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Grant Whittaker – Owner of business Grants SA (Pty) Ltd
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Government Subsidy Update for SA Industrialists and Entrepreneurs – February 2017


PROMOTIONAL FEATURE | 3 MARCH 2017

In last week's annual finance budget the South African government confirmed a total incentive budget of R9.6bn. Of this, R1.3bn has been earmarked for a re-modelled Manufacturing Competitiveness Enhancement Programme (MCEP), which will support the agro-processing and metals sectors.

It is not certain when this new scheme will open, however, there is speculation that the Department of Trade & Industry (DTI) will open the application window in the 3rd quarter of the 2017/2018 financial year. Meaning, DTI will only start distributing the R1.3bn in their new financial year commencing 01 April 2018. After 16 months of no "MCEP" most manufacturers will welcome this news. Watch this space for more details.

A quick snapshot of the grants and incentives currently on offer to South African agro-processing enterprises:

  1. Section 12I Tax Allowance Incentive
    Offers 35 to 100% of qualifying asset investment for capital investment projects above R50m. This scheme's budget is almost depleted.
  2. Critical Infrastructure Programme
    Offers a cash grant of 10 to 50% of qualifying investment in transport infrastructure (e.g. roads, rails, bridges), electricity infrastructure, and bulk water supply sanitation (e.g. sewer connections, storm water), etc.
  3. Black Industrialists Scheme
    Offers a cash grant of 30 to 50% of the qualifying investment for new or expanding enterprises that are majority black owned and black managed and who are investing at least R30m in new assets.
  4. Export Marketing Investment Assistance (including the Sector Specific Assistance Scheme)
    A cash grant that subsidises qualifying travel costs incurred by South African enterprises looking to establish new export markets.
  5. Cluster Development Programme
    This scheme seeks to enhance competitiveness of enterprises within a cluster or industrial parks. This is to be implemented through defined collaborative projects that address production, productivity and marketing. This scheme will subsidise 80% of qualifying infrastructure costs, business development services and cluster management costs.
  6. Strategic Partnership Programme
    A cost-sharing support of 50:50 towards manufacturing projects and 70:30 for projects that support manufacturing supply chain-related services and deemed strategic by the DTI. The objective of the SPP is to encourage large private sector enterprises, in partnership with Government, to support, nurture and develop SMEs, which focus on manufacturing goods or supplying services, in a sustainable manner.
  7. Aquaculture Development & Enhancement Programme
    A cash grant of 20 to 80% of qualifying costs for new or expanding aquaculture projects.
  8. Research & Development grants such as:

    • Support Programme for Industrial Innovation
      Offers a cash grant of 50 to 85% of qualifying R&D costs.
    • Technology Innovation Agency
      Supports the commercialisation of innovative concepts up to 100%.
    • Technology and Human Resources for Industry Programme (THRIP)
      A cash grant of 50 to 90% for applied research and innovation in collaboration with a South African research institution.
    • Section 11D Tax Allowance Incentive
      A tax deduction of 150% for qualifying research and development projects.

Contact details

Grants SA logo

For more information:
PHONE.  +27 22 433 2000
EMAIL.  grant@sagrants.co.za
View Grants SA company profile

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