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Procurement & Supply Chain Professionals in executive round table with KPMG and CIPS

KPMG and CIPS (Chartered Institute of Procurement & Supply) Africa have gathered industry and economic experts in a forum to analyse the implications of Finance Minister, Nhlanhla Nene 2015 budget speech and how we as procurement and supply chain professionals can prepare our organisations in light of the government’s Programme of Action for the year ahead. Following the Minister’s outline of the strategic initiatives that will be the focus in the next fiscal period, we hope to unpack most of these in details and get some insights from these industry experts on how industries will support the government in achieving these initiatives.

This event opens an opportunity for procurement and supply chain professionals network with their peers and share knowledge across different topics covered in the budget speech.

Some of the key topics that we envisage will be covered include, the following without limitation

Foreign Investments

South Africa’s FDI (Foreign Direct Investment) confidence ranking has improved by 2 positions from 15 to 13 over the past year. This places SA in a good place in terms of foreign trade opportunities, however, challenges procuring organisations as they need to formulate globalised strategies when it comes to sourcing of goods and services.

“Our deepening trade and investment links with sub-Saharan Africa continue to offer favourable growth prospects. Exports to Africa grew by 19 per cent in 2013 and 11 per cent in 2014” (Source: Budget Speech 2015). Procurement organisations are therefore challenged to have a long term and global view in their sourcing strategies.

Mineral Wealth

“R2.7 billion has been allocated over the medium term under the Mineral Policy and Promotion programme to promote investment in mining and petroleum beneficiation projects. R108 million has been allocated for research and regulatory requirements for licensing shale gas exploration and hydraulic fracturing”. (Source: Budget Speech 2015)

One of the most important topics for South Africa, is getting value out of our mineral wealth. We hope to hear from our energy, natural resources experts on how their procurement organisations are dealing with such matters. Moreover, how are procurement organisations looking for innovative and unconventional ways to reduces costs in these sectors, whether supply chain costs or productions costs? This makes us relevant in these trying times and puts procurement and supply chain on the spotlight, to add more strategic value to the business.

Enterprise Development

One of the strategic pillars that government continues to drive is Enterprise Development. This was evident in the budget speech as Minister, Nhlanhla Nene spoke of unlocking potential of small enterprises. Most procurement organisations in various sectors have implemented measures to implement successful enterprise development strategies within their own environment. The challenge, however, is whether or not these are sustainable. Is it about injecting cash into a small business, or about a whole lot more to see and monitor growth over a period of time?  Is about scoring compliance points in terms of BBBEE scorecard, or a business imperative? These questions will be answered by some of the experts as they unpack how they will support this very important strategic pillar of the government’s plan.

The energy challenge

With our struggling power and utility provider provide on the spotlight recently, organisations require innovative methods to keep their business going in light of this energy challenge.  Mining, Manufacturing and Textile industries specifically rely on energy for their production. Procurement professionals should therefore be discussing how they can support business with energy management strategies that will allow production to continue despite this challenge. How do we support our power utility based on the government’s plan over the next few years?

Consolidation of Public Finance

The Minister, Nhlanhla Nene mentioned in his budget speech the implementation of consolidation of public finance. This topic is not new in the procurement environment. Large organisations have been consolidating spend for strategic sources for the several years and yielding great benefits in terms of efficiencies and cost savings. In the context of public sector, there are various dynamics involved but we would like to hear from various experts leading large government organisations on how they see this working in the near future and what the benefits will be for the larger South Africa. bp

Tax Implications

This event will also give us some insights on tax implications on procurement transactions across industries. With the increase in trade between countries in Sub-Saharan Africa, the panelists will also expose some answers on how organisations can engage in tax efficient procurement across the borders of South Africa. Ms. Lullu Krugel, the Economist at KPMG, will tell us more about the impact of tax decisions, the GDP growth impact, tax revenue sources and the impact of fiscal policy decisions for the country and for buying organisations at large.

We trust that this event will be the first of many, and that the procurement and supply chain profession continues to grow as a strategic component of any business.

For more information on how we can assist you, please contact Zinhle Dube, Senior Manager, Centre of Excellence for Procurement Advisory at KPMG on zinhle.dube@kpmg.co.za or globalafricapractice@kpmg.co.za

David Okwara

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