14 Sep IDC continues to deliver in trying times
The government-owned Industrial Development Corporation (IDC) has continued to deliver on its mandate to support the economy and facilitate job creation, demonstrating its resilience in a tough economic environment.
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In the 2015 financial year, which ended March 31, the IDC approved funding to the value of R11.5 billion, disbursing R10.9 billion to help businesses expand, facilitating the creation or saving of over 20 000 jobs during the year. These approvals covered 210 transactions, which marks an increase from the 196 transactions approved during the 2014 financial year. The organisation is committed to increase the level of its activities over the next five years.
“Part of our mandate is to grow the South African economy and increase industrial capacity,” explains IDC CEO Geoffrey Qhena.
“The approvals we made this year have been focussed on key areas that will not only protect existing investments, but also help create the next generation of industrialists, targeting emerging black industrialists, women and young entrepreneurs and increasing localisation.”
|Download the summarised audited* financial results for the year ended 31 March 2015|
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* These consolidated abridged financial statements are extracted from the audited financial statements for the year ended 31 March 2015.
In 2015 the IDC approved 85 transactions in black-empowered and owned companies to the value of R5.9 billion which included support to 41 companies controlled by black entrepreneurs.
In addition, the IDC invested R756 million in women-empowered businesses (with more than 25% women shareholding) as well as R159 million for youth-empowered businesses.
“Our investments in black-owned and empowered businesses as well as women and youth-empowered enterprises are part of our vision of a transformed South Africa where the industrial production capacity is fully representative of the demographics of the country,” says Qhena.
The IDC approved R5.2 billion towards manufacturing, a core sector to IDC’s mandate. Funding for the manufacturing sector of the economy supported the development of other key industries. The creation and protection of jobs remains one of the key criteria for the IDC when choosing which businesses to fund. The corporation expects that these approvals will result in the creation of more than 14 000 jobs and the retention of almost 6 000 jobs that were at risk of being lost.
In partnership with its wholly-owned subsidiary, the Small Enterprise Finance Agency, the IDC supported 1300 SMEs, approving R3 billion in funding.
Acknowledging the tougher economic environment, Ebrahim Patel, Minister of Economic Development, says that the IDC has a critical role to play in the execution of the government’s job creation and growth plans. “We foresee that the IDC will play a leading role in ensuring that there is sufficient and appropriate manufacturing capacity in South Africa to meet the needs of our local growth and development plans,” he says. “We are committed to investing in new infrastructure projects, but it is vital that South African businesses are integrally involved in supplying the materials for these projects. This is where the IDC, and its efforts to build South Africa’s industrial base, come to the fore. The headwinds facing the economy would require IDC to play a counter-cyclical role as it did in 2009.”
He adds that in order for this to happen the IDC needs to take a much more active role in co-ordinating key industrial sectors across the economy.
Some of the R14 billion renewable energy projects supported by the IDC are now connected to the national grid, contributing 655 MW in total.
The corporation also approved R4.3 billion for projects in rural areas, specifically in the minerals beneficiation, high-value agriculture and agro-processing sectors.
The IDC increased its investment to R1.8 billion in the rest of the continent. This, Qhena says, will further support regional integration built on mutual benefit.
He says even with increased pressure on the economy, the IDC has been able to deliver a strong set of results, enabling it to deliver on various aspects of its mandate: enhancing industrial capacity, creating and protecting jobs, and creating strong industrial value chains.
“While South Africa faces economic headwinds, the IDC will continue to play an active role, driving localisation and supporting black industrialists to participate in the productive sectors of the economy. This, however, Qhena says “will require partnerships with our clients, government and other stakeholders to build a stronger economy.”
For more information, please contact:
IDC’s Public Relations Manager
Tel: (011) 269 3282
Cell: 082 880 6074