The Department of Trade and Industry is in the process of having set-top boxes declared exempted items in terms of government's National Industrial Participation Programme (NIPP).
NIPP chief director Masizakhe Zimela says certain sectors have been designated as needing to have a minimum amount of local content. He explains this regulation came into effect last December.
Zimela says the department is in talks with communications over the status of imported content required for the boxes. The Department of Communications recently issued a tender document for bidders to apply to make about five million boxes.
The STB tender document indicates that successful bidders that qualify for NIPP will sign separate contracts with the DTI, which monitors NIPP obligations.
About 11 million South African households will need decoders to continue watching television once analogue broadcast is turned off, which is expected to happen within two years of digital turn-on, mooted for the last quarter of this year.
The state has set aside R2.45 billion to subsidise as much as 70% of the boxes for five million poor TV-owning households. Companies have until the end of this month to bid.
Giving back
Trade and industry's NIPP was launched in 1996 and aims to “leverage economic benefits and support the development of South African industry by effectively utilising the instrument of government procurement”.
The programme is mandatory for all government and parastatal purchases or lease contracts with an imported content equal to or more than $10 million - currently the equivalent of about R81 million.
Suppliers to government are subject to an industrial participation obligation of 30% of the imported content. The aim of the programme is to benefit SA through job creation, increase local sales, promote small and empowered companies, as well as research and development and technology transfer.
Companies that wanted to benefit from state procurement had to submit business concepts for consideration and approval by trade and industry, and after approval, submit bi-annual progress reports.
The DTI is now reviewing the offset deal and expects to wrap up its probe by the end of March next year, says Zimela.
According to a February presentation to the Portfolio Committee, the designated industries include buses, rolling stock, power pylons, canned vegetables, clothing textiles, leather and footwear, as well as set-top boxes.
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