Trade and Industry Minister Dr Rob Davies expects transformation in South Africa’s defence sector to gain traction, following the gazetting, on Monday, of the Defence Sector Code in terms of Section 9(1) of the Broad-Based Black Economic Empowerment Amendment Act.
Davies says the development of the Defence Sector Code was made possible owing to the leadership of the Ministry of Defence and Military Veterans, as well as the Armaments Corporation of South Africa, in collaboration with the industry, to develop sector-specific transformation guidelines.
All entities operating in the South African defence industry, in its entirety, including national or provincial departments, and State-owned and private enterprises will, from the date of gazette of the sector code, be measured according to its provisions.
“This includes those entities providing products and services to the State – whether they are procured from local or foreign-owned enterprises, defence manufacturing enterprises, research and development enterprises and other entities, as well as any role-player and stakeholder that might opt in,” explains Davies.
He adds that the key highlights of the sector code include that companies are required to procure at least 60% of materials locally, as well as use locally produced technologies.
Further, the black ownership target has been increased to 35% which is higher than the 25% benchmark of the generic codes, notes Davies.
Defence and Military Veterans Minister Nosiviwe Mapisa-Nqakula will soon appoint a Sector Charter Council to monitor implementation of the sector code and to conduct regular reviews.