Have you ever considered exploring any of the incentives out of the Department of Trade, Industry and Competition (DTIC) to grow your business?

The DTIC is charged with driving industrial policy in South Africa and the development and the development of local manufacturing and industrial capacity in the country,

As part of this mandate, it has developed a number of incentives to reward and encourage businesses looking to grow their operations.

Below we outline some of the most popular DTIC incentives in the market at the moment.

The Youth Employment Service (YES) DTIC Incentive

Arguably the best adopted DTIC incentive in recent years, the YES legislation allows organisations to move up to 2 full levels on their B-BBEE scorecard in return for creating youth jobs.

This DTIC incentive has proven particularly popular with organisations who struggle with their B-BBEE credentials – particularly on the ownership element on the scorecard.

At the time of writing this post, YES had created nearly 80000 jobs in South Africa and had over 1500 organisations supporting it.

YES is also increasingly being used as a tool to integrate with ESG investment guidelines as well as meeting UN Sustainable Development Goals (SDGs)

We have extensive experience in implementing and running YES programs and Sam from our team has written this article entitled: “Tips to run a Youth Employment Service (YES) program“)

The Black Industrialist Scheme (BIS) DTIC incentive

 The purpose of Black Industrialists (BI) policy is to leverage the State’s capacity to unlock the industrial potential that exists within black-owned and managed businesses that operate within the South African economy through deliberate, targeted and well-defined financial and non-financial interventions as described in the IPAP and other government policies.

The initiative offers up to R50m in grant funding for high-growth entrepreneurs who have the goal of building sustainable businesses which can tackle unemployment in South Africa.

Our partners from Uzenzele have prepared the below video explaining when a business can make use of DTIC grant incentives

https://www.youtube.com/watch?v=S4968_B2Y6Q

Critical Infrastructure Program (CIP) Incentive

The Critical Infrastructure Programme (CIP) aims to leverage investment by supporting infrastructure that is deemed to be critical, thus lowering the cost of doing business. The South African Government is implementing the CIP to stimulate investment growth in line with the National Industrial Policy Framework (NIPF) and Industrial Policy Action Plan (IPAP).

The CIP is a cost-sharing incentive that is available to the approved applicant/s or infrastructure project/s upon the completion of verifiable milestones or as may be approved by the Adjudication Committee.  Infrastructure is deemed “critical” to the investment if such investment would not take place without the said infrastructure or the said investment would not operate optimally.

Grant Offerings available include:

• The CIP offers a grant of 10% to 30% of the total qualifying infrastructural development costs, up to a maximum of R50 million, based on the achieved score in the Economic Benefit Criteria.
• Agro-processing applicants and state-owned Aerospace and Defence National Strategic Testing Facilities: The CIP will offer a grant of 10% to 50% of the total infrastructural development costs, up to a maximum of R50 million.
• Projects that alleviate water and/or electricity dependency on the national grid: The CIP will offer a grant of 10% to 50%, up to a maximum of R50 million.
• Distressed municipalities and state-owned industrial parks: The CIP offers a maximum grant of up to 100%, capped at R50 million for infrastructural developmental. Applicants are encouraged to make a contribution according to their affordability

 SA Film & TV Production and Co-production (SA Film)

South Africa has a vibrant television production sector and the DTIC sees this as an opportunity to develop local content sharing South African stories both locally and internationally.

To support official co-productions and contribute towards employment opportunities in South Africa the DTIC incentive has the following benefits for successful applicants:

• The rebate is calculated as 35% of QSAPE.
• An additional 5% of Qualifying South African Production Expenditure (QSAPE) is provided for productions hiring at least 30% of black South African citizens as HODs and procuring at least 30% of QSAPE from 51% South African black- owned entities which have been operating for at least a period of one year; with a cap of R50 million per project.

There are vast array of different DTIC incentives available to forward-thinking entrepreneurs who are keen to develop local capacity. Applying for these incentives require a combination of skills and capital.

Our partners and us look forward to working with you to grow your business through access to these different incentives.