JOHANNESBURG - The Industrial Development Corporation of South Africa (IDC) has set its sights on increasing its involvement in the black industrialist programme after its investment in the initiative surged 67percent in the year ended March.
The corporation said it had approved R7.9billion in funding for the government-backed programme aimed at increasing black participation and influence in manufacturing.
The IDC said the funding was part of the R16.7bn approved for the financial year. It said it disbursed R15.4bn of the approved funding, an increase of 40percent.
IDC chief executive Geoffrey Qhena said the corporation expected to ramp up funding for black industrialists.
“We are responding to the challenges affecting the most productive sectors of our economy, especially manufacturing. As our economy embraces the fourth industrial revolution, we are also seeing many opportunities which start-ups and black industrialists can tap into,” Qhena said.
The programme, which was approved in November 2015, has attracted a lot of scrutiny, with some calling for the names of beneficiaries to be published.
However, Trade and Industry Minister Rob Davies has resisted the calls, saying the names would be released only once the recipients had given their permission.
Funding
Minister of Economic Development Ebrahim Patel said he was pleased the IDC had disbursed 67percent of the R23bn in funding the government had directed it to provide to black industrialists.
“Notably, the IDC has already achieved the five-year target that was set for women entrepreneurs, with R6.6bn approved for women-empowered businesses over the past three years, against the target of R4.5bn,” Patel said.
“Funding approvals for youth entrepreneurs is within close reach of the R4.5bn five-year target, at R4.4bn.”
The group’s profit increased from R2.2bn to R3.6bn in the period, while its asset base inched up 5percent to R137bn.
However, the corporation’s performance was hampered by the underperformance of its subsidiaries, Foskor and Scaw Metals Group.
The IDC bought a 74percent majority shareholding in Scaw Metals from Anglo American for R3.4bn in 2012.
The IDC said the steel producer had incurred losses of more than R3.3bn since the acquisition. This year, the Competition Tribunal approved the acquisition by Barnes Southern Palace of Scaw from the IDC for an undisclosed sum.
Qhena said Foskor and Scaw Metals were largely responsible for impairments on the IDC’s loan book, which have risen from 16.7to 17.4percent.