Revised Capital Feasibility plan to increase SA's exports

The revised Capital Projects Feasibility Programme, which is intended to facilitate feasibility studies, will increase South Africa's exports, stimulate growth for the local capital goods and services sector and allied industries.

The revised programme, previously known as the SA Capital Goods Feasibility Study Fund, will come into effect on 1 April 2008, according to the Department of Trade and Industry.

The programme aims to attract higher levels of domestic and foreign investment and strengthen the international competitiveness of South African business.

It will also seek to stimulate the development of projects in Africa, in particular the Southern African Development Community countries, as well as support for the objectives of the New Partnership for Africa's Development (NEPAD).

The revised plan will also promote linkages with and development of small, medium and micro enterprises and black economic empowerment businesses.

According to the department, the value of the rebate for any qualifying feasibility study is capped at a maximum of R5 million.

“This component is available to registered legal entities in South Africa and provides a rebate of 55% of the total costs of the feasibility study for projects in Africa, and 50% for those outside Africa.”

Effectively, the following key changes are being introduced:

  • Although it should be aimed at achieving local content of 50% in the feasibility study and project in terms of goods and professional services, this percentage will remain at the discretion of the adjudication committee.
  • The rebate will then proportionally be reduced, depending on the proposed percentage of local content.
  • Providing incentives will encourage companies to advance industry transformation through adherence to the requirements of Broad-Based Black Economic Empowerment as well as greater alignment with NEPAD initiatives.

Application forms and programme guidelines can be downloaded from the department at www.thedti.gov.za.

Article published courtesy of BuaNews

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