The Strategic Partnership Programme by the DTI

The Incubation Support Programme is no longer open for applications. It has been replaced by the Strategic Partnership Programme (SPP).

The Department of Trade and Industry (DTI) initiated the SPP to develop and support programmes / interventions aimed at enhancing the manufacturing and services supply capacity of suppliers with linkages to to strategic partners’ supply chains, industries, or sectors.

The objective of the SPP is to encourage large private sector enterprises in partnership with government to support, nurture and develop SME’s within the partners’ supply chain to or sector to be manufacturers of goods and suppliers of services in a sustainable manner.

The intention of the programme is to support Broad-Based Black Economic Empowerment (B-BBEE) policy through encouraging businesses to strengthen the element of Enter and Supplier Development (ESD) of the Codes of Good Practice.

The SPP will be available on a cost-sharing basis between government and the strategic partner(s). It is available for infrastructure and business development services necessary to mentor and grow enterprises.

Qualifying costs:

Machinery, equipment, and tools;
Infrastructure linked to the strategic partner’s supplier development initiative (owned / leased buildings, leased improvements);
Product or service development;
Information and Communication Technology (ICT);
Operational costs; and
Business development costs.

Grant Support

The grant approval will be based on projections for the first year at application stage whereas the approval for subsequent year(s) will be dependent on the review of actual performance of the preceding year against agreed milestones.

All payments will be made directly to the strategic partner’s established Special Purpose Corporate Vehicle (SPCV) or a set-up cost centre.

The grant approval is capped at a maximum of R15 million (VAT inclusive) per financial year over a 3 year period towards qualifying costs, based on the number of qualifying suppliers and is subject to the availability of funds.

The SPP offers a cost-sharing support of 50:50 towards manufacturing projects and 70:30 for projects that support manufacturing supply chain-related services, and deemed strategic by the DTI.

Eligibility Criteria of the Strategic Partnership Programme

The strategic partner can either be:

A South African registered legal entity in terms of the Companies Act, the Close Corporation Act, or the Co-operatives Act;
An entity with a minimum turnover of R100 million per annum for at least 2 consecutive years at application stage confirmed by the latest available audited statements;
An industry association representing interests of member manufacturing companies;
An association with 5 or more registered legal entities; and
An association which can organise itself for this purpose and must, in this regard, provide a letter(s) of commitment from manufacturer(s) that controls and / or has a direct influence in the market / manufacturing value chain to be developed.

The strategic partner must be:

A taxpayer in good standing and must, in this regard, provide a valid tax clearance certificate;
In compliance with the requirements of B-BBEE and must provide a valid certificate of B-BBEE Compliance;
60 % of total SME’s supported by the strategic partner programme should at least be 51 % owned by black South African citizens; and
Committed to the strategic partnership by having a corporate interest in supplier development and must, in this regard, provide a market access plan for SME’s to be developed or off-take agreement(s).