Perspective
7 minute read
Manufacturing Support Programme (MSP)
A cash grant to grow and develop the manufacturing sector
Achieved through investment in new or expansion projects aimed to create and sustain employment, encourage transformation through supporting black-owned enterprises, as well as enterprises owned by, women, youth and people with disabilities, and promote localisation using locally produced inputs or raw materials as well as machinery directly related to production.
Incentive offering
It is a reimbursable cost-sharing grant payable in line with approved milestones. The grant is capped at 20% of the investment project value or at 30% if 51% woman/youth and/or persons with disability owned and controlled limited to R10 million.
Mandatory conditions
Please note the below list is not exhaustive.
- Achieve a minimum B-BBEE Level
4 contributor status. - Expansion/ upgrade investments – Maintain and/or create direct employment.
- New projects – Create new employment.
- Demonstrate ≥ 50% input will be sourced from South African (SA) producers and ≥ 10% of inputs will be sourced from black SA producers, government departments, state-owned enterprise or similar government institutions.
- If inputs cannot be locally sourced - Provide indisputable evidence in support.
- Commence with production ≤ 180 days after submission of application.
Eligibility criteria
- Assets can only be brought into commercial use, and competitiveness improvement costs can only be incurred, 30 days after submission of a complete application to the Department of Trade, Industry and Competition.
- Base year employment needs to be maintained throughout the contact.
Qualifying and non-qualifying costs
Qualifying assets and investment costs
Please note the below list is not exhaustive.
- Machinery and equipment, including, green technology, energy and resource efficiency equipment.
- Tools, jigs and dies.
- Raw materials to support exporters (grant limited to R500 000).
- Commercial vehicles linked to production process (grant limited to R1 million).
- Buildings - owned and leasehold improvement investment limited to qualifying machinery and equipment (grant limited to R1 million).
- Competitive improvement costs:
- Conformity assessments
- Registration, validation requirements and licensing
- Information technology systems or technology transfer
- Process or product or logistics improvements
- Cleaner production improvements or waste management and/or water usage improvements
- Energy efficiency improvements or renewable energy.
Non-qualifying criteria
- Land
- Staff wages and salaries
- Vehicles (e.g., sedans, SUVs, 4x4s, people carrier minibuses)
- VAT and finance charges
- Rental, rates and taxes
- Litigation costs
- Increase in investment costs after submission (exchange rate related)
- Training costs (non-manufacturing operations related).
