By Lehlohonolo Lehana.
The National Skills Fund (NSF) will provide R800 million towards skills development in the digital and technology sector.
This was announced by President Cyril Ramaphosa in his weekly newsletter.
An entity of the Department of Higher Education and Training, the NSF provides funding for national skills developmentinitiatives that are identified by the National Skills Development Plan 2030 as national priorities, or are related to the achievement of the Skills Development Act 97 of 1998.
The NSF’s funding focus and skills development portfolio is two-pronged. First, a significant allocation of its annual and medium-term budget is aimed towards education education and training initiatives such as bursaries and scholarships, learnership and skills programmes, and workplace-based learning.
Secondly, NSF funding is aimed at improving the post-school, education and training system, with a focus on capacity-building, investing in skills infrastructure, research and innovation.
With a rising unemployment rate, especially among young people, there is increased focus on addressing SA’s technological and skillset shortcomings by upskilling youth.
One of the key findings of the South Africa ICT Talent Development White Paper shows the country’s digital skills gap and demand for ICT talent continue to be inhibiting factors to the growth of the economy.
Ramaphosa says the move is aimed at ensuring that as investment into the digital economy continues to grow, South Africans are able to use their skills to take advantage of employment and economic opportunities.
“To boost the job creation potential of these investments, the National Skills Fund will soon launch a new model for demand-led skills development, which will provide R800 million to fund training for unemployed young people in digital skills.
“As we look to foster increased investment over the next five years, as the structural reform process continues to gather pace and as measures to end the energy crisis bear fruit, we will be able to further position ourselves at the forefront of the digital economy in Africa,” he said.
Ramaphosa explained that over the past five years, significant investments have been made into the country’s digital economy – a boon that is driving the country’s development.
At the recent South Africa Investment Conference (SAIC) alone, companies pledged at R81 billion to ICT and digital services projects in the country, bringing the total amount invested specifically in ICT since the first SAIC to some R200 billion.
“The [SAIC]…provided a huge boost to the country’s digital economy. In addition to significant investment commitments in data and telecommunications infrastructure, there were also announcements about investments in the mining, manufacturing, energy, property, logistics and food and beverages sectors.
“While all these investments contribute to economic growth and job creation, the investments in the digital economy will, in addition, propel our country into a new era of innovation and progress. Not only is the digital economy important for growth, but it is also vital to the provision of key services such as education, social services and health care.
“Several recent tech surveys indicate that higher speeds and improved mobile and fibre infrastructure are helping to narrow the digital divide. This is the result of stepped-up investment in the digital economy in recent years. Faster fibre and 5G rollout makes our economy more competitive as more connectivity solutions help businesses emerge and expand,” he said.
The ICT sector has seen some significant improvements over the past five years including:
- The Equiano subsea cable announced at the 3rd South Africa Investment Conference in 2020 was launched by Google last year.
- Amazon Web Services, Teraco and Dimension Data have made investment commitments of R21 billion in the past five years
- In 2021 Vantage Data Centers, a US-based company, announced plans to build its first African campus in Johannesburg.
- Africa’s Data Centre Market recently reported that South Africa is fast becoming a hub for cloud hosting
Ramaphosa said although these developments are a boost, there are challenges, such as load shedding, that are hampering the growth of the ICT sector.