#KnowYourIncentives: Agro-processing Support Scheme

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Launched in 2017, the Agro-processing Support Scheme (APSS) incentive scheme is a R1-billion cost-sharing grant fund designed to boost investments in new and existing agro-processing projects.

Qualifying Sectors

The scheme targets food and beverage value addition and processing (including black winemakers), furniture manufacturing, fibre processing, feed production, and fertiliser production.

Aim

It aims to increase capacity, create employment, boost competitiveness and contribute to transformation in these five sectors.

Grant Offering

The Department of Trade and Industry (the dti) has set aside R1 billion in the 2017/2018 financial year to fund the scheme. It offers a 20% to 30% cost-sharing grant, to a maximum of R20 million, over a two-year investment period. The minimum investment value is R1 million.

Qualifying Assets and Investment Costs

  • New Machinery and Equipment
  • Commercial Vehicles
  • Buildings
  • Competitiveness Improvement Costs

Exceptions

The purchase of a business does not qualify for support under the programme. However, once an existing entity has been purchased, further investment in the upgrading or capital expansion of the operations may qualify for support. The purchasing of land is also excluded in the scheme.

Requirements

  • Be a registered legal entity in South Africa in terms of the Companies Act, 1973 (as amended) or the Companies Act, 2008 (as amended); the Close Corporations Act, 1984 (as amended) or the Co-operatives Act, 2005 (as amended).
  • Be a taxpayer in good standing.
  • Be involved in starting a new Agro-processing/beneficiation1 operation or in expanding or upgrading an existing Agro-processing/beneficiation operation.
  • Be B-BBEE compliant in terms of the B-BBEE codes (achieve level 1 to level 4) and submit a valid B-BBEE certificate of compliance or affidavit.
  • Undertake an investment project which should result in retaining and creating direct employment.
  • Indicate that the project will be able to boost the local capacity of identified product(s); or where possible prospects of export orientation.
  • Adhere to sectorial minimum wage and legislative requirements governing the sector.
  • Demonstrate that at least 50% of the inputs (raw materials) will be sourced from South African suppliers and that at least 30% of the inputs will be sourced from Black South African suppliers in particular.

All information courtesy of the Dti

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Lebohang Thulo
Lebohang Thulo
Lebohang Thulo is the editor of SME South Africa. She enjoys keeping up with the country’s exciting and fast developing entrepreneurship ecosystem. You can find her at @lelele3