Investing in the economy



Supporting emerging entrepreneurs in rural communities, especially those owning land, is one of the key strategies of the Forestry and Wood Products SBU.

Among other objectives, the SBU funds forestry projects whose focus is on planting and harvesting trees, in the process ensuring increased industrial capacity in line with complementing government’s industrial policy action plan (IPAP) which aims to increase timber supply in the country.

One such project to have benefited from this strategy is Sihleza, a community-owned forestry development based in Umzimkhulu, south of KwaZulu-Natal (KZN). iNkosi Ngwadla, on whose communal land the project is located initiated the development of this project as far back as 2003. However, lack of funds affected implementation. Following IDC intervention in 2010, this project which is now managed by a company in which the Community Trust is the sole shareholder, became the first community-owned commercial forestry project to be developed using IDC grant funding. The anticipated impact of the project on the rural community of KZN also supports IDC’s Rural Development strategy.

As part of the project development the community agreed to set a portion of their largely unproductive land aside for the establishment of 345 hectares of commercial timber plantation projected to create about 40 jobs, and once in rotation will generate an annual income of approximately R5 million for this formerly impoverished rural community.

IDC funding has catered for the necessary working and capex requirement and Sappi has agreed to co-invest and match IDC’s extent and terms of funding. Planting of Eucalyptus plantations will commence once land tenure issues have been resolved, and it is anticipated that the first timber will be harvested in 2020. What makes this project even more appealing is the fact that it is located adjacent to another successful community forestry project (Zintwala) which was partly funded by IDC and mentored by Rural Forest Management (RFM) . The two communities will therefore be able to share resources and equipment and work together particularly during the fire season as is commonly done within the farming community.

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.

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R16.0 billion
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