High-level announcement on MIDP imminent

THE MOTOR Industry
Development programme
(MIDP) will move away
from export incentives in
its revised form, according
to Nimrod Zalk, the
department’s chief director
industrial policy, enterprise
and industry development.
Zalk said recently that
subsidies linked directly to
exports or local content
would be viewed as “redlight
subsidies” by the
World Trade Organisation
(WTO).
Australia has already
used these regulations to
successfully remove MIDP
credits from exports of
vehicle leather.
Zalk declined to give
further details on the
planned changes because a
“high-level announcement”
on the architecture of
the programme would be
made later this month by
trade and industry minister
Mandisi Mpahlwa.
It would be followed
by a more detailed
announcement in June on
the revised MIDP.
Local vehicle and
component manufacturers
have repeatedly warned
that some form of support
is needed to retain the
industry in this country
by countering the high
logistics costs and distance
from the primary global
markets.
Africa as a whole
accounts for about 1 % of
new vehicle sales around
the world.