The Agro Processing Support Scheme (APSS) seeks to stimulate investment in the agro-processing sector.
The Objectives of the APSS:
- Increased capacity,
- Employment creation,
- Modernised machinery and equipment,
- Competitiveness and productivity improvement,
- Broadening participation.
Description of Qualifying Processes/Projects
The incentive is available to new and existing agro-processing/beneficiation projects. This can also involve a wide range of processing or beneficiation activities of post-harvest that result in value addition and/or enhanced storage life, such as cleaning, sorting, grading, waxing, controlled ripening, labelling, packing & packaging, warehousing, canning, freezing, freeze drying, wood carving, extrusion, synthesizing, polymerisation, and various levels of processing that change agricultural product form. In the forestry value-chain may also include sawing, pulping, peeling and preservation.
Five key identified sub-sectors
- Food and beverage value addition and processing (including Black winemakers);
- Furniture manufacturing;
- Fibre processing;
- Feed production; and
- Fertilizer production.
The APSS offers support on a cost-sharing basis towards:
- Machinery & Equipment; Tooling; Forklifts
- Commercial Vehicles
- T. Software – Management Information Systems
- 3rd Party consulting that focuses on Quality management; Environmental management; Process capability improvement; Product quality improvement; Accreditation.
The grant will cover 20% to 30% of the above costs, to a maximum of R3 million for small enterprises and R20 million for large enterprises. A further 10% bonus grant may be claimed by Level 1 B-BBEE contributors who comply with certain criteria.
Additional 10% grant for projects that meet all Economic Benefit Criteria below:
- Employment- Increase base year employment by at least 25%
- Transformation- Achieve a level 1 on B-BBEE codes of good practice
- Geographical Spread- Projects located in state owned industrial parks or areas with unemployment higher than 25%2
- Local procurement- Procuring at least 70% of inputs or equipment and machinery that is locally manufactured
- A South African registered legal entity (Company, Close Corporation or Co-Operative). Divisions, Branches and Profit Centres are also eligible to apply.
- Be a Tax Payer in Good Standing
- Involved in a New / Expanding Agro-Processing Beneficiation Operation
- Must be at least Level 4 BEE compliant
- Investment project must result in retaining and creating direct employment
- The project must be able to boost the local capacity of identified products or result in increased exports
- Adhere to sectorial legislative requirements as well as minimum wage legislation
- Demonstrate that at least 50% of inputs (raw materials) will be sourced from South African suppliers and at least 30% of the inputs will be sourced from Black South African suppliers. Where this is not possible, applicants must provide a motivation including a sourcing plan to adhere to this condition within 2 years from the submission of the application.
- Activities must commence within 90 calendar days of the approval of the application
- Costs Incurred before Approval are regarded as Non-Qualifying
The first window for the submission of APSS applications will open on 01 June 2017 and will close on 31 August 2017.