PRESENTATION TO THE PORTFOLIO COMMITTEE

14 MAY 2008

BY SAMSA CEO – COMMANDER TSIETSI MOKHELE

BRIEFING CONTENT

OBJECTIVE OF THE PRESENTATION

OVERVIEW OF MARITIME INDUSTRY AND SAMSA

SAMSA LEGAL MANDATE AND ROLE GLOBAL TRENDS AND DEVELOPMENTS

CHALLENGES FACING THE INDUSTRY AND ENTITY

INDUSTRY CHALLENGES INSTITUTIONAL CHALLENGES

STRATEGIC RESPONSE - INTERVENTIONS NEW CORPORATE DIRECTION AND VALUES INDUSTRY INSTITUTIONAL PROJECTS

CONCLUSION WAY FORWARD AND RECOMMENDATIONS

Objective of The Presentation

The objective of this presentation is to brief the Portfolio Committee on Transport on

Challenges currently faced by SAMSA Interventions in place to address the challenges Key strategic activities planned for the 2008/2009 financial year

Overview of Maritime Industry and SAMSA

- A snapshot SAMSA LEGAL MANDATE AND ROLE

SAMSA was established on 1 April 1998

Its formation resulted from the 1996 Transport Policy which articulated its context as follows:

RDP context of Growing the economy Developing the human resources Democratising the state and society Meeting basic needs

The vision for South Africa’s transport as being to ‘... support government strategies for economic and social development whilst being environmentally and economically sustainable’

The maritime policy imperatives and goals articulated as Developing maritime awareness Assisting in the creation and fostering of an economic environment for the Maritime Transport Industry which will allow it to compete... with other nations Contributing to the release of the full potential of the maritime industry in South Africa and to the modernisation of shipping administration...

Industry and SAMSA Overview- A snapshot ...continued

SAMSA LEGAL MANDATE AND ROLE

The founding legislation of SAMSA identified three core mandate functions of the entity as:

To ensure safety of life and property at sea To prevent and combat pollution from ships in the marine environment To promote South Africa’s maritime interests

Needless to say that the first 2 functions are of a safety regulatory/compliance nature, which SAMSA focussed over the past 10 years. However, even then, SAMSA’s effectiveness was hampered by

an ineffective business model a fragmented offering, eg Aids to Navigation, Civil Hydrography and pollution management lack of systems and technologies to track and monitor shipping activities at sea

The 3rd mandate has remained largely dormant, and its implications not fully explored; yet it is this mandate/function which has largely been leveraged by other maritime administrations to reposition themselves beyond regulatory and technical compliance ,into national strategic assets capable of advancing and protecting national interestson the global stage

Industry and SAMSA Overview- A snapshot ...continued GLOBAL TRENDS AND DEVELOPMENTS

Globally, over the past decade, maritime administrations have transformed themselves into lead agencies for maritime industry development and sector leadership, serving their domestic economies and industries as:

Strategic centres for maritime knowledge management ie centers for maritime information, research, innovation and expertise

Hosts of the national promotional facilities such as International Maritime Centre (IMC)and Maritime based Economic Cluster projects aimed at attracting international maritime industries and investments into the local economy

Policy advisory services for the state and private sectors on issues beyond regulatory eg competitiveness and job creation

Facilitators of maritime sector growth initiatives aimed at improving the sector’s contribution to the GDP and promotion of domestic industries internationally

Agencies providing a full menu of navigational services such as Hydrography,And Marine Aids to Navigation, as well as pollution control capabilities

Challenges facing the Industry and Entity

...industryINDUSTRY CHALLENGES

Inadequate attention given to the maritime industry Lack of policy on the maritime transport sector Lack of support/incentive programmes to key maritime industries & initiatives

Fragmented industry with no coherent structures to engage on key issues

Outdated and uncompetitive ship register only 1 commercial ship on the SA register (as opposed to 60 in 1990)

Chronic shortage of maritime skills (seafarer & nonseafarer), resulting from shortage of training infrastructure capacity lack of awareness of maritime careers lack of domestic fleet high demand on skills globally reliance on expatriate expertise

Insignificant gains in the implementation of the BEE transformation initiatives

Lack of technological and innovative support infrastructure to the shipping industry eg e-commerce, track and trace, ship-to-shore communication

Challenges facing the Industry and Entity

...SAMSASAMSA CHALLENGES

A dis-joint between the policy establishing SAMSA and the legal mandate, resulting in an ineffective business model, functioning largely on historical and adhocratic mode

A mismatch between the vast and diverse maritime interests and mandate, and the current configuration of the Entity

An unsustainable funding model, resulting in the current year-on-year deficit budgeting (F2007/2008 had deficit of R14m)

Low skills capacity to address both the institutional and industry challenges

Lack of technological capacity to support and enable business no vessel tracking or identification technology no e-commerce capability inadequate internal management information systems

Low levels of participation by women and black people in the technical areas

Strategic Response – Interventions...new direction

NEW SAMSA DIRECTION AND ORIENTATION

Value proposition

The authority leading the advancement of South Africa’s maritime safety and industry development through service excellence

Vision

The authority championing South Africa’s global maritime ambitions

Mission

To promote South Africa’s maritime interests and develop and position the country as an International Maritime Center while ensuring maritime safety, health and environment

Strategic Response – Interventions...values

VALUES STATEMENT: (D-ETHIC)

Diversity: Strength in our diversity as a true South African company

EnterprisingForward thinking and innovative in our business solutions

TeamworkRecognising the support of others in building the future

High performanceDelivering service excellence

Integrity Our business conduct and credibility beyond reproach

CaringRespect and caring for our employees

Strategic Response – Interventions...industry

POLICY Engage and assist the DoT and Ministry with the development of the Maritime policy To enhance SAMSA’s Strategy and Policy functions in order to improve its capacity to provide quality advice on maritime policy matters

INDUSTRY ORGANISATION Initiate and host the Maritime Cluster forum as a platform to engage on maritime industry promotion and policy engagement

SHIP REGISTER Take the lead in engaging stakeholders on the revamping of the SA Ship register Engage in the development and promotion of the tonnage tax policy

SKILLS Develop a business case for the development of the Maritime Skills Strategy and Plan for the entire sector Initiate in partnership, a maritime awareness campaign throughout SA

Strategic Response – Interventions...industry cont

BEE INTERVENTION Engage the maritime industry on the policies aimed at the transformation of the industry and implementation of BEE Engage DoT/DTI on the promulgation/implementation of the Maritime BEE Charter

TECHNOLOGY Initiate projects to improve the technological and innovative uptake of the industry and SAMSA

LRIT – Long Range Identification and Tracking VTS/VTMIS – Vessel Tracking Services AIS – Automatic Identification System

Strategic Response – Interventions...SAMSA

SAMSA MANDATE Review the SAMSA mandate Update international and domestic maritime legislation

INSTITUTIONAL CAPACITY, INNOVATION AND TRANSFORMATION Improve the institutional capacity

Improve human capital through recruitment and training Improve the financial resources Improve systems and technological infrastructure

Implement an aggressive transformation programme Improve the entity’s research capacity and programme

BUSINESS AND FINANCIAL MODEL Review the business model of SAMSA with the aim to growing the agency into a competent maritime authority Review the funding model and its attendant financial model

Strategic Response – Interventions...SAMSA cont

STRATEGIC PROJECTS

Western Indian Ocean Marine Highway (sponsored by World Bank and GEF)

Implementation of the expanded regional Search and Rescue programme

Studies on: The BEE compliance issues in the maritime transport industry The risk assessment in the provision of the maritime pollution prevention capability Development of South Africa’s Maritime Skills Strategy and Plan Establishment of a Maritime (Economic) Cluster Forum/Promotion Council

Improve the technology and systems in the company Implementation of a company-wide Enterprise Resource Planning (ERP) system Implementation of new operating systems ie

Ship registration system and Seafarer certification system

Implementation of the Small Vessels and Inland Waterways regulations

Implementation of the IMO Voluntary Audit Scheme – Correction Plan

Diversity/Change management intervention

Conclusion

WAY FORWARD AND RECOMMENDATIONS

SAMSA requests for the PCOT’s support in the following key interventions:

Repositioning and remodelling SAMSA into a financially viable and self sufficient, competent and modern maritime authority

Supporting the initiative to establish the Maritime Industry Cluster forum intended to advance the competitiveness of the industry and the attractiveness of South Africa as an International Maritime Center

Review and updating of international maritime legislation in the light of the IMO Audit

Expediting the promulgation and enforcement of the Maritime BEE Charter

Embarking on a maritime awareness campaign to draw attention to the role the sector can play in addressing poverty issues such as job creation, growing the economy and providing business opportunities

Embarking on the Promotion of the South African Ship Register as a register of choice, primarily to South African ship owners

Maritime Cluster

WAY FORWARD AND RECOMMENDATIONS

Maritime Cluster