Downstream Steel Industry Competitiveness Fund (DSCIF)

DOWNSTREAM STEEL INDUSTRY

COMPETITIVENESS FUND (DSCIF)

OBJECTIVES

To help the struggling steel industry with an interest subsidy that offers discounts to qualifying clients.

Target Sectors

  • Foundry industries;
  • Fabrication sectors – focused on pressure vessels, pipes and pipe fittings sub-sectors; structural steel and any fabrication work in support of steel intensive designated sectors/products;
  • Parts and component manufacturers of steel-intensive products;
  • Valve and pump manufacturers;
  • Machining plants;
  • Capital equipment industries particularly steel intensive rail and rolling stock components; and
  • Any other steel-intensive business.

Qualifying Criteria:

  • Applicant can be a start-up and expansion; and
  • Enterprises that create net additional employment are prioritized, particularly opportunities with greater labour intensity. Saved jobs are also be considered.

Purpose of Funding

  • Finance provided for the following:
    • Modernization of plant machinery and equipment;
    • Upgrade of plant machinery and equipment to meet quality assurance requirements;
    • Capacity expansion of existing plants;
    • Process improvements for cost efficiencies and productivity and assist with plant optimization;
    • Working capital requirements or revolving facility;
    • Assist firms to achieve appropriate industry quality certification and standards including environmental standards; and
    • Development and testing of prototypes, as well as the testing and certification of new products.

Instruments and Pricing

  • Quasi equity and loans;
  • Maximum of R75 million per transaction;
  • IDC Risk Pricing less:
    • 2% for enterprises with annual turnover up to R123.5 million; and
    • 5% for enterprises with annual turnover greater than R123.5 million
  • Maximum discount period of 5 years; and
  • Standard IDC fees apply.

Exclusions:

  • Pilot plants
  • Integrated steel mills
  • Component manufacturers that qualifies for other incentives
  • Large multinational OEMs and assemblers and their subsidiaries that already benefit from a specific government support programme, e.g. Automotive Production and Development Programme (APDP)

OTHER

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