12 May IDC CONCLUDES EUR60M LOAN WITH EUROPEAN INVESTMENT BANK
The Industrial Development Corporation of South Africa Limited (IDC) has received a EUR 60 million credit line from the European Investment Bank (EIB) to finance private sector small and medium sized enterprises. The funds will support viable projects undertaken by small and medium enterprises businesses in the industrial, resources and services sectors.
The agreement was signed in March 2009.
EIB Vice President Plutarchos Sakellaris, who is responsible for lending operations in South Africa, said: “This loan is a strong signal of the EIB’s commitment to supporting the private sector and encouraging the creation of employment in South Africa. Moreover, the Bank is confident that by working in partnership with the Industrial Development Corporation we can help to stimulate the South African financial markets by diversifying IDC’s funding base and enhancing the provision of finance to SMEs.”
Commenting about the loan, IDC CEO Geoffrey Qhena said the line of credit will improve access to funding SMEs in the country.
“This credit could not have come at a more opportune time when the cost of raising funds is extremely high given the market volatility and the liquidity crisis,” Qhena said.
“We are particularly pleased that this loan will further enhance our commitment to development finance and addressing market failures.”
“IDC’s expertise in project evaluation ensures that the EIB funds are directed towards projects which promote economic growth and job creation, as well as being environmentally and socially sustainable.”
The IDC’s relationship with the EIB dates back to the mid ‘90s and over the years provided four credit lines totalling about EUR 165 million to IDC for private sector small businesses in South Africa.
About EIB Activities in South Africa
The EIB is active in Africa, the Caribbean and the Pacific (ACP) under the Cotonou partnership agreement. The Republic of South Africa is one of the ACP countries but receives EIB funding under a separate mandate. In October 2007, the EIB signed a Declaration of Intent with the Government of the Republic of South Africa, pledging financial support to the country until 2013. From 2008 to 2013, the EIB will lend up to EUR 900 million to South Africa.
The EIB cooperates with the South African authorities, public agencies, private enterprises and the financial sector to focus investment on infrastructure projects of public interest (including municipal infrastructure, power and water supply) and support for the private sector, including small and medium-sized businesses.
In 2008, the EIB supported sustainable economic development in South Africa by investing in three projects to the tune of EUR 202.5 million, almost doubling its financing activity compared with EUR 113 million in 2007.
The IDC (www.idc.co.za) is a self -financing, state-owned development finance institution. The vision of the IDC is to be the primary source of commercially sustainable industrial development and innovation to the benefit of South Africa and the rest of the African continent.
The IDC provides financing to entrepreneurs engaged in competitive industries and enterprises based on sound business principles.
IDC Media Contact:
Head: Corporate Communications
Phone: +2711 269 3000
EIB Media Contact
Phone: +352 4379 83326