2025/26 Budget Vote Speech by Minister Parks Tau, at M46, Marks Building, Parliament, Cape Town on 4 July 2025
House Chairperson, Honourable Members, Director-General and Senior Officials of the dtic, Ladies and Gentlemen, Good Morning!
Seventy years ago, in Kliptown, ordinary South Africans dared to imagine an extraordinary future:
“The people shall share in the country’s wealth!”
This call still resonates as we face daunting headwinds like energy insecurity, logistics constraints, premature de-industrialisation and global volatility that have squeezed exports, slowed growth, and deepened uncertainty. We see it in last year’s sluggish 0.6% GDP growth, a near-stall in the first quarter of 2025, a 2.8% drop in exports, and 32.9% unemployment. Since the start of the 7th Administration, we have been in firefighting mode. Saving Arcelor Mittal South Africa (AMSA) to protect long steel and Newcastle, supporting the ferrochrome sector, and navigating strained incentives in the film and Global Business Services sectors. Budget Vote 39, signals a pivot, from crisis management to enabling growth, from emergency fixes to collective action. At its heart lies the simple conviction that when Government, business, labour and communities co-create solutions, we unlock exponential impact.
Repositioning South Africa’s Industrial Policy
Minister Tau’s speech marks a critical pivot in South Africa’s economic trajectory—from crisis response to proactive industrial growth. The government is now placing industrialisation at the heart of its development strategy by:
- Enhancing electricity, rail, and logistics performance to support industry competitiveness.
- Promoting diversification, decarbonisation, and digitalisation through policy reviews.
- Transforming Development Finance Institutions (DFIs) into active equity partners in strategic sectors.
The shift includes streamlined licensing, investor engagement platforms, and the creation of policy-certainty bonds to attract long-term investment. The introduction of an Omnibus Fast-Tracking Act aims to remove regulatory bottlenecks that hamper development.
Investing in Future-Focused Industries
South Africa is actively investing in future-facing sectors such as:
- Critical Minerals and New Energy Vehicles (NEVs), supported by a 150% tax incentive starting March 2026.
- The Green Hydrogen Commercialisation Strategy, led by development in Boegoebaai SEZ, Northern Cape.
- The National Policy on Hemp and Cannabis, with a vision to boost exports and create rural jobs.
These investments will promote beneficiation over raw exports and position the country at the forefront of green energy. Provinces like the Western and Eastern Cape are already targeted for green economic expansion.
Technical Institutions and Standards Modernisation
Minister Tau emphasizes upgrading the country’s Technical Infrastructure Institutions to support quality assurance in emerging industries. The aim is for these agencies to be self-sustaining, eliminating the need for over R700 million in annual budget allocations.
Inclusive Transformation and Economic Justice
Honoring the Freedom Charter’s vision of shared wealth, the Transformation Fund was introduced as a solution to long-standing inefficiencies in Enterprise and Supplier Development (ESD). Currently, only 61% of mandated 3% post-tax contributions reach intended beneficiaries.
The Transformation Fund will centralize and manage these contributions—amounting to an estimated R26 billion annually—with discipline and scale. Existing funds, including R1 billion in equity-equivalent projects and R3 billion from various sectors, are being aligned under this umbrella.
Showcasing Success: Bokone Gas
A notable example of inclusive growth is Bokone Gas, a 100% Black women-owned enterprise in Rosslyn. The company supplies medical-grade oxygen and is set to introduce locally manufactured nitrogen, demonstrating the impact of targeted industrial support.
Investment and Regulatory Reform
With a curated R700 billion project pipeline, South Africa aims to spark investment across sectors—from renewable energy (25GW worth R339 billion) to transport, digital infrastructure, and agro-processing.
The Omnibus Bill offers a fast-track mechanism for high-impact projects. Applications demonstrating significant job creation, localization, or export potential will be processed within 90 days. This is a move to remove bureaucratic red tape and facilitate ease of doing business.
Market Regulation and Competition
Efforts to open markets include sector-specific inquiries into steel, poultry, polymers, and franchising. These aim to eliminate anti-competitive barriers and empower historically disadvantaged enterprises.
The Online Platform Intermediation Market Inquiry yielded a R330 million support fund for digital innovation, reflecting South Africa’s commitment to evidence-based economic governance.
Global Strategy: The “Butterfly Strategy”
Minister Tau introduced a compelling metaphor for South Africa’s global trade vision—The Butterfly Strategy. With Africa as its core and trade wings stretching westward and eastward, this strategy positions South Africa not merely as an exporter, but as a value creator and global connector.
Key components include:
- Rising exports under AfCFTA, now reaching R820 million in value-added goods.
- A pending automotive pact and the Digital Trade Protocol under AfCFTA.
- South Africa’s chairmanship of SACU and leadership in regional integration.
International Partnerships and Trade Deals
South Africa is actively forging and strengthening partnerships:
- AGOA: Finalising the General Terms Framework Deal with the US to extend Africa Growth and Opportunity Act (AGOA) benefits.
- EU: Launching a Clean Trade and Investment Partnership (CTIP) with an R90 billion commitment, targeting sectors like green hydrogen, new energy vehicles, and battery components.
- China: Engaging with Minister Wang Wentao to leverage President Xi’s announcement of expanded market access for African countries.
These partnerships are vital for diversifying trade and unlocking South Africa’s full export potential.
Impact of the 2025/26 Budget on Key Economic Sectors
The 2025/26 Budget introduces substantial allocations aimed at revitalizing critical sectors such as healthcare, education, and infrastructure. Economists have highlighted that the 2025/26 Budget demonstrates a strategic shift toward inclusive growth, with increased public spending projected to stimulate employment and boost GDP.
Reactions and Expectations Surrounding the 2025/26 Budget
Following the release of the 2025/26 Budget, various stakeholders, including opposition parties, business leaders, and civil society groups, have voiced their opinions. While some welcomed the increased focus on social welfare, others questioned the feasibility of revenue targets. The 2025/26 Budget is expected to undergo further scrutiny in upcoming parliamentary sessions.
Long-Term Vision Behind the 2025/26 Budget
The 2025/26 Budget is not just a financial document; it reflects a broader long-term vision for national development. By prioritizing digital transformation, green energy initiatives, and youth employment programs, the 2025/26 Budget aims to position the country competitively in the global economy. Government officials have emphasized that strategic investments made through the 2025/26 Budget will yield sustainable growth and social stability over the coming decade.
Biography of Minister Ebrahim Patel
Ebrahim Patel, the current Minister of Trade, Industry, and Competition, is a seasoned political leader and long-standing advocate for inclusive economic transformation in South Africa. Born in 1962 in the Western Cape, Patel began his public service journey as a trade unionist, rising through the ranks of the labour movement during the country’s tumultuous apartheid era. He was a key figure in the founding of the Southern African Clothing and Textile Workers’ Union (SACTWU), where he served as General Secretary for over a decade.
Throughout his career, Minister Patel has remained deeply committed to worker rights, economic equality, and sustainable industrial growth. Appointed as Minister of Economic Development in 2009 by then-President Jacob Zuma, he later took office as Minister of Trade and Industry in 2019 under President Cyril Ramaphosa, following the merging of the departments. His tenure has been marked by a pragmatic push for localisation, industrial policy reform, and greater investment in high-growth sectors like green hydrogen, electric vehicles, and digital infrastructure.
Patel’s leadership style is defined by his emphasis on stakeholder dialogue and social compacting. He believes that the future of South Africa’s economy lies in a collaborative approach between government, business, labour, and civil society. His 2025/26 budget vote speech is a testament to this philosophy, showcasing a strategic blend of developmental ambition and grounded policy refor
Conclusion: A Call for Co-Creation
Minister Tau’s 2025/26 budget speech is more than a fiscal address—it is a vision for collaborative governance. By involving business, labour, and communities, the strategy aims to transform South Africa’s economic landscape from one of recovery to one of resurgence.
For more insight on South Africa’s trade initiatives, you can explore the Department of Trade, Industry and Competition official site.
