Investing in the economy


Agribank of Zimbabwe  

As part of the pan African regional integration and industrialisation through development finance initiatives, IDC has developed programmes to contribute to an enabling environment for development finance institutions (DFIs) outside South Africa by providing lines of credit to the DFIs, as well as capacity building.

The lines of credit to DFIs are geared to promote the industrial sector in South Africa, with the ultimate aim of creating local employment and increasing industrial capacity. The benefits that accrue through the provision of lines of credit can be directly related to financial capacity building of the respective DFI; job creation in South Africa and in the countries where the DFIs are located; promotion of exports of locally manufactured products as part of the localisation programme; and promotion of regional trade and integration. All of these benefits directly support the New Growth Path, Industrial Policy Action Plan, National Development Plan and the work of the Presidential Infrastructure Co-ordinating Commission through SIP 17 – Regional Integration for African co-operation and Development.

To date, IDC has approved and disbursed over R500 million in lines of credit to three DFIs. Agribank of Zimbabwe (Agribank) is one of the beneficiary DFIs of which a total of US$60 million has been approved. The IDC funding has directly resulted in the creation and preservation of at least 4 874 jobs, with over 2 500 permanent jobs and over 2 374 contract or seasonal jobs, thus stimulating the Zimbabwean economy. The funding provided by IDC was utilised by Agribank’s investee companies to import South African manufactured goods and services, which helped to preserve and create additional manufacturing jobs in South Africa. With more than 70% of the key inputs and supplies purchased from South African suppliers, the result has been a multiplier effect on the South African economy, positively impacting jobs, allowing for skills training and transfer, improving capacity and stimulating economic growth. In addition, each beneficiary company which received funding reported substantial improvements in capacity. Part of the funds were used to capitalise corporates in the fertiliser manufacturing industry, resulting in higher output and clear downstream benefits to farmers who were able to access farming inputs on time with longer and more affordable payment terms.

Moreover the funding has provided much required liquidity and long-term financing to the investee companies and the Zimbabwean economy as this type of facilities was absent, thus constraining the growth of the country’s economy. The IDC funding has also had a positive impact on the balance sheet of Agribank.

One such beneficiary of funding from AgriBank is Interfresh, which is a major supplier of citrus fruits used in production of the popular Zimbabwean beverage Mazoe.

Building partnerships

The IDC’s capacity-building interventions in South Africa and elsewhere in Africa are motivated by the benefits potentially emanating from assisting our clients and DFI business partners in developing their requisite skills and knowledge bases.

Investing in communities

The IDC has adopted a framework to guide the development of rural areas and an important part of the corporation’s leadership in industrial development strategy focuses on support for priority sectors identified in the New Growth Path and Industrial Policy Action Plan.

R13.1 billion
R16.0 billion
18 922
3 950
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