4 July 2008
South Africa’s Department of Trade and industry (DTI) has launched the Enterprise Investment Programme, offering investment support – in the form of financial grants – to small and medium manufacturing and tourism companies based outside the country’s major metropolitan areas.
“We will be making these sectors more attractive to people to invest in,” Trade and Industry Minister Mandisi Mpahlwa said at the programme’s launch in Pretoria this week.
“The idea is to attract investment into [geographical] areas outside of the developed metropolitan municipalities in order to spread development and labour absorption.”
Deputy director-general of the DTI’s Enterprise Organisation, Tumelo Chipfupa, said the new programme would run for the next six years, replacing the Small Medium Enterprise Development Programme which was offered between 2001 and August 2006.
The Enterprise Investment Programme is made up of the Manufacturing Investment Programme and the Tourism Support Programme.
“An investment grant of 15 to 30% of qualifying investment costs will be provided covering the plant, machinery, equipment, commercial vehicles, land and buildings,” said Chipfupa, adding that the maximum investment per project was increased from R100-million to R200-million.
Qualifying criteria
Chipfupa explained that there were various qualifying criteria which a company would have to match before a grant was given.
These include their black economic empowerment (BEE) status, whether the company will be located in a high unemployment area, how labour absorbent the company is as well as whether they are in the clothing and textiles industry.
For the Tourism Support Programme, the objective, he said, was to stimulate job creation outside of traditional destination clusters, as well as increase BEE participation in the tourism sector.
To be eligible for the support programme, companies need to employ a minimum of eight people and must score at least a level four on their BEE contribution.
Diversifying manufacturing
DTI director-general Tshediso Matona said at the launch that the department was serious about the building of a strong, diverse and flourishing manufacturing sector in South Africa.
“We take this work seriously in the department as it is part of our core mandate of industrial development. We did a review of what the DTI has done and could do to support industry,” he said, adding that increasing industrial development was one of the country’s priorities.
The department has also urged private sector financial institutions to work together with the government on the sector incentive schemes.
Source: BuaNews
