15 June 2012

Businesses looking to get involved in creating employment and growing productive capacity in South Africa can now access information on government investment incentives through a one-stop portal, www.investmentincentives.co.za .

The government offers a wide range of incentive schemes to encourage the growth of competitive new enterprises and the creation of sustainable employment. However, these have tended to become lost from view within the websites of particular departments.

This week’s launch of the Government Investment Incentives portal is set to change all that.

Promoting private sector involvement

A joint project of the Department of Trade and Industry (DTI), the Economic Development Department and the Industrial Development Corporation (IDC), the new website pulls together state incentive schemes, including grants and tax breaks, together in one easily navigable package.

“It is important to establish sustainable enterprises to boost job creation and to increase the state’s participation in development,” Meryl Mamathuba, head of the IDC’s development finance department, said in a statement on Wednesday.

“Ultimately, the aim is to promote private sector involvement in both the creation of productive capacity and research and development (R&D) in the country,” Mamathuba said.

Three types of incentive

The website helps the potential applicant find the incentive that might fit by dividing state incentives into three categories:

• • Concept, research and development incentives – for private sector businesses that invest in the creation, design and improvement of new products and processes.

• • Capital expenditure incentives – for companies that want to acquire or upgrade assets in order either to establish or expand their business’ productive capacity.

• • Competitiveness enhancement incentives – for investments that facilitate increased competitiveness, sustainable economic growth and development in a specific sector.

Subcategories of incentive

The first category breaks down into eight subcategories, namely:

• • Grants for small R&D projects;

• • Grants for large R&D projects;

• • R&D tax incentives;

• • Grants for feasibility studies;

• • The Technology and Human Resources in Industry Programme (THRIP);

• • The SEDA technology programme;

• • A technology venture capital fund; and

• • R&D in the automotive industry.

The capital expenditure category includes incentives for:

• • Small industry;

• • Large industr;

• • Critical infrastructure;

• • Industrial development zones;

• • Capital expenditure in the automotive industry;

• • Foreign investment;

• • Capital expenditure in the textiles industry; and

• • Manufacturing competitiveness enhancement.

And the competitiveness enhancement incentives are for:

• • Business process services (outsourcing);

• • Black business supplier development;

• • Export marketing and investment assistance;

• • Sector specific assistance;

• • Film production;

• • Competitiveness in the clothing and textiles industries;

• • Co-operatives;

• • Female economic empowerment through the Bavumile and Isivande Women’s Fund; and

• • Manufacturing competitiveness enhancement.

Completing the website’s initial offering is a set of answers to frequently asked questions on incentives and the process of applying for them.

SAinfo reporter

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