Donwald Pressly

The Industrial Development Corporation (IDC) increased its profit by 22 percent to R3.3 billion in the 2011/12 financial year.

This was a year in which the IDC made its highest ever level of investment in the local economy, chief executive Geoffrey Qhena reported at the state-owned corporation’s annual general meeting yesterday. The number of funding approvals rose by 33 percent to 293, its public relations manager, Mandla Mpangase, added.

The profits were largely as a result of increased dividend income and gains from the disposal of investments, albeit offset by reduced profits from its subsidiaries, mainly Foskor, Qhena reported.

Economic Development Minister Ebrahim Patel, who attended the meeting, said the corporation had achieved “an unprecedented level of approvals” during the past year. “The high level figures show that they approved R13.5bn last year compared [with] R8.7bn the previous year.”

Noting that the corporation played a key role in implementing the government’s New Growth Path, Patel said it would rely in part “in crowding in private investment and encouraging new economic activities, thus supporting the creation of new jobs”, while the government expected the IDC to continue “ramping up its performance”.

Qhena said the rise in the approvals would help sustain about 45 900 local jobs compared with 39 400 the previous year. Some 48 percent of these jobs were in rural areas, largely in mining, agriculture and renewable energy.

Almost all funding approvals underpinned the aims of the New Growth Path and the Industrial Policy Action Plan. Communities in far-flung areas would benefit from IDC funding “where possible”, he stressed.

With the massive capital expenditure programmes of the parastatals in mind, the IDC had been focusing on expanding the fabricated meals, capital and transport equipment industries downstream.

IDC chairman Monhla Hlahla said a business unit dedicated to the development of green industries was established in the past year. “The IDC has earmarked R25bn over five years towards the development of green industries,” she said.

Foskor’s profit before tax was down from R535 million last year to R262m this year. . Business Watch, page 16