Industry reviews details of MIDP successor

BY THE time you read this, the SA vehicle and component industries should be reviewing the details of the new automotive production and development programme (APDP) – the successor to the current motor industry development programme (MIDP), according to Norman Lamprecht, executive manager of the National Association of Automobile Manufacturers of SA (Naamsa). After trade and industry minister Mandisi Mpahlwa announced the framework of the programme last week, Lamprecht told FTW that the association was “happy” with it, and that “it’s a positive programme”. The details of the provisions covering import duties (a tariff reduction freeze from 2013 until 2020), the local assembly allowance, a production incentive and investment allowances, were due to be released by the department this week, he added. And, according to the president of Naamsa, Dr Johan van Zyl, the release of these detailed elements would enable vehicle manufacturers and their suppliers to plan strategically for the future and to finalise investment decisions with confidence and certainty. It should also enable various manufacturers to tender for the production of new models in SA. “There was no doubt,” Van Zyl added, “that the new programme would stimulate production of motor vehicles and automotive components, encourage further investment in the industry – and assist the process of stabilising and creating employment over time.” Also, unlike the present MIDP, the new APDP should pass all the tests laid down by the World Trade Organisation (WTO), according to the department. Director-general Tshediso Matona said the new programme emphasised production and was “a shift from the MIDP”, which incentivises exports through duty credits. “We think those other elements should not be problematical from a WTO viewpoint,” he added. “The [WTO] subsidy agreement prohibits outright subsidies contingent on exports. This programme is not contingent on access to the benefits to export.”