Funding cuts to government research in Southern Africa pushed businesses to seek foreign partners, limiting local access to research. Life AgriScience was founded to bridge this gap, making applied research more accessible to South African businesses.
Historically, the bulk of research in Southern Africa has been undertaken by the university sector, government research units, science councils, and industry associations.
With the steady decline in recent years in funding and governance of governmental institutes and facilities, the business world in Southern Africa has been forced to look at alternative research partners in the private sector abroad. Consequently, making research inaccessible or impractical for many businesses. Subsequently, Life AgriScience was established to bridge the gap between the business sector, research and development, and academia, and act as an independent research facilitator. Thereby making applied research accessible to all business sectors in South Africa.
South Africa’s nominal expenditure on research and development (R&D) has remained unchanged the last fifteen years at around 0.8% of the country’s Gross Domestic Profit (GDP). This translates to a world ranking of 44 with regards to expenditure on R&D in relation to GDP. The national target expressed in many policy documents is 1.0%, which has remained an elusive target. In most of the lead countries investing in R&D, the business world tends to be the largest funder of R&D. Conversely, in most countries in Africa the government sector and funding from abroad are the main sources of funding of R&D.
The declining trend of BERD has been recognised by the South African government. The causes of this trend are also reasonably well understood and include the:
The Department of Science and Technology (DST) has adopted a broad set of instruments to deal with this problem, including the introduction of the R&D tax incentive, the establishment of the Technology Innovation Agency (TIA) and the direct funding of BERD in certain sectors such as energy, biotechnology and pharmaceuticals.
The information below was extracted from the Department: Science and Technology’s website at https://www.dst.gov.za/rdtax/.
The South African government offers generous Research and Development (R&D) Tax Incentives to encourage private-sector investment in research and development activities. The R&D Tax Incentives are administered with an objective to promote the R&D investment in South Africa and complements the government expenditure on R&D activities.
South Africa has set an interim target to achieve the 1% of gross expenditure on R&D as a percentage of GDP by 2008.
The Income Tax Act amendments extending the increase in the allowance took effect on 2 November 2006. For eligible activities a deduction at the rate of 150% of expenditure is available directly in respect of scientific or technological research and development. These amendments include an accelerated depreciation of assets used for purposes of scientific and technological R&D. Eligible capital expenditure on R&D assets is deductible over a period of three years at the rate of 50:30:20 starting from the year of assessment in which the asset is brought into use. More information can be found in the Income Tax Act (1962) as amended under Section 11D which deals with “deductions in respect of scientific or technological research and development”.
Government opted for simplicity in the design of the R&D Tax Incentives programme to ensure that South African taxpayers and enterprises of all sizes and in all sectors of the economy are encouraged to conduct R&D locally which will lead to new, improved, or technologically advanced products, processes or systems.
Through our partnership with the FPLRI Research Technology and Innovation Institute and a wide network in the private sector, Life AgriScience has a well-established network and client base across various sectors.
