MIDP revision remains a closely guarded secret

It will be announced before year-end
ALAN PEAT
THE CRUCIAL foundation for the future of the SA motor vehicle industry – the long-awaited revision of the motor industry development programme (MIDP) – is likely to be announced by government before year-end. According to voices in the industry the current export incentives – where vehicle and component manufacturers can use credits earned from exports to offset duties payable on imports of vehicles and components – is likely to be replaced with what is termed “a production allowance”. Although everyone assured FTW that such a programme would comply with World Trade Organisation (WTO) regulations – which the old MIDP did not – we were unable to get a definition of what form such a production allowance would take. According to Nico Vermeulen, executive director of the National Association of Automobile Manufacturers of SA (Naamsa), a production allowance did not represent a major change to the programme – and that it was likely to be “a medium-term development”. But as for its expected format, he referred FTW to Johan Cloete, Blueprint International’s project leader in its management consultancy to the department of trade and industry on MIDP. Cloete told us that his organisation was “embargoed from talking to the press” before the minister makes that expected announcement – but in turn referred us to Mkhululi Mlota at the department. However, Mlota also apologised for being unable to reveal any detail until the departmental announcement, and being unable even to confirm the production allowance. “There is a lot of speculation about the contents of the new MIDP,” he said.