the ongoing Middle East conflict and disruptions to global energy and supply chains.
“As a net oil importer, South Africa faces real recessionary risks and threats to our industrial competitiveness,” Tau said.
Despite the economic risks, Tau argued that South Africa’s industrial policy framework was becoming more coherent and forward-looking following Cabinet’s adoption of the new Industrial Development Strategy (IDS).
The strategy is anchored on decarbonisation, diversification and digitalisation, with government seeking to position South Africa as a leader in the green economy while driving industrial expansion and job creation.
Tau said the country could no longer “compete in the world of the future using the tools of the past”.
“This strategy recognises that the structure of South Africa’s economy is transforming. We are clear that this strategy is about positioning South Africa as a leading player in the green economy, implementing a forward-looking industrial policy that creates jobs, and using trade policy to support export resilience and growth,” Tau said.
A major focus of government’s strategy will be strengthening trade partnerships and boosting exports.
Tau said South Africa had already begun trading under the China-Africa Economic Partnership Agreement (CADEPA), which from 1 May 2026 granted South Africa duty-free access to targeted sectors in the Chinese market.
“Our aim is to change the composition of trade with China from exports comprised mainly of commodities to significantly increasing manufactured and value-added products,” Tau said.
He also pointed to growing trade opportunities with the European Union, United States, MERCOSUR and the Gulf Cooperation Council.
According to Tau, exports to the US increased from R238 billion in 2024 to R260bn in 2025, despite continued uncertainty surrounding the future of the African Growth and Opportunity Act (Agoa).
On industrial policy, Tau confirmed that government was reviewing the Automotive Production and Development Programme (APDP2) to attract new investment and support local component manufacturers as competition intensifies from imported vehicles.
“We are reviewing our APDP2 with a view to stimulate new investments in South Africa and supporting the growth of our component manufacturers,” Tau said.
“The work of the dtic in implementing localisation is evident in the R86.6bn in locally manufactured goods and services procured in the 2025/26 financial year. For this current financial year, our target is R100bn in localisation. This is possible through collaboration with our social partners.”
Tau also warned about the growing threat posed by illicit trade, which government estimates costs the economy roughly R700bn annually, or about 10% of GDP.
To combat the problem, the National Consumer Commission will introduce a new track-and-trace system targeting illicit tobacco, alcohol, food and consumer appliance products.
Tau highlighted strong investment momentum, saying the 2026 South African Investment Conference secured the highest value of investment commitments since its launch in 2018.
The dtic secured R647bn in investment commitments during the 2025/26 financial year, significantly above its R450bn target, while government has now launched a second investment mobilisation drive targeting R3 trillion in new investment by 2030.
Tau said Special Economic Zones (SEZ) continued attracting investment despite global uncertainty, with 224 operational investments valued at more than R31bn supporting nearly 29,000 active jobs.
“Despite the challenging global trading environment, the country’s SEZ Programme continues to make a meaningful contribution towards attracting fixed capital investments,” he said.
Meanwhile, Tau said entities such as the Industrial Development Corporation and National Empowerment Fund were playing an important role in supporting struggling industries, black industrialists and women-owned enterprises.
Tau said the dtic and its entities had been allocated approximately R130.6bn over the medium term to support industrialisation, economic transformation and investment initiatives.
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