SIP incentives on stream
Although there has been a delay in implementing the scheme, the trade and industry department announced in April 2002 that the R3-billion Strategic Investment Projects (SIP) incentive scheme had come on stream after finalising the criteria for the evaluation of projects.
The incentive is expected to unlock a multi-billion rand investment logjam for South Africa and has been broadly welcomed by investment analysts and consultants.
The Department of Trade and Industry said: "The incentive represents an innovative step by government to attract private sector investment in profitable and wealth-creating entitities into SA, from both local and foreign entrepreneurs.
"The SIP will support industrial projects investing at least R50m in qualifying industrial assets. These projects are expected to increase production within the SA industry and have a potential for long-term sustainability."
The SIP incentive programme is managed within the Department of Trade and Industry by The Enterprise Organisation (TEO).
Which industry sectors qualify?
The SIP incentive is accessible to industrial projects participating within the following sectors:
- Manufacturing of products: all listed manufacturing activities excluding tobacco and tobacco related products
- Computer and computer related activities: hardware consultancy, software consultancy and supply, data processing (excluding standard secretarial services), and database activities
- Research and development activities: research and experimental development on natural sciences and engineering
The proposed project should:
- Comprise investment in new qualifying assets equal to or exceeding R50 million
- Increase annual production of the relevant industry sector within South Africa
- Not substantially displace products or jobs in the relevant sectors demonstrate long term commercial viability
- Promote employment and production in the same economic sector in which the project is to be established
- Not concurrently be benefiting from certain other schemes as per the relevant legislation
