Trade and Industry Minister Rob Davies has announced the establishment of the metals and engineering incentive aimed at stimulating investment in the sector.

The Minister said this when he briefed the media ahead of tabling the department’s Budget Vote debate on Tuesday afternoon.

“The next issue that I think is covered in the speech is that we are making an announcement about the new sector specific incentive. You will recall that last year, the one that we announced was on agro-processing.

This year, we are announcing the sector-specific incentive on the metal and engineering value chain. It will be a R500 million new incentive that will be rolled-out,” he said.

The Minister said that in some respects, the department has seen that it gets better value for money in the sector specific programmes.

Malebo Mabitje-Thompson, the Deputy Director-General for Incentive Development and Administration, said similarly to the support that is being given to the auto sector, the incentive is aimed at supporting the purchasing of equipment as well as investing in competitiveness enhancing activities of an enterprise.

“…and where it also makes sense, we will partner with some of the enterprises for supplier development and the reason we are doing it is that we are looking at the sector more as a value chain rather than just individual companies without looking at the supplier relationships.

“We are worried about the foundry sector. We are worried that if that sector continues to decline in the manner in which it is declining now, we will quickly de-industrialise. We want to stabilise the foundry sector and in doing so, also work with the engineering services,” she said.