MIDP uncertainty affects investment – Naamsa

CAPITAL INVESTMENT by the South African automotive industry “declined substantially” between 2006 and 2007 “primarily as a result of uncertainty regarding the outcome of the MIDP review process,” says National Association of Automobile Manufacturers of South Africa (Naamsa) director Nico Vermeulen. According to Naamsa, capital expenditure in 2007 fell to R3.09-billion from R6.2-billion the year before. Projections for 2008 are R4.4-billion, which would be the second-highest total since 2000. However, Vermeulen cautions that “invariably projections tend to be higher than eventual actuals”. Component manufacturers are also concerned about the MIDP. “We will be working closely with the authorities over the next six months to assist them in working out the details of a new MIDP,” says National Association of Automotive Component and Allied Manufacturers executive director Roger Pitot.