Basic and Speciality Chemicals

HOWWE FUND BUSINESSES IN THE
BASIC AND SPECIALITY CHEMICALS SECTOR

The local chemicals industry plays a significant role to the country’s economy, contributing in the region of 5% to GDP and 25% of South Africa’s overall manufacturing sales.  The sector-is a source of employment providing a livelihood to a large section of SA’s population.

 

Against this background, IDC’s Basic and speciality chemicals SBU, aims to develop both the local and regional upstream basic and speciality chemicals value chain. Accordingly, the unit offers finance, business support and continued engagement with industry stakeholders where relevant including a range of entities in this space.

 

The unit provides funding towards development of projects that seek to expand local production capabilities, replace imports, and enhance industry competitiveness, with the ultimate goal of lowering the cost to downstream consumers as well as overcoming supply challenges. The unit also invests in new chemical value chains, particularly those that give the industry a competitive edge.

 

The following sub sectors are our key focus areas:

WHAT WE FUND

Oil and Gas

Synthetic Rubber

Basic Chemicals

Speciality Chemicals from various sources

Fertilisers

Plastics in its Primary form

In addition, the unit provides funding to the development of smart technologies, green chemicals and new materials that provide unique market opportunities, as well as identifying opportunities for new consumer products, production capacity or localisation.

OUTCOMES

By providing both project development activities and industrial development capabilities, the unit envisages the following impact on the local and regional economies:

 

  • Expansion and extension of existing industries that create, and/or preserve jobs and drive sustainable economic growth.
  • Enabling the industry to achieve its potential and become globally competitive
  • Providing assistance to start-up and building new sustainable businesses within the basic and speciality chemicals value chain

DOING BUSINESS WITH THE UNIT

Entrepreneurs that have developed a business proposal for the expansion of an existing manufacturing business or for the establishment of a new manufacturing venture in our key sub-sectors should apply for investment.

 

The unit assess all important aspects relating to technical, commercial, financial, and economic and management appraisal of businesses and projects to ascertain sustainability and economic viability thereof.

 

in need of a partner to develop medium to large scale projects that will have a significant industrial and socio-economic impact on the  industry are also encouraged to consider applying for support. The process entails the following:

 

  • Understanding the requirements of clients and preparing suitable financing structure
  • Appraisal and detailed due diligence;
  • Coordinating with lenders/investors to ensure timely sanction of facilities;
  • Harmonizing the terms and conditions among all lenders/investors;
  • Documentation.

FUNDING CRITERIA

In assessing the suitability of an application, the unit considers the following:

 

  • The business venture or project exhibits economic merit in terms of profitability and sustainability;
  • Shareholders and owners make a reasonable contribution to the business venture which will be evaluated at the time of the application;
  • Compliance with applicable environmental standards;
  • The business venture or project should have a significant socio-economic impact such as job creation potential, value addition to raw materials, rural development, empowerment, township development; and
  • The business has security, the form and nature of which must be related to your specific circumstances.

HOW TO

APPLY FOR FUNDING

Application for funding should be in writing and should include an executive summary and a business plan.

STEP 1

BUSINESS PLAN

Draw up a well-researched business plan, stating a compelling case for funding

STEP 2

REGISTER ONLINE

*Applications can also be submitted at the IDC office

STEP 3

UPLOAD APPLICATION

Upload your application with the relevant documents, certificates and business plan

STEP 4

PROCESS APPLICATION

IDC will confirm that it has received your application. While processing we may ask you to supply extra information or documentation

STEP 5

APPROVAL STATUS

IDC will give you feedback on the outcome of your application, in writing. If your application is successful, due diligence will be conducted on your business.

STEP 6

LOAN CONTRACT

Once the IDC has satisfied itself of your bona fides, you will be asked to sign a loan contract

OTHER INDUSTRY SECTORS

WE FUND

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