The International Trade Administration Commission (ITAC) has proposed changes to the automotive incentive framework that could encourage manufacturers to source selected battery minerals from within the SACU and SADC regions.
The proposed amendments would expand the list of materials that qualify as ‘standard materials’ under the Automotive Production and Development Programme Phase 2 (APDP2) to include minerals used in electric vehicle (EV) battery production.
The list includes lithium, graphite, copper, cobalt, iron, rare earth elements, nickel, manganese, titanium, vanadium, fluorspar and sodium carbonate, provided the materials originate in the Southern African Customs Union (SACU) or Southern African Development Community (SADC) region.
The proposal is intended to support EV battery production and align the incentive programme with the objectives of the South African Automotive Master Plan 2035, ITAC says.
Regional sourcing
Under the proposal, qualifying battery materials sourced from SACU and SADC countries would receive preferential treatment when calculating production incentives.
Half the value of qualifying battery materials would be recognised as local value addition for incentive purposes. The changes would broaden the programme beyond traditional automotive materials such as aluminium, steel and platinum group metals.
The amendments are aimed at supporting the development of a new energy vehicle battery value chain while promoting greater use of minerals available within the region. The SADC region contains significant reserves of minerals required for battery production and the proposed amendments would support regional beneficiation and value addition, ITAC says.
The proposed amendments have been published for public comment, with interested parties given until July 3 to submit comments to ITAC.
