Trade and Industry Minister Rob Davies. (Gallo)
The government's latest version of the industrial policy action plan (Ipap) is doomed to fail, the DA said on Monday.
Briefing journalists at Parliament, Democratic Alliance MPs on Monday said they would call for the plan to be rejected when Trade and Industry Minister Rob Davies appeared before a parliamentary committee on Tuesday.
DA MP Wilmot James said while the new plan was more user-friendly, there were more flaws than benefits.
These included "heavy-handed state intervention", instead of a "light-touch rebalancing".
"It is a dissipated, fragmented waste of taxpayers' money, because it's unfocused, undirected and it doesn't get to the heart of the problem," James said.
South Africa could learn a lot from Japan, which he called the "leaders of the world in terms of industrial planning".
"What the Japanese did, they said here's an incentive programme for research and development in robotics. You compete for it, and the best firms got the money and they got on with it," he said.
State intervention should happen
The party believed state intervention should happen only in exceptional circumstances, and should be ideas-based instead of sector-based.
"What you need is to enhance competitiveness on an incentive basis through targeted incentives, not on a firm basis or sector basis, but on a good ideas basis in a productive sector of the economy, and everything else will follow from that, including the creation of jobs."
The DA criticised previous state interventions for going "too far" and for not providing "sunset clauses" or exit strategies.
"We don't want to have a situation where industrial policy is a welfare programme for derailed businesses and also to operate in perpetuity because it apparently saves jobs.
"What you want to do is to provide a series of incentives in productive sectors of the economy on projects where there are market failures … " James said. – Sapa